Document:

Amendment Deed between Alchemia Limited and the Registrant.

 Exhibit 10.21 

 

							
		 	 Waterfront Place
 1 Eagle Street Brisbane QLD 4000
 GPO Box 9925 QLD 4001

Tel (07) 3228 9333

Fax (07) 3228 9444

www.corrs.com.au
	  	

 Sydney 
 Melbourne 
 Brisbane 

Perth 
  

 
 Alchemia Limited 

 
  
 Audeo Oncology, Inc. 
  
  

Amendment deed 

  
 7673399/1 

 
 © Corrs Chambers Westgarth 

									
	Contents	  			
			
	 1
	 	 Interpretation
	  	 	1	  
				
		 	1.1	  	 Definitions
	  	 	1	  
		 	1.2	  	 Definitions in Original Document
	  	 	1	  
		 	1.3	  	 Construction
	  	 	1	  
		 	1.4	  	 Headings
	  	 	2	  
			
	 2
	 	 Amendment and continuation
	  	 	2	  
				
		 	2.1	  	 Amendment of Original Document
	  	 	2	  
		 	2.2	  	 Original Document in full force and effect
	  	 	2	  
			
	 3
	 	 General
	  	 	2	  
				
		 	3.1	  	 Counterparts
	  	 	2	  
		 	3.2	  	 Legal costs
	  	 	3	  
		 	3.3	  	 Governing law and jurisdiction
	  	 	3	  

  
  

7673399/1 

 Date 17 October 2012 

Parties 

Alchemia Limited ACN 071 666 334 of 3 Hi Tech Court, Eight Mile Plains, Brisbane, Queensland, 4113 (Alchemia) 

Audeo Oncology, Inc., a Delaware incorporated company (Audeo Oncology) 

 

	
	 

 Agreed terms 
  

	1	Interpretation 

  

	1.1	Definitions 

 In this
document: 
 Operative Date means the date of this document. 

Original Document means the Demerger Implementation Agreement between Alchemia and Audeo Oncology dated 22 August 2012.

  

	1.2	Definitions in Original Document 

 Unless expressed to the contrary, terms defined in the Original Document have the same meaning in this document. 
  

	1.3	Construction 

 Unless
expressed to the contrary, in this document: 
  

	 	(a)	words in the singular include the plural and vice versa; 

  

	 	(b)	any gender includes the other genders; 

  

	 	(c)	if a word or phrase is defined its other grammatical forms have corresponding meanings; 

 

	 	(d)	“includes” means includes without limitation; 

  

	 	(e)	no rule of construction will apply to a clause to the disadvantage of a party merely because that party put forward the clause or would otherwise benefit from it; and

  

	 	(f)	a reference to: 

  

	 	(i)	a person includes a partnership, joint venture, unincorporated association, corporation and a government or statutory body or authority; 

 

	 	(ii)	a person includes the person’s legal personal representatives, successors, assigns and persons substituted by novation; 

  
  

7673399/1 

	 	(iii)	any legislation includes subordinate legislation under it and includes that legislation and subordinate legislation as modified or replaced; 

 

	 	(iv)	an obligation includes a warranty or representation and a reference to a failure to comply with an obligation includes a breach of warranty or representation;

  

	 	(v)	a right includes a benefit, remedy, discretion or power; 

  

	 	(vi)	time is to local time in Brisbane 

  

	 	(vii)	“$” or “dollars” is a reference to Australian currency; 

 

	 	(viii)	this or any other document includes the document as novated, varied or replaced and despite any change in the identity of the parties; 

 

	 	(ix)	writing includes any mode of representing or reproducing words in tangible and permanently visible form, and includes fax transmissions; 

 

	 	(x)	any thing (including any amount) is a reference to the whole or any part of it and a reference to a group of things or persons is a reference to any one or more of
them; 

  

	 	(xi)	this document includes ail schedules and annexures to it; and 

  

	 	(xii)	a clause, schedule or annexure is a reference to a clause, schedule or annexure, as the case may be, of this document. 

 

	1.4	Headings 

 Headings do not
affect the interpretation of this document. 
  

	2	Amendment and continuation 

  

	2.1	Amendment of Original Document 

 On and from the Operative Date, the Original Document is amended as shown in tracked changes in the Annexure. 
  

	2.2	Original Document in full force and effect 

 The Original Document as amended by this document is and continues to be in full force and effect. 
  

	3	General 

  

	3.1	Counterparts 

 This
document may consist of a number of counterparts and, if so, the counterparts taken together constitute one document. 

  
  

			
	7673399/1	  	page 2

	3.2	Legal costs 

 Except as
expressly stated otherwise in this document, each party must pay its own legal and other costs and expenses of negotiating, preparing, executing and performing its obligations under this document. 

 

	3.3	Governing law and jurisdiction 

  

	 	(a)	This document is governed by and is to be construed in accordance with the laws applicable in Queensland. 

 

	 	(b)	Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts exercising jurisdiction in Queensland and any courts which have
jurisdiction to hear appeals from any of those courts and waives any right to object to any proceedings being brought in those courts. 

  

					
	Executed and delivered as a deed.
			
	 Executed by Alchemia Limited
 ACN 071 666 334
	 	 )
 )
	 	
			
	 

	 		 	
	Authorised Representative	 		 	
			
	 Peter M Smith
	 		 	
	 Name of Authorised Representative
 (print)
	 		 	
			
	Executed by Audeo Oncology, Inc.	 	 )
 )
	 	
	 

	 		 	
	Secretary	 		 	
			
	 Charles Walker
	 		 	
	Name of Secretary (print)	 		 	

  
  

			
	7673399/1	  	page 3

 Annexure 
 Original Document as amended (clause 2.1) 

  
  

			
	7673399/1	  	page 4

							
		 	 Waterfront Place
 1 Eagle Street Brisbane QLD 4000
 GPO Box 9925 QLD 4001

Tel (07) 3228 9333
 Fax (07) 3228 9444
 www.corrs.com.au
	  	

				
		 		 		  	Sydney
		 		 		  	Melbourne
		 		 		  	Brisbane
		 		 		  	Perth

  
  
 Alchemia Limited 
  
  

Audeo Oncology, Inc. 
  

 
 Demerger 

Implementation 
 Agreement 

  
 Ref: SD/JR STRA3333-9073263
7673384/1 
  
 © Corrs Chambers
Westgarth 

 Contents 
  

									
	 1
	 	Interpretation	  	 	2	  
				
		 	1.1	  	 Definitions
	  	 	2	  
		 	1.2	  	 Construction
	  	 	7	  
		 	1.3	  	 Headings
	  	 	9	  
			
	 2
	 	Implementation of the Scheme and Demerger	  	 	9	  
			
	 3
	 	Conditions	  	 	9	  
				
		 	3.1	  	 Conditions
	  	 	9	  
		 	3.2	  	 Condition Subsequent
	  	 	10	  
		 	3.3	  	 Best endeavours
	  	 	10	  
		 	3.4	  	 Benefit and waiver of certain conditions
	  	 	10	  
		 	3.5	  	 Regulatory Approvals
	  	 	11	  
		 	3.6	  	 Notification of certain events
	  	 	11	  
			
	 4
	 	Steps for implementation	  	 	12	  
				
		 	4.1	  	 Alchemia’s obligations
	  	 	12	  
		 	4.2	  	 Audeo Oncology’s obligations
	  	 	13	  
		 	4.3	  	 Execution of Underwriting Agreement
	  	 	14	  
			
	 5
	 	Obligations after the Implementation Date	  	 	14	  
				
		 	5.1	  	 Alchemia’s obligations
	  	 	14	  
		 	5.2	  	 Audeo Oncology’s obligations
	  	 	15	  
				
	 6
	 	GST	  		  	 	15	  
				
		 	6.1	  	 Construction
	  	 	15	  
		 	6.2	  	 Consideration GST exclusive
	  	 	15	  
		 	6.3	  	 Payment of GST
	  	 	15	  
		 	6.4	  	 Timing of GST payment
	  	 	16	  
		 	6.5	  	 Tax invoice
	  	 	16	  
		 	6.6	  	 Adjustment event
	  	 	16	  
		 	6.7	  	 Reimbursements
	  	 	16	  
		 	6.8	  	 No merger
	  	 	16	  
			
	 7
	 	Notices	  	 	16	  
				
		 	7.1	  	 General
	  	 	16	  
		 	7.2	  	 How to give a communication
	  	 	16	  
		 	7.3	  	 Particulars for delivery of notices
	  	 	17	  
		 	7.4	  	 Communications by post
	  	 	17	  
		 	7.5	  	 Communications by fax
	  	 	17	  
		 	7.6	  	 After hours communications
	  	 	18	  
		 	7.7	  	 Process service
	  	 	18	  
			
	 8
	 	General	  	 	18	  
				
		 	8.1	  	 Duty
	  	 	18	  
		 	8.2	  	 Legal costs
	  	 	18	  
		 	8.3	  	 Amendment
	  	 	18	  

  
  

			
	7673384/1	  	page i

									
		 	 8.4
	  	Waiver and exercise of rights	  	 	18	  
		 	 8.5
	  	Rights cumulative	  	 	19	  
		 	 8.6
	  	Consents	  	 	19	  
		 	 8.7
	  	Further steps	  	 	19	  
		 	 8.8
	  	Governing law and jurisdiction	  	 	19	  
		 	 8.9
	  	Assignment	  	 	19	  
		 	 8.10
	  	Liability	  	 	19	  
		 	 8.11
	  	Counterparts	  	 	19	  
		 	 8.12
	  	Entire understanding	  	 	19	  
		 	 8.13
	  	Relationship of parties	  	 	20	  
		 	 8.14
	  	No merger	  	 	20	  
		
	 Schedule – Timetable
	  	 	21	  
		
	 Annexure A – Scheme
	  	 	23	  
		
	 Annexure B – Demerger Deed Poll
	  	 	46	  

  
  

			
	7673384/1	  	page ii

 Date     October 2012 

Parties 

Alchemia Limited ACN 071 666 334 of 3 Hi Tech Court, Eight Mile Plains, Brisbane, Queensland, 4113 (Alchemia) 

Audeo Oncology, Inc., a Delaware incorporated company (Audeo Oncology) 

 

	
	 

 Background 
  

	A	Alchemia intends to: 

  

	 	(a)	undertake a demerger of its Oncology Business which is wholly owned by Audeo Oncology; and 

 

	 	(b)	grant the VAST Licence to a Subsidiary of Audeo Oncology. 

  

	B	The Demerger will be implemented by Alchemia undertaking the Capital Reduction, if the Market Value of Audeo Oncology exceeds the Audeo Oncology Book Value, paying the
Demerger Dividend and implementing the Scheme pursuant to which the Demerger Entitlements of Alchemia Shareholders will be applied by Alchemia as consideration for the issue by Alchemia of Audeo Oncology CDIs to Scheme Shareholders or, if the
shareholders elect, transfer by Alchemia to Scheme Shareholders of Audeo Oncology Shares. 

  

	C	The Scheme is conditional upon, amongst other things, approval by the Court and Alchemia Shareholders. 

 

	D	Implementation of the Scheme, the Capital Reduction and the Demerger Dividend (if any) are all conditional upon satisfaction of the Condition Subsequent.

  

	E	The Capital Reduction is conditional upon, amongst other things, approval by Alchemia Shareholders, and it and the Demerger Dividend (if any) are conditional upon the
Scheme becoming Effective. 

  

	F	Alchemia is the legal and beneficial holder all of Audeo Oncology’s issued share capital. Upon the transfer of the Scheme Consideration pursuant to the Scheme,
Audeo Oncology will cease to be a subsidiary of Alchemia. 

  

	G	Alchemia and Audeo Oncology have agreed to carry into effect the Capital Reduction, the Demerger Dividend (if any) and the Scheme and to do all steps required to
implement the Capital Reduction, the Demerger Dividend (if any) and the Scheme. 

  

	
	 

  
  

			
	7673384/1	  	page 1

 Agreed terms 

 

	1	Interpretation 

  

	1.1	Definitions 

 In this
document: 
 Alchemia Share Register means the share register of members of Alchemia maintained in accordance with the
Corporations Act. 
 Alchemia Share means a fully paid ordinary share in the capital of Alchemia. 

Alchemia Shareholder means a person who is registered as the holder of Alchemia Shares. 

ASIC means the Australian Securities and Investments Commission. 

ASX means ASX Limited ABN 98 008 624 691 or, as the context requires, the financial market operated by it. 

ASX Settlement Operating Rules means the operating rules of the clearing and settlement facility operated by ASX Settlement Pty Ltd
ABN 49 008 504 532. 
 ATO means the Australian Taxation Office. 

Audeo Fundraising and IPO means the initial public offering of Audeo Oncology Shares. 

Audeo Fundraising and IPO Share Price means the price at which Audeo Oncology Shares are issued under the Audeo Fundraising and
IPO. 
 Audeo Oncology Book Value means $54,442,340. 

Audeo Oncology CDI means a CHESS depositary interest to be issued in connection with the Scheme representing an interest in one
corresponding Audeo Oncology Share. 
 Audeo Oncology Share means a fully paid share in the common stock of Audeo Oncology
to be issued in connection with the Scheme. 
 Audeo Oncology Warrants means an option to acquire Audeo Oncology Shares.

 Business Day means a day on which banks are open for business in Brisbane, excluding a Saturday, Sunday or public
holiday and which is a “Business Day” as defined in the Listing Rules. 
 Capital Reduction means a reduction of
the share capital of Alchemia equal to: 
  

	 	(a)	if the Market Value is equal to or greater than the Audeo Oncology Book Value, the Audeo Oncology Book Value; or 

 

	 	(b)	If the Market Value is less than the Audeo Oncology Book value, the Market Value. 

  
  

			
	7673384/1	  	page 2

 Capital Reduction Amount means the amount of capital on each Alchemia Share that is
to be reduced in accordance with the Capital Reduction Resolution, being the total amount of the Capital Reduction divided by the number of Scheme Shares. 
 Capital Reduction Entitlement means, in relation to each Scheme Shareholder the Capital Reduction Amount multiplied by the number of Scheme Shares held by the Scheme Shareholder. 

Capital Reduction Resolution means the ordinary resolution to approve the reduction of the share capital of Alchemia to be
considered at the General Meeting. 
 CHESS means the clearing house electronic subregister system of share transfers
operated by ASX Settlement Pty Ltd ABN 49 008 504 532. 
 CDN means CHESS Depositary Nominees Pty Limited ABN 75 071 346
506. 
 Completion means when both of the following have occurred: 

 

	 	(a)	an underwriting agreement is executed with Audeo Oncology for an amount, not exceeding US$60 million, expected at the time to be sufficient to complete the pivotal
Phase III clinical trial of HA-Irinotecan for metastatic colorectal cancer and to cover associated working capital requirements; and 

  

	 	(b)	the receipt by Audeo Oncology in cleared funds of the underwritten amount. 

 Conditions means the conditions in clause 3.1 
 Condition
Subsequent means Completion of the Audeo Fundraising and IPO. 
 Corporations Act means the Corporations Act
2001 (Cth). 
 Court means the Federal Court of Australia or any other court of competent jurisdiction under the
Corporations Act. 
 Demerger means the proposal by Alchemia to effect the demerger of Audeo Oncology from Alchemia to be
implemented by way of the Capital Reduction, the Demerger Dividend (if any) and the Scheme in the manner more fully described in the Scheme Booklet. 
 Demerger Deed means the demerger deed dated the same date as this document between Alchemia and Audeo Oncology describing the transitional arrangements and ongoing relationship between Alchemia and
Audeo Oncology. 
 Demerger Deed Poll means a deed poll in the form of annexure B or in such other form as agreed
by Alchemia and Audeo Oncology to be executed by Audeo Oncology in favour of the Investors. 
 Demerger Dividend means the
aggregate of the special dividend (if any) to be paid pursuant to the Demerger Dividend Resolution, which is equal to the amount by which the Market Value exceeds the Audeo Oncology Book Value. 

  
  

			
	7673384/1	  	page 3

 Demerger Dividend Amount means the amount of the Demerger Dividend (if any) divided
by the number of Scheme Shares. 
 Demerger Dividend Entitlement in relation to each Scheme Shareholder, means the
Demerger Dividend Amount (if any) multiplied by the number of Scheme Shares held by that Scheme Shareholder. 
 Demerger
Dividend Resolution means the resolution by the board of directors of Alchemia to pay a special dividend to Scheme Shareholders if the Market Value is greater than the Audeo Oncology Book Value for an aggregate amount equal to the amount by
which the Market Value exceeds the Audeo Oncology Book Value. 
 Demerger Entitlement means the aggregate of the Capital
Reduction Entitlement and the Demerger Dividend Entitlement (if any). 
 Demerger Tax Relief means relief from any
Australian capital gains tax that may arise from the transfer of shares in Audeo Oncology to Scheme Shareholders and confirmation from the ATO that no part of the Demerger Entitlement will be an assessable dividend. 

End Date means 31 December 2012. 
 Effective means the coming into effect, under section 411(10) of the Corporations Act, of the order of the Court made under section 411(4)(b) in relation to the Scheme. 

Effective Date means the date on which the Scheme becomes Effective. 

Eligible Shareholder means an Alchemia Shareholder as at the Scheme Record Date whose Registered Address on the Alchemia Share
Register is in: 
  

	 	(a)	Australia; 

  

	 	(b)	New Zealand; 

  

	 	(c)	the US; 

  

	 	(d)	the United Kingdom; 

  

	 	(e)	France; 

  

	 	(f)	Germany; 

  

	 	(g)	the Netherlands; 

  

	 	(h)	Switzerland; 

  

	 	(i)	Singapore; 

  

	 	(j)	Hong Kong; or 

  

	 	(k)	any other jurisdiction in which Alchemia reasonably believes that the implementation of the Scheme and the transfer of Audeo Oncology CDIs and Audeo Oncology Shares to
Scheme Shareholders in that jurisdiction is not prohibited, not unduly onerous and not impracticable, 

 unless
Alchemia determines as at the Scheme Record Date that the requirements of any exemption from applicable regulatory requirements in a 

  
  

			
	7673384/1	  	page 4

 
relevant jurisdiction is not or is no longer available for any particular Alchemia Shareholder, it may determine that that Alchemia Shareholder is not an Eligible Shareholder. 

First Court Date means the first day of the First Court Hearing or, if the First Court Hearing is adjourned for any reason, the
first day on which the adjourned application is heard. 
 First Court Hearing means the hearing of the application made to
the Court for orders under section 411(1) of the Corporations Act that the Scheme Meeting be convened. 
 General Meeting
means the extraordinary general meeting of Alchemia Shareholders convened to consider the Capital Reduction Resolution and to be held immediately following the Scheme Meeting. 
 GST has the meaning given to that term in the A New Tax System (Goods & Services Tax) Act 1999 (Cth). 
 HA-Irinotecan means a HyACT-targeted version of the chemotherapeutic drug irinotecan. 
 HyACT means Hyaluronic Acid Chemotransport Technology. 
 Implementation
Date means the date that is one Business Day after Completion of the Audeo Fundraising and IPO or such later date (being a date that is not later than the End Date) as: 

 

	 	(a)	Alchemia and Audeo Oncology may agree; or 

  

	 	(b)	may be required by the ASX. 

Implemented means the completion of all steps in paragraphs 4.1(g)(i) to 4.1(g)(v). 

Independent Expert means BDO Corporate Finance (Qld) Limited ABN 54 010 185 725. 

Independent Expert’s Report means the report in connection with the Scheme to be prepared by the Independent Expert in
accordance with the Corporations Act, and ASIC policy and practice, for inclusion in the Scheme Booklet. 
 Ineligible Foreign
Shareholders means an Alchemia Shareholder who is not an Eligible Shareholder. 
 Intra-group Transfer Agreement has
the meaning given to that term in the Demerger Deed. 
 Investors means the persons and entities who have a right to
receive Audeo Oncology Warrants as set out in schedule 2 of the Demerger Deed Poll. 
 Listing Rules means the official
listing rules of ASX. 
 Market Value means the amount which is the Audeo Fundraising and IPO Share Price multiplied by
the number of Audeo Oncology Shares issued to Scheme Shareholders under the Scheme. 

  
  

			
	7673384/1	  	page 5

 NASDAQ means the NASDAQ Stock Market. 

Official List means the official list of the ASX. 
 Oncology Business has the meaning given to that term in the Demerger Deed. 

Registered Address means, in relation to an Alchemia Shareholder, the address shown in the Alchemia Share Register as at the Scheme
Record Date. 
 Regulatory Approval means: 

 

	 	(a)	any approval, consent, authorisation, registration, filing, lodgement, permit, franchise, agreement, notarisation, certificate, permission, licence, approval,
direction, declaration, authority or exemption from, by or with a Regulatory Authority; or 

  

	 	(b)	in relation to anything that would be fully or partly prohibited or restricted by law if a Regulatory Authority intervened or acted in any way within a specified period
after lodgement, filing, registration or notification, the expiry of that period without intervention or action. 

Regulatory Authority means any Australian or foreign government or governmental, semi-governmental, administrative, fiscal,
regulatory or judicial entity, commission, tribunal agency or authority or any Minister, department, office or delegate of any government. It includes a self-regulatory organisation established under statute or a stock exchange, ASIC, ASX, SEC,
NASDAQ and the Australian Competition and Consumer Commission. 
 Sale Facility Agent means the entity who will be
appointed to sell or facilitate the issue or transfer of the Audeo Oncology CDIs or Audeo Oncology Shares on behalf of the Ineligible Foreign Shareholders. 
 Scheme means the members’ scheme of arrangement under Part 5.1 of the Corporations Act between Alchemia and the Scheme Shareholders relating to the Demerger in the form of annexure A,
together with any alterations or conditions made or required in accordance with section 411(6) of the Corporations Act and agreed or consented to by Alchemia and Audeo Oncology. 

Scheme Booklet means the information to be dispatched to Alchemia Shareholders and approved by the Court, including the Scheme,
explanatory statement in relation to the Scheme issued pursuant to section 412 of the Corporations Act and registered with ASIC, the Independent Expert’s Report, the Demerger Deed Poll, a summary of this document and the notices convening the
General Meeting and the Scheme Meeting (together with, in each case, proxy forms). 
 Scheme Consideration means in
respect of every 37 Scheme Shares held by a Scheme Shareholder, one Audeo Oncology CDI or (if the Scheme Shareholder elects), one Audeo Oncology Share or such other number of Audeo Oncology Shares or Audeo Oncology CDIs as agreed between Alchemia
and Audeo Oncology. 

  
  

			
	7673384/1	  	page 6

 Scheme Meeting means the meeting of Alchemia Shareholders to be convened by the Court
in relation to the Scheme in accordance with section 411(1) of the Corporations Act. 
 Scheme Order means the order of
the Court made for the purposes of section 411(4)(b) of the Corporations Act in relation to the Scheme. 
 Scheme Record
Date means date notified by Alchemia to ASX which will be after the Effective Date and five Trading Days after the last trading day for Alchemia Shares to trade with an entitlement to the Demerger Entitlement. 

Scheme Resolution means the resolution to approve the Scheme to be considered by Alchemia Shareholders at the Scheme Meeting set
out in the notice convening the Scheme Meeting contained in annexure F of the Scheme Booklet. 
 Scheme Shareholder means
a person registered in the Alchemia Share Register as the holder of Scheme Shares on the Scheme Record Date. 
 Scheme
Share means each Alchemia Share on issue as at the Scheme Record Date. 
 SEC means the Securities Exchange Commission
of the United States of America. 
 Second Court Date means the first day of the Second Court Hearing or, if the Second
Court Hearing is adjourned for any reason, the first day on which the adjourned application is heard. 
 Second Court
Hearing means the hearing of the application made to the Court for the Scheme Order. 
 Subsidiary has the meaning
given to that term in the Corporations Act. 
 Timetable means the indicative timetable set out in the schedule or
such other timetable as may be agreed in writing by the parties. 
 Trading Day has the meaning given in the Listing
Rules. 
 Transaction Documents has the meaning given to that term in the Demerger Deed. 

Transition Services Agreement has the meaning given to that term in the Demerger Deed. 

Underwriting Agreement means the underwriting agreement between Audeo Oncology and the underwriters referred to in the definition
of Completion. 
 VAST Licence has the meaning given to that term in the Demerger Deed. 

 

	1.2	Construction 

 Unless
expressed to the contrary, in this document: 
  

	 	(a)	words in the singular include the plural and vice versa; 

  

	 	(b)	any gender includes the other genders; 

  
  

			
	7673384/1	  	page 7

	 	(c)	if a word or phrase is defined its other grammatical forms have corresponding meanings; 

 

	 	(d)	“includes” means includes without limitation; 

  

	 	(e)	no rule of construction will apply to a clause to the disadvantage of a party merely because that party put forward the clause or would otherwise benefit from it;

  

	 	(f)	words and phrases have the same meaning (if any) given to them in the Corporations Act; 

 

	 	(g)	a reference to: 

  

	 	(i)	a holder includes a joint holder; 

  

	 	(ii)	a person includes a partnership, joint venture, unincorporated association, corporation and a government or statutory body or authority; 

 

	 	(iii)	a person includes the person’s legal personal representatives, successors, assigns and persons substituted by novation; 

 

	 	(iv)	any legislation includes subordinate legislation under it and includes that legislation and subordinate legislation as modified or replaced; 

 

	 	(v)	an obligation includes a warranty or representation and a reference to a failure to comply with an obligation includes a breach of warranty or representation;

  

	 	(vi)	a right includes a benefit, remedy, discretion or power; 

  

	 	(vii)	time is to local time in Brisbane, Queensland; 

  

	 	(viii)	“$” or “dollars” is a reference to Australian currency; 

 

	 	(ix)	this or any other document includes the document as novated, varied or replaced and despite any change in the identity of the parties; 

 

	 	(x)	writing includes any mode of representing or reproducing words in tangible and permanently visible form, and includes fax transmissions; 

 

	 	(xi)	this document includes all schedules and annexures to it; and 

  

	 	(xii)	a clause, schedule or annexure is a reference to a clause, schedule or annexure, as the case may be, of this document; 

 

	 	(h)	if the date on or by which any act must be done under this document is not a Business Day, the act must be done on or by the next Business Day; and

  

	 	(i)	where time is to be calculated by reference to a day or event, that day or the day of that event is excluded. 

  
  

			
	7673384/1	  	page 8

	1.3	Headings 

 Headings do not
affect the interpretation of this document. 
  

	2	Implementation of the Scheme and Demerger 

  

	 	(a)	Alchemia and Audeo Oncology agree to take all steps reasonably required to give effect to the Demerger in accordance with the Timetable including the steps set out in
this document. 

  

	 	(b)	If the Effective Date has not occurred by the End Date, the parties will discuss in good faith and, if appropriate, agree a revised Timetable and revised dates for
other dates referred to in this document. 

  

	 	(c)	If the Implementation Date has not occurred by the End Date, the Scheme will cease to be effective and this document will automatically terminate.

  

	3	Conditions 

  

	3.1	Conditions 

 The Scheme
will not become Effective unless each of the following Conditions are satisfied or waived in accordance with clause 3.4: 
  

	 	(a)	(ASIC and ASX) before 8.00 am on the Second Court Date, ASIC and the ASX issue or provide such consents, approvals or waivers or do such other acts which
Alchemia determines are necessary or desirable to implement the Demerger and such acts are not withdrawn, including in the case of ASIC, providing the statement required under section 411(17)(b) of the Corporations Act. 

 

	 	(b)	(Independent Expert Report) the Independent Expert issues its report which concludes that the Scheme is in the best interests of Scheme Shareholders before the
date on which the Scheme Booklet is registered by ASIC under the Corporations Act and the Independent Expert does not change its conclusions or withdraw its report prior to 8.00 am on the Second Court Date. 

 

	 	(c)	(Alchemia Shareholder approval – Scheme) Alchemia Shareholders approve the Scheme by the necessary majorities at the Scheme Meeting (or any adjournment or
postponement of the Scheme Meeting). 

  

	 	(d)	(Alchemia Shareholder approval – Capital Reduction) Alchemia Shareholders approve the Capital Reduction by the necessary majority under the Corporations Act
and the constitution of Alchemia before the Second Court Date. 

  

	 	(e)	(Court approval of Scheme) the Court approves the Scheme under section 411(4)(b) of the Corporations Act and an office copy of the Scheme Order is lodged with
ASIC as contemplated by section 411(10) of the Corporations Act. 

  
  

			
	7673384/1	  	page 9

	 	(f)	(No restraint) no temporary restraining order, preliminary or permanent injunction or other order is issued by a court of competent jurisdiction or other legal
restraint or prohibition preventing the Demerger is in effect at 8.00 am on the Second Court Date. 

  

	 	(g)	(CDN): before 8.00 am on the Second Court Date, Audeo Oncology has appointed CDN and CDN has agreed to the transfer to it of Audeo Oncology Shares under the
Scheme; 

  

	 	(h)	(Sale Facility Agent) before 8.00 am on the Second Court Date, Audeo Oncology has appointed a Sale Facility Agent and the Sale Facility Agent has agreed to sell
the Audeo Oncology CDIs and Audeo Oncology Shares (as relevant); 

  

	 	(i)	(Ability to issue Audeo Oncology CDIs) before 8.00 am on the Second Court Date, Audeo Oncology has done everything necessary under the ASX Settlement Operating
Rules to enable it to issue Audeo Oncology CDls other than the transfer to CDN of Audeo Oncology Shares under the Scheme; and 

  

	 	(j)	(Demerger Tax relief) before the making of the Scheme Order, Alchemia obtaining Demerger Tax Relief. 8.00 am on the Second Court Date, Alchemia
obtaining Demerger Tax Relief. 

  

	3.2	Condition Subsequent 

 The
Scheme will not be Implemented unless the Condition Subsequent is satisfied by the End Date. 
  

	3.3	Best endeavours 

 Alchemia
and Audeo Oncology must use their best endeavours to procure that the: 
  

	 	(a)	Conditions are satisfied as soon as practicable after the date of this document; and 

 

	 	(b)	Condition Subsequent is satisfied as soon as practicable after the Effective Date. 

 

	3.4	Benefit and waiver of certain conditions 

  

	 	(a)	Each of the conditions in clauses 3.1(a), 3.1(b) and 3.1(f) is for the benefit of Alchemia, and any breach or non-fulfilment of those conditions
can only be waived with the written consent of Alchemia. 

  

	 	(b)	The conditions in clauses 3.1(c), 3.1(d), 3.1(e), 3.1(g), 3.1(h), 3.1(i), 3.1(j) and 3.2 cannot be waived by either party.

  

	 	(c)	If a waiver by a party of a Condition Precedent is itself conditional and the other party accepts the condition, the terms of that condition apply accordingly. If the
other party does not accept a conditional waiver of the Condition Precedent, the Condition Precedent has not been waived. 

  

	 	(d)	 If a party waives the breach or non-fulfilment of any of the Conditions or the Condition Subsequent that waiver will not preclude it from taking

  
  

			
	7673384/1	  	page 10

	 	
action against the other party for any breach of this document, including a breach that resulted in the non-fulfilment of the Condition Precedent that was waived. 

 

	 	(e)	Unless specified in the waiver, a waiver of the breach or non-fulfilment of any Condition Precedent will not constitute: 

 

	 	(i)	a waiver of breach or non-fulfilment of any other Condition Precedent resulting from events or circumstances giving rise to the breach or non-fulfilment of the first
Condition Precedent; or 

  

	 	(ii)	a waiver of breach or non-fulfilment of that Condition Precedent resulting from any other event or circumstance. 

 

	3.5	Regulatory Approvals 

Without limiting the generality of clause 3.3: 
  

	 	(a)	each party must promptly apply for all relevant Regulatory Approvals, providing a copy to the other party of all such applications, and take all steps it is responsible
for as part of the approval process for the Scheme, including responding to requests for information at the earliest practicable time; and 

  

	 	(b)	each party must use best endeavours to consult with the other in advance in relation to all material communications with any Regulatory Authority relating to any
Regulatory Approval and provide the other party with all information reasonably requested in connection with the application for any Regulatory Authority. 

  

	3.6	Notification of certain events 

  

	 	(a)	Each party must: 

  

	 	(i)	(keep informed) promptly and reasonably inform the other either directly or through its legal advisers of the steps it has taken and of its progress towards
satisfaction of the Conditions and the Condition Subsequent; 

  

	 	(ii)	(notice of satisfaction) promptly notify the other if it becomes aware that any Condition has been satisfied; 

 

	 	(iii)	(notice of failure) promptly notify the other if it becomes aware that any Condition has failed to be satisfied or has become incapable of being satisfied or is
not reasonably capable of being satisfied or of any circumstances which may reasonably be expected to lead to such a state of affairs; and 

  

	 	(iv)	 (notice of waiver) after having given or received a notice in accordance with clause 3.6(a)(iii) in relation to a Condition Precedent
that it is entitled under clause 3.4 to waive, give notice to the other party as soon as possible (and in any event no later than five Business Days or such shorter time to ensure that notice is given before 5.00 pm on the last Business Day
before the Second Court Date) as to whether or not it waives the breach or 

  
  

			
	7673384/1	  	page 11

	 	
non-fulfilment of the relevant Condition Precedent, specifying the Condition Precedent in question. 

  

	 	(b)	Subject to the satisfaction or waiver of the Conditions, Alchemia and Audeo Oncology must each provide the Court on the Second Court Date with a certificate that all of
the Conditions (other than the Condition 3.1(e)) are satisfied, or if not satisfied, are waived. 

  

	 	(c)	The giving of a certificate by each of Alchemia and Audeo Oncology under clause 3.6(b) will in the absence of manifest error, be conclusive evidence of the
satisfaction or waiver of the Conditions referred to in the certificate. 

  

	4	Steps for implementation 

  

	4.1	Alchemia’s obligations 

 Alchemia must execute all documents and do all acts and things within its power as may be necessary or desirable for the implementation and performance of the Scheme on a basis consistent with this
document, in accordance with the Timetable, and in particular Alchemia must: 
  

	 	(a)	(Scheme Booklet) promptly prepare and, subject to approval by the Court, despatch the Scheme Booklet to the Alchemia Shareholders. Alchemia will prepare the
Scheme Booklet in good faith to attempt to ensure that the Scheme Booklet complies with the requirements of: 

  

	 	(i)	the Corporations Act and the Corporations Regulations 2001 (Cth); 

  

	 	(ii)	ASIC policy; and 

  

	 	(iii)	the Listing Rules; 

  

	 	(b)	(Independent Expert) promptly appoint the Independent Expert (and any other specialist expert required) and provide all assistance and information reasonably
requested by the Independent Expert (and any other specialist expert) in connection with the preparation of the necessary report(s) for inclusion in the Scheme Booklet; 

 

	 	(c)	(General Meeting) promptly take all steps necessary to convene the General Meeting in accordance with Alchemia’s constitution including, as required,
despatching the Scheme Booklet to the Alchemia Shareholders and holding the General Meeting; 

  

	 	(d)	(Scheme Meeting) promptly: 

  

	 	(i)	apply to the Court for an order under section 411(1) of the Corporations Act directing Alchemia to convene the Scheme Meeting; and 

 

	 	(ii)	take all steps necessary to comply with the orders of the Court including, as required, despatching the Scheme Booklet to the Alchemia Shareholders and holding the
Scheme Meeting; 

  
  

			
	7673384/1	  	page 12

	 	(e)	(registration of explanatory statement) request ASIC to register the explanatory statement included in the Scheme Booklet in relation to the Scheme in accordance
with section 412(6) of the Corporations Act; 

  

	 	(f)	(approval and implementation of Scheme) if the Scheme Resolution and the Capital Reduction Resolution are passed by the necessary majorities and once the
Conditions (other than Condition 3.1(e)) are satisfied, promptly apply (and, to the extent necessary, re-apply) to the Court for orders approving the Scheme and if that approval is obtained promptly lodge with ASIC an office copy of the
Scheme Order in accordance with section 411(10) of the Corporations Act; 

  

	 	(g)	(Capital Reduction, Demerger Dividend (if any) and transfer) if the Scheme becomes Effective and the Condition Subsequent is satisfied: 

 

	 	(i)	close the Alchemia Share Register as at the Scheme Record Date and determine the Capital Reduction Entitlement and Demerger Dividend Entitlement (if any) of each Scheme
Shareholder; 

  

	 	(ii)	on or prior to the Implementation Date, if the Market Value is greater than the Audeo Oncology Book Value, ensure the board of directors of Alchemia passes the Demerger
Dividend Resolution; 

  

	 	(iii)	on the Implementation Date, reduce the capital of each Scheme Share by the Capital Reduction Amount in accordance with the Capital Reduction Resolution;

  

	 	(iv)	on the Implementation Date, pay the Demerger Dividend (if any) which will be applied in accordance with clause 4.1(g)(v); and 

 

	 	(v)	on the Implementation Date, Alchemia must apply the Demerger Entitlement of each Scheme Shareholder as consideration for the transfer by Alchemia to that Scheme
Shareholder (or to the Sale Facility Agent as nominee for and on behalf of any Ineligible Foreign Shareholders) of the Scheme Consideration in accordance with the Scheme. 

 

	4.2	Audeo Oncology’s obligations 

 Audeo Oncology must execute all documents and do all acts and things within its power as may be necessary or desirable for the implementation and performance of the Scheme on a basis consistent with this
document, in accordance with the Timetable, and in particular Audeo Oncology must: 
  

	 	(a)	(Demerger Deed Poll) prior to the First Court Date, execute the Demerger Deed Poll; 

 

	 	(b)	(application for listing of Audeo Oncology on NASDAQ) as soon as practicable after the date of this document: 

 

	 	(i)	apply to NASDAQ for admission of Audeo Oncology to NASDAQ; 

  

	 	(ii)	prepare and file a registration statement for Audeo Oncology in accordance with SEC rules and regulations; 

 

	 	(iii)	use its best endeavours to ensure that: 

  
  

			
	7673384/1	  	page 13

	 	(A)	the SEC grants an order of effectiveness for the registration statement; and 

 

	 	(B)	trading in Audeo Oncology Shares (on a normal settlement basis) commences on NASDAQ prior to the Implementation Date; 

 

	 	(c)	(application for secondary listing of Audeo Oncology on ASX) prior to the Implementation Date: 

 

	 	(i)	apply to ASX for admission of Audeo Oncology to the Official List; 

  

	 	(ii)	prepare a listing memorandum for Audeo Oncology in accordance with the Listing Rules, as waived where necessary; 

 

	 	(iii)	use its best endeavours to ensure that: 

  

	 	(A)	ASX grants approval to the application for Audeo Oncology’s admission to the Official List; and 

 

	 	(B)	trading in Audeo Oncology CDIs (on a normal settlement basis) commences on ASX as soon as possible following the Implementation Date; 

 

	 	(d)	(issue of CDIs) do all things necessary under the ASX Settlement Operating Rules to enable the Audeo Oncology CDIs to be issued; 

 

	 	(e)	(issue of Audeo Oncology Shares) do all things necessary to enable the Audeo Oncology Shares to be issued; 

 

	 	(f)	(execution of Underwriting Agreement) if the Scheme becomes Effective, and only if agreed to by Alchemia, execute the Underwriting Agreement;

  

	 	(g)	(Completion) if the Underwriting Agreement is executed, use its best endeavours to ensure the Condition Subsequent is satisfied by the End Date; and

  

	 	(h)	(Scheme Consideration and registration) if the Scheme becomes Effective and the Condition Subsequent is satisfied, Audeo Oncology must, on the Implementation
Date, register the transfer of the Scheme Consideration referred to in clause 4.1(g)(v) in accordance with the Scheme and the Demerger Deed Poll. 

  

	4.3	Execution of Underwriting Agreement 

 Audeo Oncology will not execute, vary or terminate the Underwriting Agreement without the prior written consent of Alchemia. 

 

	5	Obligations after the Implementation Date 

  

	5.1	Alchemia’s obligations 

 After the Implementation Date, Alchemia must: 
  

	 	(a)	 (sale of entitlements) if a Scheme Shareholder is an Ineligible Foreign Shareholder for the purposes of the transfer of the Scheme

  
  

			
	7673384/1	  	page 14

	 	
Consideration, within 25 Business Days after the Implementation Date sell or procure the sale of the Audeo Oncology CDIs or Audeo Oncology Shares to which that Ineligible Foreign Shareholder is
entitled under the Scheme and remit the proceeds of sale to the Ineligible Foreign Shareholder in the manner described in the Scheme; and 

  

	 	(b)	(Alchemia’s independence) use its best endeavours to transition away from using Audeo Oncology’s services under the Transition Services Agreement.

  

	5.2	Audeo Oncology’s obligations 

 After the Implementation Date, Audeo Oncology must: 
  

	 	(a)	send, or cause to be sent, in the case of Audeo Oncology Shares, transaction confirmations and in the case of Audeo Oncology CDIs, holding statements, in respect of the
Scheme Consideration transferred under the Scheme, within the time required by US securities laws or the ASX Settlement Operating Rules (as appropriate); and 

 

	 	(b)	issue Audeo Oncology Warrants in accordance with the terms of the Intra-group Transfer Agreement. 

 

	6	GST 

  

	6.1	Construction 

 In this
clause 6: 
  

	 	(a)	words and expressions which are not defined in this document but which have a defined meaning in GST Law have the same meaning as in the GST Law;

  

	 	(b)	GST Law has the same meaning given to that expression in the A New Tax System (Goods and Services Tax) Act 1999; and 

 

	 	(c)	references to GST payable and input tax credit entitlement include GST payable by, and the input tax credit entitlement of, the representative member for a GST group of
which the entity is a member. 

  

	6.2	Consideration GST exclusive 

 Unless otherwise expressly stated, all prices or other sums payable or consideration to be provided under this document are exclusive of GST. 

 

	6.3	Payment of GST 

 If GST is
payable on any supply made by a party (or any entity through which that party acts) (Supplier) under or in connection with this document, the recipient will pay to the Supplier an amount equal to the GST payable on the supply. 

  
  

			
	7673384/1	  	page 15

	6.4	Timing of GST payment 

The recipient will pay the amount referred to in clause 6.3 in addition to and at the same time that the consideration for the
supply is to be provided under this document. 
  

	6.5	Tax invoice 

 The Supplier
must deliver a tax invoice or an adjustment note to the recipient before the Supplier is entitled to payment of an amount under clause 6.3. The recipient can withhold payment of the amount until the Supplier provides a tax invoice or an
adjustment note, as appropriate. 
  

	6.6	Adjustment event 

 If an
adjustment event arises in respect of a taxable supply made by a Supplier under this document, the amount payable by the recipient under clause 6.3 will be recalculated to reflect the adjustment event and a payment will be made by the
recipient to the Supplier or by the Supplier to the recipient as the case requires. 
  

	6.7	Reimbursements 

 Where a
party is required under this document to pay or reimburse an expense or outgoing of another party, the amount to be paid or reimbursed by the first party will be the sum of: 

 

	 	(a)	the amount of the expense or outgoing less any input tax credits in respect of the expense or outgoing to which the other party is entitled; and

  

	 	(b)	if the payment or reimbursement is subject to GST, an amount equal to that GST. 

 

	6.8	No merger 

 This clause
6 does not merge in the completion or termination of this document or on the transfer of the property supplied under this document. 
  

	7	Notices 

  

	7.1	General 

 A notice,
demand, certification, process or other communication relating to this document must be in writing in English and may be given by an agent of the sender. 
  

	7.2	How to give a communication 

 In addition to any other lawful means, a communication may be given by being: 
  

	 	(a)	personally delivered; 

  

	 	(b)	left at the party’s current delivery address for notices; 

  

	 	(c)	sent to the party’s current postal address for notices by pre-paid ordinary mail or, if the address is outside Australia, by pre-paid airmail; or

  
  

			
	7673384/1	  	page 16

	 	(d)	sent by fax to the party’s current fax number for notices. 

 The parties will use all reasonable endeavours to provide a copy of any communication provided under this clause by email to the email address of the other party set out in clause 7.3. To avoid
doubt, such email communication is provided as support for the official communication provided in accordance with paragraphs (a) to (d) of this clause and does not supersede or replace any obligation on a party to provide
that communication in accordance with paragraphs (a) to (d) of this clause or derogate from the other provisions of this clause 7. 
  

	7.3	Particulars for delivery of notices 

  

	 	(a)	The particulars for delivery of notices are initially: 

  

			
	Alchemia	  	
		
	Delivery address:	  	3 Hi Tech Court, Eight Mile Plains, Brisbane, Queensland 4113
		
	Postal address:	  	3 Hi Tech Court, Eight Mile Plains, Brisbane, Queensland 4113
		
	Fax:	  	+61 7 3340 0222
		
	Attention:	  	Tracie Ramsdale
		
	Audeo Oncology	  	
		
	Delivery address:	  	3 Hi Tech Court, Eight Mile Plains, Brisbane, Queensland 4113
		
	Postal address:	  	3 Hi Tech Court, Eight Mile Plains, Brisbane, Queensland 4113
		
	Fax:	  	+61 7 3340 0222
		
	Attention:	  	Charles Walker

  

	 	(b)	Each party may change its particulars for delivery of notices by notice to each other party. 

 

	7.4	Communications by post 

Subject to clause 7.6, a communication is given if posted: 

 

	 	(a)	within Australia to an Australian postal address, three Business Days after posting; or 

 

	 	(b)	outside of Australia to an Australian postal address or within Australia to an address outside of Australia, ten Business Days after posting. 

 

	7.5	Communications by fax 

Subject to clause 7.6, a communication is given if sent by fax, when the sender’s fax machine produces a report that the fax
was sent in full to the addressee. That report is conclusive evidence that the addressee received the fax in full at the time indicated on that report. 

  
  

			
	7673384/1	  	page 17

	7.6	After hours communications 

If a communication is given: 
  

	 	(a)	after 5.00 pm in the place of receipt; or 

  

	 	(b)	on a day which is a Saturday, Sunday or bank or public holiday in the place of receipt, 

it is taken as having been given at 9.00 am on the next day which is not a Saturday, Sunday or bank or public holiday in that place.

  

	7.7	Process service 

 Any
process or other document relating to litigation, administrative or arbitral proceedings relating to this document may be served by any method contemplated by this clause 7 or in accordance with any applicable law. 

 

	8	General 

  

	8.1	Duty 

  

	 	(a)	Alchemia as between the parties is liable for and must pay all duty (including any fine, interest or penalty except where it arises from default by the other party) on
or relating to this document, the Scheme, the Demerger Deed Poll, any document executed under any of these, or any dutiable transaction evidenced or effected by any of these. 

 

	 	(b)	If a party other than Alchemia pays any duty (including any fine, interest or penalty) on or relating to this document, the Scheme, the Demerger Deed Poll, any document
executed under any of these, or any dutiable transaction evidenced or effected by any of these, Alchemia must pay that amount to the paying party on demand. 

 

	8.2	Legal costs 

  

	 	(a)	Subject to clause 8.1, Alchemia must bear the costs and expenses in respect of the negotiation, preparation, execution of this document and any other agreement
or document entered into or signed under this document. 

  

	 	(b)	Any action to be taken by a party in performing its obligations under this document must be taken at its own cost and expense unless otherwise expressly provided in
this document. 

  

	8.3	Amendment 

 This document
may only be varied or replaced by a document executed by the parties. 
  

	8.4	Waiver and exercise of rights 

  

	 	(a)	A single or partial exercise or waiver by a party of a right relating to this document does not prevent any other exercise of that right or the exercise of any other
right. 

  
  

			
	7673384/1	  	page 18

	 	(b)	A party is not liable for any loss, cost or expense of any other party caused or contributed to by the waiver, exercise, attempted exercise, failure to exercise or
delay in the exercise of a right. 

  

	8.5	Rights cumulative 

 Except
as expressly stated otherwise in this document, the rights of a party under this document are cumulative and are in addition to any other rights of that party. 
  

	8.6	Consents 

 Except as
expressly stated otherwise in this document, a party may conditionally or unconditionally give or withhold any consent to be given under this document and is not obliged to give its reasons for doing so. 

 

	8.7	Further steps 

 Each party
must promptly do whatever any other party reasonably requires of it to give effect to this document and to perform its obligations under it. 
  

	8.8	Governing law and jurisdiction 

  

	 	(a)	This document is governed by and is to be construed in accordance with the laws applicable in Queensland. 

 

	 	(b)	Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts exercising jurisdiction in Queensland and any courts which have
jurisdiction to hear appeals from any of those courts and waives any right to object to any proceedings being brought in those courts. 

  

	8.9	Assignment 

  

	 	(a)	A party must not assign or deal with any right under this document without the prior written consent of the other parties. 

 

	 	(b)	Any purported dealing in breach of this clause is of no effect. 

  

	8.10	Liability 

 An obligation
of two or more persons binds them separately and together. 
  

	8.11	Counterparts 

 This
document may consist of a number of counterparts and, if so, the counterparts taken together constitute one document. 
  

	8.12	Entire understanding 

  

	 	(a)	The Transaction Documents contain the entire understanding between the parties as to the subject matter of the Transaction Documents. 

 

	 	(b)	All previous negotiations, understandings, representations, warranties, memoranda or commitments concerning the subject matter of the Transaction Documents are merged
in and superseded by the Transaction Documents and are of no effect. No party is liable to any other party in respect of those matters. 

  
  

			
	7673384/1	  	page 19

	 	(c)	No oral explanation or information provided by any party to another: 

  

	 	(i)	affects the meaning or interpretation of this document; or 

  

	 	(ii)	constitutes any collateral agreement, warranty or understanding between any of the parties. 

 

	8.13	Relationship of parties 

This document is not intended to create a partnership, joint venture or agency relationship between the parties. 

 

	8.14	No merger 

 The rights and
obligations of the parties will not merge on the completion of any transaction contemplated by this document. They will survive the execution and delivery of any assignment or other document entered into for the purpose of implementing a
transaction. 

  
  

			
	7673384/1	  	page 20

 Schedule 
 Timetable 
  

			
	Action	  	Date
		
	Draft Scheme Booklet lodged with ASIC	  	21 August 2012
		
	Deed Poll executed by Audeo Oncology	  	21 August 2012
		
	First Court Date	  	24 August 2012
		
	Scheme Booklet dispatched to Alchemia Shareholders	  	3 September 2012
		
	Scheme Meeting	  	5 October 2012
		
	Second Court Date	  	9 October 2012
		
	Effective Date: office copy of Court order approving the Scheme lodged with ASIC	  	10 October 2012
		
	Record Date	  	Trading Day 4
		
	Implementation Date	  	Trading Day 5

  
  

			
	7673384/1	  	page 21

					
	Executed as an agreement.	 		 	
			
	Executed by Alchemia Limited	 	)	 	
		 	)	 	
		 	)	 	
			
	  
	 		 	  

	Company Secretary/Director	 		 	Director
			
	  
	 		 	  

	Name of Company Secretary/Director	 		 	Name of Director (print)
	(print)	 		 	
			
	Executed by Audeo Oncology, Inc.	 		 	
			
	  
	 		 	
	Signature	 		 	
			
	  
	 		 	
	by (print name)	 		 	
			
	  
	 		 	
	its (print title)	 		 	

  
  

			
	7673384/1	  	page 22

 Annexure A 
 Scheme 

  
  

			
	7673384/1	  	page 23

  

Alchemia Limited 
  

 
 The holders of ordinary shares in Alchemia Limited

  
  
 Scheme of 
 arrangement 
 Pursuant to section 411 of the Corporations Act 

  
  

			
	7673384/1	  	page 24

 Contents 
  

									
	 1
	 	 Interpretation
	  	 	27	  
				
		 	 1.1
	  	 Definitions
	  	 	27	  
		 	 1.2
	  	 Construction
	  	 	32	  
		 	 1.3
	  	 Headings
	  	 	33	  
			
	 2
	 	 Preliminary
	  	 	33	  
				
		 	 2.1
	  	 Alchemia
	  	 	33	  
		 	 2.2
	  	 Audeo Oncology
	  	 	33	  
		 	 2.3
	  	 Summary of the Scheme
	  	 	34	  
		 	 2.4
	  	 Demerger Implementation Agreement
	  	 	34	  
		 	 2.5
	  	 Demerger Deed Poll
	  	 	34	  
			
	 3
	 	 Conditions
	  	 	35	  
				
		 	 3.1
	  	 Conditions of Scheme
	  	 	35	  
		 	 3.2
	  	 Conditions Subsequent
	  	 	36	  
		 	 3.3
	  	 Waiver of condition
	  	 	36	  
		 	 3.4
	  	 Certificate
	  	 	36	  
		 	 3.5
	  	 Conclusive evidence
	  	 	36	  
		 	 3.6
	  	 Termination of Demerger Implementation Agreement
	  	 	36	  
		 	 3.7
	  	 Effective Date
	  	 	37	  
			
	 4
	 	 Scheme
	  	 	37	  
				
		 	 4.1
	  	 Issue of Audeo Oncology Shares to Alchemia
	  	 	37	  
		 	 4.2
	  	 Demerger Dividend Resolution
	  	 	37	  
		 	 4.3
	  	 Capital Reduction and Demerger Dividend (if any)
	  	 	37	  
		 	 4.4
	  	 Entitlements of Scheme Shareholders
	  	 	37	  
		 	 4.5
	  	 Election
	  	 	38	  
		 	 4.6
	  	 Transfer of Audeo Oncology Shares and issue of Audeo Oncology CDIs
	  	 	38	  
		 	 4.7
	  	 Dispatch of holding statements and transaction confirmations
	  	 	39	  
		 	 4.8
	  	 Enforcement of Demerger Deed Poll
	  	 	39	  
		 	 4.9
	  	 Ineligible Foreign Shareholders
	  	 	40	  
		 	 4.10
	  	 Joint holders
	  	 	41	  
		 	 4.11
	  	 Fractional entitlements
	  	 	42	  
			
	 5
	 	 Scheme Shareholders
	  	 	42	  
				
		 	 5.1
	  	 Appointment of Alchemia as sole attorney and agent
	  	 	42	  
		 	 5.2
	  	 Scheme Shareholder’s consent
	  	 	42	  
			
	 6
	 	 Dealings in Alchemia Shares
	  	 	43	  
				
		 	 6.1
	  	 Alchemia Share Register
	  	 	43	  
		 	 6.2
	  	 Determination of Scheme Shareholders
	  	 	43	  
			
	 7
	 	 Notices
	  	 	44	  
				
		 	 7.1
	  	 General
	  	 	44	  
		 	 7.2
	  	 Communications by post
	  	 	44	  
		 	 7.3
	  	 Communications by fax
	  	 	44	  
		 	 7.4
	  	 After hours communications
	  	 	44	  

  
  

			
	7673384/1	  	page 25

									
	 8
	 	 General
	  	 	44	  
				
		 	 8.1
	  	 Alchemia and Scheme Shareholders bound
	  	 	44	  
		 	 8.2
	  	 Further assurances
	  	 	44	  
		 	 8.3
	  	 Alterations and conditions
	  	 	44	  
		 	 8.4
	  	 Costs
	  	 	45	  
		 	 8.5
	  	 Governing law and jurisdiction
	  	 	45	  

  
  

			
	7673384/1	  	page 26

 Parties 
 Alchemia Limited ACN 071 666 334 of 3 Hi Tech Court, Eight Mile Plains, Brisbane, Queensland 4113 (Alchemia) 
 The holders of ordinary shares in Alchemia Limited as at the Scheme Record Date 
  

	
	  

 Agreed terms 
  

	1	Interpretation 

  

	1.1	Definitions 

 In this
document: 
 Alchemia Option means an option to acquire Alchemia Shares under the Alchemia Option Plan. 

Alchemia Option Plan means the Alchemia Limited Employee Share Option Plan as amended and approved by Alchemia Shareholders at the
2010 annual general meeting. 
 Alchemia Share Register means the share register of members of Alchemia maintained in
accordance with the Corporations Act. 
 Alchemia Share means a fully paid ordinary share in the capital of Alchemia.

 Alchemia Shareholder means a person who is registered as the holder of Alchemia Shares. 

ASIC means the Australian Securities and Investments Commission. 

ASX means ASX Limited ABN 98 008 624 691 or, as the context requires, the financial market operated by it. 

ASX Settlement means ASX Settlement Pty Limited ABN 49 008 504 532. 

ASX Settlement Operating Rules means the operating rules of the clearing and settlement facility operated by ASX Settlement.

 ATO means the Australian Taxation Office. 
 Audeo Fundraising and IPO means the initial public offering of Audeo Oncology Shares. 
 Audeo Fundraising and IPO Share Price means the price at which Audeo Oncology Shares are issued under the Audeo Fundraising and IPO. 

Audeo Oncology Book Value means $54,442,340. 

  
  

			
	7673384/1	  	page 27

 Audeo Oncology means Audeo Oncology, Inc. of 100 Pine Street, Suite 2040, San
Francisco, California 94111. 
 Audeo Oncology CDI means a CHESS depositary interest to be issued in connection with the
Scheme representing an interest in one corresponding Audeo Oncology Share. 
 Audeo Oncology Register means: 

 

	 	(a)	in the case of Audeo Oncology Shares, the share register of members of Audeo Oncology maintained by or on behalf of Audeo Oncology; and 

 

	 	(b)	in the case of Audeo Oncology CDIs, the CDI register of Audeo Oncology maintained by or on behalf of Audeo Oncology. 

Audeo Oncology Registry means the registry that maintains the Audeo Oncology Register on behalf of Audeo Oncology. 

Audeo Oncology Warrant means an option to acquire Audeo Oncology Shares. 

Audeo Oncology Share means a fully paid share in the common stock of Audeo Oncology to be issued in connection with the Scheme.

 Business Day means a day on which banks are open for business in Brisbane, excluding a Saturday, Sunday or public
holiday and which is a “Business Day” as defined in the Listing Rules. 
 Capital Reduction means a reduction of
the share capital of Alchemia equal to: 
  

	 	(a)	if the Market Value is equal to or greater than the Audeo Oncology Book Value, the Audeo Oncology Book Value; or 

 

	 	(b)	if the Market Value is less than the Audeo Oncology Book Value, the Market Value. 

 Capital Reduction Amount means, in respect of each Scheme Share, the amount of capital that is to be reduced in accordance with the Capital Reduction Resolution, being the Capital Reduction divided
by the number of Scheme Shares. 
 Capital Reduction Entitlement means, in relation to each Scheme Shareholder, the
Capital Reduction Amount multiplied by the number of Scheme Shares held by that Scheme Shareholder. 
 Capital Reduction
Resolution means the ordinary resolution to approve the reduction of the share capital of Alchemia to be considered at the General Meeting. 
 CDN means CHESS Depositary Nominees Pty Limited ABN 75 071 346 506. 

CHESS means the Clearing House Electronic Subregister System, which facilitates electronic security transfer in Australia, operated
by ASX Settlement. 
 Completion means when both of the following have occurred: 

  
  

			
	7673384/1	  	page 28

	 	(a)	an underwriting agreement is executed with Audeo Oncology for an amount, not exceeding US$60 million, expected at the time to be sufficient to complete the pivotal
Phase III clinical trial of HA-Irinotecan for metastatic colorectal cancer and to cover associated working capital requirements; and 

  

	 	(b)	the receipt by Audeo Oncology in cleared funds of the underwritten amount. 

 Conditions means the conditions in clause 3.1. 
 Condition
Subsequent means Completion of the Audeo Fundraising and IPO. 
 Corporations Act means the Corporations Act
2001 (Cth). 
 Court means the Federal Court of Australia or any other court of competent jurisdiction under the
Corporations Act agreed in writing by Alchemia and Audeo Oncology. 
 Demerger means the proposal by Alchemia to effect
the demerger of Audeo Oncology from Alchemia to be implemented by way of the Capital Reduction, the Demerger Dividend (if any) and the Scheme in the manner more fully described in the Scheme Booklet. 

Demerger Deed Poll means the deed poll to be executed by Audeo Oncology in favour of the Scheme Shareholders and the Investors.

 Demerger Dividend means the aggregate of the special dividend (if any) to be paid pursuant to the Demerger Dividend
Resolution, which is equal to the amount by which the Market Value exceeds the Audeo Oncology Book Value. 
 Demerger Dividend
Amount means the amount of the Demerger Dividend (if any) divided by the number of Scheme Shares. 
 Demerger Dividend
Entitlement in relation to each Scheme Shareholder, means the Demerger Dividend Amount (if any) multiplied by the number of Scheme Shares held by that Scheme Shareholder. 
 Demerger Dividend Resolution means the resolution by the Alchemia board of directors to resolve to pay a special dividend to Scheme Shareholders if the Market Value is greater than the Audeo
Oncology Book Value for an aggregate amount equal to the amount by which the Market Value exceeds the Audeo Oncology Book Value. 

Demerger Entitlement means the aggregate of the Capital Reduction Entitlement and the Demerger Dividend Entitlement (if any).

 Demerger Implementation Agreement means the demerger implementation agreement between Alchemia and Audeo Oncology dated
on or about 22 August 2012, relating to the implementation of the Demerger. 
 Demerger Tax Relief means relief from
any Australian capital gains tax that may arise from the transfer of shares in Audeo Oncology to Scheme Shareholders and confirmation from the ATO that no part of the Demerger Entitlement will be an assessable dividend. 

  
  

			
	7673384/1	  	page 29

 Effective means the coming into effect, under section 411(10) of the Corporations
Act, of the order of the Court made under section 411(4)(b) in relation to the Scheme. 
 Effective Date means the date on
which the Scheme becomes Effective. 
 Eligible Shareholder means an Alchemia Shareholder as at the Scheme Record Date
whose registered address on the Alchemia Share Register is in: 
  

	 	(a)	Australia; 

  

	 	(b)	New Zealand; 

  

	 	(c)	the US; 

  

	 	(d)	the United Kingdom; 

  

	 	(e)	France; 

  

	 	(f)	Germany; 

  

	 	(g)	the Netherlands; 

  

	 	(h)	Switzerland; 

  

	 	(i)	Singapore; 

  

	 	(j)	Hong Kong; or 

  

	 	(k)	any other jurisdiction in which Alchemia reasonably believes that the implementation of the Scheme and the issue of Audeo Oncology CDIs and transfer of Audeo Oncology
Shares to Scheme Shareholders in that jurisdiction is not prohibited, not unduly onerous and not impracticable, 

unless Alchemia determines as at the Scheme Record Date that the requirements of any exemption from applicable regulatory requirements in
a relevant jurisdiction is not or is no longer available for any particular Alchemia Shareholder, in which case it may determine that that Alchemia Shareholder is not an Eligible Shareholder. 

End Date means 31 December 2012. 
 General Meeting means the general meeting of Alchemia Shareholders to be convened to consider the Capital Reduction Resolution. 

(A) HA-Irinotecan means a HyACT-targeted version of the chemotherapeutic drug irinotecan. 

HyACT means Hyaluronic Acid Chemotransport Technology. 
 (B) Implementation Date means the date that is one Business Day after Completion of the Audeo Fundraising and IPO or such later date (being a date that is not later than the End Date) as:

  

	 	(a)	Alchemia and Audeo Oncology may agree; or 

  

	 	(b)	may be required by the ASX. 

Independent Expert means BDO Corporate Finance (QLD) Limited ABN 54 010 185 725. 

  
  

			
	7673384/1	  	page 30

 Ineligible Foreign Shareholders means an Alchemia Shareholder who is not an Eligible
Shareholder. 
 Intra-group Transfer Agreement means the agreement for the transfer of the Oncology Business by Alchemia
to Audeo Oncology in consideration for shares issued in the capital of Audeo Oncology between Alchemia and Audeo Oncology dated 28 June 2012. 
 Investors means the persons and entities who have a right to receive Audeo Oncology Warrants as set out in schedule 2 of the Demerger Deed Poll. 

Listing Rules means the official listing rules of the ASX. 
 Market Value means the amount which is the Audeo Fundraising and IPO Share Price multiplied by the number of Audeo Oncology Shares issued to Scheme Shareholders under the Scheme. 

NASDAQ means the NASDAQ Stock Market. 
 Oncology Business means Alchemia’s business which is focussed on the use of HyACT (oncology) technology to improve existing drugs used to treat and manage cancer. 

Registered Address means, in relation to an Alchemia Shareholder, the address shown in the Alchemia Share Register as at the Scheme
Record Date. 
 Restated Certificate of Incorporation and By-Laws means the constituent documents of Audeo Oncology.

 Sale Facility means the facility under which Audeo Oncology Shares or Audeo Oncology CDIs to which Ineligible Foreign
Shareholders would otherwise have been entitled under the Scheme are sold. 
 Sale Facility Agent means the entity who
will be appointed to sell or facilitate the issue or transfer of the Audeo Oncology CDIs or Audeo Oncology Shares on behalf of the Ineligible Foreign Shareholders. 
 Scheme means this scheme of arrangement, subject to any alterations or conditions made or required by the Court under section 411(6) of the Corporations Act and agreed or consented to by Alchemia
and Audeo Oncology. 
 Scheme Booklet means the information to be dispatched to Alchemia Shareholders and approved by the
Court, including the Scheme, explanatory statement in relation to the Scheme issued pursuant to section 412 of the Corporations Act and registered with ASIC, the Independent Expert’s Report, the Demerger Deed Poll, a summary of this document
and the notices convening the General Meeting and the Scheme Meeting (together with, in each case, proxy forms). 
 Scheme
Meeting means the meeting of Alchemia Shareholders to be convened by the Court in relation to the Scheme in accordance with section 411(1) of the Corporations Act. 
 Scheme Order means the order of the Court made for the purposes of section 411(4)(b) of the Corporations Act in respect of the Scheme. 

  
  

			
	7673384/1	  	page 31

 Scheme Record Date means five Trading Days after the last Trading Day for Alchemia
Shares to trade with an entitlement to the Demerger Entitlement. 
 Share Registry means Link Market Services Limited ABN
54 083 214 537. 
 Scheme Shareholder means a person registered in the Alchemia Share Register as the holder of Scheme
Shares on the Scheme Record Date. 
 Scheme Share means each Alchemia Share on issue on the Scheme Record Date.

 Second Court Date means the first day of the Second Court Hearing or, if the Second Court Hearing is adjourned for any
reason, the first day on which the adjourned application is heard. 
 Second Court Hearing means the hearing of the
application made to the Court for the Scheme Order. 
 Subsidiary has the meaning given in the Corporations Act.

 Trading Day has the meaning given in the Listing Rules. 

 

	1.2	Construction 

 Unless
expressed to the contrary, in this document: 
  

	 	(a)	words in the singular include the plural and vice versa; 

  

	 	(b)	if a word or phrase is defined its other grammatical forms have corresponding meanings; 

 

	 	(c)	“includes” means includes without limitation; 

  

	 	(d)	no rule of construction will apply to a clause to the disadvantage of a party merely because that party put forward the clause or would otherwise benefit from it;

  

	 	(e)	words and phrases have the same meaning (if any) given to them in the Corporations Act; 

 

	 	(f)	a reference to: 

  

	 	(i)	a holder includes a joint holder; 

  

	 	(ii)	a person includes a partnership, joint venture, unincorporated association, corporation and a government or statutory body or authority; 

 

	 	(iii)	a person includes the person’s legal personal representatives, successors, assigns and persons substituted by novation; 

 

	 	(iv)	any legislation includes subordinate legislation under it and includes that legislation and subordinate legislation as modified or replaced; 

 

	 	(v)	an obligation includes a warranty or representation and a reference to a failure to comply with an obligation includes a breach of warranty or representation;

  

	 	(vi)	a right includes a benefit, remedy, discretion or power; 

  
  

			
	7673384/1	  	page 32

	 	(vii)	time is to local time in Brisbane, Australia; 

  

	 	(viii)	“$” or “dollars” is a reference to Australian currency; 

 

	 	(ix)	this or any other document includes the document as novated, varied or replaced and despite any change in the identity of the parties; 

 

	 	(x)	writing includes any mode of representing or reproducing words in tangible and permanently visible form, and includes fax transmissions; 

 

	 	(xi)	this document includes all schedules and annexures to it; and 

  

	 	(xii)	a clause, party, schedule, exhibit or annexure is a reference to a clause, party, schedule, exhibit or annexure, as the case may be, of this document;

  

	 	(g)	if the date on or by which any act must be done under this document is not a Business Day, the act must be done on or by the next Business Day; and

  

	 	(h)	where time is to be calculated by reference to a day or event, that day or the day of that event is excluded. 

 

	1.3	Headings 

 Headings do not
affect the interpretation of this document. 
  

	2	Preliminary 

  

	2.1	Alchemia 

  

	 	(a)	Alchemia is: 

  

	 	(i)	a public company limited by shares under section 112(1) of the Corporations Act; 

 

	 	(ii)	incorporated in Australia and registered in Queensland, having its registered office at Eight Mile Plains, Brisbane, Queensland 4113; and 

 

	 	(iii)	admitted to the official list of the ASX and fully paid Alchemia Shares are quoted on the official list of the ASX. 

 

	 	(b)	As at the date of the Demerger Implementation Agreement: 

  

	 	(i)	280,617,079 Alchemia Shares were on issue; and 

  

	 	(ii)	3,463,000 Alchemia Options which may convert into Alchemia Shares were on issue. 

 

	2.2	Audeo Oncology 

  

	 	(a)	Audeo Oncology is a corporation incorporated in Delaware, the United States, having its registered office at 100 Pine Street, Suite 2040, San Francisco, California
94111. 

  
  

			
	7673384/1	  	page 33

	 	(b)	As at the date of the Demerger Implementation Agreement 7,500,020 Audeo Oncology Shares were on issue. 

 

	2.3	Summary of the Scheme 

 If
the Scheme becomes Effective and the Condition Subsequent is satisfied by the End Date, but subject to clauses 3.1 and 3.6, then on the Implementation Date: 

 

	 	(a)	Alchemia will reduce its share capital by the amount of the Capital Reduction and will, if the Market Value exceeds the Audeo Oncology Book Value pay the Demerger
Dividend; 

  

	 	(b)	Alchemia will apply the Demerger Entitlement on behalf of each Scheme Shareholder as consideration in full and exchange for: 

 

	 	(i)	if a Scheme Shareholder is an Eligible Shareholder: 

  

	 	(A)	and elects to receive Audeo Oncology Shares, the transfer of Audeo Oncology Shares to each Scheme Shareholder; and 

 

	 	(B)	otherwise, the transfer of Audeo Oncology Shares to CDN and issue of Audeo Oncology CDIs to each Scheme Shareholder; and 

 

	 	(ii)	if a Scheme Shareholder is an Ineligible Foreign Shareholder, the transfer of Audeo Oncology Shares to CDN and issue of Audeo Oncology CDIs to the Sale Facility Agent;
and 

  

	 	(c)	Audeo Oncology will cease to be a Subsidiary of Alchemia. 

  

	2.4	Demerger Implementation Agreement 

 Alchemia and Audeo Oncology have entered into the Demerger Implementation Agreement pursuant to which, among other things, Alchemia has agreed to propose the Scheme to Alchemia Shareholders and each of
Alchemia and Audeo Oncology have agreed to take all steps to give effect to the Capital Reduction, the Demerger Dividend (if any) and the Scheme. 
  

	2.5	Demerger Deed Poll 

 Audeo
Oncology has executed the Demerger Deed Poll in favour of Scheme Shareholders and Investors pursuant to which it has covenanted to: 
  

	 	(a)	perform its obligations under the Scheme and do all things necessary or expedient on its part to implement the Scheme; and 

 

	 	(b)	issue the Audeo Oncology Warrants to the Investors in accordance with their terms. 

  
  

			
	7673384/1	  	page 34

	3	Conditions 

  

	3.1	Conditions of Scheme 

 The
Scheme is conditional upon the satisfaction or waiver of the following conditions: 
  

	 	(a)	(ASIC and ASX) before 8.00 am on the Second Court Date, ASIC and the ASX issue or provide such consents, approvals or waivers or do such other acts which
Alchemia determines are necessary or desirable to implement the Demerger and such acts are not withdrawn, including in the case of ASIC, providing the statement required under section 411(17)(b) of the Corporations Act; 

 

	 	(b)	(Independent Expert Report) the Independent Expert issues its report which concludes that the Scheme is in the best interests of Scheme Shareholders before the
date on which the Scheme Booklet is registered by ASIC under the Corporations Act and the Independent Expert does not change its conclusions or withdraw its report prior to 8.00 am on the Second Court Date; 

 

	 	(c)	(Alchemia Shareholder approval – Scheme) Alchemia Shareholders approve the Scheme by the necessary majorities at the Scheme Meeting (or any adjournment or
postponement of the Scheme Meeting); 

  

	 	(d)	(Alchemia Shareholder approval – Capital Reduction) Alchemia Shareholders approve the Capital Reduction by the necessary majority under the Corporations Act
and the constitution of Alchemia before the Second Court Date. 

  

	 	(e)	(Court approval of Scheme) the Court approves the Scheme under section 411(4)(b) of the Corporations Act and an office copy of the Scheme Order is lodged with
ASIC as contemplated by section 411(10) of the Corporations Act; 

  

	 	(f)	(No restraint) no temporary restraining order, preliminary or permanent injunction or other order is issued by a court of competent jurisdiction or other legal
restraint or prohibition preventing the Demerger is in effect at 8.00 am on the Second Court Date; 

  

	 	(g)	(CDN) before 8.00 am on the Second Court Date, Audeo Oncology has appointed CDN and CDN has agreed to the transfer to it of Audeo Oncology Shares under the
Scheme; 

  

	 	(h)	(Sale Facility Agent) before 8.00 am on the Second Court Date, Audeo Oncology has appointed a Sale Facility Agent and the Sale Facility Agent has agreed to sell
the Audeo Oncology CDIs and Audeo Oncology Shares (as relevant); 

  

	 	(i)	(Ability to issue Audeo Oncology CDIs) before 8.00 am on the Second Court Date, Audeo Oncology has done everything necessary under the ASX Settlement Operating
Rules to enable it to issue Audeo Oncology CDls other than the transfer to CDN of Audeo Oncology Shares under the Scheme; and 

  
  

			
	7673384/1	  	page 35

	 	(j)	(Demerger Tax relief) before 8.00 am on the Second Court Date, Alchemia obtaining Demerger Tax Relief. 

 

	3.2	Conditions Subsequent 

The Scheme will not be implemented and clauses 4 to 6 will not take effect unless the Condition Subsequent is satisfied by
the End Date. If the Condition Subsequent is satisfied by the End Date, the Scheme will be implemented and clause 4 to 6 will take effect on the date of satisfaction of the Condition Subsequent. 

 

	3.3	Waiver of condition 

  

	 	(a)	Each of the conditions in clauses 3.1(a) and 3.1(f) is for the benefit of Alchemia, and any breach or non-fulfilment of those conditions can only be
waived with the consent Alchemia. 

  

	 	(b)	The conditions in clauses 3.1(b), 3.1(c), 3.1(d), 3.1(e), 3.1(g), 3.1(h), 3.1(i), 3.1(j) and 3.2 cannot
be waived by either party. 

  

	3.4	Certificate 

 Alchemia
must provide, and must procure Audeo Oncology to provide, to the Court on the Second Court Date a certificate authorised by its respective board and signed by at least one of its respective directors (or such other evidence as the Court may request)
stating (to the best of its knowledge) whether or not the conditions in clause 3.1 (other than clause 3.1(e)) have been satisfied or waived (subject to the terms of the Demerger Implementation Agreement) as at 8.00 am on the Second
Court Date. 
  

	3.5	Conclusive evidence 

 The
giving of a certificate by each of Alchemia and Audeo Oncology in accordance with clause 3.4 will, in the absence of manifest error, be conclusive evidence of the matters referred to in the certificate. 

 

	3.6	Termination of Demerger Implementation Agreement 

 Without limiting rights under the Demerger Implementation Agreement, if: 
  

	 	(a)	the Demerger Implementation Agreement is terminated in accordance with its terms before 8.00 am on the Second Court Date; 

 

	 	(b)	the Conditions are not satisfied or waived by the time required; 

  

	 	(c)	the Condition Subsequent is not satisfied by the End Date; or 

  

	 	(d)	the Effective Date has not occurred on or before the End Date, 

 the Scheme will have no further operation, will come to an end and will and be of no further force or effect and Alchemia and Audeo Oncology are each released from: 

 

	 	(e)	any further obligation to take steps to implement the Scheme; and 

  

	 	(f)	any liability with respect to the Scheme. 

  
  

			
	7673384/1	  	page 36

	3.7	Effective Date 

 This
Scheme takes effect on the Effective Date. 
  

	4	Scheme 

  

	4.1	Issue of Audeo Oncology Shares to Alchemia 

 The Audeo Oncology Shares: 
  

	 	(a)	are or will be validly issued; 

  

	 	(b)	are or will be fully paid; and 

  

	 	(c)	rank pari passu in all respects with all other Audeo Oncology Shares then issued and outstanding. 

 

	4.2	Demerger Dividend Resolution 

 Prior to the Implementation Date and if the Market Value is greater than the Audeo Oncology Book Value, the board of directors of Alchemia will pass the Demerger Dividend Resolution. 

 

	4.3	Capital Reduction and Demerger Dividend (if any) 

 On the Implementation Date: 
  

	 	(a)	Alchemia will reduce its share capital in accordance with the Capital Reduction Resolution; 

 

	 	(b)	if the Market Value is greater than the Audeo Oncology Book Value, Alchemia will declare the Demerger Dividend; and 

 

	 	(c)	Alchemia must apply the Demerger Entitlement of each Scheme Shareholder in accordance with clause 4.4. 

 

	4.4	Entitlements of Scheme Shareholders 

 The Demerger Entitlement of each Scheme Shareholder, will, on the Implementation Date, be applied as follows: 
  

	 	(a)	for each Scheme Shareholder, who is an Eligible Shareholder, by Alchemia as consideration in full and in exchange for: 

 

	 	(i)	if a Scheme Shareholder elects to receive Audeo Oncology Shares, the transfer by Alchemia to that Scheme Shareholder of one Audeo Oncology Share; and

  

	 	(ii)	otherwise, the issue to that Scheme Shareholder of one Audeo Oncology CDI, 

 for every 37 Scheme Shares held by that Scheme Shareholder, in accordance with clause 4.6; and 
  

	 	(b)	 for each Ineligible Foreign Shareholder, by Alchemia procuring (on behalf of that Ineligible Foreign Shareholder) the Sale Facility Agent to sell as
soon as reasonably practicable after the Implementation Date, in a manner reasonably determined by Alchemia and the Sale Facility 

  
  

			
	7673384/1	  	page 37

	 	
Agent, that number of Audeo Oncology CDIs or Audeo Oncology Shares to which that Ineligible Foreign Shareholder would otherwise have been entitled, in accordance with clause 4.9.

  

	4.5	Election 

  

	 	(a)	Each Scheme Shareholder who is an Eligible Shareholder may make an election to receive Audeo Oncology Shares rather than Audeo Oncology CDIs under the Scheme by 10.00
am on 3 October 2012 (or such other date as agreed by Alchemia and Audeo Oncology in writing) to the Share Registry. 

  

	 	(b)	An election under clause 4.5(a) may only be made in respect of all and not part of the Scheme Shares held by a Scheme Shareholder who is an Eligible Foreign
Shareholder. 

  

	 	(c)	If a Scheme Shareholder who is an Eligible Shareholder does not make an election in accordance with clause 4.5(a), that Scheme Shareholder will receive Audeo
Oncology CDIs under the Scheme. 

  

	4.6	Transfer of Audeo Oncology Shares and issue of Audeo Oncology CDIs 

 The obligations of Alchemia under clause 4.4(a) will be discharged by: 
  

	 	(a)	Alchemia executing a transfer or transfers of Audeo Oncology Shares to: 

  

	 	(i)	if a Scheme Shareholder elects to receive Audeo Oncology Shares, the Scheme Shareholder; and 

 

	 	(ii)	otherwise, CDN as nominee for the relevant Scheme Shareholders, 

 in the numbers determined in accordance with clause 4.4(a) and delivering the transfer or transfers of such Audeo Oncology Shares to Audeo Oncology for registration; 

 

	 	(b)	Alchemia procuring Audeo Oncology to register the transfers delivered to Audeo Oncology under clause 4.6(a) by entering in the Audeo Oncology Register the name
of each Scheme Shareholder or CDN (as relevant) in respect of the Audeo Oncology Shares transferred to the relevant Scheme Shareholder or CDN (as relevant) in accordance with this Scheme; and 

 

	 	(c)	if a Scheme Shareholder receives Audeo Oncology CDIs, Alchemia procuring Audeo Oncology to: 

 

	 	(i)	issue, or procure the issue of, to those Scheme Shareholders Audeo Oncology CDIs in the numbers determined in accordance with clause 4.4(a); and

  

	 	(ii)	record in the Audeo Oncology Register each person who is to receive an Audeo Oncology CDI under clause 4.6(c)(i). 

  
  

			
	7673384/1	  	page 38

	4.7	Dispatch of holding statements and transaction confirmations 

  

	 	(a)	As soon as practicable after the Implementation Date, Alchemia will procure that Audeo Oncology sends: 

 

	 	(i)	to Scheme Shareholders that are entitled to and elect to receive Audeo Oncology Shares, transaction confirmations for the Audeo Oncology Shares to which they are
entitled; 

  

	 	(ii)	for Ineligible Foreign Shareholders: 

  

	 	(A)	to CDN, as the nominee for the Sale Facility Agent, transaction confirmations for the Audeo Oncology Shares which that Ineligible Foreign Shareholder would otherwise be
entitled; and 

  

	 	(B)	to the Sale Facility Agent as nominee for the Ineligible Foreign Shareholders, holding statements for the Audeo Oncology CDIs to which that Ineligible Foreign
Shareholder would otherwise be entitled; and 

  

	 	(iii)	for all other Scheme Shareholders: 

  

	 	(A)	to CDN as nominee for that Scheme Shareholder, transaction confirmations for the Audeo Oncology Shares to which that Scheme Shareholder would otherwise be entitled; and

  

	 	(B)	to that Scheme Shareholder, holding statements for the Audeo Oncology CDIs to which that Scheme Shareholder would otherwise be entitled, 

by prepaid post (in the case of holding statements) or first class post (in the case of transaction confirmations) to: 

 

	 	(C)	in the case of Scheme Participants, their Registered Addresses, unless that Scheme Participant has directed otherwise, does not have a Registered Address or where
Alchemia and Audeo Oncology believe that such Scheme Participant is not known at their Registered Address; 

  

	 	(D)	in the case of the Sale Facility Agent, the address notified to Alchemia by the Sale Facility Agent; and 

 

	 	(E)	in the case of CDN, the address notified to Alchemia by CDN. 

  

	4.8	Enforcement of Demerger Deed Poll 

 Alchemia undertakes in favour of each Scheme Shareholder and Investor to enforce the Demerger Deed Poll against Audeo Oncology on behalf of and as agent for the Scheme Shareholders and Investors.

  
  

			
	7673384/1	  	page 39

	4.9	Ineligible Foreign Shareholders 

  

	 	(a)	In respect of Scheme Shares held by Ineligible Foreign Shareholders, the obligations of Alchemia under clause 4.4(b) will be discharged by Alchemia:

  

	 	(i)	as soon as reasonably practicable after the Implementation Date, procuring the sale, pursuant to the Sale Facility, of Audeo Oncology CDIs to which the Ineligible
Foreign Shareholders would otherwise have been entitled or the underlying Audeo Oncology Shares their Audeo Oncology CDIs represent a beneficial entitlement in, in a manner reasonably determined by Alchemia and the Sale Facility Agent;

  

	 	(ii)	accounting to each Ineligible Foreign Shareholder for the net proceeds of sale of those Audeo Oncology CDIs and Audeo Oncology Shares after deducting any applicable
brokerage, registry fees, duties and charges, at the Ineligible Foreign Shareholder’s cost and in full satisfaction of the Ineligible Foreign Shareholder’s rights under the Scheme; and 

 

	 	(iii)	as soon as reasonably practicable after the receipt by Alchemia of the net proceeds of sale referred to in clause 4.9(a)(ii), remitting to the Ineligible Foreign
Shareholder those net proceeds of sale in respect of the Ineligible Foreign Shareholder’s entitlement under clause 4.4 and this clause 4.9. 

 

	 	(b)	The applicable net proceeds of sale remitted to an Ineligible Foreign Shareholder under clause 4.9(a)(iii) will: 

 

	 	(i)	reflect the average price which all Audeo Oncology CDIs and Audeo Oncology Shares not able to be transferred to Ineligible Foreign Shareholders had been sold;

  

	 	(ii)	be rounded down to the nearest whole cent; and 

  

	 	(iii)	be paid to the Ineligible Foreign Shareholder either by cheque or bank draft in Australian dollars drawn on an Australian bank, such cheque or bank draft to be
dispatched by mail to the Ineligible Foreign Shareholder’s Registered Address. 

  

	 	(c)	If the Sale Facility Agents sells Audeo Oncology Shares on NASDAQ under clause 4.9(a)(i), the proceeds from sale will be converted at the exchange rate between
the US dollar and the Australian dollar at a date determined by the Sale Facility Agent after the date of sale of the Audeo Oncology Shares. 

  

	 	(d)	Any interest earned on the net proceeds of sale of any Audeo Oncology CDIs and Audeo Oncology Shares to which the Ineligible Foreign Shareholders would otherwise have
been entitled will be paid to and retained by Alchemia. 

  

	 	(e)	 Any amount payable to an Ineligible Foreign Shareholder under this clause 4.9 will be reduced by the amount of any withholding or other tax
which Alchemia believes, based on professional advice, is required by 

  
  

			
	7673384/1	  	page 40

	 	
any taxation or other law to be withheld in respect of such amount and payment of such amount to the relevant taxation or other authority within any required statutory period will fully and
finally discharge Alchemia’s obligations in respect of such amount (although Alchemia must on request, or if required by law, provide a receipt or other evidence of such payment to each affected Scheme Shareholder). 

 

	 	(f)	If the Ineligible Foreign Shareholder does not have a Registered Address or Alchemia believes that the Ineligible Foreign Shareholder is not known at their Registered
Address, the amount payable to that Ineligible Foreign Shareholder under this clause 4.9 will be credited to a separate bank account of Alchemia to be held until the Ineligible Foreign Shareholder claims the amount or the amount is dealt with
in accordance with unclaimed money legislation. Alchemia must hold the amount on trust, but any benefit accruing from the amount will be to the benefit of Alchemia. An amount credited to the account is to be treated as having been paid to the
Ineligible Foreign Shareholder when credited to the account. Alchemia must maintain records of the amounts paid, the people who are entitled to the amounts, and any transfers of the amounts. 

 

	 	(g)	Alchemia, in complying with the terms of this clause 4.9 in respect of an Ineligible Foreign Shareholder will be taken to have satisfied and discharged its
obligations to the Ineligible Foreign Shareholder under the terms of the Capital Reduction Resolution, the Demerger Dividend Resolution and the Scheme. An Ineligible Foreign Shareholder will have no claim against Alchemia for any entitlement they
would have had to Audeo Oncology CDIs or Audeo Oncology Shares but for the terms of this Scheme. 

  

	 	(h)	Under this Scheme, each Ineligible Foreign Shareholder agrees and acknowledges that the sale of that person’s Audeo Oncology CDIs, to which they were otherwise
entitled or the underlying Audeo Oncology Shares these Audeo Oncology CDIs represent a beneficial entitlement in, under the Sale Facility or this Scheme by operation of this clause 4.9 constitutes satisfaction of all that person’s
entitlements in and to that person’s Audeo Oncology CDIs or Audeo Oncology Shares. 

  

	 	(i)	Each Ineligible Foreign Shareholder appoints Alchemia as its agent to receive on its behalf any financial services guide or any other notice which may be given to that
Ineligible Foreign Shareholder. 

  

	4.10	Joint holders 

 In the
case of Scheme Shares held in joint names: 
  

	 	(a)	any share certificates for Audeo Oncology Shares or holding statements for Audeo Oncology CDIs to be issued to Scheme Shareholders will be issued in the names of the
joint holders; and 

  

	 	(b)	any cheque required to be paid to Ineligible Foreign Shareholders will be payable to the joint holders, 

  
  

			
	7673384/1	  	page 41

 and will be forwarded to the holder whose name appears first in the Alchemia Share Register
as at the Scheme Record Date. 
  

	4.11	Fractional entitlements 

If the number of Alchemia Shares held by a Scheme Shareholder is such that: 

 

	 	(a)	regarding a Scheme Shareholder who is not an Ineligible Foreign Shareholder, that Scheme Shareholder’s entitlement to Audeo Oncology CDIs or Audeo Oncology Shares
(as relevant) under clauses 4.4(a); or 

  

	 	(b)	regarding an Ineligible Foreign Shareholder, that number of Audeo Oncology CDIs or Audeo Oncology Shares which that Ineligible Foreign Shareholder would otherwise have
been entitled and that are to be sold by the Sale Facility Agent under clause 4.4(b), 

 is not a whole
number, that Scheme Shareholder’s entitlement to Audeo Oncology CDIs or Audeo Oncology Shares (as relevant) will be rounded up to the nearest whole number. If Alchemia believes that a Scheme Shareholder’s shareholding of Alchemia Shares
has been manipulated to take advantage of rounding up, then any fractional entitlement will be aggregated or rounded down to the next whole number of Alchemia Shares. 
  

	5	Scheme Shareholders 

  

	5.1	Appointment of Alchemia as sole attorney and agent 

 Each Scheme Shareholder, without the need for any further act, irrevocably appoints Alchemia and each of the directors and officers of Alchemia, jointly and severally, as the Scheme Shareholder’s
attorney and agent for the purpose of executing any document necessary or expedient to give effect to the Scheme or doing any other act necessary or desirable to give full effect to the Scheme and the transactions contemplated by it. 

 

	5.2	Scheme Shareholder’s consent 

 Each Scheme Shareholder: 
  

	 	(a)	consents to Alchemia doing all things and executing all deeds, instruments, transfers or other documents as may be necessary, incidental or expedient to the
implementation and performance of the Scheme and Alchemia, as agent of each Scheme Shareholder, may sub-delegate its functions under this clause 5.2 to any of its directors and officers, severally; 

 

	 	(b)	 agrees to become a holder of any Audeo Oncology CDIs or Audeo Oncology Shares (as relevant) to which they become entitled under the Scheme and a member
of Audeo Oncology and to be bound by the Restated Certificate of Incorporation and By-Laws in respect of Audeo Oncology CDIs or Audeo Oncology Shares (as relevant) issued to them pursuant to the Scheme, and that its holdings of the Audeo Oncology
Shares or Audeo Oncology CDIs (as relevant) will be registered with the 

  
  

			
	7673384/1	  	page 42

	 	
same name and registered address as its holding of the Scheme Shares; and 

  

	 	(c)	except for a Scheme Shareholder’s tax file number (unless relief is obtained by Alchemia), any binding instruction or notification between a Scheme Shareholder and
Alchemia relating to the Scheme Shares at the Scheme Record Date (including any instructions relating to payment of dividends or to communications from Alchemia) will from the Scheme Record Date be deemed to be a similarly binding instruction or
notification to, and accepted by, Audeo Oncology in respect of the Audeo Oncology Shares transferred to the Scheme Shareholder until that instruction or notification is revoked or amended in writing addressed to Audeo Oncology at the Audeo Oncology
Registry. Any such instructions or notifications accepted by Audeo Oncology will apply to and in respect of Audeo Oncology Shares or Audeo Oncology CDIs transferred to Scheme Shareholders only to the extent that they are not inconsistent with the
other provisions of the Scheme. 

  

	6	Dealings in Alchemia Shares 

  

	6.1	Alchemia Share Register 

The establishment of the persons who are the Scheme Shareholders and their respective entitlements will be solely determined by the
Alchemia Share Register (maintained by Alchemia in the manner set out in clause 6.2). 
  

	6.2	Determination of Scheme Shareholders 

  

	 	(a)	For the purpose of establishing the persons who are the Scheme Shareholders and their respective entitlements, dealings in Alchemia Shares will only be recognised if:

  

	 	(i)	in the case of dealings of the type to be effected using CHESS, the transferee is registered in the Alchemia Share Register as the holder of the relevant Alchemia
Shares at the Scheme Record Date; and 

  

	 	(ii)	in all other cases, registrable transmission applications or transfers in registrable form in respect of those dealings are received at or before the Scheme Record Date
at the place where the Alchemia Share Register is kept. 

  

	 	(b)	Alchemia must register registrable transmission applications or transfers of the kind referred to in clause 6.2(a)(ii) by the Scheme Record Date.

  

	 	(c)	Alchemia will not accept for registration or recognise for any purpose any transmission applications or transfers in respect of Alchemia Shares received after the
Scheme Record Date. 

  
  

			
	7673384/1	  	page 43

	7	Notices 

  

	7.1	General 

 Any notice,
transfer, transmission, application, direction, demand, consent or other communication (Notice) given or made under this document must be in writing in English and signed by the sender or a person duly authorised by the sender. 

 

	7.2	Communications by post 

Subject to clause 7.4, where a Notice referred to in this document is sent by post to Alchemia, it will not be deemed to have been
received in the ordinary course of post or on a date other than the date (if any) on which it is actually received at Alchemia’s registered office or at the Share Registry. 

 

	7.3	Communications by fax 

Subject to clause 7.4, a Notice is given if sent by fax, when the sender’s fax machine produces a report that the fax was sent
in full to the addressee. That report is conclusive evidence that the addressee received the fax in full at the time indicated on that report. 
  

	7.4	After hours communications 

If a Notice is given: 
  

	 	(a)	after 5.00 pm in the place of receipt; or 

  

	 	(b)	on a day which is a Saturday, Sunday or bank or public holiday in the place of receipt, 

it is taken as having been given at 9.00 am on the next day which is not a Saturday, Sunday or bank or public holiday in that place.

  

	8	General 

  

	8.1	Alchemia and Scheme Shareholders bound 

 The Scheme binds Alchemia and all Scheme Shareholders (including Scheme Shareholders who do not attend the Scheme Meeting, do not vote at that meeting or vote against the Scheme) and will, for all
purposes, to the extent of any inconsistencies and permitted by law, have effect notwithstanding any provision in the constitution of Alchemia. 
  

	8.2	Further assurances 

Subject to clause 8.3, Alchemia will execute all documents and do all acts and things (on its own behalf and on behalf of each
Alchemia Shareholder) necessary or expedient for the implementation of, and performance of its obligations under, the Scheme. 
  

	8.3	Alterations and conditions 

Alchemia may, with the consent of Audeo Oncology, by its counsel, consent on behalf of all Scheme Shareholders to any modifications or
conditions which the 

  
  

			
	7673384/1	  	page 44

 
Court thinks fit to impose, provided that in no circumstances will Alchemia be obliged to do so. 
  

	8.4	Costs 

 Any costs, and any
stamp duty and any related fines, interest or penalties, which are payable on or in respect of this document or on any document referred to in this document will be paid as provided for in the Demerger Implementation Agreement. For the avoidance of
doubt, the Scheme Shareholders do not have to pay any stamp duty, related fines, interest or penalties which are payable on or in respect of this document or any document referred to in this document. 

 

	8.5	Governing law and jurisdiction 

  

	 	(a)	This document is governed by and is to be construed in accordance with the laws applicable in Queensland, Australia. 

 

	 	(b)	Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts exercising jurisdiction in Queensland, Australia and any courts which
have jurisdiction to hear appeals from any of those courts and waives any right to object to any proceedings being brought in those courts. 

  
  

			
	7673384/1	  	page 45

 Annexure B 
 Demerger Deed Poll 

  
  

			
	7673384/1	  	page 46

  

Audeo Oncology, Inc. 
  

 
 Deed Poll 

  
  

			
	7673384/1	  	page 47

 Contents 
  

									
	 1
	 	 Interpretation
	  	 	49	  
				
		 	1.1	  	 Definitions
	  	 	49	  
		 	1.2	  	 Construction
	  	 	50	  
		 	1.3	  	 Headings
	  	 	50	  
			
	 2
	 	 Nature of this deed poll
	  	 	50	  
			
	 3
	 	 Conditions precedent and termination
	  	 	50	  
				
		 	3.1	  	 Conditions precedent
	  	 	50	  
		 	3.2	  	 Termination
	  	 	50	  
		 	3.3	  	 Consequences of termination
	  	 	51	  
			
	 4
	 	 Certificate in relation to conditions
	  	 	51	  
			
	 5
	 	 Audeo Oncology obligations
	  	 	51	  
				
		 	5.1	  	 Performance of obligations generally
	  	 	51	  
		 	5.2	  	 Obligation to update Audeo Oncology Register
	  	 	51	  
		 	5.3	  	 Confirmation dispatch of holding statements and transaction confirmations
	  	 	52	  
			
	 6
	 	 Audeo Oncology Warrants
	  	 	53	  
			
	 7
	 	 Representations and warranties
	  	 	53	  
			
	 8
	 	 Continuing obligations
	  	 	54	  
			
	 9
	 	 Stamp duty
	  	 	54	  
			
	 10
	 	 Notices
	  	 	54	  
				
		 	10.1	  	 General
	  	 	54	  
		 	10.2	  	 How to give a Notice
	  	 	54	  
		 	10.3	  	 Particulars for delivery of Notices
	  	 	54	  
		 	10.4	  	 Communications by post
	  	 	55	  
		 	10.5	  	 Communications by fax
	  	 	55	  
		 	10.6	  	 After hours communications
	  	 	55	  
		 	10.7	  	 Process service
	  	 	55	  
			
	 11
	 	 General
	  	 	55	  
				
		 	11.1	  	 Waiver
	  	 	55	  
		 	11.2	  	 Cumulative rights
	  	 	56	  
		 	11.3	  	 Amendment
	  	 	56	  
		 	11.4	  	 Assignment
	  	 	56	  
		 	11.5	  	 Severability
	  	 	56	  
		 	11.6	  	 Further assurances
	  	 	56	  
		 	11.7	  	 Governing law and jurisdiction
	  	 	56	  
		
	 Schedule 1 – Audeo Oncology Warrant terms
	  	 	57	  
		
	 Schedule 2 – Investors
	  	 	63	  

  
  

			
	7673384/1	  	page 48

 Dated      August 2012 

By 
 Audeo
Oncology, Inc. of 100 Pine Street, Suite 2040, San Francisco, California 94111 (Audeo Oncology) 
 in favour of each
Scheme Shareholder and Investor. 

	
	  

 Background 
  

	A	The directors of Alchemia Limited (Alchemia) consider that it is in the interests of Alchemia and Alchemia’s Shareholders that Alchemia Shareholders
consider the Scheme. The directors of Alchemia have therefore resolved that Alchemia propose the Scheme. 

  

	B	Audeo Oncology and Alchemia have entered into the Demerger Implementation Agreement. 

 

	C	Audeo Oncology is entering into this document for the purpose of covenanting in favour of Scheme Shareholders and the Investors to: 

 

	 	(a)	perform its obligations under the Scheme; and 

  

	 	(b)	issue the Audeo Oncology Warrants to the Investors in accordance with their terms. 

	
	  

 Declarations 
  

	1	Interpretation 

  

	1.1	Definitions 

 In this
document: 
  

	 	(a)	Audeo Oncology Warrant means an option to subscribe for Audeo Oncology Shares on the terms and conditions set out in schedule 1; 

 

	 	(b)	First Tranche Shares means the total number of Alchemia Shares available for placement under the first tranche of the Placement; 

 

	 	(c)	Investors means the persons and entities who have a right to receive Audeo Oncology Warrants as set out in schedule 2; 

 

	 	(d)	Listing means the listing of Audeo Oncology on a securities exchange; 

  
  

			
	7673384/1	  	page 49

	 	(e)	Placement means the Alchemia institutional placement capital raising in November 2011 to be undertaken in two tranches; 

 

	 	(f)	Second Tranche Shares means the balance of Alchemia Shares to be issued under the Placement; and 

 

	 	(g)	words and phrases defined in the Scheme have the same meaning in this document unless the context requires otherwise. 

 

	1.2	Construction 

 The rules
specified in clause 1.2 of the Scheme apply in interpreting or construing this document, unless the context requires otherwise. 
  

	1.3	Headings 

 Headings do not
affect the interpretation of this document. 
  

	2	Nature of this deed poll 

 Audeo
Oncology acknowledges that: 
  

	 	(a)	this document may be relied on and enforced by any Scheme Shareholder or Investor in accordance with its terms, even though the Scheme Shareholders and Investors are
not party to it; and 

  

	 	(b)	under the Scheme, each Scheme Shareholder irrevocably appoints Alchemia and any of Alchemia’s directors as its agent and attorney, inter alia, to enforce this
document against Audeo Oncology. 

  

	3	Conditions precedent and termination 

  

	3.1	Conditions precedent 

 The
obligations of Audeo Oncology in respect of the Scheme pursuant to this document are subject to the Scheme becoming Effective and the satisfaction of the Condition Subsequent by the End Date. 

 

	3.2	Termination 

 If:

  

	 	(a)	the Demerger Implementation Agreement is terminated in accordance with its terms before 8.00 am on the Second Court Date; 

 

	 	(b)	the Conditions are not satisfied or waived by the time required; 

  

	 	(c)	the Condition Subsequent is not satisfied by the End Date; or 

  

	 	(d)	the Effective Date has not occurred on or before the End Date, 

 Audeo Oncology’s obligations under this document will automatically terminate, unless Audeo Oncology and Alchemia otherwise agree in writing in accordance with the Demerger Implementation Agreement.

  
  

			
	7673384/1	  	page 50

	3.3	Consequences of termination 

 If this document is terminated under clause 3.2 then, in addition and without prejudice to any other rights, powers or remedies available to Scheme Shareholders: 

 

	 	(a)	Audeo Oncology is released from its obligations to further perform this document, except those obligations contained in clause 9; and 

 

	 	(b)	each Scheme Shareholder and Investor retains any rights, power or remedies it has against Audeo Oncology in respect of any breach of this document by Audeo Oncology
which occurred before termination of this document. 

  

	4	Certificate in relation to conditions 

 Audeo Oncology must provide to the Court on the Second Court Date a certificate which is authorised by the board of Audeo Oncology and signed by at least one director of Audeo Oncology (or such other
evidence as the Court may request) stating, to the best of its knowledge, whether or not the conditions precedent set out in clause 3.1 (other than clause 3.1(e)) of the Scheme have been satisfied or waived, subject to the terms of the Demerger
Implementation Agreement as at 8.00 am on the Second Court Date. 
  

	5	Audeo Oncology obligations 

  

	5.1	Performance of obligations generally 

 Subject to clause 3, Audeo Oncology must comply with its obligations under the Demerger Implementation Agreement and must do all things necessary or desirable on its part to implement the Scheme.

  

	5.2	Obligation to update Audeo Oncology Register 

 As soon as practicable after the Implementation Date, Audeo Oncology must enter, or procure the entry, into the Audeo Oncology Register of: 

 

	 	(a)	each Scheme Shareholder (other than Ineligible Foreign Shareholders) or CDN (as relevant) in respect of the Audeo Oncology Shares transferred to the relevant Scheme
Shareholder or CDN (as relevant) under the Scheme; 

  

	 	(b)	each Scheme Shareholder (other than Ineligible Foreign Shareholders) in respect of the Audeo Oncology CDIs issued to the relevant Scheme Shareholder under the Scheme;
and 

  

	 	(c)	the Sale Facility Agent, as nominee for and on behalf of, the Ineligible Foreign Shareholders, in respect of the Audeo Oncology Shares or Audeo Oncology CDIs to which
those shareholders are entitled to under the Scheme. 

  
  

			
	7673384/1	  	page 51

	5.3	Confirmation dispatch of holding statements and transaction confirmations 

 

	 	(a)	In accordance with clauses 4.6 and 4.7 of the Scheme, as soon as practicable after the Implementation Date, Audeo Oncology must send: 

 

	 	(i)	to Scheme Shareholders that are entitled to and elect to receive Audeo Oncology Shares, transaction confirmations for the Audeo Oncology Shares to which they are
entitled; 

  

	 	(ii)	for Ineligible Foreign Shareholders: 

  

	 	(A)	to CDN, as the nominee for the Sale Facility Agent, transaction confirmations for the Audeo Oncology Shares which that Ineligible Foreign Shareholder would otherwise be
entitled; and 

  

	 	(B)	to the Sale Facility Agent as nominee for the Ineligible Foreign Shareholders, holding statements for the Audeo Oncology CDIs to which that Ineligible Foreign
Shareholder would otherwise be entitled; and 

  

	 	(iii)	for all other Scheme Shareholders: 

  

	 	(A)	to CDN as nominee for that Scheme Shareholder, transaction confirmations for the Audeo Oncology Shares to which that Scheme Shareholder would otherwise be entitled; and

  

	 	(B)	to that Scheme Shareholder, holding statements for the Audeo Oncology CDIs to which that Scheme Shareholder would otherwise be entitled, 

by prepaid post (in the case of holding statements) or first class post (in the case of transaction confirmations) to: 

 

	 	(iv)	in the case of Scheme Shareholders, their Registered Addresses, unless that Scheme Shareholder has directed otherwise, does not have a Registered Address or where
Alchemia and Audeo Oncology believe that such Scheme Shareholder is not known at their Registered Address; 

  

	 	(v)	in the case of the Sale Facility Agent, the address notified to Alchemia by the Sale Facility Agent; and 

 

	 	(vi)	in the case of CDN, the address notified to Alchemia by CDN. 

  

	 	(b)	In the case of Scheme Shares held in joint names: 

  

	 	(i)	any share certificates for Audeo Oncology Shares or holding statements for Audeo Oncology CDIs to be issued to Scheme Shareholders will be issued in the names of the
joint holders; and 

  

	 	(ii)	any cheque required to be paid to Ineligible Foreign Shareholders will be payable to the joint holders, 

  
  

			
	7673384/1	  	page 52

 and will be forwarded to the holder whose name appears first in the Alchemia Register as at
the Scheme Record Date. 
  

	 	(c)	This clause 5.3 does not apply to a Scheme Shareholder (other than Ineligible Foreign Shareholders) who does not have a Registered Address, or where Alchemia and
Audeo Oncology believe that such Scheme Shareholder is not known at their Registered Address. 

  

	6	Audeo Oncology Warrants 

 Subject
to the listing of Audeo Oncology on NASDAQ on or before 31 December 2012, Audeo Oncology must as soon as practicable after Audeo Oncology is admitted to NASDAQ: 
  

	 	(a)	issue to each Investor; and 

  

	 	(b)	register each Investor as the holder of, 

 the number of Audeo Oncology Warrants (based on each Audeo Oncology Warrant entitling the Investor to subscribe for an Audeo Oncology Share) calculated as follows: 

 

							
	a	 	=	 	 b
	 	
	 	 	c	 	’

 where: 
 a = Audeo Oncology Warrants; 
 b = 50% of the aggregate subscription price for the
First Tranche Shares and the Second Tranche Shares (if any) subscribed for by the Investor; and 
 c = 130% of the volume
weighted average price of Audeo Oncology Warrants over the 60 trading days immediately following Listing. 
  

	7	Representations and warranties 

Audeo Oncology represents and warrants that: 
  

	 	(a)	it is a company validly existing under the laws of Delaware, the United States; 

 

	 	(b)	it has the corporate power to enter into and perform its obligations under this document and to carry out the transactions contemplated by this document;

  

	 	(c)	it has taken all necessary corporate action to authorise the entry into this document and has taken or will take all necessary corporate action to authorise the
performance of this document and to carry out the transactions contemplated by this document; 

  

	 	(d)	this document is its valid and binding obligation enforceable in accordance with its terms; and 

  
  

			
	7673384/1	  	page 53

	 	(e)	the Audeo Oncology Shares to be issued pursuant to the Scheme will be validly issued, fully paid and free from any mortgage, charge, lien, encumbrance or other security
interest and will rank equally in all respects with all other Audeo Oncology Shares then on issue. 

  

	8	Continuing obligations 

 This
document is irrevocable and, subject to clause 3, remains in full force and effect until: 
  

	 	(a)	Audeo Oncology has completely performed its obligations under this document and the Demerger Implementation Agreement; or 

 

	 	(b)	this document is terminated in accordance with clause 3, 

 whichever comes first. 
  

	9	Stamp duty 

 Audeo Oncology will:

  

	 	(a)	pay all stamp duties and any related fines, interest and penalties in respect of or in connection with this document, the performance of this document and each
transaction effected by or made or any instrument executed under this document or the Scheme, including the transfer of Scheme Shares under the Scheme; and 

 

	 	(b)	indemnify each Scheme Shareholder on demand against any liability arising from its failure to comply with clause 9(a). 

 

	10	Notices 

  

	10.1	General 

 Any notice,
transfer, transmission, application, direction, demand, consent or other communication (Notice) given or made to Audeo Oncology under this document must be in writing in English and signed by the sender or a person duly authorised by the
sender. 
  

	10.2	How to give a Notice 

 A
Notice must be given to Audeo Oncology by being: 
  

	 	(a)	personally delivered; 

  

	 	(b)	left at Audeo Oncology’s current delivery address for notices; 

  

	 	(c)	sent to Audeo Oncology’s current postal address for notices by pre-paid ordinary mail or, if the address is outside Australia, by pre-paid airmail; or

  

	 	(d)	sent by fax to Audeo Oncology’s current fax number for notices. 

  

	10.3	Particulars for delivery of Notices 

 The particulars for delivery of Notices to Audeo Oncology are: 

  
  

			
	7673384/1	  	page 54

			
	Attention:	  	Tracie Ramsdale
		
	Delivery address:	  	3 Hi Tech Court, Eight Mile Plains
		  	Brisbane Queensland 4113
	
	Postal address: Same as delivery address
	
	Fax:                  +61 7 3340 0222

  

	10.4	Communications by post 

Subject to clause 10.6, a Notice is given if posted: 

 

	 	(a)	within Australia to an Australian postal address, three Business Days after posting; or 

 

	 	(b)	outside of Australia to an Australian postal address or within Australia to an address outside of Australia, ten Business Days after posting. 

 

	10.5	Communications by fax 

Subject to clause 10.6, a Notice is given if sent by fax, when the sender’s fax machine produces a report that the fax was
sent in full to the addressee. That report is conclusive evidence that the addressee received the fax in full at the time indicated on that report. 
  

	10.6	After hours communications 

If a Notice is given: 
  

	 	(a)	after 5.00 pm in the place of receipt; or 

  

	 	(b)	on a day which is a Saturday, Sunday or bank or public holiday in the place of receipt, 

it is taken as having been given at 9.00 am on the next day which is not a Saturday, Sunday or bank or public holiday in that place.

  

	10.7	Process service 

 Any
process or other document relating to litigation, administrative or arbitral proceedings relating to this document may be served by any method contemplated by this clause 10 or in accordance with any applicable law. 

 

	11	General 

  

	11.1	Waiver 

 Failure to
exercise or enforce or a delay in exercising or enforcing or the partial exercise or enforcement of any right, power or remedy provided by law or under this document by any party will not in any way preclude, or operate as a waiver of, any exercise
or enforcement, or further exercise or enforcement of that or any other rights, power or remedy provided by law or under this document. A waiver is not valid or binding on the person granting that waiver unless made in writing. 

  
  

			
	7673384/1	  	page 55

	11.2	Cumulative rights 

 The
rights, powers and remedies of Audeo Oncology and of each Scheme Shareholder and Investor under this document are cumulative and do not exclude any other rights, powers or remedies provided by law or equity independently of this document.

  

	11.3	Amendment 

 A provision of
this document may not be varied unless: 
  

	 	(a)	if before the First Court Date, the variation is agreed to by Alchemia; or 

 

	 	(b)	if on or after the First Court Date, the variation is agreed to by Alchemia and the Court indicates that the variation would not of itself preclude approval of the
Scheme, 

 in which event Audeo Oncology must enter into a further deed poll in favour of the Scheme Shareholders
and Investors giving effect to that amendment. 
  

	11.4	Assignment 

 The rights
and obligations of Audeo Oncology and of each Scheme Shareholder and Investor under this document are personal and must not be assigned, encumbered or otherwise dealt with at law or in equity and no person may attempt, or purport, to do so without
the prior written consent of Audeo Oncology and Alchemia. 
  

	11.5	Severability 

 If the
whole or any part of a provision of this document is void, unenforceable or illegal in a jurisdiction it is severed for that jurisdiction. The remainder of this document has full force and effect and the validity or enforceability of that provision
in any other jurisdiction is not affected. This clause 11.5 has no effect if the severance alters the basic nature of this document or is contrary to public policy. 

 

	11.6	Further assurances 

 Audeo
Oncology will execute and deliver all documents and do all acts and things (on its own behalf and on behalf of each Scheme Shareholder and Investor) necessary or desirable to give full effect to this document and the transactions contemplated by it.

  

	11.7	Governing law and jurisdiction 

  

	 	(a)	This document is governed by and is to be construed in accordance with the laws applicable in Queensland, Australia. 

 

	 	(b)	Each party irrevocably and unconditionally submits to the non-exclusive jurisdiction of the courts exercising jurisdiction in Queensland, Australia, and any courts
which have jurisdiction to hear appeals from any of those courts, and waives any right to object to any proceedings being brought in those courts. 

  
  

			
	7673384/1	  	page 56

 Schedule 1 
  

	 	a.	Each warrant entitles the holder to subscribe for a fully paid share of common stock of Audeo Oncology, Inc. (the “Company”) (a
“Share”) upon exercise of the warrant and payment of the Exercise Price (defined below). 

  

	 	b.	Each warrant is exercisable for shares of common stock at an exercise price equal to 130% of the volume weighted average price of the Shares over the 60 trading days
immediately following the listing of the Company on a recognised securities exchange (the “Exercise Price”), payable in full on exercise of the warrant. 

 

	 	c.	The warrants vest and are exercisable from the date that is six months after the date of the initial public offering of the Company (the “IPO Date”)
until the date that is the later to occur of the following (the “Expiry Date”): 

  

	 	(i)	three years from IPO Date; and 

  

	 	(ii)	the earlier of: 

  

	 	(A)	six months from the date that the Company announces to the market the results for the primary end point of the Phase III clinical trial period for HA-Irinotecan in
colorectal cancer; and 

  

	 	(B)	five years from the IPO Date. 

Any warrant not exercised prior to the Expiry Date, automatically expires on the Expiry Date. 

 

	 	d.	The Company must give the holder of each warrant a certificate or holding statement including these warrant terms and stating: 

 

	 	(i)	the number of warrants issued to each holder; 

  

	 	(ii)	the Exercise Price of the warrants; and 

  

	 	(iii)	the date of issue of the warrants. 

  

	 	e.	Warrants may only be exercised by the delivery to the registered office of the Company or its share registry of a certificate in the form attached as annexure A to
these warrant terms and a notice (the “Exercise Notice”) in writing stating the intention of the holder to: 

  

	 	(i)	exercise all or a specified number of warrants; and 

  

	 	(ii)	either pay the Exercise Price in cash for the exercise of each such warrant or elect a cashless exercise for the exercise of each such warrant.

  

	 	f.	The Exercise Notice must be accompanied by the certificate or holding statement for the warrants being exercised, if not a cashless exercise, and a cheque made payable
to the Company for the Exercise Price for the warrants being exercised. 

  

	 	g.	In lieu of paying the Exercise Price in cash for the exercise of each warrant, if the fair market value of one share of common stock is greater than the Exercise Price,
the holder may elect a cashless exercise of the warrant. 

  

	 	h.	The warrants will be deemed to have been exercised on the date the Exercise Notice is received by the Company or the share registry. 

 

	 	i.	 The Company will allot the Shares to which a holder is entitled following exercise

  
  

			
	7673384/1	  	page 57

	 	
of warrants and deliver a holding statement with respect to such Shares within the timeframe required by the listing rules of the exchange on which the Company is listed.

  

	 	j.	The exercise of only some portion of a warrant will not affect the rights of the holder to the balance of the warrants held by them. 

 

	 	k.	If the holder of the warrants exercises less than the total number of warrants registered in the holder’s name: 

 

	 	(i)	the holder of the warrants must surrender its warrant certificate, if one has been issued by the Company; and 

 

	 	(ii)	the Company must cancel the warrant and issue the holder of the warrants a new warrant or holding statement stating the remaining number of warrants held by the holder
and stating the information set out in item (d) above. 

  

	 	l.	Warrants will not confer an entitlement to receive dividends declared and paid by the Company, nor an entitlement to vote at general meetings of the Company unless the
holder of the warrants has exercised its warrants before the record date for determining these entitlements and participates as a result of holding Shares. 

 

	 	m.	Each Share issued on exercise of an warrant will: 

  

	 	(i)	rank equally in all respects (including, without limitation, rights relating to dividends) with other issued Shares; 

 

	 	(ii)	be issued credited as fully paid; 

  

	 	(iii)	be duly authorised and issued by all necessary corporate action; and 

  

	 	(iv)	be allotted and issued free from all liens, charges and encumbrances whether known about or not including statutory and other pre-emption rights and any transfer
restrictions. 

  

	 	n.	The Company will apply to the exchange on which the Company is listed for official quotation of the Shares issued upon exercise of warrants within the time period
required by the listing rules of the exchange on which the Company is listed. 

  

	 	o.	The warrants are not transferable without the prior written consent of the Company, which shall not be unreasonably withheld only where all warrants held by the holder
are transferred to a related body corporate of the holder (or, in the case of a custodian of a fund, a custodian of a fund with the same manager), that: 

  

	 	(i)	the Company is satisfied (acting reasonably) is a permitted transferee under applicable securities law without additional disclosure or other regulatory requirements on
either the transferor or the Company; 

  

	 	(ii)	has provided any written certification or other evidence of their sophisticated/professional/exempt investor status, reasonably requested by the Company; and

  

	 	(iii)	has agreed in writing to be bound by these warrant terms (including, if required by the Company, delivering a certificate in the form attached as annexure A to these
warrant terms on exercise of the warrants). 

  

	 	p.	 A holder of warrants does not have the right to participate in bonus issues or

  
  

			
	7673384/1	  	page 58

	 	
new issues of securities offered to shareholders until Shares are allotted to the holder pursuant to the exercise of the relevant warrants. 

 

	 	q.	After the listing of the Company on a securities exchange, and in the event of a reorganisation (including, without limitation, consolidation, sub-division, reduction
or return) of the capital of the Company, the rights of the holders of warrants (including, without limitation, the number of warrants to which the warrant holder is entitled and the exercise price) will be changed (as appropriate) in accordance
with the listing rules of the exchange on which the Company is listed applying to a reorganisation of capital at the time of the reorganisation. 

  

	 	r.	If after the listing of the Company on a securities exchange, the Company makes a pro rata issue (other than a bonus issue) to existing shareholders and no Shares have
been issued in respect of the warrants before the record date for determining entitlements to the issue, the Exercise Price of each warrant will be reduced in the manner permitted by the listing rules of the exchange on which the Company is listed.

  

	 	s.	If after the listing of the Company on a securities exchange, the Company makes a bonus issue to existing shareholders and no Share has been issued in respect of a
warrant before the record date for determining entitlements to the issue, then the number of Shares over which that warrant is exercisable will be increased in the manner permitted by the listing rules of the exchange on which the Company is listed.

  

	 	t.	The Company is entitled to treat the registered holder of a warrant as the absolute holder of that warrant and is not bound to recognise any equitable or other claim
to, or interest in, that warrant on the part of any person other than the registered holder, except as ordered by a court of competent jurisdiction or as required by statute. 

 

	 	u.	If the Company is obliged to make a payment in respect of withholding tax in relation to the warrants, the Company must: 

 

	 	(i)	promptly pay any amount deducted to the appropriate governmental taxation authority; 

 

	 	(ii)	if requested by the warrant holder, within 30 days after that request, give to that warrant holder a copy of the relevant documentation evidencing the payment; and

  

	 	(iii)	issue the warrant holder the net number of warrants after making the payment. 

  
  

			
	7673384/1	  	page 59

 Annexure A 
 Certificate for warrant holders 
 By executing this Investor Certificate in favour of Audeo
Oncology, Inc. (the “Company”), the undersigned (“holder”) represents, warrants and covenants to the Company, and acknowledges that the Company is relying thereon, that: 

 

	(a)	if the YES box is checked, it is not a U.S. person and is not acquiring the securities for the benefit of any U.S. person; 

 

			
	YES     ̈	  	No     ̈

  

	(b)	if the YES box is checked, it is an institutional “Accredited Investor” as defined in Rule 501(a)(1), (2) (3) or (7) under the U.S. Securities
Act of 1933, as amended (the “1933 Act”); 

  

			
	YES     ̈	  	No     ̈

  

	(c)	it understands that the shares of common stock of the Company (the “Shares”) to be issued upon exercise of the warrants (the
“Warrants”) have not been (and will not be) registered under the 1933 Act or any applicable state securities laws, and that the contemplated issue of Shares is being made in reliance on a private placement exemption available under
the 1933 Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the holder’s representations, warranties and covenants as expressed herein and the Company is under no obligation to register
any subsequent proposed resale of the shares by the holder; and the holder agrees not to engage in hedging transactions with regard to such Shares unless in compliance with the Act: 

 

	(d)	it understands that the issue of Shares on exercise of a Warrant is not intended to be part of a public offering and that it will not be able to rely on the protection
of Section 11 of the 1933 Act; 

  

	(e)	it is acquiring the Shares for its own account and not with a view to any resale, distribution or other disposition (to the extent possible) of the Shares in violation
of U.S. federal or state securities laws, and it is not an underwriter with respect to the Shares within the meaning of Section 2(a) (11) of the 1933 Act; 

 

	(f)	it has had an opportunity to discuss the Company’s business, management, financial affairs and the terms and conditions of the issue of Shares on exercise of a
Warrant with the Company’s management and has had access to such additional information, if any, concerning the Company as it has considered necessary or appropriate in connection with its investment decision to exercise the Warrants;

  

	(g)	it is aware of the characteristics of the Shares, the risks relating to an investment therein and agrees that the holder must bear the economic risk of its investment
in the Shares and the holder acknowledges that it can bear the economic risk of its investment and is able, without impairing its financial condition, to hold the Shares for an indefinite period of time and to suffer a complete loss of its
investment; 

  

	(h)	it alone, or with the assistance of its professional advisors, has such knowledge in financial and business affairs as to be capable of evaluating the merits and risks
of the holder’s proposed investment in the Shares; 

  
  

			
	7673384/1	  	page 60

	(i)	it agrees that if it decides to sell or otherwise transfer (to the extent possible) any Shares, it will only do so only if the offer and sale (to the extent possible)
of such Shares is (i) registered under the 1933 Act (which the holder acknowledges the Company has no obligation to do); (ii) made pursuant to an exemption from registration under the Act, or (iii) made in standard (regular way)
brokered transactions on the exchange on which the Shares are listed, provided that such exchange is a “designated offshore securities market” as defined in Regulation S under the 1933 Act (“Regulation S”)
(“Exchange”) in offshore transactions that qualifies for the exemption available under Regulation S where neither it nor any person acting on its behalf knows, or has reason to know, that the sale has been pre-arranged with, or that
the purchaser is, a person in the United States; 

  

	(j)	it is not engaged in the business of distributing securities or, if it is, it agrees that it will not offer or sell in the United States (i) any Shares it acquires
at any time or (ii) any ordinary shares of the Company that it may acquire other than as a result of exercising Warrants until one year after the relevant date of issue or transfer, except in either of cases (i) or (ii), in a transaction
exempt from the registration requirements of the 1933 Act. Notwithstanding the foregoing, it may sell Shares in standard (regular way) brokered transactions on the Exchange in offshore transactions in accordance with Regulation S where neither it
nor any person acting on its behalf knows, or has reason to know, that the sale has been pre-arranged with, or that the purchaser is, a person in the United States; 

 

	(k)	it understands that the Shares will constitute “restricted securities” within the meaning of Rule 144(a)(3) under the 1933 Act and it will not deposit such
Shares into any unrestricted depositary receipt facility established or maintained by a depositary bank unless and until such time as such Shares are no longer “restricted securities” within the meaning of Rule 144(a)(3) of the 1933 Act;

  

	(l)	it is not acquiring the Shares as a result of any “general solicitation or general advertising” (as those terms are used in Regulation D under the 1933 Act),
including, but not limited to, any advertisements, articles, notices or other communications published in any newspaper, magazine or similar media or on the Internet or broadcast over radio, television or the Internet, or any seminar or meeting
whose attendees have been invited by general solicitation or general advertising, and it has a pre-existing business relationship with the Company; 

  

	(m)	it is aware that (i) acquiring, holding and disposing (to the extent possible) of the Shares may have tax consequences under the laws of both Australia and the
United States and (ii) it is solely responsible for determining the tax consequences applicable to its particular circumstances and should consult its own tax advisors concerning investment in such securities; 

 

	(n)	if the holder is an employee benefit plan but is not an investor which is subject to the prohibited transaction rules of Section 4975 of the U.S. Internal Revenue
Code of 1986 (the “Code”) or the fiduciary responsibility provisions of the U.S. Employee Retirement Security Act of 1974 (“ERISA”) (such an investor, a “Benefit Plan Investor”), the acquisition and
holding of the Shares by the holder complies with all applicable laws governing the holder, is in accordance with the holder’s governing documents, and will not result in the assets of the Company being treated as the “plan assets” of
the holder under applicable law; 

  

	(o)	 if the holder is a Benefit Plan Investor, (i) the holder’s commitment to purchase the Shares does not, in the aggregate, constitute more than
10% of the fair market value of the holder’s assets, (ii) the acquisition and holding of the Shares by the holder complies with all applicable requirements of ERISA, the Code and other

  
  

			
	7673384/1	  	page 61

	 	
applicable laws governing the holder and is in accordance with the holder’s governing documents, (iii) the acquisition and holding of the Shares by the holder either does not constitute
a prohibited transaction under Section 406 of ERISA or Section 4975 of the Code, or one or more statutory or administrative exemptions from the prohibited transaction rules of ERISA and the Code is applicable to such acquisition and
holding and (iv) the holder agrees to provide to the Company, in writing, all additional information that the Company may reasonably request in order to avoid violations of any provision of ERISA and to determine whether the holder meets the
suitability standards for ownership of the Shares; and 

  

	(p)	it agrees that the Warrants have been issued to it in satisfaction in full of Alchemia Limited’s or Alchemia Oncology Pty Ltd’s obligation (if any) to issue
options to you under the subscription agreement between you and Alchemia Limited and Alchemia Oncology Pty Ltd dated on or about 5 November 2011. 

 Details of holder and authorised signatory 
  

 
  

									
	Holder:	 	  

									
	Signature (authorised signatory):	 	  
	 		 	Date:	 	  

									
	Name:	 	  

									
	Title:	 	  

  
  

  
  

			
	7673384/1	  	page 62

 Schedule 2 
 Investors 
  

			
	1.	  	ABN AMRO CLEARING SYDNEY
	2.	  	ANTIOCH INVESTMENTS AUSTRALIA
	3.	  	ARMADA TRADING PTY LIMITED
	4.	  	ASIA UNION INVESTMENTS
	5.	  	AUST EXECUTOR TRUSTEES NSW LTD
	6.	  	BERNE NO 132 NOMINEES PTY LTD
	7.	  	BERNE NO 132 NOMINEES PTY LTD
	8.	  	BERNE NO 132 NOMINEES PTY LTD
	9.	  	BOUSSAL PTY LTD
	10.	  	BRYLET PTY LIMITED
	11.	  	C B C SECURITIES PTY LIMITED
	12.	  	CAWDOR-CRAIGNISH PTY LTD
	13.	  	CITICORP NOMINEES PTY LIMITED
	14.	  	CLEM JONES PTY LTD
	15.	  	CRAIMAR INVESTMENTS PTY
	16.	  	DEHORS HOLDINGS PTY LTD
	17.	  	DR BRIAN HARRY LOCKHART GIBSON
	18.	  	DR SIAVASH ES’HAGHI &
	19.	  	ELSCLIFF PTY LTD
	20.	  	GILLILODGE PTY LIMITED
	21.	  	GREENWICH STREET PTY LTD
	22.	  	HARBURG NOMINEES PTY LTD
	23.	  	HATTONGROVE PTY LTD
	24.	  	HSBC CUSTODY NOMINEES
	25.	  	HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED-GSCO ECA
	26.	  	INDLETRAN PTY LIMITED
	27.	  	J P MORGAN NOMINEES AUSTRALIA
	28.	  	JAGEN PTY LTD
	29.	  	JP MORGAN NOMINEES AUSTRALIA
	30.	  	JULIBER PTY LTD
	31.	  	LALIBER PTY LTD
	32.	  	LITTLE OWL CAPITAL PTY LTD
	33.	  	M E J C PTY LTD
	34.	  	MAXIM SUPER FUND PTY LTD
	35.	  	MISS JOSEPHINE MYRA LITTLE
	36.	  	MITCHELLDANGAR PTY LTD
	37.	  	MIZPOCHA PTY LTD
	38.	  	MONTOYA PTY LTD
	39.	  	MR ANDREW GEORGE MALUISH &
	40.	  	MR ANTHONY STEPHEN WALL &
	41.	  	MR BRIAN GERARD SHEAHAN
	42.	  	MR CONSTANTINE CHRISTOFIDES &
	43.	  	MR DALLAS JOHN WILLIAM ALLMAN
	44.	  	MR DARREN JOHN THOMPSON &
	45.	  	MR DAVID FREDERICK OAKLEY

  
  

			
	7673384/1	  	page 63

			
	46.	  	MR DEREK ROBERT MC COMBER &
	47.	  	MR GREGORY WAYNE BROWN
	48.	  	MR JAMES MARK STEPHANOS &
	49.	  	MR JAMIE PHEROUS
	50.	  	MR JOHN WIEN-SMITH
	51.	  	MR LEGH DAVIS &
	52.	  	MR MATTHEW EDWARD CLARKE
	53.	  	MR NIGEL PAUL ST CLAIR EMSLIE
	54.	  	MR PAUL ROSS NUTTER &
	55.	  	MR PETER JAMES COLEMAN &
	56.	  	MR PETER RONALD MORRISON &
	57.	  	MR PHILIP ANDREW THICK
	58.	  	MR PHILIP JOHN LEE &
	59.	  	MR ROGER WILLIAM LEANING
	60.	  	MR SCOTT WILLIAM DUGGAN &
	61.	  	MR SCOTT WILLIAM POWER &
	62.	  	MR SIMON PETER FERGUSON &
	63.	  	MR THOMAS WILLIAM MAlchemiaEAN
	64.	  	MRS FIONA RICHARDSON
	65.	  	MRS GAIL IRENE WISSEMANN
	66.	  	MRS KAREN GRETA MARTIN
	67.	  	MRS LORRAINE DAWN HAYDEN
	68.	  	MRS LOTTE KATRINA TURLEY
	69.	  	MRS VIOLETA TODOROVA
	70.	  	NATIONAL NOMINEES LIMITED
	71.	  	NILIBER PTY LTD
	72.	  	PAWGRIF PTY LTD
	73.	  	PHILLIP ASSET MANAGEMENT LTD
	74.	  	PINWILLOW PTY LTD
	75.	  	PLANETTE THOROUGHBRED TRADING
	76.	  	PLASMA EQUITIES RESEARCH PTY
	77.	  	REDLICH SUPERANNUATION FUND
	78.	  	RESHAPE PTY LTD
	79.	  	ROSHERVILLE PTY LTD
	80.	  	S G TURLEY NOMINEES PTY LTD
	81.	  	T B I C PTY LTD
	82.	  	THE TRUST COMPANY
	83.	  	TIMBINA PTY LTD
	84.	  	TRINA INVESTMENTS PTY LTD
	85.	  	TROPICAL HARVEST PTY LTD
	86.	  	UBS NOMINEES PTY LTD
	87.	  	VANDALEX PTY LTD
	88.	  	X F INVESTMENTS PTY LTD

  
  

			
	7673384/1	  	page 64

 Executed as a deed poll in Queensland, Australia. 

 

	
	Executed by Audeo Oncology, Inc.
	
	  

	Signature
	
	  

	by (print name)
	
	  

	its (print title)

  
  

			
	7673384/1	  	page 65EX-10.1

 Exhibit 10.1 
 REVOLVING CREDIT 
 AND 

SECURITY AGREEMENT 
 PNC BANK, NATIONAL ASSOCIATION 
 (AS LENDER AND AS AGENT) 

WITH 

GAIAM AMERICAS, INC. 
 SPRI PRODUCTS, INC. 
 GT DIRECT, INC. 

AND 

VE NEWCO, LLC 
 (COLLECTIVELY, THE BORROWERS) 
 JULY 31, 2012 

 TABLE OF CONTENTS 

 

									
	 	 	 	 	 	  	Page	 
			
	I.     	 	    DEFINITIONS	  	 	1	  
				
		 	1.1.	 	Accounting Terms	  	 	1	  
		 	1.2.	 	General Terms	  	 	1	  
		 	1.3.	 	Uniform Commercial Code Terms	  	 	25	  
		 	1.4.	 	Certain Matters of Construction	  	 	25	  
			
	II.	 	    ADVANCES, PAYMENTS	  	 	26	  
				
		 	2.1.	 	Revolving Advances	  	 	26	  
		 	2.2.	 	Procedure for Revolving Advances Borrowing	  	 	27	  
		 	2.3.	 	Disbursement of Advance Proceeds	  	 	29	  
		 	2.4.	 	Reserved	  	 	29	  
		 	2.5.	 	Maximum Advances	  	 	29	  
		 	2.6.	 	Repayment of Advances	  	 	30	  
		 	2.7.	 	Repayment of Excess Advances	  	 	30	  
		 	2.8.	 	Statement of Account	  	 	30	  
		 	2.9.	 	Letters of Credit	  	 	31	  
		 	2.10.	 	Issuance of Letters of Credit	  	 	31	  
		 	2.11.	 	Requirements For Issuance of Letters of Credit	  	 	31	  
		 	2.12.	 	Disbursements, Reimbursement	  	 	32	  
		 	2.13.	 	Repayment of Participation Advances	  	 	33	  
		 	2.14.	 	Documentation	  	 	34	  
		 	2.15.	 	Determination to Honor Drawing Request	  	 	34	  
		 	2.16.	 	Nature of Participation and Reimbursement Obligations	  	 	34	  
		 	2.17.	 	Indemnity	  	 	35	  
		 	2.18.	 	Liability for Acts and Omissions	  	 	36	  
		 	2.19.	 	Additional Payments	  	 	37	  
		 	2.20.	 	Manner of Borrowing and Payment	  	 	37	  
		 	2.21.	 	Mandatory Prepayments	  	 	39	  
		 	2.22.	 	Use of Proceeds	  	 	39	  
		 	2.23.	 	Defaulting Lender	  	 	40	  
			
	III.	 	    INTEREST AND FEES	  	 	40	  
				
		 	3.1.	 	Interest	  	 	40	  
		 	3.2.	 	Letter of Credit Fees	  	 	41	  
		 	3.3.	 	Closing Fee and Facility Fee	  	 	42	  
		 	3.4.	 	Collateral Evaluation Fee and Collateral Monitoring Fee	  	 	42	  
		 	3.5.	 	Computation of Interest and Fees	  	 	43	  
		 	3.6.	 	Maximum Charges	  	 	43	  
		 	3.7.	 	Increased Costs	  	 	43	  
		 	3.8.	 	Basis For Determining Interest Rate Inadequate or Unfair	  	 	44	  
		 	3.9.	 	Capital Adequacy	  	 	44	  
		 	3.10.	 	Taxes	  	 	45	  

  
 i 

									
		 	3.11.	 	Designation of a Different Lending Office	  	 	47	  
			
	IV.	 	    COLLATERAL: GENERAL TERMS	  	 	47	  
				
		 	4.1.	 	Security Interest in the Collateral	  	 	47	  
		 	4.2.	 	Perfection of Security Interest	  	 	47	  
		 	4.3.	 	Disposition of Collateral	  	 	48	  
		 	4.4.	 	Preservation of Collateral	  	 	48	  
		 	4.5.	 	Ownership of Collateral	  	 	48	  
		 	4.6.	 	Defense of Agent’s and Lenders’ Interests	  	 	49	  
		 	4.7.	 	Books and Records	  	 	49	  
		 	4.8.	 	Financial Disclosure	  	 	50	  
		 	4.9.	 	Compliance with Laws	  	 	50	  
		 	4.10.	 	Inspection of Premises	  	 	50	  
		 	4.11.	 	Insurance	  	 	50	  
		 	4.12.	 	Failure to Pay Insurance	  	 	51	  
		 	4.13.	 	Payment of Taxes	  	 	51	  
		 	4.14.	 	Payment of Leasehold Obligations	  	 	52	  
		 	4.15.	 	Receivables	  	 	52	  
		 	4.16.	 	Inventory	  	 	54	  
		 	4.17.	 	Maintenance of Equipment	  	 	54	  
		 	4.18.	 	Exculpation of Liability	  	 	54	  
		 	4.19.	 	Environmental Matters	  	 	55	  
		 	4.20.	 	Financing Statements	  	 	57	  
		 	4.21.	 	Appraisals	  	 	57	  
			
	V.	 	    REPRESENTATIONS AND WARRANTIES	  	 	57	  
				
		 	5.1.	 	Authority	  	 	57	  
		 	5.2.	 	Formation and Qualification	  	 	58	  
		 	5.3.	 	Survival of Representations and Warranties	  	 	58	  
		 	5.4.	 	Tax Returns	  	 	58	  
		 	5.5.	 	Financial Statements	  	 	58	  
		 	5.6.	 	Entity Names	  	 	59	  
		 	5.7.	 	O	  	 	59	  
		 	5.8.	 	Solvency; No Litigation, Violation, Indebtedness or Default; ERISA Compliance	  	 	60	  
		 	5.9.	 	Patents, Trademarks, Copyrights and Licenses	  	 	61	  
		 	5.10.	 	Licenses and Permits	  	 	62	  
		 	5.11.	 	Default of Indebtedness	  	 	62	  
		 	5.12.	 	No Default	  	 	62	  
		 	5.13.	 	No Burdensome Restrictions	  	 	62	  
		 	5.14.	 	No Labor Disputes	  	 	62	  
		 	5.15.	 	Margin Regulations	  	 	62	  
		 	5.16.	 	Investment Company Act	  	 	63	  
		 	5.17.	 	Disclosure	  	 	63	  
		 	5.18.	 	Delivery of Acquisition Agreement	  	 	63	  
		 	5.19.	 	Swaps	  	 	63	  
		 	5.20.	 	Conflicting Agreements	  	 	63	  
		 	5.21.	 	Application of Certain Laws and Regulations	  	 	63	  

  
 ii 

									
		 	5.22.	 	Business and Property of Borrowers	  	 	63	  
		 	5.23.	 	Section 20 Subsidiaries	  	 	64	  
		 	5.24.	 	Anti-Terrorism Laws	  	 	64	  
		 	5.25.	 	Trading with the Enemy	  	 	64	  
		 	5.26.	 	Federal Securities Laws	  	 	64	  
		 	5.27.	 	Equity Interests	  	 	64	  
		 	5.28.	 	Commercial Tort Claims	  	 	65	  
		 	5.29.	 	Letter of Credit Rights: As of the Closing Date, no Borrower has any letter of credit rights	  	 	65	  
		 	5.30.	 	Material Contracts	  	 	65	  
		 	5.31.	 	Gaiam License Agreement	  	 	65	  
		 	5.32.	 	Intercorporate Services Agreement	  	 	65	  
			
	VI.	 	    AFFIRMATIVE COVENANTS	  	 	65	  
				
		 	6.1.	 	Payment of Fees	  	 	65	  
		 	6.2.	 	Conduct of Business and Maintenance of Existence and Assets	  	 	65	  
		 	6.3.	 	Violations	  	 	66	  
		 	6.4.	 	Government Receivables	  	 	66	  
		 	6.5.	 	Financial Covenants	  	 	66	  
		 	6.6.	 	Execution of Supplemental Instruments	  	 	67	  
		 	6.7.	 	Payment of Indebtedness	  	 	67	  
		 	6.8.	 	Standards of Financial Statements	  	 	67	  
		 	6.9.	 	Federal Securities Laws	  	 	67	  
		 	6.10.	 	Exercise of Rights	  	 	67	  
		 	6.11.	 	Post Closing Covenants	  	 	67	  
			
	VII.	 	    NEGATIVE COVENANTS	  	 	68	  
				
		 	7.1.	 	Merger, Consolidation, Acquisition and Sale of Assets	  	 	68	  
		 	7.2.	 	Creation of Liens	  	 	68	  
		 	7.3.	 	Guarantees	  	 	68	  
		 	7.4.	 	Investments	  	 	68	  
		 	7.5.	 	Loans	  	 	68	  
		 	7.6.	 	Capital Expenditures	  	 	68	  
		 	7.7.	 	Distributions	  	 	69	  
		 	7.8.	 	Indebtedness	  	 	69	  
		 	7.9.	 	Nature of Business	  	 	70	  
		 	7.10.	 	Transactions with Affiliates	  	 	70	  
		 	7.11.	 	Leases	  	 	70	  
		 	7.12.	 	Subsidiaries	  	 	70	  
		 	7.13.	 	Fiscal Year and Accounting Changes	  	 	70	  
		 	7.14.	 	Pledge of Credit	  	 	70	  
		 	7.15.	 	Amendment of Organizational Documents	  	 	71	  
		 	7.16.	 	Compliance with ERISA	  	 	71	  
		 	7.17.	 	Prepayment of Indebtedness	  	 	71	  
		 	7.18.	 	Anti-Terrorism Laws	  	 	71	  
		 	7.19.	 	Membership/Partnership Interests	  	 	72	  
		 	7.20.	 	Trading with the Enemy Act	  	 	72	  

  
 iii

									
		 	7.21.	 	Subordinated Indebtedness	  	 	72	  
		 	7.22.	 	Other Agreements	  	 	72	  
			
	VIII.	 	    CONDITIONS PRECEDENT	  	 	72	  
				
		 	8.1.	 	Conditions to Initial Advances	  	 	72	  
		 	8.2.	 	Conditions to Each Advance	  	 	75	  
			
	IX.	 	    INFORMATION AS TO BORROWERS	  	 	76	  
				
		 	9.1.	 	Disclosure of Material Matters	  	 	76	  
		 	9.2.	 	Schedules	  	 	76	  
		 	9.3.	 	Environmental Reports	  	 	77	  
		 	9.4.	 	Litigation	  	 	77	  
		 	9.5.	 	Material Occurrences	  	 	77	  
		 	9.6.	 	Government Receivables	  	 	77	  
		 	9.7.	 	Annual Financial Statements	  	 	77	  
		 	9.8.	 	Quarterly Financial Statements	  	 	78	  
		 	9.9.	 	Monthly Financial Statements	  	 	78	  
		 	9.10.	 	Other Reports	  	 	78	  
		 	9.11.	 	Additional Information	  	 	78	  
		 	9.12.	 	Projected Operating Budget	  	 	79	  
		 	9.13.	 	Variances From Operating Budget	  	 	79	  
		 	9.14.	 	Notice of Suits, Adverse Events	  	 	79	  
		 	9.15.	 	ERISA Notices and Requests	  	 	79	  
		 	9.16.	 	Additional Documents	  	 	80	  
			
	X.	 	    EVENTS OF DEFAULT	  	 	80	  
				
		 	10.1.	 	Nonpayment	  	 	80	  
		 	10.2.	 	Breach of Representation	  	 	80	  
		 	10.3.	 	Financial Information	  	 	80	  
		 	10.4.	 	Judicial Actions	  	 	80	  
		 	10.5.	 	Noncompliance	  	 	80	  
		 	10.6.	 	Judgments	  	 	81	  
		 	10.7.	 	Bankruptcy	  	 	81	  
		 	10.8.	 	Inability to Pay	  	 	81	  
		 	10.9.	 	Reserved;	  	 	81	  
		 	10.10.	 	Material Adverse Effect	  	 	81	  
		 	10.11.	 	Lien Priority	  	 	81	  
		 	10.12.	 	Reserved;	  	 	81	  
		 	10.13.	 	Cross Default	  	 	81	  
		 	10.14.	 	Breach of Guaranty or Pledge Agreement	  	 	82	  
		 	10.15.	 	Change of Ownership	  	 	82	  
		 	10.16.	 	Invalidity	  	 	82	  
		 	10.17.	 	Licenses	  	 	82	  
		 	10.18.	 	Seizures	  	 	82	  
		 	10.19.	 	Reserved	  	 	82	  
		 	10.20.	 	Operations	  	 	82	  
		 	10.21.	 	Pension Plans	  	 	83	  

  
 iv 

									
			
	XI.	 	    LENDERS’ RIGHTS AND REMEDIES AFTER DEFAULT	  	 	83	  
				
		 	11.1.	 	Rights and Remedies	  	 	83	  
		 	11.2.	 	Agent’s Discretion	  	 	84	  
		 	11.3.	 	Setoff	  	 	85	  
		 	11.4.	 	Rights and Remedies not Exclusive	  	 	85	  
		 	11.5.	 	Allocation of Payments After Event of Default	  	 	85	  
			
	XII.	 	    WAIVERS AND JUDICIAL PROCEEDINGS	  	 	86	  
				
		 	12.1.	 	Waiver of Notice	  	 	86	  
		 	12.2.	 	Delay	  	 	86	  
		 	12.3.	 	Jury Waiver	  	 	86	  
			
	XIII.	 	    EFFECTIVE DATE AND TERMINATION	  	 	86	  
				
		 	13.1.	 	Term	  	 	86	  
		 	13.2.	 	Termination	  	 	87	  
			
	XIV.	 	    REGARDING AGENT	  	 	87	  
				
		 	14.1.	 	Appointment	  	 	87	  
		 	14.2.	 	Nature of Duties	  	 	88	  
		 	14.3.	 	Lack of Reliance on Agent and Resignation	  	 	88	  
		 	14.4.	 	Certain Rights of Agent	  	 	89	  
		 	14.5.	 	Reliance	  	 	89	  
		 	14.6.	 	Notice of Default	  	 	89	  
		 	14.7.	 	Indemnification	  	 	89	  
		 	14.8.	 	Agent in its Individual Capacity	  	 	89	  
		 	14.9.	 	Delivery of Documents	  	 	90	  
		 	14.10.	 	Borrowers’ Undertaking to Agent	  	 	90	  
		 	14.11.	 	No Reliance on Agent’s Customer Identification Program	  	 	90	  
		 	14.12.	 	Other Agreements	  	 	90	  
			
	XV.	 	    BORROWING AGENCY	  	 	90	  
				
		 	15.1.	 	Borrowing Agency Provisions	  	 	90	  
		 	15.2.	 	Waiver of Subrogation	  	 	91	  
			
	XVI.	 	    MISCELLANEOUS	  	 	91	  
				
		 	16.1.	 	Governing Law	  	 	91	  
		 	16.2.	 	Entire Understanding	  	 	92	  
		 	16.3.	 	Successors and Assigns; Participations; New Lenders	  	 	94	  
		 	16.4.	 	Application of Payments	  	 	96	  
		 	16.5.	 	Indemnity	  	 	96	  
		 	16.6.	 	Notice	  	 	97	  
		 	16.7.	 	Survival	  	 	99	  
		 	16.8.	 	Severability	  	 	99	  
		 	16.9.	 	Expenses	  	 	99	  
		 	16.10.	 	Injunctive Relief	  	 	99	  
		 	16.11.	 	Consequential Damages	  	 	99	  
		 	16.12.	 	Captions	  	 	99	  

  
 v 

									
		 	16.13.	 	Counterparts; Facsimile Signatures	  	 	100	  
		 	16.14.	 	Construction	  	 	100	  
		 	16.15.	 	Confidentiality; Sharing Information	  	 	100	  
		 	16.16.	 	Publicity	  	 	100	  
		 	16.17.	 	Certifications From Banks and Participants; USA PATRIOT Act	  	 	100	  

  
 vi 

 LIST OF EXHIBITS AND SCHEDULES 

 

			
	Exhibits	 	 
		
	Exhibit 1.2	 	Borrowing Base Certificate
	Exhibit 1.2(a)	 	Compliance Certificate
	Exhibit 2.1(a)	 	Revolving Credit Note
	Exhibit 5.5(b)	 	Financial Projections
	Exhibit 8.1(j)	 	Financial Condition Certificate
	Exhibit 16.3	 	Commitment Transfer Supplement
		
	Schedules	 	
		
	Schedule 1.2	 	Permitted Encumbrances
	Schedule 4.5	 	Equipment and Inventory Locations; Place of Business, Chief Executive Office, Real Property
	Schedule 4.15(h)	 	Deposit and Investment Accounts
	Schedule 5.1	 	Consents
	Schedule 5.2(a)	 	States of Qualification and Good Standing
	Schedule 5.2(b)	 	Subsidiaries
	Schedule 5.4	 	Federal Tax Identification Number
	Schedule 5.6	 	Prior Names
	Schedule 5.8(b)	 	Litigation
	Schedule 5.8(d)	 	Plans
	Schedule 5.9	 	Intellectual Property, Source Code Escrow Agreements
	Schedule 5.10	 	Licenses and Permits
	Schedule 5.14	 	Labor Disputes
	Schedule 5.27	 	Equity Interests
	Schedule 5.30	 	Material Contracts

  
 vii

 REVOLVING CREDIT 

AND 

SECURITY AGREEMENT 
 Revolving Credit and Security Agreement dated as of July 31, 2012 among GAIAM AMERICAS, INC., a corporation organized under the laws of the State
of Colorado (“Gaiam Americas”), SPRI PRODUCTS, INC., a corporation organized under the laws of the State of Illinois (“SPRI”), GT DIRECT, INC., a
corporation organized under the laws of the State of Colorado (“GT Direct”), VE NEWCO, LLC, a limited liability company formed under the laws of the State of Delaware (“NewCo”, together with Gaiam Americas,
SPRI, GT Direct and each Person joined hereto as a borrower from time to time, collectively, the “Borrowers”, and each a “Borrower”), the financial institutions which are now or which hereafter become a party hereto
(collectively, the “Lenders” and each individually a “Lender”) and PNC BANK, NATIONAL ASSOCIATION (“PNC”), as agent for Lenders (PNC, in such capacity,
the “Agent”). 
 IN CONSIDERATION of the mutual covenants and undertakings herein contained, Borrowers, Lenders and
Agent hereby agree as follows: 
  

	I.	DEFINITIONS. 

 1.1. Accounting
Terms. As used in this Agreement, the Other Documents or any certificate, report or other document made or delivered pursuant to this Agreement, accounting terms not defined in Section 1.2 or elsewhere in this Agreement and accounting terms
partly defined in Section 1.2 to the extent not defined, shall have the respective meanings given to them under GAAP; provided, however, whenever such accounting terms are used for the purposes of determining compliance with financial covenants
in this Agreement, such accounting terms shall be defined in accordance with GAAP as applied in preparation of the financial statements of Borrowers for the fiscal year ended December 31, 2011. 

1.2. General Terms. For purposes of this Agreement the following terms shall have the following meanings: 

“Accountants” shall have the meaning set forth in Section 9.7 hereof. 

“Acquisition Agreement” shall mean the Purchase Agreement including all exhibits and schedules thereto dated as of
March 6, 2012 between Universal Music Group Distribution, Corp., as seller, and Gaiam Americas, Inc., as buyer. 

“Advance Rates” shall have the meaning set forth in Section 2.1(a)(y)(ii) hereof. 

“Advances” shall mean and include the Revolving Advances and Letters of Credit. 

“Affiliate” of any Person shall mean (a) any Person which, directly or indirectly, is in control of, is controlled
by, or is under common control with such Person, or (b) any Person who is a director, manager, member, managing member, general partner or officer (i) of such Person, (ii) of any Subsidiary of such Person or (iii) of any Person
described in clause (a) above. For 

 
purposes of this definition, control of a Person shall mean the power, direct or indirect, (x) to vote 5% or more of the Equity Interests having ordinary voting power for the election of
directors of such Person or other Persons performing similar functions for any such Person, or (y) to direct or cause the direction of the management and policies of such Person whether by ownership of Equity Interests, contract or otherwise.

 “Agent” shall have the meaning set forth in the preamble to this Agreement and shall include its successors
and assigns. 
 “Agreement” shall mean this Revolving Credit and Security Agreement, as the same may be
amended, restated, supplemented or otherwise modified from time to time. 
 “Alternate Base Rate” shall mean,
for any day, a rate per annum equal to the highest of (i) the Base Rate in effect on such day, (ii) the Federal Funds Open Rate in effect on such day plus one half of one-percent (1/2 of 1%), and (iii) the sum of the Daily LIBOR Rate
in effect on such day plus one percent (1.0%), so long as a Daily LIBOR Rate is offered, ascertainable and not unlawful. 

“Anti-Terrorism Laws” shall mean any Applicable Laws relating to terrorism or money laundering, including Executive
Order No. 13224, the USA PATRIOT Act, the Applicable Laws comprising or implementing the Bank Secrecy Act, and the Applicable Laws administered by the United States Treasury Department’s Office of Foreign Asset Control (as any of the
foregoing Applicable Laws may from time to time be amended, renewed, extended, or replaced). 
 “Applicable
Law” shall mean all laws, rules and regulations applicable to the Person, conduct, transaction, covenant, Other Document or contract in question, including all applicable common law and equitable principles; all provisions of all applicable
state, federal and foreign constitutions, statutes, rules, regulations, treaties, directives and orders of any Governmental Body, and all orders, judgments and decrees of all courts and arbitrators. 

“Authority” shall have the meaning set forth in Section 4.19(d) hereof. 

“Availability Reserve” shall mean, as of any date of determination, an amount equal to fifteen percent (15%) of the
Maximum Revolving Advance Amount then in effect. 
 “Base Rate” shall mean the base commercial lending rate of
PNC as publicly announced to be in effect from time to time, such rate to be adjusted automatically, without notice, on the effective date of any change in such rate. This rate of interest is determined from time to time by PNC as a means of pricing
some loans to its customers and is neither tied to any external rate of interest or index nor does it necessarily reflect the lowest rate of interest actually charged by PNC to any particular class or category of customers of PNC. 

“Benefited Lender” shall have the meaning set forth in Section 2.20(d) hereof. 

“Blocked Accounts” shall have the meaning set forth in Section 4.15(h) hereof. 

“Blocked Account Bank” shall have the meaning set forth in Section 4.15(h) hereof. 

  
 2 

 “Blocked Person” shall mean: (a) a Person that is listed in an annex
to, or is otherwise subject to the provisions of any Executive Order; (b) a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in an annex to, or is otherwise subject to the provisions of, an Executive
Order; (c) a Person or entity with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law; (d) a Person or entity that commits, supports, threatens or conspires to commit or support
“terrorism” as defined in the Executive Order No. 13224; (e) a Person or entity that is named as a “specially designated national” on the most current list published by the U.S. Treasury Department Office of Foreign
Asset Control at its official website or any replacement website or other replacement official publication of such list, or (f) a Person or entity who is affiliated or associated with a Person or entity listed above. 

“Borrower” or “Borrowers” shall have the meaning set forth in the preamble to this Agreement and shall
extend to all permitted successors and assigns of such Persons. 
 “Borrowers on a Consolidated Basis” shall
mean the consolidation in accordance with GAAP of the accounts or other items of the Borrowers. 
 “Borrowers’
Account” shall have the meaning set forth in Section 2.8 hereof. 
 “Borrowing Agent” shall mean
Gaiam Americas. 
 “Borrowing Base Certificate” shall mean a certificate in substantially the form of Exhibit
1.2 duly executed by the President, Chief Financial Officer or Controller of the Borrowing Agent and delivered to the Agent, appropriately completed, by which such officer shall certify to Agent the Formula Amount and calculation thereof as of the
date of such certificate. 
 “Business Day” shall mean any day other than Saturday or Sunday or a legal holiday
on which commercial banks are authorized or required by law to be closed for business in East Brunswick, New Jersey and, if the applicable Business Day relates to any Eurodollar Rate Loans, such day must also be a day on which dealings are carried
on in the London interbank market. 
 “Capital Expenditures” shall mean expenditures made or liabilities
incurred for the acquisition of any equipment, real property, fixed assets or improvements, replacements, substitutions or additions thereto which have a useful life of more than one year, including the total principal portion of Capitalized Lease
Obligations, which, in accordance with GAAP, would be classified as capital expenditures. 
 “Capitalized Lease
Obligation” shall mean any Indebtedness of any Borrower represented by obligations under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP. 

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42
U.S.C. §§9601 et seq. 
 “Change of Control” shall mean: (a) the occurrence of any event
(whether in one or more transactions) which results in a transfer of control of or the power to vote any of the Equity Interests of any Borrower to a Person other than Gaiam; (b) the occurrence of any event (whether

  
 3 

 
in one or more transactions) which results in a transfer of control of Gaiam to any Person other than Jirka Rysavy, (c) the occurrence of any event (whether in one or more transactions)
which results in Jirka Rysavy failing to own at least 50% of the voting Equity Interests of Gaiam; or (d) any merger, consolidation or sale of substantially all of the property or assets of any Borrower. For purposes of this definition,
“control of Borrower” shall mean the power, direct or indirect (x) to vote more than 50% of the Equity Interests having ordinary voting power for the election of directors (or the individuals performing similar functions) of any
Borrower or (y) to direct or cause the direction of the management and policies of any Borrower by contract or otherwise. 

“Charges” shall mean all taxes, charges, fees, imposts, levies or other assessments, including all net income, gross
income, gross receipts, sales, use, ad valorem, value added, transfer, franchise, profits, inventory, capital stock, license, withholding, payroll, employment, social security, unemployment, excise, severance, stamp, occupation and property taxes,
custom duties, fees, assessments, liens, claims and charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts, imposed by any taxing or other authority, domestic or foreign (including the
Pension Benefit Guaranty Corporation or any environmental agency or superfund), upon the Collateral, any Borrower or any of its Affiliates. 
 “Cinram Reserve” shall mean an amount equal to all accounts payable owing to Cinram Distribution LLC by any Borrower pursuant to the Inventory Management Services Agreement dated as of
June 14, 2011 that are due or unpaid more than fifteen (15) days after the original due date or sixty (60) days after the original invoice date. 
 “Closing Date” shall mean July 31, 2012 or such other date as may be agreed to by the parties hereto. 
 “Code” shall mean the Internal Revenue Code of 1986, as the same may be amended or supplemented from time to time, and any successor statute of similar import, and the rules and
regulations thereunder, as from time to time in effect. 
 “Collateral” shall mean and include: 

(a) all Receivables; 
 (b) all Equipment; 
 (c) all General Intangibles; 

(d) all Inventory; 
 (e) all Investment Property; 
 (f) all Subsidiary Stock; 

(g) all of each Borrower’s right, title and interest in and to, whether now owned or hereafter acquired and wherever located;
(i) its respective goods and other property including, but not limited to, all merchandise returned or rejected by Customers, relating to or securing any of the Receivables; (ii) all of each Borrower’s rights as a consignor, a
consignee, an 

  
 4 

 
unpaid vendor, mechanic, artisan, or other lienor, including stoppage in transit, setoff, detinue, replevin, reclamation and repurchase; (iii) all additional amounts due to any Borrower from
any Customer relating to the Receivables; (iv) other property, including warranty claims, relating to any goods securing the Obligations; (v) all of each Borrower’s contract rights, rights of payment which have been earned under a
contract right, instruments (including promissory notes), documents, chattel paper (including electronic chattel paper), warehouse receipts, deposit accounts, letters of credit and money; (vi) all commercial tort claims (whether now existing or
hereafter arising); (vii) if and when obtained by any Borrower, all real and personal property of third parties in which such Borrower has been granted a lien or security interest as security for the payment or enforcement of Receivables;
(viii) all letter of credit rights (whether or not the respective letter of credit is evidenced by a writing); (ix) all supporting obligations; and (x) any other goods, personal property or real property now owned or hereafter
acquired in which any Borrower has expressly granted a security interest or may in the future grant a security interest to Agent hereunder, or in any amendment or supplement hereto or thereto, or under any other agreement between Agent and any
Borrower; 
 (h) all of each Borrower’s ledger sheets, ledger cards, files, correspondence, records, books of account,
business papers, computers, computer software (owned by any Borrower or in which it has an interest), computer programs, tapes, disks and documents relating to (a), (b), (c), (d), (e), (f) or (g) of this paragraph; and 

(i) all proceeds and products of (a), (b), (c), (d), (e), (f), (g) and (h) in whatever form, including, but not limited to:
cash, deposit accounts (whether or not comprised solely of proceeds), certificates of deposit, insurance proceeds (including hazard, flood and credit insurance), negotiable instruments and other instruments for the payment of money, chattel paper,
security agreements, documents, eminent domain proceeds, condemnation proceeds and tort claim proceeds. 
 “Commitment
Percentage” of any Lender shall mean the percentage set forth below such Lender’s name on the signature page hereof as same may be adjusted upon any assignment by a Lender pursuant to Section 16.3(c) or (d) hereof.

 “Commitment Transfer Supplement” shall mean a document in the form of Exhibit 16.3 hereto, properly
completed and otherwise in form and substance satisfactory to Agent by which the Purchasing Lender purchases and assumes a portion of the obligation of Lenders to make Advances under this Agreement. 

“Compliance Certificate” shall mean a compliance certificate substantially in the form attached hereto as Exhibit 1.2(a)
to be signed by the Chief Financial Officer or Controller of Borrowing Agent. 
 “Consents” shall mean all
filings and all licenses, permits, consents, approvals, authorizations, qualifications and orders of Governmental Bodies and other third parties, domestic or foreign, necessary to carry on any Borrower’s business or necessary (including to
avoid a conflict or breach under any agreement, instrument, other document, license, permit or other authorization) for the execution, delivery or performance of this Agreement, the Other Documents or the Acquisition Agreement, including any
Consents required under all applicable federal, state or other Applicable Law. 

  
 5 

 “Consigned Inventory” shall mean Inventory of any Borrower that is in the
possession of another Person on a consignment, sale or return, or other basis that does not constitute a final sale and acceptance of such Inventory. 
 “Controlled Group” shall mean, at any time, each Borrower and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common
control and all other entities which, together with any Borrower, are treated as a single employer under Section 414 of the Code. 
 “Customer” shall mean and include the account debtor with respect to any Receivable and/or the prospective purchaser of goods, services or both with respect to any contract or contract
right, and/or any party who enters into or proposes to enter into any contract or other arrangement with any Borrower, pursuant to which such Borrower is to deliver any personal property or perform any services. 

“Customs” shall have the meaning set forth in Section 2.11(b) hereof. 

“Daily LIBOR Rate” shall mean, for any day, the rate per annum determined by the Agent by dividing (x) the
Published Rate by (y) a number equal to 1.00 minus the Reserve Percentage. 
 “Debt Payments” shall mean
and include (a) all cash actually expended by any Borrower to make interest payments on any Advances hereunder, plus (b) all cash actually expended by any Borrower to make payments for all fees, commissions and charges set forth herein and
with respect to any Advances, plus (c) all cash actually expended by any Borrower to make payments on Capitalized Lease Obligations, plus (d) all cash actually expended by any Borrower to make payments with respect to any other
Indebtedness for borrowed money (other than principal payments on any Advances hereunder). 
 “Default” shall
mean an event, circumstance or condition which, with the giving of notice or passage of time or both, would constitute an Event of Default. 
 “Default Rate” shall have the meaning set forth in Section 3.1 hereof. 
 “Defaulting Lender” shall have the meaning set forth in Section 2.23(a) hereof. 
 “Depository Accounts” shall have the meaning set forth in Section 4.15(h) hereof. 
 “Designated Lender” shall have the meaning set forth in Section 16.2(b) hereof. 
 “Dollar” and the sign “$” shall mean lawful money of the United States of America. 
 “Domestic Rate Loan” shall mean any Advance that bears interest based upon the Alternate Base Rate. 

  
 6 

 “Drawing Date” shall have the meaning set forth in Section 2.12(b)
hereof. 
 “Early Termination Date” shall have the meaning set forth in Section 13.1 hereof. 

“Earnings Before Interest and Taxes” shall mean for any period the sum of (i) net income (or loss) of Borrowers on
a Consolidated Basis for such period (excluding extraordinary gains and losses), plus (ii) all interest expense of Borrowers on a Consolidated Basis for such period, plus (iii) all charges against income of Borrowers on a
Consolidated Basis for such period for federal, state and local taxes. 
 “EBITDA” shall mean for any period
the sum of (i) Earnings Before Interest and Taxes for such period, plus (ii) depreciation expenses of Borrowers on a Consolidated Basis for such period, plus (iii) amortization expenses of Borrowers on a Consolidated
Basis, including without limitation, capitalized production amortization, slotting amortization and deferred advertising amortization, for such period. 
 “Eligible In-Transit Inventory” shall mean, In-Transit Inventory that (a) would be Eligible Inventory but for the fact that it is In-Transit Inventory, and (b) Agent determines
in its sole discretion satisfies all of the following additional criteria: (i) pursuant to the terms of sale with respect to such Inventory, title and risk of loss have passed from the foreign vendor to Borrowers; (ii) the applicable
foreign vendor shall not have asserted (and shall have no right to assert) any reclamation, repossession, diversion, stoppage in transit, Lien or title retention rights in respect of such In-Transit Inventory; (iii) such In-Transit Inventory is
covered by insurance that satisfies the requirements of this Agreement; (iv) such In-Transit Inventory (other than In-Transit Inventory that has cleared customs in the United States and has been offloaded at the port of entry) is subject to
documents of title that are “clean” negotiable bills of lading naming Borrower (or Agent, if so required) as consignee; and the original bills of lading covering such In-Transit Inventory are in the possession of Agent; and (v) if
such In-Transit Inventory is in-transit directly to a location of a customer of Borrower, title and risk of loss has passed to Borrower and no Receivable has arisen in respect of the sale to such customer. 

“Eligible Inventory” shall mean and include Inventory , excluding work in process, with respect to each Borrower, valued
at the lower of cost or market value, determined on a first-in-first-out basis, which is not, in Agent’s opinion, obsolete, slow moving or unmerchantable and which Agent, in its sole discretion, shall not deem ineligible Inventory, based on
such considerations as Agent may from time to time deem appropriate including whether the Inventory is subject to a perfected, first priority security interest in favor of Agent and no other Lien (other than a Permitted Encumbrance). In addition,
Inventory shall not be Eligible Inventory if it (i) does not conform to all standards imposed by any Governmental Body which has regulatory authority over such goods or the use or sale thereof, (ii) is in-transit (iii) is located
outside the continental United States or at a location that is not otherwise in compliance with this Agreement, (iv) constitutes Consigned Inventory, (v) is the subject of an Intellectual Property Claim; (vi) is subject to a License
Agreement or other agreement that limits, conditions or restricts any Borrower’s or Agent’s right to sell or otherwise dispose of such Inventory, unless Agent is a party to a Licensor/Agent Agreement with the Licensor under such License
Agreement; (vii) is situated at a location not owned by a Borrower unless the owner or occupier of such location has executed in favor of Agent a Lien Waiver Agreement; or (viii) or if the sale

  
 7 

 
of such Inventory would result in an ineligible Receivable. Eligible Inventory shall not include Inventory being acquired pursuant to a trade Letter of Credit to the extent such trade Letter of
Credit remains outstanding. 
 “Eligible Receivables” shall mean and include with respect to each Borrower,
each Receivable of such Borrower arising in the Ordinary Course of Business and which Agent, in its sole credit judgment, shall deem to be an Eligible Receivable, based on such considerations as Agent may from time to time deem appropriate. A
Receivable shall not be deemed eligible unless such Receivable is subject to Agent’s first priority perfected security interest and no other Lien (other than Permitted Encumbrances), and is evidenced by an invoice or other documentary evidence
satisfactory to Agent. In addition, no Receivable shall be an Eligible Receivable if: 
 (a) it arises out of a sale made by any
Borrower to an Affiliate of any Borrower or to a Person controlled by an Affiliate of any Borrower; 
 (b) it is due or unpaid
more than sixty (60) days after the original due date (not to exceed ninety (90) days after the original invoice date); provided however that if the applicable Customer for such Receivable is Target, Walmart, Entertainment One Limited or
Dick’s Sporting Goods, such Receivable shall only be deemed ineligible under this clause (b) if it is due or unpaid more than thirty (30) days after the original due date (not to exceed one hundred and twenty (120) days after the
original invoice date); 
 (c) fifty percent (50%) or more of the Receivables from such Customer are not deemed Eligible
Receivables hereunder. Such percentage may, in Agent’s sole discretion, be increased or decreased from time to time; 
 (d)
any covenant, representation or warranty contained in this Agreement with respect to such Receivable has been breached; 
 (e)
the Customer shall (i) apply for, suffer, or consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property or call a meeting of its
creditors, (ii) admit in writing its inability, or be generally unable, to pay its debts as they become due or cease operations of its present business, (iii) make a general assignment for the benefit of creditors, (iv) commence a
voluntary case or proceeding under any state or federal bankruptcy laws (as now or hereafter in effect), (v) be adjudicated a bankrupt or insolvent, (vi) file a petition seeking to take advantage of any other law providing for the relief
of debtors, (vii) acquiesce to, or fail to have dismissed, any petition which is filed against it in any involuntary case under such bankruptcy laws, or (viii) take any action for the purpose of effecting any of the foregoing; 

(f) the sale is to a Customer outside the continental United States of America or Canada (unless to a Customer in Quebec in which case
such Receivable shall be ineligible), unless the sale is on letter of credit, guaranty or acceptance terms, in each case acceptable to Agent in its sole discretion; 

  
 8 

 (g) the sale to the Customer is on a bill-and-hold, guaranteed sale, sale-and-return, sale
on approval, consignment or any other repurchase or return basis or is evidenced by chattel paper; 
 (h) Agent believes, in its
Permitted Discretion, that collection of such Receivable is insecure or that such Receivable may not be paid by reason of the Customer’s financial inability to pay; 
 (i) the Customer is the United States of America, any state or any department, agency or instrumentality of any of them, unless the applicable Borrower assigns its right to payment of such Receivable to
Agent pursuant to the Assignment of Claims Act of 1940, as amended (31 U.S.C. Sub-Section 3727 et seq. and 41 U.S.C. Sub-Section 15 et seq.) or has otherwise complied with other applicable statutes or ordinances; 

(j) the goods giving rise to such Receivable have not been delivered to and accepted by the Customer or the services giving rise to such
Receivable have not been performed by the applicable Borrower and accepted by the Customer or the Receivable otherwise does not represent a final sale; 
 (k) the Receivables of the Customer exceed a credit limit determined by Agent, in its Permitted Discretion, to the extent such Receivable exceeds such limit; 

(l) the Receivable is subject to any offset, deduction, defense, dispute, or counterclaim (to the extent of such offset, deduction,
defense or counterclaim), the Customer is also a creditor or supplier of a Borrower or the Receivable is contingent in any respect or for any reason; 
 (m) the applicable Borrower has made any agreement with any Customer for any deduction therefrom, except for discounts or allowances made in the Ordinary Course of Business for prompt payment, all of
which discounts or allowances are reflected in the calculation of the face value of each respective invoice related thereto; 

(n) any return, rejection or repossession of the merchandise has occurred or the rendition of services has been disputed; 

(o) such Receivable is not payable to a Borrower; or 
 (p) such Receivable is not otherwise satisfactory to Agent a Permitted Discretion. 

“Environmental Complaint” shall have the meaning set forth in Section 4.19(d) hereof. 

“Environmental Laws” shall mean all federal, state and local environmental, land use, zoning, health, chemical use,
safety and sanitation laws, statutes, ordinances and codes relating to the protection of the environment and/or governing the use, storage, treatment, generation, transportation, processing, handling, production or disposal of Hazardous Substances
and the rules, regulations, policies, guidelines, interpretations, decisions, orders and directives of federal, state and local governmental agencies and authorities with respect thereto. 

  
 9 

 “Equipment” shall mean and include as to each Borrower all of such
Borrower’s goods (other than Inventory) whether now owned or hereafter acquired and wherever located including all equipment, machinery, apparatus, motor vehicles, fittings, furniture, furnishings, fixtures, parts, accessories and all
replacements and substitutions therefor or accessions thereto. 
 “Equity Interests” shall mean, with respect
to any Person, any and all shares, rights to purchase, options, warrants, general, limited or limited liability partnership interests, member interests, participation or other equivalents of or interest in (regardless of how designated) equity of
such Person, whether voting or nonvoting, including common stock, preferred stock, convertible securities or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the SEC
under the Exchange Act), including in each case all of the following rights relating to such Equity Interests, whether arising under the Organizational Documents of the Person issuing such Equity Interests (the “issuer”) or under the
applicable laws of such issuer’s jurisdiction of organization relating to the formation, existence and governance of corporations, limited liability companies or partnerships or business trusts or other legal entities, as the case may be:
(i) all economic rights (including all rights to receive dividends and distributions) relating to such Equity Interests; (ii) all voting rights and rights to consent to any particular action(s) by the applicable issuer; (iii) all
management rights with respect to such issuer; (iv) in the case of any Equity Interests consisting of the membership/limited liability company interests of a managing member in a limited liability company, all powers and rights as a managing
member with respect to the management, operations and control of the business and affairs of the applicable issuer; and (v) all certificates evidencing such Equity Interests. 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time and the rules and
regulations promulgated thereunder. 
 “Eurodollar Rate” shall mean for any Eurodollar Rate Loan for the then
current Interest Period relating thereto, the interest rate per annum determined by Agent by dividing (the resulting quotient rounded upwards, if necessary, to the nearest 1/100th of 1% per annum) (i) the rate which appears on the
Bloomberg Page BBAM1 (or on such other substitute Bloomberg page that displays rates at which US dollar deposits are offered by leading banks in the London interbank deposit market), or the rate which is quoted by another source selected by Agent
which has been approved by the British Bankers’ Association as an authorized information vendor for the purpose of displaying rates at which U.S. dollar deposits are offered by leading banks in the London interbank deposit market (an
“Alternate Source”), at approximately 11:00 a.m., London time, two (2) Business Days prior to the commencement of such Interest Period as the London interbank offered rate for U.S. Dollars for an amount comparable to such Eurodollar
Rate Loan and having a borrowing date and a maturity comparable to such Interest Period (or if there shall at any time, for any reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or any Alternate Source, a comparable replacement
rate determined by Agent at such time (which determination shall be conclusive absent manifest error)), by (ii) a number equal 1.00 minus the Reserve Percentage. The Eurodollar Rate may also be expressed by the following formula: 

 

			
		  	Average of London interbank offered rates quoted by Bloomberg or appropriate Successor as shown on
		
	 Eurodollar Rate =
	  	 Bloomberg Page BBAM1

1.00 - Reserve Percentage

  
 10 

 The Eurodollar Rate shall be adjusted with respect to any Eurodollar Rate Loan that is
outstanding on the effective date of any change in the Reserve Percentage as of such effective date. The Agent shall give prompt notice to the Borrowing Agent of the Eurodollar Rate as determined or adjusted in accordance herewith, which
determination shall be conclusive absent manifest error. 
 “Eurodollar Rate Loan” shall mean an Advance at any
time that bears interest based on the Eurodollar Rate. 
 “Event of Default” shall have the meaning set forth
in Article X hereof. 
 “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended. 

“Excluded Taxes” shall mean, with respect to the Agent, any Lender, Participant, Swing Loan Lender Issuer or any other
recipient of any payment to be made by or on account of any Obligations, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or
any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, Participant, Swing Loan Lender or Issuer, in which its applicable lending office is
located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which any Borrower is located, (c) in the case of a Foreign Lender, any withholding tax that is imposed
on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new lending office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law)
to comply with Section 3.10(e), except to the extent that such Foreign Lender or Participant (or its assignor or seller of a participation, if any) was entitled, at the time of designation of a new lending office (or assignment or sale of a
participation), to receive additional amounts from the Borrowers with respect to such withholding tax pursuant to Section 3.10(a), or (d) any Taxes imposed on any “withholding payment” payable to such recipient as a result of the
failure of such recipient to satisfy the requirements set forth in the FATCA after December 31, 2012 
 “Executive
Orders” shall mean all Executive Orders issued in connection with the Trading With The Enemy Act, 50 U.S.C. App 1-44, the International Emergency Economic Powers Act, 50 U.S.C. 1701, et seq., (as they may be amended, renewed, extended or
replaced) including but not limited to Executive Order No, 12947 (effective January 23, 1995), Executive Order 13099 (effective August 20, 1998), Executive Order No. 13372 (effective February 16, 2005), and Executive Order 13224
(effective September 24, 2001), as the same has been, or shall hereafter be, renewed, extended, amended or replaced. 

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor
version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof. 

  
 11 

 “Federal Funds Effective Rate” for any day shall mean the rate per annum
(based on a year of 360 days and actual days elapsed and rounded upward to the nearest 1/100 of 1%) announced by the Federal Reserve Bank of New York (or any successor) on such day as being the weighted average of the rates on overnight federal
funds transactions arranged by federal funds brokers on the previous trading day, as computed and announced by such Federal Reserve Bank (or any successor) in substantially the same manner as such Federal Reserve Bank computes and announces the
weighted average it refers to as the “Federal Funds Effective Rate” as of the date of this Agreement; provided, if such Federal Reserve Bank (or its successor) does not announce such rate on any day, the “Federal Funds Effective
Rate” for such day shall be the Federal Funds Effective Rate for the last day on which such rate was announced. 

“Federal Funds Open Rate” for any day shall mean the rate per annum (based on a year of 360 days and actual days
elapsed) which is the daily federal funds open rate as quoted by ICAP North America, Inc. (or any successor) as set forth on the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on such other substitute Bloomberg Screen
that displays such rate), or as set forth on such other recognized electronic source used for the purpose of displaying such rate as selected by PNC (an “Alternate Source”) (or if such rate for such day does not appear on the Bloomberg
Screen BTMM (or any substitute screen) or on any Alternate Source, or if there shall at any time, for any reason, no longer exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate Source, a comparable replacement rate determined by
the PNC at such time (which determination shall be conclusive absent manifest error); provided however, that if such day is not a Business Day, the Federal Funds Open Rate for such day shall be the “open” rate on the immediately preceding
Business Day. If and when the Federal Funds Open Rate changes, the rate of interest with respect to any advance to which the Federal Funds Open Rate applies will change automatically without notice to the Borrowers, effective on the date of any such
change. 
 “Fixed Charge Coverage Ratio” shall mean and include, with respect to any fiscal period, the ratio
of (a) EBITDA, minus Unfunded Capital Expenditures made during such period, minus without duplication, capitalized productions costs for such period, minus deferred advertising costs for such period, minus the net
adjustment for cash flow impact of advances versus recoupments, minus distributions (including tax distributions) and dividends made during such period, minus cash taxes paid during such period to (b) all Debt Payments made during
such period. 
 “Flood Laws” shall mean all Applicable Laws relating to policies and procedures that address
requirements placed on federally regulated lenders under the National Flood Insurance Reform Act of 1994 and other Applicable Laws related thereto. 
 “Foreign Lender” shall mean any Lender that is organized under the laws of a jurisdiction other than that in which the Borrowers are resident for tax purposes. For purposes of this
definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction. 

  
 12 

 “Foreign Subsidiary” of any Person, shall mean any Subsidiary of such
Person that is not organized or incorporated in the United States or any State or territory thereof. 
 “Formula
Amount” shall have the meaning set forth in Section 2.1(a) hereof. 
 “Funded Debt” shall mean,
with respect to any Person, without duplication, all Indebtedness for borrowed money evidenced by notes, bonds, debentures, or similar evidences of Indebtedness that by its terms matures more than one year from, or is directly or indirectly
renewable or extendible at such Person’s option under a revolving credit or similar agreement obligating the lender or lenders to extend credit over a period of more than one year from the date of creation thereof, and specifically including
Capitalized Lease Obligations, current maturities of long-term debt, revolving credit and short term debt extendible beyond one year at the option of the debtor, and also including, in the case of Borrower, the Obligations and, without duplication,
Indebtedness consisting of guaranties of Funded Debt of other Persons. 
 “GAAP” shall mean generally accepted
accounting principles in the United States of America in effect from time to time. 
 “Gaiam” shall mean Gaiam,
Inc., a Colorado corporation. 
 “Gaiam License Agreement” shall mean collectively, the Intellectual Property
License Agreement dated as of January 1, 2012 by Gaiam, as licensor, and Gaiam Americas, as licensee, and that certain Media License Agreement dated as of January 1, 2012 among Gaiam, as licensor, and Gaiam Americas, as licensee.

 “General Intangibles” shall mean and include as to each Borrower all of such Borrower’s general
intangibles, whether now owned or hereafter acquired, including all payment intangibles, all choses in action, causes of action, corporate or other business records, inventions, designs, patents, patent applications, equipment formulations,
manufacturing procedures, quality control procedures, trademarks, trademark applications, service marks, trade secrets, goodwill, copyrights, design rights, software, computer information, source codes, codes, records and updates, registrations,
licenses, franchises, customer lists, tax refunds, tax refund claims, computer programs, all claims under guaranties, security interests or other security held by or granted to such Borrower to secure payment of any of the Receivables by a Customer
(other than to the extent covered by Receivables) all rights of indemnification and all other intangible property of every kind and nature (other than Receivables). 
 “Governmental Acts” shall have the meaning set forth in Section 2.17 hereof. 
 “Governmental Body” shall mean any nation or government, any state or other political subdivision thereof or any entity, authority, agency, division or department exercising the
legislative, judicial, regulatory or administrative functions of or pertaining to a government. 
 “Guarantor”
shall mean any Person who may hereafter guarantee payment or performance of the whole or any part of the Obligations and “Guarantors” means collectively all such Persons. 

  
 13 

 “Guarantor Security Agreement” shall mean any security agreement executed
by any Guarantor in favor of Agent securing the Obligations or the Guaranty of such Guarantor, in form and substance satisfactory to Agent. 
 “Guaranty” shall mean any guaranty of the Obligations executed by a Guarantor in favor of Agent for its benefit and for the ratable benefit of Lenders, in form and substance satisfactory
to Agent. 
 “Hazardous Discharge” shall have the meaning set forth in Section 4.19(d) hereof. 

“Hazardous Substance” shall mean, without limitation, any flammable explosives, radon, radioactive materials, asbestos,
urea formaldehyde foam insulation, polychlorinated biphenyls, petroleum and petroleum products, methane, hazardous materials, Hazardous Wastes, hazardous or Toxic Substances or related materials as defined in CERCLA, the Hazardous Materials
Transportation Act, as amended (49 U.S.C. Sections 5101, et seq.), RCRA, Articles 15 and 27 of the New York State Environmental Conservation Law or any other applicable Environmental Law and in the regulations adopted pursuant thereto. 

“Hazardous Wastes” shall mean all waste materials subject to regulation under CERCLA, RCRA or applicable state law, and
any other applicable Federal and state laws now in force or hereafter enacted relating to hazardous waste disposal. 

“Hedge Liabilities” shall have the meaning provided in the definition of “Lender-Provided Interest Rate
Hedge”. 
 “Increased Tax Burden” shall mean the additional federal, state or local taxes assumed to be
payable by a member of any Borrower as a result of such Borrower’s status as a limited liability company as evidenced and substantiated by the tax returns filed by such Borrower as a limited liability company, with such taxes being calculated
for all members at the highest marginal rate applicable to any member. 
 “Indebtedness” shall mean, as to any
Person at any time, any and all indebtedness, obligations or liabilities (whether matured or unmatured, liquidated or unliquidated, direct or indirect, absolute or contingent, or joint or several) of such Person for or in respect of:
(a) borrowed money; (b) amounts received under or liabilities in respect of any note purchase or acceptance credit facility, and all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;
(c) all Capitalized Lease Obligations; (d) reimbursement obligations (contingent or otherwise) under any letter of credit agreement, banker’s acceptance agreement or similar arrangement; (e) obligations under any Interest Rate
Hedge or other interest rate management device, foreign currency exchange agreement, currency swap agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement; (f) any other
advances of credit made to or on behalf of such Person or other transaction (including forward sale or purchase agreements, capitalized leases and conditional sales agreements) having the commercial effect of a borrowing of money entered into by
such Person to finance its operations or capital requirements including to finance the purchase price of property or services and all obligations of such Person to pay the deferred purchase price of property or services (but not including trade
payables and accrued expenses 

  
 14 

 
incurred in the Ordinary Course of Business which are not represented by a promissory note or other evidence of indebtedness and which are not more than thirty (30) days past due);
(g) all Equity Interests of such Person subject to repurchase or redemption rights or obligations (excluding repurchases or redemptions at the sole option of such Person); (h) all indebtedness, obligations or liabilities secured by a Lien
on any asset of such Person, whether or not such indebtedness, obligations or liabilities are otherwise an obligation of such Person; (i) all obligations of such Person for “earnouts”, purchase price adjustments, profit sharing
arrangements, deferred purchase money amounts and similar payment obligations or continuing obligations of any nature of such Person arising out of purchase and sale contracts; (j) off-balance sheet liabilities and/or pension plan liabilities
of such Person; (k) obligations arising under bonus, deferred compensation, incentive compensation or similar arrangements, other than those arising in the Ordinary Course of Business; and (l) any guaranty of any indebtedness, obligations
or liabilities of a type described in the foregoing clauses (a) through (k). 
 “Indemnified Taxes” shall
mean Taxes other than Excluded Taxes. 
 “Ineligible Security” shall mean any security which may not be
underwritten or dealt in by member banks of the Federal Reserve System under Section 16 of the Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as amended. 
 “Intellectual Property” shall mean property constituting under any Applicable Law a patent, patent application, copyright, trademark, service mark, trade name, mask work, trade secret or
license or other right to use any of the foregoing. 
 “Intellectual Property Claim” shall mean the assertion
by any Person of a claim (whether asserted in writing, by action, suit or proceeding or otherwise) that any Borrower’s ownership, use, marketing, sale or distribution of any Inventory, Equipment, Intellectual Property or other property or asset
is violative of any ownership of or right to use any Intellectual Property of such Person. 
 “Intercompany
Subordination Agreement” shall mean the Intercompany Subordination Agreement dated as of the Closing Date among Parent, Borrowers and Agent and any Intercompany Subordination Agreement entered into subsequent to the Closing Date.

 “Interest Period” shall mean the period provided for any Eurodollar Rate Loan pursuant to
Section 2.2(b) hereof. 
 “Interest Rate Hedge” shall mean an interest rate exchange, collar, cap, swap,
adjustable strike cap, adjustable strike corridor or similar agreements entered into by any Borrower or its Subsidiaries in order to provide protection to, or minimize the impact upon, such Borrower, any Guarantor and/or their respective
Subsidiaries of increasing floating rates of interest applicable to Indebtedness. 
 “In-Transit Inventory”
shall mean Inventory of Borrower that is in the possession of a common carrier and: (a) is in transit from a location outside the United States to a location of Borrower inside the United States and listed on Schedule 4.5; or (b) has
cleared customs in the United States, been offloaded at the port of entry and is in transit to a location of Borrower inside the continental United States and listed on Schedule 4.5. 

  
 15 

 “Inventory” shall mean and include as to each Borrower all of such
Borrower’s now owned or hereafter acquired goods, merchandise and other personal property, wherever located, to be furnished under any consignment arrangement, contract of service or held for sale or lease, all raw materials, work in process,
finished goods and materials and supplies of any kind, nature or description which are or might be used or consumed in such Borrower’s business or used in selling or furnishing such goods, merchandise and other personal property, and all
documents of title or other documents representing them. 
 “Inventory Advance Rate” shall have the meaning set
forth in Section 2.1(a)(y)(ii) hereof. 
 “Inventory NOLV Advance Rate” shall have the meaning set forth
in Section 2.1(a)(y)(ii) hereof. 
 “Investment Property” shall mean and include as to each Borrower, all
of such Borrower’s now owned or hereafter acquired securities (whether certificated or uncertificated), securities entitlements, securities accounts, commodities contracts and commodities accounts. 

“Issuer” shall mean any Person who issues a Letter of Credit and/or accepts a draft pursuant to the terms hereof.

 “Lender” and “Lenders” shall have the meaning ascribed to such term in the preamble to this
Agreement and shall include each Person which becomes a transferee, successor or assign of any Lender. 
 “Lender
Default” shall have the meaning set forth in Section 2.23(a) hereof. 
 “Lender-Provided Interest Rate
Hedge” shall mean an Interest Rate Hedge which is provided by any Lender and with respect to which the Agent confirms meets the following requirements: such Interest Rate Hedge (i) is documented in a standard International Swap Dealer
Association Agreement, (ii) provides for the method of calculating the reimbursable amount of the provider’s credit exposure in a reasonable and customary manner, and (iii) is entered into for hedging (rather than speculative)
purposes. The liabilities of any Borrower to the provider of any Lender-Provided Interest Rate Hedge (the “Hedge Liabilities”) shall be “Obligations” hereunder, guaranteed obligations under the Guaranty and secured obligations
under the Guarantor Security Agreement and otherwise treated as Obligations for purposes of each of the Other Documents. The Liens securing the Hedge Liabilities shall be pari passu with the Liens securing all other Obligations under this
Agreement and the Other Documents. 
 “Letter of Credit Application” shall have the meaning set forth in
Section 2.10 hereof. 
 “Letter of Credit Borrowing” shall have the meaning set forth in
Section 2.12(d) hereof. 
 “Letter of Credit Fees” shall have the meaning set forth in Section 3.2
hereof. 
 “Letter of Credit Sublimit” shall mean $8,000,000. 

  
 16 

 “Letters of Credit” shall have the meaning set forth in Section 2.9
hereof. 
 “License Agreement” shall mean any agreement between any Borrower and a Licensor pursuant to which
such Borrower is authorized to use any Intellectual Property in connection with the manufacturing, marketing, sale or other distribution of any Inventory of such Borrower or otherwise in connection with such Borrower’s business operations.

 “Licensor” shall mean any Person from whom any Borrower obtains the right to use (whether on an exclusive or
non-exclusive basis) any Intellectual Property in connection with such Borrower’s manufacture, marketing or sale of any Inventory or otherwise in connection with such Borrower’s business operations. 

“Licensor/Agent Agreement” shall mean an agreement between Agent and a Licensor, in form and content satisfactory to
Agent, by which Agent is given the unqualified right, vis-a-vis such Licensor, to enforce Agent’s Liens with respect to and to dispose of any Borrower’s Inventory with the benefit of any Intellectual Property applicable thereto,
irrespective of such Borrower’s default under any License Agreement with such Licensor. 
 “Lien” shall
mean any mortgage, deed of trust, pledge, hypothecation, assignment, security interest, lien (whether statutory or otherwise), Charge, claim or encumbrance, or preference, priority or other security agreement or preferential arrangement held or
asserted in respect of any asset of any kind or nature whatsoever including any conditional sale or other title retention agreement, any lease having substantially the same economic effect as any of the foregoing, and the filing of, or agreement to
give, any financing statement under the Uniform Commercial Code or comparable law of any jurisdiction. 
 “Lien Waiver
Agreement” shall mean an agreement which is executed in favor of Agent by a Person who owns or occupies premises at which any Collateral may be located from time to time and by which such Person shall waive any Lien that such Person may
ever have with respect to any of the Collateral and shall authorize Agent from time to time to enter upon the premises to inspect or remove the Collateral from such premises or to use such premises to store or dispose of such Inventory. 

“Material Adverse Effect” shall mean a material adverse effect on (a) the condition (financial or otherwise),
results of operations, assets, business, properties or prospects of any Borrower or any Guarantor, (b) any Borrower’s ability to duly and punctually pay or perform the Obligations in accordance with the terms thereof, (c) the value of
the Collateral, or Agent’s Liens on the Collateral or the priority of any such Lien or (d) the practical realization of the benefits of Agent’s and each Lender’s rights and remedies under this Agreement and the Other Documents.

 “Material Contract” shall mean any contract, agreement, instrument, permit, lease or license, written or
oral, of Borrowers, which are material to any Borrower’s business or which, the failure to comply with, could reasonably be expected to result in a Material Adverse Effect. 

“Maximum Face Amount” shall mean, with respect to any outstanding Letter of Credit, the face amount of such Letter of
Credit including all automatic increases provided for in such Letter of Credit, whether or not any such automatic increase has become effective. 

  
 17 

 “Maximum Revolving Advance Amount” shall mean
$35,000,000; provided however that for the period commencing March 1st through and including
May 31st of each calendar year, the Maximum Revolving
Advance Amount shall mean $26,000,000. 
 “Maximum Undrawn Amount” shall mean with respect to any outstanding
Letter of Credit, the amount of such Letter of Credit that is or may become available to be drawn, including all automatic increases provided for in such Letter of Credit, whether or not any such automatic increase has become effective. 

“Modified Commitment Transfer Supplement” shall have the meaning set forth in Section 16.3(d) hereof. 

“Multiemployer Plan” shall mean a “multiemployer plan” as defined in Sections 3(37) or 4001(a)(3) of ERISA to
which contributions are required or, within the preceding five plan years, were required by any Borrower or any member of the Controlled Group. 
 “Multiple Employer Plan” shall mean a Plan which has two or more contributing sponsors (including any Borrower or any member of the Controlled Group) at least two of whom are not under
common control, as such a plan is described in Section 4064 of ERISA. 
 “Non-Defaulting Lender” shall
have the meaning set forth in Section 2.23(b) hereof. 
 “Note” shall mean collectively, the Revolving
Credit Notes. 
 “Obligations” shall mean and include any and all loans (including without limitation, all
Advances), advances, debts, liabilities, obligations, covenants and duties owing by any Borrower to Lenders or Agent or to any other direct or indirect subsidiary or affiliate of Agent or any Lender of any kind or nature, present or future
(including any interest or other amounts accruing thereon, and any costs and expenses of any Person payable by Borrower and any indemnification obligations payable by Borrower arising or payable after maturity, or after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like proceeding relating to any Borrower, whether or not a claim for post-filing or post-petition interest or other amounts is allowable or allowed in such proceeding), whether or
not evidenced by any note, guaranty or other instrument, whether arising under any agreement, instrument or document, (including this Agreement and the Other Documents) whether or not for the payment of money, whether arising by reason of an
extension of credit, opening of a letter of credit, loan, equipment lease or guarantee, under any interest or currency swap, future, option or other similar agreement, or in any other manner, whether arising out of overdrafts or deposit or other
accounts or electronic funds transfers (whether through automated clearing houses or otherwise) or out of the Agent’s or any Lenders non-receipt of or inability to collect funds or otherwise not being made whole in connection with depository
transfer check or other similar arrangements, whether direct or indirect (including those acquired by assignment or participation), absolute or contingent, joint or several, due or to become due, now existing or hereafter arising, contractual or
tortious, liquidated or unliquidated, regardless of how such indebtedness or liabilities arise or by what agreement or instrument they may be evidenced or whether evidenced by any agreement or instrument, including, but not limited to, any and all
of any Borrower’s Indebtedness and/or liabilities under this Agreement, the Other Documents or under any other agreement between 

  
 18 

 
Agent or Lenders and any Borrower and any amendments, extensions, renewals or increases and all costs and expenses of Agent and any Lender incurred in the documentation, negotiation,
modification, enforcement, collection or otherwise in connection with any of the foregoing, including but not limited to reasonable attorneys’ fees and expenses and all obligations of any Borrower to Agent or Lenders to perform acts or refrain
from taking any action. 
 “Ordinary Course of Business” shall mean with respect to any Borrower, the ordinary
course of such Borrower’s business as conducted on the Closing Date. 
 “Organizational Documents” shall
mean, with respect to any Person, any charter, articles or certificate of incorporation, certificate of organization, registration or formation, certificate of partnership or limited partnership, bylaws, operating agreement, limited liability
company agreement, or partnership agreement of such Person and any and all other applicable documents relating to such Person’s formation, organization or entity governance matters (including any shareholders’ or equity holders’
agreement or voting trust agreement) and specifically includes, without limitation, any certificates of designation for preferred stock or other forms of preferred equity. 
 “Other Documents” shall mean the Note, the Perfection Certificates, any Guaranty, any Guarantor Security Agreement, any Pledge Agreement, any Lender-Provided Interest Rate Hedge and any
and all other agreements, instruments and documents, including any subordination or intercreditor agreements, guaranties, pledges, powers of attorney, consents, interest or currency swap agreements or other similar agreements and all other writings
heretofore, now or hereafter executed by any Borrower or any Guarantor and/or delivered to Agent or any Lender in respect of the transactions contemplated by this Agreement. 
 “Other Taxes” shall mean all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under
any Other Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any Other Document. 
 “Out-of-Formula Loans” shall have the meaning set forth in Section 16.2(b) hereof. 
 “Parent” of any Person shall mean a corporation or other entity owning, directly or indirectly at least 50% of the shares of stock or other ownership interests having ordinary voting
power to elect a majority of the directors of the Person, or other Persons performing similar functions for any such Person. 

“Participant” shall mean each Person who shall be granted the right by any Lender to participate in any of the Advances
and who shall have entered into a participation agreement in form and substance satisfactory to such Lender. 

“Participation Advance” shall have the meaning set forth in Section 2.12(d) hereof. 

“Participation Commitment” shall mean each Lender’s obligation to buy a participation of the Letters of Credit
issued hereunder. 

  
 19 

 “Payment Office” shall mean initially Two Tower Center Boulevard, East
Brunswick, New Jersey 08816; thereafter, such other office of Agent, if any, which it may designate by notice to Borrowing Agent and to each Lender to be the Payment Office. 
 “PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA or any successor. 

“Pension Benefit Plan” shall mean at any time any “employee pension benefit plan” as defined in
Section 3(2) of ERISA (including a Multiple Employer Plan, but not a Multiemployer Plan) which is covered by Title IV of ERISA or is subject to the minimum funding standards under Sections 412, 430 or 436 of the Code and either (i) is
maintained or to which contributions are required by Borrower or any member of the Controlled Group or (ii) has at any time within the preceding five years been maintained or to which contributions have been required by Borrower or any entity
which was at such time a member of the Controlled Group. 
 “Perfection Certificates” shall mean collectively,
the Perfection Certificates and the responses thereto provided by each Borrower and delivered to Agent. 
 “Permitted
Discretion” means a determination made in good faith and in the exercise (from the perspective of a secured asset-based lender) of commercially reasonable business judgment. 

“Permitted Encumbrances” shall mean (a) Liens in favor of Agent for the benefit of Agent and Lenders;
(b) Liens for taxes, assessments or other governmental charges not delinquent or being Properly Contested; (c) Liens disclosed in the financial statements referred to in Section 5.5, the existence of which Agent has consented to in
writing; (d) deposits or pledges to secure obligations under worker’s compensation, social security or similar laws, or under unemployment insurance; (e) deposits or pledges to secure bids, tenders, contracts (other than contracts for
the payment of money), leases, statutory obligations, surety and appeal bonds and other obligations of like nature arising in the Ordinary Course of Business; (f) Liens arising by virtue of the rendition, entry or issuance against any Borrower
or any Subsidiary, or any property of any Borrower or any Subsidiary, of any judgment, writ, order, or decree for so long as each such Lien (I) is in existence for less than 20 consecutive days after it first arises or is being Properly
Contested and (II) is at all times junior in priority to any Liens in favor of Agent; (g) mechanics’, workers’, materialmen’s or other like Liens arising in the Ordinary Course of Business with respect to obligations which are
not due or which are being Properly Contested; (h) Liens placed upon fixed assets hereafter acquired to secure a portion of the purchase price thereof, provided that (I) any such lien shall not encumber any other property of any Borrower
and (II) the aggregate amount of Indebtedness secured by such Liens incurred as a result of such purchases during any fiscal year shall not exceed the amount provided for in Section 7.6; and (i) Liens disclosed on Schedule 1.2
provided that such Liens shall secure only those obligations which they secure on the Closing Date and shall not subsequently apply to any other property or assets of any Borrower other than the property and assets to which they apply as of
the Closing Date. 

  
 20 

 “Person” shall mean any individual, sole proprietorship, partnership,
corporation, business trust, joint stock company, trust, unincorporated organization, association, limited liability company, limited liability partnership, institution, public benefit corporation, joint venture, entity or Governmental Body (whether
federal, state, county, city, municipal or otherwise, including any instrumentality, division, agency, body or department thereof). 
 “Plan” shall mean any employee benefit plan within the meaning of Section 3(3) of ERISA (including a Pension Benefit Plan and a Multiemployer Plan, as defined herein) maintained by
any Borrower or any member of the Controlled Group or to which any Borrower or any member of the Controlled Group is required to contribute. 
 “Pledge Agreement” shall mean those certain Collateral Pledge Agreements executed by Gaiam and Gaiam Americas in favor of Agent dated as of the Closing Date and any other pledge
agreements executed subsequent to the Closing Date by any other Person to secure the Obligations. 
 “PNC”
shall have the meaning set forth in the preamble to this Agreement and shall extend to all of its successors and assigns. 

“Pro Forma Balance Sheet” shall have the meaning set forth in Section 5.5(a) hereof. 

“Pro Forma Financial Statements” shall have the meaning set forth in Section 5.5(b) hereof. 

“Properly Contested” shall mean, in the case of any Indebtedness or Lien, as applicable, of any Person (including any
taxes) that is not paid as and when due or payable by reason of such Person’s bona fide dispute concerning its liability to pay same or concerning the amount thereof: (i) such Indebtedness or Lien, as applicable, is being properly
contested in good faith by appropriate proceedings promptly instituted and diligently conducted; (ii) such Person has established appropriate reserves as shall be required in conformity with GAAP; (iii) the non-payment of such Indebtedness
will not have a Material Adverse Effect and will not result in the forfeiture of any assets of such Person; (iv) no Lien is imposed upon any of such Person’s assets with respect to such Indebtedness unless such Lien is at all times junior
and subordinate in priority to the Liens in favor of the Agent (except only with respect to property taxes that have priority as a matter of applicable state law) and enforcement of such Lien is stayed during the period prior to the final resolution
or disposition of such dispute; (v) if such Indebtedness or Lien, as applicable, results from, or is determined by the entry, rendition or issuance against a Person or any of its assets of a judgment, writ, order or decree, enforcement of such
judgment, writ, order or decree is stayed pending a timely appeal or other judicial review; and (vi) if such contest is abandoned, settled or determined adversely (in whole or in part) to such Person, such Person forthwith pays such
Indebtedness and all penalties, interest and other amounts due in connection therewith. 
 “Projections” shall
have the meaning set forth in Section 5.5(b) hereof. 
 “Published Rate” shall mean the rate of interest
published each Business Day in the Wall Street Journal “Money Rates” listing under the caption “London Interbank Offered Rates” for a one month period (or, if no such rate is published therein for any reason, then the Published
Rate shall be the Eurodollar Rate for a one month period as published in another publication selected by the Agent). 

  
 21 

 “Purchasing CLO” shall have the meaning set forth in Section 16.3(d)
hereof. 
 “Purchasing Lender” shall have the meaning set forth in Section 16.3(c) hereof. 

“RCRA” shall mean the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et seq., as same may be
amended from time to time. 
 “Real Property” shall mean all of each Borrower’s right, title and interest
in and to the owned and leased premises identified on Schedule 4.5 hereto or which is hereafter owned or leased by any Borrower. 
 “Receivables” shall mean and include, as to each Borrower, all of such Borrower’s accounts, contract rights, instruments (including those evidencing indebtedness owed to such
Borrower by its Affiliates), documents, chattel paper (including electronic chattel paper), general intangibles relating to accounts, drafts and acceptances, credit card receivables and all other forms of obligations owing to such Borrower arising
out of or in connection with the sale or lease of Inventory or the rendition of services, all supporting obligations, guarantees and other security therefor, whether secured or unsecured, now existing or hereafter created, and whether or not
specifically sold or assigned to Agent hereunder. 
 “Receivables Advance Rate” shall have the meaning set
forth in Section 2.1(a)(y)(i) hereof. 
 “Register” shall have the meaning set forth in
Section 16.3(e) hereof. 
 “Reimbursement Obligation” shall have the meaning set forth in
Section 2.12(b)hereof. 
 “Release” shall have the meaning set forth in Section 5.7(c)(i) hereof.

 “Reportable Event” shall mean a reportable event described in Section 4043 of ERISA or the regulations
promulgated thereunder. 
 “Required Lenders” shall mean Lenders holding at least sixty six and two thirds of
one percent (66 2/3%) of the Advances and, if no Advances are outstanding, shall mean Lenders holding sixty six and two thirds percent (66 2/3%) of the Commitment Percentages; provided, however, if there are fewer than three (3) Lenders,
Required Lenders shall mean all Lenders. 
 “Reserve Percentage” shall mean as of any day the maximum
percentage in effect on such day as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for determining the reserve requirements (including supplemental, marginal and emergency reserve requirements) with respect to
eurocurrency funding (currently referred to as “Eurocurrency Liabilities”. 
 “Revolving Advances”
shall mean Advances made other than Letters of Credit. 

  
 22 

 “Revolving Credit Note” shall mean, collectively, the promissory notes
referred to in Section 2.1(a) hereof. 
 “Revolving Interest Rate” shall mean, (a) with
respect to Domestic Rate Loans, an interest rate per annum equal to the sum of three quarters of one percent (0.75%) plus the Alternate Base Rate and (b) with respect to Eurodollar Rate Loans, the sum of two and one
quarter of one percent (2.25%) plus the Eurodollar Rate. 
 “Royalty Reserve” shall mean, as of any
date of determination, the sum of (i) the royalties payable by Borrowers on such date, plus (ii) the accrued royalties of Borrowers as stated on Borrowers’ general ledger, plus (iii) estimated royalties owing for Inventory on
hand. 
 “SEC” shall mean the Securities and Exchange Commission or any successor thereto. 

“Section 20 Subsidiary” shall mean the Subsidiary of the bank holding company controlling PNC, which Subsidiary has been
granted authority by the Federal Reserve Board to underwrite and deal in certain Ineligible Securities. 
 “Securities
Act” shall mean the Securities Act of 1933, as amended. 
 “Settlement Date” shall mean the Closing
Date and thereafter Wednesday or Thursday of each week or more frequently if Agent deems appropriate unless such day is not a Business Day in which case it shall be the next succeeding Business Day. 

“Subordinated Indebtedness” shall mean the Indebtedness evidenced by that certain Demand Note dated as of July 1,
2012 owing from Gaiam Americas to Gaiam in the original principal amount of $9,000,000. 
 “Subsidiary” of any
Person shall mean a corporation or other entity of whose Equity Interests having ordinary voting power (other than Equity Interests having such power only by reason of the happening of a contingency) to elect a majority of the directors of such
corporation, or other Persons performing similar functions for such entity, are owned, directly or indirectly, by such Person. 

“Subsidiary Stock” shall mean all of the issued and outstanding Equity Interests of any Subsidiary owned by any Borrower
(not to exceed 65% of the Equity Interests of any Foreign Subsidiary). 
 “Taxes” shall mean all present or
future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Body, including any interest, additions to tax or penalties applicable thereto. 

“Term” shall have the meaning set forth in Section 13.1 hereof. 

“Termination Event” shall mean: (a) a Reportable Event with respect to any Plan; (b) the withdrawal of any
Borrower or any member of the Controlled Group from a Plan during a plan year in which such entity was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as such a
withdrawal under Section 4062(e) of 

  
 23 

 
ERISA; (c) the providing of notice of intent to terminate a Plan in a distress termination described in Section 4041(c) of ERISA; (d) the commencement of proceedings by the PBGC to
terminate a Plan; (e) any event or condition (a) which might constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or (b) that may result in termination of
a Multiemployer Plan pursuant to Section 4041A of ERISA; (f) the partial or complete withdrawal within the meaning of Section 4203 or 4205 of ERISA, of any Borrower or any member of the Controlled Group from a Multiemployer Plan;
(g) notice that a Multiemployer Plan is subject to Section 4245 of ERISA; or (h) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not diligent, upon any Borrower or any member of the
Controlled Group. 
 “Toxic Substance” shall mean and include any material present on the Real Property or the
Leasehold Interests which has been shown to have significant adverse effect on human health or which is subject to regulation under the Toxic Substances Control Act (TSCA), 15 U.S.C. §§ 2601 et seq., applicable state law, or any other
applicable Federal or state laws now in force or hereafter enacted relating to toxic substances. “Toxic Substance” includes but is not limited to asbestos, polychlorinated biphenyls (PCBs) and lead-based paints. 

“Trading with the Enemy Act” shall mean the foreign assets control regulations of the United States Treasury Department
(31 CFR, Subtitle B, Chapter V, as amended) and any enabling legislation or executive order relating thereto. 

“Transactions” shall have the meaning set forth in Section 5.5 hereof. 

“Transferee” shall have the meaning set forth in Section 16.3(d) hereof. 

“Undrawn Availability” at a particular date shall mean an amount equal to (a) the lesser of (i) the Formula
Amount or (ii) the Maximum Revolving Advance Amount less the Maximum Undrawn Amount of all outstanding Letters of Credit less the Availability Reserve, minus (b) the sum of (i) the outstanding amount of Advances
plus (ii) all amounts due and owing to any Borrower’s trade creditors which are outstanding sixty (60) days or more past their due date, plus (iii) fees and expenses for which Borrowers are liable but which have not
been paid or charged to Borrowers’ Account. 
 “Unfunded Capital Expenditures” shall mean, as to any
Borrower, without duplication, a Capital Expenditure funded (a) from such Borrower’s internally generated cash flow or (b) with the proceeds of a Revolving Advance. 

“Uniform Commercial Code” shall have the meaning set forth in Section 1.3 hereof. 

“USA PATRIOT Act” shall mean the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept
and Obstruct Terrorism Act of 2001, Public Law 107-56, as the same has been, or shall hereafter be, renewed, extended, amended or replaced. 
 “Week” shall mean the time period commencing with the opening of business on a Wednesday and ending on the end of business the following Tuesday. 

  
 24 

 1.3. Uniform Commercial Code Terms. All terms used herein and defined in the Uniform
Commercial Code as adopted in the State of New York from time to time (the “Uniform Commercial Code”) shall have the meaning given therein unless otherwise defined herein. Without limiting the foregoing, the terms “accounts”,
“chattel paper”, “commercial tort claims”, “instruments”, “general intangibles”, “goods”, “payment intangibles”, “proceeds”, “supporting obligations”,
“securities”, “investment property”, “documents”, “deposit accounts”, “software”, “letter of credit rights”, “inventory”, “equipment” and “fixtures”, as and
when used in the description of Collateral shall have the meanings given to such terms in Articles 8 or 9 of the Uniform Commercial Code. To the extent the definition of any category or type of collateral is expanded by any amendment, modification
or revision to the Uniform Commercial Code, such expanded definition will apply automatically as of the date of such amendment, modification or revision. 
 1.4. Certain Matters of Construction. The terms “herein”, “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any
particular section, paragraph or subdivision. All references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement. Any pronoun used shall be
deemed to cover all genders. Wherever appropriate in the context, terms used herein in the singular also include the plural and vice versa. All references to statutes and related regulations shall include any amendments of same and any successor
statutes and regulations. Unless otherwise provided, all references to any instruments or agreements to which Agent is a party, including references to any of the Other Documents, shall include any and all modifications, supplements or amendments
thereto, any and all restatements or replacements thereof and any and all extensions or renewals thereof. All references herein to the time of day shall mean the time in Los Angeles, California. Unless otherwise provided, all financial calculations
shall be performed with Inventory valued on a first-in, first-out basis. Whenever the words “including” or “include” shall be used, such words shall be understood to mean “including, without limitation” or
“include, without limitation”. A Default or Event of Default shall be deemed to exist at all times during the period commencing on the date that such Default or Event of Default occurs to the date on which such Default or Event of Default
is waived in writing pursuant to this Agreement or, in the case of a Default, is cured within any period of cure expressly provided for in this Agreement; and an Event of Default shall “continue” or be “continuing” until such
Event of Default has been waived in writing by the Required Lenders or all Lenders, as applicable. Any Lien referred to in this Agreement or any of the Other Documents as having been created in favor of Agent, any agreement entered into by Agent
pursuant to this Agreement or any of the Other Documents, any payment made by or to or funds received by Agent pursuant to or as contemplated by this Agreement or any of the Other Documents, or any act taken or omitted to be taken by Agent, shall,
unless otherwise expressly provided, be created, entered into, made or received, or taken or omitted, for the benefit or account of Agent and Lenders. Wherever the phrase “to the best of Borrowers’ knowledge” or words of similar
import relating to the knowledge or the awareness of any Borrower are used in this Agreement or Other Documents, such phrase shall mean and refer to (i) the actual knowledge of a senior officer of any Borrower or (ii) the knowledge that a
senior officer would have obtained if he had engaged in good faith and diligent performance of his duties, including the making of such reasonably specific inquiries as may be necessary of the employees or agents of such Borrower and a good faith
attempt to ascertain the existence or 

  
 25 

 
accuracy of the matter to which such phrase relates. All covenants hereunder shall be given independent effect so that if a particular action or condition is not permitted by any of such
covenants, the fact that it would be permitted by an exception to, or otherwise within the limitations of, another covenant shall not avoid the occurrence of a default if such action is taken or condition exists. In addition, all representations and
warranties hereunder shall be given independent effect so that if a particular representation or warranty proves to be incorrect or is breached, the fact that another representation or warranty concerning the same or similar subject matter is
correct or is not breached will not affect the incorrectness of a breach of a representation or warranty hereunder. 
  

	II.	ADVANCES, PAYMENTS. 

 2.1.
Revolving Advances. 
 (a) Amount of Revolving Advances. Subject to the terms and conditions set forth in this
Agreement including Sections 2.1(b) and (c), each Lender, severally and not jointly, will make Revolving Advances to Borrowers in aggregate amounts outstanding at any time equal to such Lender’s Commitment Percentage of the lesser of
(x) the Maximum Revolving Advance Amount less the aggregate Maximum Undrawn Amount of all outstanding Letters of Credit less the Availability Reserve or (y) an amount equal to the sum of: 

(i) up to 85%, subject to the provisions of Section 2.1(b) hereof (“Receivables Advance Rate”), of Eligible Receivables,
plus 
 (ii) up to the lesser of (A) 55%, subject to the provisions of Section 2.1(b) and (c) hereof (the
“Inventory Advance Rate”), of the cost of Eligible Inventory and Eligible In-Transit Inventory, (B) 85% of the appraised net orderly liquidation value of Eligible Inventory and Eligible In-Transit Inventory (as evidenced by an
Inventory appraisal satisfactory to Agent in its sole discretion exercised in good faith) (the “Inventory NOLV Advance Rate, together with the Inventory Advance Rate and the Receivables Advance Rate, collectively, the “Advance
Rates”), minus 
 (iii) the aggregate Maximum Undrawn Amount of all outstanding Letters of Credit, minus

 (iv) the Availability Reserve; minus 
 (v) the Royalty Reserve; minus 
 (vi) the Cinram Reserve; minus

 (vii) such other reserves as Agent may reasonably deem proper and necessary from time to time, including without limitation,
reserves for dilution and chargebacks. 
 The amount derived from the sum of (x) Sections 2.1(a)(y)(i) and (ii) minus
(y) Section 2.1(a)(y)(iii), (iv), (v) and (vi) at any time and from time to time shall be referred to as the “Formula Amount”. The Revolving Advances shall be evidenced by one or more secured promissory notes
(collectively, the “Revolving Credit Note”) substantially in the form attached hereto as Exhibit 2.1(a). 

  
 26 

 (b) Discretionary Rights. The Advance Rates may be increased or decreased by Agent at
any time and from time to time in the exercise of its Permitted Discretion. Each Borrower consents to any such increases or decreases and acknowledges that decreasing the Advance Rates or increasing or imposing reserves may limit or restrict
Advances requested by Borrowing Agent. 
 (c) Sublimit for Revolving Advances made against Inventory. The aggregate
amount of Revolving Advances made to Borrower (i) against Eligible Inventory and Eligible In-Transit Inventory shall not exceed in the aggregate, at any time outstanding, $12,000,000, (ii) against Eligible In-Transit Inventory shall not
exceed in the aggregate, at any time outstanding, $1,000,000, (iii) against Eligible Inventory consisting of DVDs shall not exceed in the aggregate, at any time outstanding, $5,000,000. 

2.2. Procedure for Revolving Advances Borrowing. 
 (a) Borrowing Agent on behalf of any Borrower may notify Agent prior to 10:00 a.m. on a Business Day of a Borrower’s request to incur, on that day, a Revolving Advance hereunder. Should any amount
required to be paid as interest hereunder, or as fees or other charges under this Agreement or any other agreement with Agent or Lenders, or with respect to any other Obligation, become due, same shall be deemed a request for a Revolving Advance
maintained as a Domestic Rate Loan as of the date such payment is due, in the amount required to pay in full such interest, fee, charge or Obligation under this Agreement or any other agreement with Agent or Lenders, and such request shall be
irrevocable. 
 (b) Notwithstanding the provisions of subsection (a) above, in the event any Borrower desires to obtain a
Eurodollar Rate Loan, Borrowing Agent shall give Agent written notice by no later than 10:00 a.m. on the day which is three (3) Business Days prior to the date such Eurodollar Rate Loan is to be borrowed, specifying (i) the date of the
proposed borrowing (which shall be a Business Day), (ii) the type of borrowing and the amount on the date of such Advance to be borrowed, which amount shall be in a minimum amount of $1,000,000 and in integral multiples of $100,000 thereafter,
and (iii) the duration of the first Interest Period therefor. Interest Periods for Eurodollar Rate Loans shall be for one, two or three months; provided, if an Interest Period would end on a day that is not a Business Day, it shall end on the
next succeeding Business Day unless such day falls in the next succeeding calendar month in which case the Interest Period shall end on the next preceding Business Day. No Eurodollar Rate Loan shall be made available to any Borrower during the
continuance of a Default or an Event of Default. After giving effect to each requested Eurodollar Rate Loan, including those which are converted from a Domestic Rate Loan under Section 2.2(d), there shall not be outstanding more than three
(3) Eurodollar Rate Loans, in the aggregate. 
 (c) Each Interest Period of a Eurodollar Rate Loan shall commence on the
date such Eurodollar Rate Loan is made and shall end on such date as Borrowing Agent may elect as set forth in subsection (b)(iii) above provided that the exact length of each Interest Period shall be determined in accordance with the practice of
the interbank market for offshore Dollar deposits and no Interest Period shall end after the last day of the Term. 

  
 27 

 Borrowing Agent shall elect the initial Interest Period applicable to a Eurodollar Rate Loan
by its notice of borrowing given to Agent pursuant to Section 2.2(b) or by its notice of conversion given to Agent pursuant to Section 2.2(d), as the case may be. Borrowing Agent shall elect the duration of each succeeding Interest Period
by giving irrevocable written notice to Agent of such duration not later than 10:00 a.m. on the day which is three (3) Business Days prior to the last day of the then current Interest Period applicable to such Eurodollar Rate Loan. If Agent
does not receive timely notice of the Interest Period elected by Borrowing Agent, Borrowing Agent shall be deemed to have elected to convert to a Domestic Rate Loan subject to Section 2.2(d) below. 

(d) Provided that no Event of Default shall have occurred and be continuing, Borrowing Agent may, on the last Business Day of the then
current Interest Period applicable to any outstanding Eurodollar Rate Loan, or on any Business Day with respect to Domestic Rate Loans, convert any such loan into a loan of another type in the same aggregate principal amount provided that any
conversion of a Eurodollar Rate Loan shall be made only on the last Business Day of the then current Interest Period applicable to such Eurodollar Rate Loan. If Borrowing Agent desires to convert a loan, Borrowing Agent shall give Agent written
notice by no later than 10:00 a.m. (i) on the day which is three (3) Business Days’ prior to the date on which such conversion is to occur with respect to a conversion from a Domestic Rate Loan to a Eurodollar Rate Loan, or
(ii) on the day which is one (1) Business Day prior to the date on which such conversion is to occur with respect to a conversion from a Eurodollar Rate Loan to a Domestic Rate Loan, specifying, in each case, the date of such conversion,
the loans to be converted and if the conversion is from a Domestic Rate Loan to any other type of loan, the duration of the first Interest Period therefor. 
 (e) At its option and upon written notice given prior to 10:00 a.m. at least three (3) Business Days’ prior to the date of such prepayment, any Borrower may prepay the Eurodollar Rate Loans in
whole at any time or in part from time to time with accrued interest on the principal being prepaid to the date of such repayment. Such Borrower shall specify the date of prepayment of Advances which are Eurodollar Rate Loans and the amount of such
prepayment. In the event that any prepayment of a Eurodollar Rate Loan is required or permitted on a date other than the last Business Day of the then current Interest Period with respect thereto, such Borrower shall indemnify Agent and Lenders
therefor in accordance with Section 2.2(f) hereof. 
 (f) Each Borrower shall indemnify Agent and Lenders and hold Agent
and Lenders harmless from and against any and all losses or expenses that Agent and Lenders may sustain or incur as a consequence of any prepayment, conversion of or any default by any Borrower in the payment of the principal of or interest on any
Eurodollar Rate Loan or failure by any Borrower to complete a borrowing of, a prepayment of or conversion of or to a Eurodollar Rate Loan after notice thereof has been given, including, but not limited to, any interest payable by Agent or Lenders to
lenders of funds obtained by it in order to make or maintain its Eurodollar Rate Loans hereunder. A certificate as to any additional amounts payable pursuant to the foregoing sentence submitted by Agent or any Lender to Borrowing Agent shall be
conclusive absent manifest error. 

  
 28 

 (g) Notwithstanding any other provision hereof, if any Applicable Law, treaty, regulation or
directive, or any change therein or in the interpretation or application thereof, shall make it unlawful for any Lender (for purposes of this subsection (g), the term “Lender” shall include any Lender and the office or branch where any
Lender or any corporation or bank controlling such Lender makes or maintains any Eurodollar Rate Loans) to make or maintain its Eurodollar Rate Loans, the obligation of Lenders to make Eurodollar Rate Loans hereunder shall forthwith be cancelled and
Borrowers shall, if any affected Eurodollar Rate Loans are then outstanding, promptly upon request from Agent, either pay all such affected Eurodollar Rate Loans or convert such affected Eurodollar Rate Loans into loans of another type. If any such
payment or conversion of any Eurodollar Rate Loan is made on a day that is not the last day of the Interest Period applicable to such Eurodollar Rate Loan, Borrowers shall pay Agent, upon Agent’s request, such amount or amounts as may be
necessary to compensate Lenders for any loss or expense sustained or incurred by Lenders in respect of such Eurodollar Rate Loan as a result of such payment or conversion, including (but not limited to) any interest or other amounts payable by
Lenders to lenders of funds obtained by Lenders in order to make or maintain such Eurodollar Rate Loan. A certificate as to any additional amounts payable pursuant to the foregoing sentence submitted by Lenders to Borrowing Agent shall be conclusive
absent manifest error. 
 2.3. Disbursement of Advance Proceeds. All Advances shall be disbursed from whichever office or
other place Agent may designate from time to time and, together with any and all other Obligations of Borrowers to Agent or Lenders, shall be charged to Borrowers’ Account on Agent’s books. During the Term, Borrowers may use the Revolving
Advances by borrowing, prepaying and reborrowing, all in accordance with the terms and conditions hereof. The proceeds of each Revolving Advance requested by Borrowing Agent on behalf of any Borrower or deemed to have been requested by any Borrower
under Section 2.2(a) hereof shall, with respect to requested Revolving Advances to the extent Lenders make such Revolving Advances, be made available to the applicable Borrower on the day so requested by way of credit to such Borrower’s
operating account at PNC, or such other bank as Borrowing Agent may designate following notification to Agent, in immediately available federal funds or other immediately available funds or, with respect to Revolving Advances deemed to have been
requested by any Borrower, be disbursed to Agent to be applied to the outstanding Obligations giving rise to such deemed request. 
 2.4. Reserved. 
 2.5. Maximum Advances. The aggregate balance of
Revolving Advances outstanding at any time shall not exceed the lesser of (a) the Maximum Revolving Advance Amount less the Maximum Undrawn Amount of all issued and outstanding Letters of Credit less the Availability Reserve or
(b) the Formula Amount. 

  
 29 

 2.6. Repayment of Advances. 

(a) The Advances shall be due and payable in full on the last day of the Term subject to earlier prepayment as herein provided.

 (b) Each Borrower recognizes that the amounts evidenced by checks, notes, drafts or any other items of payment relating to
and/or proceeds of Collateral may not be collectible by Agent on the date received. In consideration of Agent’s agreement to conditionally credit Borrowers’ Account as of the next Business Day following Agent’s receipt of those items
of payment, each Borrower agrees that, in computing the charges under this Agreement, all items of payment shall be deemed applied by Agent on account of the Obligations one (1) Business Day after (i) the Business Day following
Agent’s receipt of such payments via wire transfer or electronic depository check or (ii) in the case of payments received by Agent in any other form, the Business Day such payment constitutes good funds in Agent’s account. Agent is
not, however, required to credit Borrowers’ Account for the amount of any item of payment which is unsatisfactory to Agent and Agent may charge Borrowers’ Account for the amount of any item of payment which is returned to Agent unpaid.

 (c) All payments of principal, interest and other amounts payable hereunder, or under any of the Other Documents shall be
made to Agent at the Payment Office not later than 1:00 P.M. on the due date therefor in lawful money of the United States of America in federal funds or other funds immediately available to Agent. Agent shall have the right to effectuate payment on
any and all Obligations due and owing hereunder by charging Borrowers’ Account or by making Advances as provided in Section 2.2 hereof. 
 (d) Borrowers shall pay principal, interest, and all other amounts payable hereunder, or under any related agreement, without any deduction whatsoever, including, but not limited to, any deduction for any
setoff or counterclaim. 
 2.7. Repayment of Excess Advances. The aggregate balance of Advances outstanding at any time
in excess of the maximum amount of Advances permitted hereunder shall be immediately due and payable without the necessity of any demand, at the Payment Office, whether or not a Default or Event of Default has occurred. 

2.8. Statement of Account. Agent shall maintain, in accordance with its customary procedures, a loan account
(“Borrowers’ Account”) in the name of Borrowers in which shall be recorded the date and amount of each Advance made by Agent and the date and amount of each payment in respect thereof; provided, however, the failure by Agent to record
the date and amount of any Advance shall not adversely affect Agent or any Lender. Each month, Agent shall send to Borrowing Agent a statement showing the accounting for the Advances made, payments made or credited in respect thereof, and other
transactions between Agent and Borrowers during such month. The monthly statements shall be deemed correct and binding upon Borrowers in the absence of manifest error and shall constitute an account stated between Lenders and Borrowers unless Agent
receives a written statement of Borrowers’ specific exceptions thereto within thirty (30) days after such statement is received by Borrowing Agent. The records of Agent with respect to the loan account shall be conclusive evidence absent
manifest error of the amounts of Advances and other charges thereto and of payments applicable thereto. 

  
 30 

 2.9. Letters of Credit. Subject to the terms and conditions hereof, Agent shall issue
or cause the issuance of standby and/or trade letters of credit (“Letters of Credit”) for the account of any Borrower except to the extent that the issuance thereof would then cause the sum of (i) the outstanding Revolving Advances
plus (ii) the Maximum Undrawn Amount of all outstanding Letters of Credit plus (iii) the Maximum Undrawn Amount of the Letter of Credit to be issued to exceed the lesser of (x) the Maximum Revolving Advance Amount less the
Availability Reserve or (y) the Formula Amount (calculated without giving effect to the deduction provided for in Section 2.1(a)(y)(iii). The Maximum Undrawn Amount of outstanding Letters of Credit shall not exceed in the aggregate at any
time the Letter of Credit Sublimit. All disbursements or payments related to Letters of Credit shall be deemed to be Domestic Rate Loans consisting of Revolving Advances and shall bear interest at the Revolving Interest Rate for Domestic Rate Loans;
Letters of Credit that have not been drawn upon shall not bear interest. 
 2.10. Issuance of Letters of Credit.

 (a) Borrowing Agent, on behalf of Borrowers, may request Agent to issue or cause the issuance of a Letter of Credit by
delivering to Agent at the Payment Office, prior to 10:00 a.m., at least five (5) Business Days’ prior to the proposed date of issuance, Agent’s form of Letter of Credit Application (the “Letter of Credit Application”)
completed to the satisfaction of Agent; and, such other certificates, documents and other papers and information as Agent may reasonably request. Borrowing Agent, on behalf of Borrowers, also has the right to give instructions and make agreements
with respect to any application, any applicable letter of credit and security agreement, any applicable letter of credit reimbursement agreement and/or any other applicable agreement, any letter of credit and the disposition of documents,
disposition of any unutilized funds, and to agree with Agent upon any amendment, extension or renewal of any Letter of Credit. 

(b) Each Letter of Credit shall, among other things, (i) provide for the payment of sight drafts, other written demands for payment,
or acceptances of usance drafts when presented for honor thereunder in accordance with the terms thereof and when accompanied by the documents described therein and (ii) have an expiry date not later than twelve (12) months after such
Letter of Credit’s date of issuance and in no event later than the last day of the Term. Each standby Letter of Credit shall be subject either to the Uniform Customs and Practice for Documentary Credits as most recently published by the
International Chamber of Commerce at the time a Letter of Credit is issued (the “UCP”) or the International Standby Practices (ISP98-International Chamber of Commerce Publication Number 590) (the “ISP98 Rules”), and any
subsequent revision thereof at the time a standby Letter of Credit is issued, as determined by Agent, and each trade Letter of Credit shall be subject to the UCP. 
 (c) Agent shall use its reasonable efforts to notify Lenders of the request by Borrowing Agent for a Letter of Credit hereunder. 
 2.11. Requirements For Issuance of Letters of Credit. 
 (a) Borrowing Agent
shall authorize and direct any Issuer to name the applicable Borrower as the “Applicant” or “Account Party” of each Letter of Credit. If Agent is not the Issuer of any Letter of Credit, Borrowing Agent shall authorize and direct
the Issuer to 

  
 31 

 
deliver to Agent all instruments, documents, and other writings and property received by the Issuer pursuant to the Letter of Credit and to accept and rely upon Agent’s instructions and
agreements with respect to all matters arising in connection with the Letter of Credit, the application therefor or any acceptance thereof. 
 (b) In connection with all Letters of Credit issued or caused to be issued by Agent under this Agreement, each Borrower hereby appoints Agent, or its designee, as its attorney, with full power and
authority if an Event of Default shall have occurred, (i) to sign and/or endorse such Borrower’s name upon any warehouse or other receipts, letter of credit applications and acceptances, (ii) to sign such Borrower’s name on bills
of lading; (iii) to clear Inventory through the United States of America Customs Department (“Customs”) in the name of such Borrower or Agent or Agent’s designee, and to sign and deliver to Customs officials powers of attorney in
the name of such Borrower for such purpose; and (iv) to complete in such Borrower’s name or Agent’s, or in the name of Agent’s designee, any order, sale or transaction, obtain the necessary documents in connection therewith, and
collect the proceeds thereof. Neither Agent nor its attorneys will be liable for any acts or omissions nor for any error of judgment or mistakes of fact or law, except for Agent’s or its attorney’s willful misconduct. This power, being
coupled with an interest, is irrevocable as long as any Letters of Credit remain outstanding. 
 2.12. Disbursements,
Reimbursement. 
 (a) Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from Agent a participation in such Letter of Credit and each drawing thereunder in an amount equal to such Lender’s Commitment Percentage of the Maximum Face Amount of such Letter of Credit
and the amount of such drawing, respectively. 
 (b) In the event of any request for a drawing under a Letter of Credit by the
beneficiary or transferee thereof, Agent will promptly notify Borrowing Agent. Provided that Borrowing Agent shall have received such notice, the Borrowers shall reimburse (such obligation to reimburse Agent shall sometimes be referred to as a
“Reimbursement Obligation”) Agent prior to 12:00 Noon on each date that an amount is paid by Agent under any Letter of Credit (each such date, a “Drawing Date”) in an amount equal to the amount so paid by Agent. In the event
Borrowers fail to reimburse Agent for the full amount of any drawing under any Letter of Credit by 12:00 Noon on the Drawing Date, Agent will promptly notify each Lender thereof, and Borrowers shall be deemed to have requested that a Revolving
Advance maintained as a Domestic Rate Loan be made by the Lenders to be disbursed on the Drawing Date under such Letter of Credit, subject to the amount of the unutilized portion of the lesser of (i) the Maximum Revolving Advance Amount, less
the Maximum Undrawn Amount of all outstanding Letters of Credit, less the Availability Reserve, or (ii) the Formula Amount and, in each case, subject to Section 8.2 hereof. Any notice given by Agent pursuant to this Section 2.12(b)
may be oral if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice. 

  
 32 

 (c) Each Lender shall upon any notice pursuant to Section 2.12(b) make available to
Agent an amount in immediately available funds equal to its Commitment Percentage of the amount of the drawing, whereupon the participating Lenders shall (subject to Section 2.12(d)) each be deemed to have made a Revolving Advance maintained as
a Domestic Rate Loan to Borrowers in that amount. If any Lender so notified fails to make available to Agent the amount of such Lender’s Commitment Percentage of such amount by no later than 2:00 p.m. on the Drawing Date, then interest shall
accrue on such Lender’s obligation to make such payment, from the Drawing Date to the date on which such Lender makes such payment (i) at a rate per annum equal to the Federal Funds Effective Rate during the first three days following the
Drawing Date and (ii) at a rate per annum equal to the rate applicable to Revolving Advances maintained as a Domestic Rate Loans on and after the fourth day following the Drawing Date. Agent will promptly give notice of the occurrence of the
Drawing Date, but failure of Agent to give any such notice on the Drawing Date or in sufficient time to enable any Lender to effect such payment on such date shall not relieve such Lender from its obligation under this Section 2.12(c), provided
that such Lender shall not be obligated to pay interest as provided in Section 2.12(c) (i) and (ii) until and commencing from the date of receipt of notice from Agent of a drawing. 

(d) With respect to any unreimbursed drawing that is not converted into a Revolving Advance maintained as a Domestic Rate Loan to
Borrowers in whole or in part as contemplated by Section 2.12(b), because of Borrowers’ failure to satisfy the conditions set forth in Section 8.2 hereof (other than any notice requirements) or for any other reason, Borrowers shall be
deemed to have incurred from Agent a borrowing (each a “Letter of Credit Borrowing”) in the amount of such drawing. Such Letter of Credit Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the
rate per annum applicable to a Revolving Advance maintained as a Domestic Rate Loan. Each Lender’s payment to Agent pursuant to Section 2.12(c) shall be deemed to be a payment in respect of its participation in such Letter of Credit
Borrowing and shall constitute a “Participation Advance” from such Lender in satisfaction of its Participation Commitment under this Section 2.12. 
 (e) Each Lender’s Participation Commitment shall continue until the last to occur of any of the following events: (x) Agent ceases to be obligated to issue or cause to be issued Letters of
Credit hereunder; (y) no Letter of Credit issued or created hereunder remains outstanding and uncancelled; and (z) all Persons (other than the Borrowers) have been fully reimbursed for all payments made under or relating to Letters of
Credit. 
 2.13. Repayment of Participation Advances. 

(a) Upon (and only upon) receipt by Agent for its account of immediately available funds from Borrowers (i) in reimbursement of any
payment made by the Agent under the Letter of Credit with respect to which any Lender has made a Participation Advance to Agent, or (ii) in payment of interest on such a payment made by Agent under such a Letter of Credit, Agent will pay to
each Lender, in the same funds as those received by Agent, the amount of such Lender’s Commitment Percentage of such funds, except Agent shall retain the amount of the Commitment Percentage of such funds of any Lender that did not make a
Participation Advance in respect of such payment by Agent. 

  
 33 

 (b) If Agent is required at any time to return to any Borrower, or to a trustee, receiver,
liquidator, custodian, or any official in any insolvency proceeding, any portion of the payments made by Borrowers to Agent pursuant to Section 2.13(a) in reimbursement of a payment made under the Letter of Credit or interest or fee thereon,
each Lender shall, on demand of Agent, forthwith return to Agent the amount of its Commitment Percentage of any amounts so returned by Agent plus interest at the Federal Funds Effective Rate. 

2.14. Documentation. Each Borrower agrees to be bound by the terms of the Letter of Credit Application and by Agent’s
interpretations of any Letter of Credit issued on behalf of such Borrower and by Agent’s written regulations and customary practices relating to letters of credit, though Agent’s interpretations may be different from such Borrower’s
own. In the event of a conflict between the Letter of Credit Application and this Agreement, this Agreement shall govern. It is understood and agreed that, except in the case of gross negligence or willful misconduct (as determined by a court of
competent jurisdiction in a final non-appealable judgment), Agent shall not be liable for any error, negligence and/or mistakes, whether of omission or commission, in following the Borrowing Agent’s or any Borrower’s instructions or those
contained in the Letters of Credit or any modifications, amendments or supplements thereto. 
 2.15. Determination to Honor
Drawing Request. In determining whether to honor any request for drawing under any Letter of Credit by the beneficiary thereof, Agent shall be responsible only to determine that the documents and certificates required to be delivered under such
Letter of Credit have been delivered and that they comply on their face with the requirements of such Letter of Credit and that any other drawing condition appearing on the face of such Letter of Credit has been satisfied in the manner so set forth.

 2.16. Nature of Participation and Reimbursement Obligations. Each Lender’s obligation in accordance with this
Agreement to make the Revolving Advances or Participation Advances as a result of a drawing under a Letter of Credit, and the obligations of Borrowers to reimburse Agent upon a draw under a Letter of Credit, shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of this Section 2.16 under all circumstances, including the following circumstances: 
 (i) any set-off, counterclaim, recoupment, defense or other right which such Lender may have against Agent, any Borrower or any other Person for any reason whatsoever; 

(ii) the failure of any Borrower or any other Person to comply, in connection with a Letter of Credit Borrowing, with the conditions set
forth in this Agreement for the making of a Revolving Advance, it being acknowledged that such conditions are not required for the making of a Letter of Credit Borrowing and the obligation of the Lenders to make Participation Advances under
Section 2.12; 
 (iii) any lack of validity or enforceability of any Letter of Credit; 

(iv) any claim of breach of warranty that might be made by Borrower or any Lender against the beneficiary of a Letter of Credit, or the
existence of any claim, set-off, recoupment, counterclaim, cross-claim, defense or other right which any Borrower or any Lender may have at any time against a beneficiary, any successor beneficiary or any transferee of any

  
 34 

 
Letter of Credit or the proceeds thereof (or any Persons for whom any such transferee may be acting), Agent or any Lender or any other Person, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction (including any underlying transaction between any Borrower or any Subsidiaries of such Borrower and the beneficiary for which any Letter of Credit was procured); 

(v) the lack of power or authority of any signer of (or any defect in or forgery of any signature or endorsement on) or the form of or
lack of validity, sufficiency, accuracy, enforceability or genuineness of any draft, demand, instrument, certificate or other document presented under or in connection with any Letter of Credit, or any fraud or alleged fraud in connection with any
Letter of Credit, or the transport of any property or provisions of services relating to a Letter of Credit, in each case even if Agent or any of Agent’s Affiliates has been notified thereof; 

(vi) payment by Agent under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not
comply with the terms of such Letter of Credit; 
 (vii) the solvency of, or any acts or omissions by, any beneficiary of any
Letter of Credit, or any other Person having a role in any transaction or obligation relating to a Letter of Credit, or the existence, nature, quality, quantity, condition, value or other characteristic of any property or services relating to a
Letter of Credit; 
 (viii) any failure by the Agent or any of Agent’s Affiliates to issue any Letter of Credit in the
form requested by Borrowing Agent, unless the Agent has received written notice from Borrowing Agent of such failure within three (3) Business Days after the Agent shall have furnished Borrowing Agent a copy of such Letter of Credit and such
error is material and no drawing has been made thereon prior to receipt of such notice; 
 (ix) any Material Adverse Effect;

 (x) any breach of this Agreement or any Other Document by any party thereto; 

(xi) the occurrence or continuance of an insolvency proceeding with respect to any Borrower or any Guarantor; 

(xii) the fact that a Default or Event of Default shall have occurred and be continuing; 

(xiii) the fact that the Term shall have expired or this Agreement or the Obligations hereunder shall have been terminated; and

 (xiv) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing. 

2.17. Indemnity. In addition to amounts payable as provided in Section 16.5, each Borrower hereby agrees to protect,
indemnify, pay and save harmless Agent and any of Agent’s 

  
 35 

 
Affiliates that have issued a Letter of Credit from and against any and all claims, demands, liabilities, damages, taxes, penalties, interest, judgments, losses, costs, charges and expenses
(including reasonable fees, expenses and disbursements of counsel and allocated costs of internal counsel) which the Agent or any of Agent’s Affiliates may incur or be subject to as a consequence, direct or indirect, of the issuance of any
Letter of Credit, other than as a result of (a) the gross negligence or willful misconduct of the Agent as determined by a final and non-appealable judgment of a court of competent jurisdiction or (b) the wrongful dishonor by the Agent or
any of Agent’s Affiliates of a proper demand for payment made under any Letter of Credit, except if such dishonor resulted from any act or omission, whether rightful or wrongful, of any present or future de jure or de facto Governmental Body
(all such acts or omissions herein called “Governmental Acts”). 
 2.18. Liability for Acts and Omissions. As
between Borrowers and Agent and Lenders, each Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the
respective foregoing, Agent shall not be responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for an issuance of any such Letter of
Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged (even if Agent shall have been notified thereof); (ii) the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) the failure of the
beneficiary of any such Letter of Credit, or any other party to which such Letter of Credit may be transferred, to comply fully with any conditions required in order to draw upon such Letter of Credit or any other claim of any Borrower against any
beneficiary of such Letter of Credit, or any such transferee, or any dispute between or among any Borrower and any beneficiary of any Letter of Credit or any such transferee; (iv) errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, facsimile, telex or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in
order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any
consequences arising from causes beyond the control of Agent, including any governmental acts, and none of the above shall affect or impair, or prevent the vesting of, any of Agent’s rights or powers hereunder. Nothing in the preceding sentence
shall relieve Agent from liability for Agent’s gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final non-appealable judgment) in connection with actions or omissions described in such clauses
(i) through (viii) of such sentence. In no event shall Agent or Agent’s Affiliates be liable to any Borrower for any indirect, consequential, incidental, punitive, exemplary or special damages or expenses (including without limitation
attorneys’ fees), or for any damages resulting from any change in the value of any property relating to a Letter of Credit. 
 Without limiting the generality of the foregoing, Agent and each of its Affiliates: (i) may rely on any oral or other communication believed in good faith by Agent or such Affiliate to have been
authorized or given by or on behalf of the applicant for a Letter of Credit; (ii) may honor any presentation if the documents presented appear on their face substantially to comply 

  
 36 

 
with the terms and conditions of the relevant Letter of Credit; (iii) may honor a previously dishonored presentation under a Letter of Credit, whether such dishonor was pursuant to a court
order, to settle or compromise any claim of wrongful dishonor, or otherwise, and shall be entitled to reimbursement to the same extent as if such presentation had initially been honored, together with any interest paid by Agent or its Affiliates;
(iv) may honor any drawing that is payable upon presentation of a statement advising negotiation or payment, upon receipt of such statement (even if such statement indicates that a draft or other document is being delivered separately), and
shall not be liable for any failure of any such draft or other document to arrive, or to conform in any way with the relevant Letter of Credit; (v) may pay any paying or negotiating bank claiming that it rightfully honored under the laws or
practices of the place where such bank is located; and (vi) may settle or adjust any claim or demand made on Agent or its Affiliate in any way related to any order issued at the applicant’s request to an air carrier, a letter of guarantee
or of indemnity issued to a carrier or any similar document (each an “Order”) and honor any drawing in connection with any Letter of Credit that is the subject of such Order, notwithstanding that any drafts or other documents presented in
connection with such Letter of Credit fail to conform in any way with such Letter of Credit. 
 In furtherance and extension and
not in limitation of the specific provisions set forth above, any action taken or omitted by Agent under or in connection with the Letters of Credit issued by it or any documents and certificates delivered thereunder, if taken or omitted in good
faith and without gross negligence (as determined by a court of competent jurisdiction in a final non-appealable judgment), shall not put Agent under any resulting liability to any Borrower or any Lender. 

2.19. Additional Payments. Any sums expended by Agent or any Lender due to any Borrower’s failure to perform or comply with
its obligations under this Agreement or any Other Document including any Borrower’s obligations under Sections 4.2, 4.4, 4.12, 4.13, 4.14, 4.20 and 6.1 hereof, may be charged to Borrowers’ Account as a Revolving Advance and added to the
Obligations. 
 2.20. Manner of Borrowing and Payment. 

(a) Each borrowing of Revolving Advances shall be advanced according to the applicable Commitment Percentages of Lenders. 

(b) Each payment (including each prepayment) by any Borrower on account of the principal of and interest on the Revolving Advances, shall
be applied to the Revolving Advances pro rata according to the applicable Commitment Percentages of Lenders. Except as expressly provided herein, all payments (including prepayments) to be made by any Borrower on account of principal, interest and
fees shall be made without set off or counterclaim and shall be made to Agent on behalf of the Lenders to the Payment Office, in each case on or prior to 1:00 P.M. in Dollars and in immediately available funds. 

(c) (i) Notwithstanding anything to the contrary contained in Sections 2.20(a) and (b) hereof, commencing with the first Business
Day following the Closing Date, each borrowing of Revolving Advances shall be advanced by Agent and each payment by any Borrower on account of Revolving Advances shall be applied first to those Revolving Advances

  
 37 

 
advanced by Agent. On or before 1:00 P.M. on each Settlement Date commencing with the first Settlement Date following the Closing Date, Agent and Lenders shall make certain payments as follows:
(I) if the aggregate amount of new Revolving Advances made by Agent during the preceding Week (if any) exceeds the aggregate amount of repayments applied to outstanding Revolving Advances during such preceding Week, then each Lender shall
provide Agent with funds in an amount equal to its applicable Commitment Percentage of the difference between (w) such Revolving Advances and (x) such repayments and (II) if the aggregate amount of repayments applied to outstanding
Revolving Advances during such Week exceeds the aggregate amount of new Revolving Advances made during such Week, then Agent shall provide each Lender with funds in an amount equal to its applicable Commitment Percentage of the difference between
(y) such repayments and (z) such Revolving Advances. 
 (ii) Each Lender shall be entitled to earn interest at the
applicable Revolving Interest Rate on outstanding Advances which it has funded. 
 (iii) Promptly following each Settlement
Date, Agent shall submit to each Lender a certificate with respect to payments received and Advances made during the Week immediately preceding such Settlement Date. Such certificate of Agent shall be conclusive in the absence of manifest error.

 (d) If any Lender or Participant (a “Benefited Lender”) shall at any time receive any payment of all or part of its
Advances, or interest thereon, or receive any Collateral in respect thereof (whether voluntarily or involuntarily or by set-off) in a greater proportion than any such payment to and Collateral received by any other Lender, if any, in respect of such
other Lender’s Advances, or interest thereon, and such greater proportionate payment or receipt of Collateral is not expressly permitted hereunder, such Benefited Lender shall purchase for cash from the other Lenders a participation in such
portion of each such other Lender’s Advances, or shall provide such other Lender with the benefits of any such Collateral, or the proceeds thereof, as shall be necessary to cause such Benefited Lender to share the excess payment or benefits of
such Collateral or proceeds ratably with each of the other Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefited Lender, such purchase shall be rescinded, and the
purchase price and benefits returned, to the extent of such recovery, but without interest. Each Lender so purchasing a portion of another Lender’s Advances may exercise all rights of payment (including rights of set-off) with respect to such
portion as fully as if such Lender were the direct holder of such portion. 
 (e) Unless Agent shall have been notified by
telephone, confirmed in writing, by any Lender that such Lender will not make the amount which would constitute its applicable Commitment Percentage of the Advances available to Agent, Agent may (but shall not be obligated to) assume that such
Lender shall make such amount available to Agent on the next Settlement Date and, in reliance upon such assumption, make available to Borrowers a corresponding amount. Agent will promptly notify Borrowing Agent of its receipt of any such notice from
a Lender. If such amount is made available to Agent on a date after such next Settlement Date, such Lender shall pay to Agent on demand an amount equal to the product of (i) the daily average Federal Funds Effective Rate (computed on the basis
of a year of 360 days) during such period as quoted by Agent, times (ii) such amount, times (iii) the number of days from and including such Settlement Date to the date on which such amount becomes

  
 38 

 
immediately available to Agent. A certificate of Agent submitted to any Lender with respect to any amounts owing under this paragraph (e) shall be conclusive, in the absence of manifest
error. If such amount is not in fact made available to Agent by such Lender within three (3) Business Days after such Settlement Date, Agent shall be entitled to recover such an amount, with interest thereon at the rate per annum then
applicable to such Revolving Advances hereunder, on demand from Borrowers; provided, however, that Agent’s right to such recovery shall not prejudice or otherwise adversely affect Borrowers’ rights (if any) against such Lender. 

2.21. Mandatory Prepayments. 
 (a) Subject to Section 4.3 hereof, when any Borrower sells or otherwise disposes of any Collateral other than Inventory in the Ordinary Course of Business, Borrowers shall repay the Advances in an
amount equal to the net proceeds of such sale (i.e., gross proceeds less the reasonable costs of such sales or other dispositions), such repayments to be made promptly but in no event more than one (1) Business Day following receipt of such net
proceeds, and until the date of payment, such proceeds shall be held in trust for Agent. The foregoing shall not be deemed to be implied consent to any such sale otherwise prohibited by the terms and conditions hereof. Such repayments shall be
applied to the Advances in such order as Agent may determine, subject to Borrowers’ ability to reborrow Revolving Advances in accordance with the terms hereof. 
 (b) In the event of any issuance or other incurrence of Indebtedness (other than Indebtedness permitted pursuant to Section 7.8 hereof) by Borrowers or the issuance of any Equity Interests by any
Borrower, Borrowers shall, no later than one (1) Business Day after the receipt by Borrowers of (i) the cash proceeds from any such issuance or incurrence of Indebtedness or (ii) the net cash proceeds of any issuance of Equity
Interests (other than Equity Interests issued to employees, officers or directors of any Borrower), as applicable, repay the Advances, subject to Borrowers’ ability to reborrow Revolving Advances in accordance with the terms hereof, in an
amount equal to the net cash proceeds in the case of such incurrence or issuance of Indebtedness or an issuance of Equity Interests. Such repayments will be applied in the same manner as set forth in Section 2.21(b) hereof. 

2.22. Use of Proceeds. 
 (a) Borrowers shall apply the proceeds of Advances to (i) repay existing indebtedness owed to Wells Fargo Bank, N.A., (ii) pay fees and expenses relating to this transaction, and
(iii) provide for its working capital needs and reimburse drawings under Letters of Credit. 
 (b) Without limiting the
generality of Section 2.22(a) above, neither the Borrowers, the Guarantors nor any other Person which may in the future become party to this Agreement or the Other Documents as a Borrower or Guarantor, intends to use nor shall they use any
portion of the proceeds of the Advances, directly or indirectly, for any purpose in violation of the Trading with the Enemy Act. 

  
 39 

 2.23. Defaulting Lender. 

(a) Notwithstanding anything to the contrary contained herein, in the event any Lender (x) has refused (which refusal constitutes a
breach by such Lender of its obligations under this Agreement) to make available its portion of any Advance or (y) notifies either Agent or Borrowing Agent that it does not intend to make available its portion of any Advance (if the actual
refusal would constitute a breach by such Lender of its obligations under this Agreement) (each, a “Lender Default”), all rights and obligations hereunder of such Lender (a “Defaulting Lender”) as to which a Lender Default is in
effect and of the other parties hereto shall be modified to the extent of the express provisions of this Section 2.23 while such Lender Default remains in effect. 
 (b) Advances shall be incurred pro rata from Lenders (the “Non-Defaulting Lenders”) which are not Defaulting Lenders based on their respective Commitment Percentages, and no Commitment
Percentage of any Lender or any pro rata share of any Advances required to be advanced by any Lender shall be increased as a result of such Lender Default. Amounts received in respect of principal of any type of Advances shall be applied to reduce
the applicable Advances of each Lender (other than any Defaulting Lender) pro rata based on the aggregate of the outstanding Advances of that type of all Lenders at the time of such application; provided, that, Agent shall not be obligated to
transfer to a Defaulting Lender any payments received by Agent for the Defaulting Lender’s benefit, nor shall a Defaulting Lender be entitled to the sharing of any payments hereunder (including any principal, interest or fees). Amounts payable
to a Defaulting Lender shall instead be paid to or retained by Agent. Agent may hold and, in its discretion, re-lend to a Borrower the amount of such payments received or retained by it for the account of such Defaulting Lender. 

(c) A Defaulting Lender shall not be entitled to give instructions to Agent or to approve, disapprove, consent to or vote on any matters
relating to this Agreement and the Other Documents. All amendments, waivers and other modifications of this Agreement and the Other Documents may be made without regard to a Defaulting Lender and, for purposes of the definition of “Required
Lenders”, a Defaulting Lender shall be deemed not to be a Lender and not to have either Advances outstanding or a Commitment Percentage. 
 (d) Other than as expressly set forth in this Section 2.23, the rights and obligations of a Defaulting Lender (including the obligation to indemnify Agent) and the other parties hereto shall remain
unchanged. Nothing in this Section 2.23 shall be deemed to release any Defaulting Lender from its obligations under this Agreement and the Other Documents, shall alter such obligations, shall operate as a waiver of any default by such
Defaulting Lender hereunder, or shall prejudice any rights which any Borrower, Agent or any Lender may have against any Defaulting Lender as a result of any default by such Defaulting Lender hereunder. 

(e) In the event a Defaulting Lender retroactively cures to the satisfaction of Agent the breach which caused a Lender to become a
Defaulting Lender, such Defaulting Lender shall no longer be a Defaulting Lender and shall be treated as a Lender under this Agreement. 
  

	III.	INTEREST AND FEES. 

 3.1.
Interest. Interest on Advances shall be payable in arrears on the first day of each month with respect to Domestic Rate Loans and, with respect to Eurodollar Rate Loans, at the 

  
 40 

 
end of each Interest Period or, for Eurodollar Rate Loans with an Interest Period in excess of three months, at the earlier of (a) each three months from the commencement of such Eurodollar
Rate Loan or (b) the end of the Interest Period. Interest charges shall be computed on the actual principal amount of Advances outstanding during the month at a rate per annum equal to the applicable Revolving Interest Rate. Whenever,
subsequent to the date of this Agreement, the Alternate Base Rate is increased or decreased, the Revolving Interest Rate for Domestic Rate Loans shall be similarly changed without notice or demand of any kind by an amount equal to the amount of such
change in the Alternate Base Rate during the time such change or changes remain in effect. The Eurodollar Rate shall be adjusted with respect to Eurodollar Rate Loans without notice or demand of any kind on the effective date of any change in the
Reserve Percentage as of such effective date. Upon and after the occurrence of an Event of Default, and during the continuation thereof, at the option of Agent or at the direction of Required Lenders, the Obligations shall bear interest at the
Revolving Interest Rate for Domestic Rate Loans plus two (2%) percent per annum (the “Default Rate”). 

3.2. Letter of Credit Fees. 
 (a) Borrowers shall pay (x) to Agent, for the ratable benefit of Lenders, fees for each Letter of Credit for the period from and excluding the date of issuance of same to and including the date of
expiration or termination, equal to the average daily face amount of each outstanding Letter of Credit multiplied by two and one quarter of one percent (2.25%) per annum, such fees to be calculated on the basis of a 360-day year for the actual
number of days elapsed and to be payable quarterly in arrears on the first day of each quarter and on the last day of the Term, and (y) to the Issuer, a fronting fee of one quarter of one percent (0.25%) per annum to be payable quarterly in
arrears on the first day of each calendar quarter, together with any and all administrative, issuance, amendment, payment and negotiation charges with respect to Letters of Credit and all fees and expenses as agreed upon by the Issuer and the
Borrowing Agent in connection with any Letter of Credit, including in connection with the opening, amendment or renewal of any such Letter of Credit and any acceptances created thereunder and shall reimburse Agent for any and all fees and expenses,
if any, paid by Agent to the Issuer (all of the foregoing fees, the “Letter of Credit Fees”). All such charges shall be deemed earned in full on the date when the same are due and payable hereunder and shall not be subject to rebate or
pro-ration upon the termination of this Agreement for any reason. Any such charge in effect at the time of a particular transaction shall be the charge for that transaction, notwithstanding any subsequent change in the Issuer’s prevailing
charges for that type of transaction. All Letter of Credit Fees payable hereunder shall be deemed earned in full on the date when the same are due and payable hereunder and shall not be subject to rebate or pro-ration upon the termination of this
Agreement for any reason. Upon and after the occurrence of an Event of Default, and during the continuation thereof, at the option of Agent or at the direction of Required Lenders, the Letter of Credit Fees described in clause (x) of this
Section 3.2(a) shall be increased by an additional two percent (2.0%) per annum. 
 (b) At any time following the
occurrence of an Event of Default or the expiration of the Term, Borrowers will cause cash to be deposited and maintained in an account with Agent, as cash collateral, in an amount equal to one hundred and five percent (105%) of the Maximum
Undrawn Amount of all outstanding Letters of Credit, and each Borrower hereby irrevocably authorizes Agent, in its discretion, on such Borrower’s behalf and in such 

  
 41 

 
Borrower’s name, to open such an account and to make and maintain deposits therein, or in an account opened by such Borrower, in the amounts required to be made by such Borrower, out of the
proceeds of Receivables or other Collateral or out of any other funds of such Borrower coming into any Lender’s possession at any time. Agent will invest such cash collateral (less applicable reserves) in such short-term money-market items as
to which Agent and such Borrower mutually agree and the net return on such investments shall be credited to such account and constitute additional cash collateral. No Borrower may withdraw amounts credited to any such account except upon the
occurrence of all of the following: (x) payment and performance in full of all Obligations; (y) expiration of all Letters of Credit; and (z) termination of this Agreement. 

3.3. Closing Fee and Facility Fee. 
 (a) Upon the execution of this Agreement, Borrowers shall pay to Agent a closing fee of $175,000 less that portion of the deposit of $50,000 heretofore paid by Borrowers to Agent remaining after
application of such deposit to out of pocket costs and expenses. 
 (b) If, for any calendar quarter during the Term, the
average daily unpaid balance of the Revolving Advances plus the Maximum Undrawn Amount of all outstanding Letters of Credit for each day of such calendar quarter does not equal the Maximum Revolving Advance Amount, then Borrowers shall pay to
Agent for the ratable benefit of Lenders a fee at a rate equal to one half of one percent (0.50%) per annum on the amount by which the Maximum Revolving Advance Amount exceeds such average daily unpaid balance. Such fee shall be payable to Agent in
arrears on the first day of each calendar quarter with respect to the previous calendar quarter. 
 3.4. Collateral
Evaluation Fee and Collateral Monitoring Fee. 
 (a) Borrowers shall pay Agent a collateral monitoring fee equal to $1,000
per month commencing on the first day of the month following the Closing Date and on the first day of each month thereafter during the Term. The collateral monitoring fee shall be deemed earned in full on the date when same is due and payable
hereunder and shall not be subject to rebate or proration upon termination of this Agreement for any reason. 
 (b) Borrowers
shall pay to Agent on the first day of each month following any month in which Agent performs any collateral evaluation - namely any field examination, collateral analysis or other business analysis, the need for which is to be determined by Agent
and which evaluation is undertaken by Agent or for Agent’s benefit - a collateral evaluation fee in an amount equal to $850 per day for each person employed to perform such evaluation, plus all costs and disbursements incurred by Agent in the
performance of such examination or analysis. 
 (c) All of the fees and out-of-pocket costs and expenses of any appraisals
conducted pursuant to Section 4.21 hereof shall be paid for when due, in full and without off-set, by Borrowers. 

  
 42 

 3.5. Computation of Interest and Fees. Interest and fees hereunder shall be computed
on the basis of a year of 360 days and for the actual number of days elapsed. If any payment to be made hereunder becomes due and payable on a day other than a Business Day, the due date thereof shall be extended to the next succeeding Business Day
and interest thereon shall be payable at the Revolving Interest Rate for Domestic Rate Loans during such extension. 
 3.6.
Maximum Charges. In no event whatsoever shall interest and other charges charged hereunder exceed the highest rate permissible under law. In the event interest and other charges as computed hereunder would otherwise exceed the highest rate
permitted under law, such excess amount shall be first applied to any unpaid principal balance owed by Borrowers, and if the then remaining excess amount is greater than the previously unpaid principal balance, Lenders shall promptly refund such
excess amount to Borrowers and the provisions hereof shall be deemed amended to provide for such permissible rate. 
 3.7.
Increased Costs. In the event that any Applicable Law, treaty or governmental regulation, or any change therein or in the interpretation or application thereof, or compliance by any Lender (for purposes of this Section 3.7, the term
“Lender” shall include Agent or any Lender and any corporation or bank controlling Agent or any Lender and the office or branch where Agent or any Lender (as so defined) makes or maintains any Eurodollar Rate Loans) with any request or
directive (whether or not having the force of law) from any central bank or other financial, monetary or other authority, shall: 
 (a) subject Agent or any Lender to any tax of any kind whatsoever with respect to this Agreement or any Other Document or change the basis of taxation of payments to Agent or any Lender of principal,
fees, interest or any other amount payable hereunder or under any Other Documents (except for changes in the rate of tax on the overall net income of Agent or any Lender by the jurisdiction in which it maintains its principal office); 

(b) impose, modify or hold applicable any reserve, special deposit, assessment or similar requirement against assets held by, or deposits
in or for the account of, advances or loans by, or other credit extended by, any office of Agent or any Lender, including pursuant to Regulation D of the Board of Governors of the Federal Reserve System; or 

(c) impose on Agent or any Lender or the London interbank Eurodollar market any other condition with respect to this Agreement or any
Other Document; 
 and the result of any of the foregoing is to increase the cost to Agent or any Lender of making, renewing or
maintaining its Advances hereunder by an amount that Agent or such Lender deems to be material or to reduce the amount of any payment (whether of principal, interest or otherwise) in respect of any of the Advances by an amount that Agent or such
Lender deems to be material, then, in any case Borrowers shall promptly pay Agent or such Lender, upon its demand, such additional amount as will compensate Agent or such Lender for such additional cost or such reduction, as the case may be,
provided that the foregoing shall not apply to increased costs which are reflected in the Eurodollar Rate, as the case may be. Agent or such Lender shall certify the amount of such additional cost or reduced amount to Borrowing Agent, and such
certification shall be conclusive absent manifest error. 

  
 43 

 3.8. Basis For Determining Interest Rate Inadequate or Unfair. In the event that
Agent or any Lender shall have determined that: 
 (a) reasonable means do not exist for ascertaining the Eurodollar Rate for
any Interest Period; or 
 (b) Dollar deposits in the relevant amount and for the relevant maturity are not available in the
London interbank Eurodollar market, with respect to an outstanding Eurodollar Rate Loan, a proposed Eurodollar Rate Loan, or a proposed conversion of a Domestic Rate Loan into a Eurodollar Rate Loan, 

then Agent shall give Borrowing Agent prompt written or telephonic notice of such determination. If such notice is given, (i) any
such requested Eurodollar Rate Loan shall be made as a Domestic Rate Loan, unless Borrowing Agent shall notify Agent no later than 10:00 a.m. two (2) Business Days prior to the date of such proposed borrowing, that its request for such
borrowing shall be cancelled or made as an unaffected type of Eurodollar Rate Loan, (ii) any Domestic Rate Loan or Eurodollar Rate Loan which was to have been converted to an affected type of Eurodollar Rate Loan shall be continued as or
converted into a Domestic Rate Loan, or, if Borrowing Agent shall notify Agent, no later than 10:00 a.m. two (2) Business Days prior to the proposed conversion, shall be maintained as an unaffected type of Eurodollar Rate Loan, and
(iii) any outstanding affected Eurodollar Rate Loans shall be converted into a Domestic Rate Loan, or, if Borrowing Agent shall notify Agent, no later than 10:00 a.m. two (2) Business Days prior to the last Business Day of the then current
Interest Period applicable to such affected Eurodollar Rate Loan, shall be converted into an unaffected type of Eurodollar Rate Loan, on the last Business Day of the then current Interest Period for such affected Eurodollar Rate Loans. Until such
notice has been withdrawn, Lenders shall have no obligation to make an affected type of Eurodollar Rate Loan or maintain outstanding affected Eurodollar Rate Loans and no Borrower shall have the right to convert a Domestic Rate Loan or an unaffected
type of Eurodollar Rate Loan into an affected type of Eurodollar Rate Loan. 
 3.9. Capital Adequacy. 

(a) In the event that Agent or any Lender shall have determined that any Applicable Law, rule, regulation or guideline regarding capital
adequacy, or any change therein, or any change in the interpretation or administration thereof by any Governmental Body, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by Agent or any
Lender (for purposes of this Section 3.9, the term “Lender” shall include Agent or any Lender and any corporation or bank controlling Agent or any Lender and the office or branch where Agent or any Lender (as so defined) makes or
maintains any Eurodollar Rate Loans) with any request or directive regarding capital adequacy (whether or not having the force of law) of any such authority, central bank or comparable agency, has or would have the effect of reducing the rate of
return on Agent or any Lender’s capital as a consequence of its obligations hereunder to a level below that which Agent or such Lender could have achieved but for such adoption, change or compliance (taking into consideration Agent’s and
each Lender’s policies with respect to capital adequacy) by an amount deemed by Agent or any Lender to be material, then, from time to time, Borrowers shall pay upon demand to Agent or such Lender such additional amount or amounts as will
compensate Agent or such Lender for 

  
 44 

 
such reduction. In determining such amount or amounts, Agent or such Lender may use any reasonable averaging or attribution methods. The protection of this Section 3.9 shall be available to
Agent and each Lender regardless of any possible contention of invalidity or inapplicability with respect to the Applicable Law, regulation or condition. 
 (b) A certificate of Agent or such Lender setting forth such amount or amounts as shall be necessary to compensate Agent or such Lender with respect to Section 3.9(a) hereof when delivered to
Borrowing Agent shall be conclusive absent manifest error. 
 3.10. Taxes. 

(a) Any and all payments by or on account of any Obligations hereunder or under any Other Document shall be made free and clear of and
without reduction or withholding for any Indemnified Taxes or Other Taxes; provided that if the Borrowers shall be required by Applicable Law to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then (i) the
sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section), the Agent, any Lender, Issuer or any Participant as the case may be, receives
an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrowers shall make such deductions and (iii) the Borrowers shall timely pay the full amount deducted to the relevant Governmental Body in
accordance with Applicable Law. 
 (b) Without limiting the provisions of Section 3.10(a) above, the Borrowers shall timely
pay any Other Taxes to the relevant Governmental Body in accordance with Applicable Law. 
 (c) Each Borrower shall indemnify
Agent, each Lender, Issuer and any Participant, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section) paid by Agent, such Lender, Issuer, or such Participant, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Body. A certificate as to the amount of such payment or liability delivered to the Borrowers by any Lender, Participant, or the Issuer (with a copy to Agent), or
by Agent on its own behalf or on behalf of a Lender or the Issuer, shall be conclusive absent manifest error. 
 (d) As soon as
practicable after any payment of Indemnified Taxes or Other Taxes by any Borrower to a Governmental Body, the Borrowers shall deliver to Agent the original or a certified copy of a receipt issued by such Governmental Body evidencing such payment, a
copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Agent. 
 (e) Any Foreign
Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which any Borrower is resident for tax purposes, or under any treaty to which such jurisdiction is a party, with respect to payments
hereunder or under any Other Document shall deliver to the Borrowers (with a copy to Agent), at 

  
 45 

 
the time or times prescribed by Applicable Law or reasonably requested by the Borrowers or Agent, such properly completed and executed documentation prescribed by Applicable Law as will permit
such payments to be made without withholding or at a reduced rate of withholding. Notwithstanding the submission of such documentation claiming a reduced rate of or exemption from U.S. withholding tax, Agent shall be entitled to withhold United
States federal income taxes at the full 30% withholding rate if in its reasonable judgment it is required to do so under the due diligence requirements imposed upon a withholding agent under § 1.1441-7(b) of the United States Income Tax
Regulations or other Applicable Law. Further, Agent is indemnified under § 1.1461-1(e) of the United States Income Tax Regulations against any claims and demands of any Lender, Issuer or assignee or participant of a Lender or Issuer for the
amount of any tax it deducts and withholds in accordance with regulations under § 1441 of the Code. In addition, any Lender, if requested by the Borrowers or Agent, shall deliver such other documentation prescribed by Applicable Law or
reasonably requested by the Borrowers or Agent as will enable the Borrowers or Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Without limiting the generality of the foregoing, in
the event that any Borrower is resident for tax purposes in the United States of America, any Foreign Lender (or other Lender) shall deliver to the Borrowers and Agent (in such number of copies as shall be requested by the recipient) on or prior to
the date on which such Foreign Lender (or other Lender) becomes a Lender under this Agreement (and from time to time thereafter upon the request of the Borrowers or the Agent, but only if such Foreign Lender (or other Lender) is legally entitled to
do so), whichever of the following is applicable: two (2) duly completed valid originals of IRS Form W-8BEN claiming eligibility for benefits of an income tax treaty to which the United States of America is a party, 

(i) two (2) duly completed valid originals of IRS Form W-8ECI, 

(ii) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under section 881(c) of the Code,
(x) a certificate to the effect that such Foreign Lender is not (A) a “bank” within the meaning of section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrowers within the meaning of section
881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code and (y) two duly completed valid originals of IRS Form W-8BEN, 

(iii) any other form prescribed by Applicable Law as a basis for claiming exemption from or a reduction in United States Federal
withholding tax duly completed together with such supplementary documentation as may be prescribed by Applicable Law to permit the Borrowers to determine the withholding or deduction required to be made, or 

(iv) To the extent that any Lender is not a Foreign Lender, such Lender shall submit to Agent two (2) originals of an IRS Form W-9
or any other form prescribed by Applicable Law demonstrating that such Lender is not a Foreign Lender. 
 (f) If a payment made
to a Lender, Participant, Issuer, or Agent under any Document would be subject to U.S. Federal withholding Tax imposed by FATCA if such Person fails to comply with the applicable reporting requirements of FATCA (including those contained in
Section 1471(b) or 1472(b) of the Code, as applicable), such Lender, Participant, Issuer, or Agent shall deliver to the Agent (in the case of a Lender, Participant or Issuer) and the Borrowers

  
 46 

 
(A) a certification signed by the chief financial officer, principal accounting officer, treasurer or controller of such Person, and (B) other documentation reasonably requested by the Agent
or any Borrower sufficient for Agent and the Borrowers to comply with their obligations under FATCA and to determine that such Lender, Participant, Issuer, or Agent has complied with such applicable reporting requirements. 

3.11. Designation of a Different Lending Office. If any Lender requests compensation under Section 3.10, or requires any
Borrower to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.10, then such Lender shall (at the request of the Borrowing Agent) use reasonable
efforts to designate a different lending office for funding or booking its Advances hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation
or assignment (i) would eliminate or materially reduce amounts payable pursuant to Section 3.10 in the future, and (ii) would not subject such Lender to any unreimbursed cost or expense and (iii) would not otherwise be
disadvantageous to such Lender. The Borrowers hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment 

 

	IV.	COLLATERAL: GENERAL TERMS 

 4.1.
Security Interest in the Collateral. To secure the prompt payment and performance to Agent and each Lender of the Obligations, each Borrower hereby assigns, pledges and grants to Agent for its benefit and for the ratable benefit of each
Lender a continuing security interest in and to and Lien on all of its Collateral, whether now owned or existing or hereafter acquired or arising and wheresoever located. Each Borrower shall mark its books and records as may be necessary or
appropriate to evidence, protect and perfect Agent’s security interest and shall cause its financial statements to reflect such security interest. Each Borrower shall promptly provide Agent with written notice of all commercial tort claims,
such notice to contain the case title together with the applicable court and a brief description of the claim(s). Upon delivery of each such notice, such Borrower shall be deemed to hereby grant to Agent a security interest and lien in and to such
commercial tort claims and all proceeds thereof. 
 4.2. Perfection of Security Interest. Each Borrower shall take all
action that may be necessary or desirable, or that Agent may request, so as at all times to maintain the validity, perfection, enforceability and priority of Agent’s security interest in and Lien on the Collateral or to enable Agent to protect,
exercise or enforce its rights hereunder and in the Collateral, including, but not limited to, (i) immediately discharging all Liens other than Permitted Encumbrances, (ii) obtaining Lien Waiver Agreements, (iii) delivering to Agent,
endorsed or accompanied by such instruments of assignment as Agent may specify, and stamping or marking, in such manner as Agent may specify, any and all chattel paper, instruments, letters of credits and advices thereof and documents evidencing or
forming a part of the Collateral, (iv) entering into warehousing, lockbox and other custodial arrangements satisfactory to Agent, and (v) executing and delivering financing statements, control agreements, instruments of pledge, mortgages,
notices and assignments, in each case in form and substance satisfactory to Agent, relating to the creation, validity, perfection, maintenance or continuation of Agent’s security interest and Lien under the Uniform Commercial Code or other
Applicable Law. By its signature hereto, each Borrower hereby authorizes Agent to file against such Borrower, one or 

  
 47 

 
more financing, continuation or amendment statements pursuant to the Uniform Commercial Code in form and substance satisfactory to Agent (which statements may have a description of collateral
which is broader than that set forth herein). All charges, expenses and fees Agent may incur in doing any of the foregoing, and any local taxes relating thereto, shall be charged to Borrowers’ Account as a Revolving Advance of a Domestic Rate
Loan and added to the Obligations, or, at Agent’s option, shall be paid to Agent for its benefit and for the ratable benefit of Lenders immediately upon demand. 
 4.3. Disposition of Collateral. Each Borrower will safeguard and protect all Collateral for Agent’s general account and make no disposition thereof whether by sale, lease or otherwise except
(a) the sale of Inventory in the Ordinary Course of Business and (b) the disposition or transfer of obsolete and worn-out Equipment in the Ordinary Course of Business during any fiscal year having an aggregate fair market value of not more
than $100,000 and only to the extent that (i) the proceeds of any such disposition are used to acquire replacement Equipment which is subject to Agent’s first priority security interest or (ii) the proceeds of which are remitted to
Agent to be applied pursuant to Section 2.21. 
 4.4. Preservation of Collateral. Following the occurrence of a
Default or Event of Default, in addition to the rights and remedies set forth in Section 11.1 hereof, Agent: (a) may at any time take such steps as Agent deems necessary to protect Agent’s interest in and to preserve the Collateral,
including the hiring of such security guards or the placing of other security protection measures as Agent may deem appropriate; (b) may employ and maintain at any of any Borrower’s premises a custodian who shall have full authority to do
all acts necessary to protect Agent’s interests in the Collateral; (c) may lease warehouse facilities to which Agent may move all or part of the Collateral; (d) may use any Borrower’s owned or leased lifts, hoists, trucks and
other facilities or equipment for handling or removing the Collateral; and (e) shall have, and is hereby granted, a right of ingress and egress to the places where the Collateral is located, and may proceed over and through any of
Borrowers’ owned or leased property. Each Borrower shall cooperate fully with all of Agent’s efforts to preserve the Collateral and will take such actions to preserve the Collateral as Agent may direct. All of Agent’s expenses of
preserving the Collateral, including any expenses relating to the bonding of a custodian, shall be charged to Borrowers’ Account as a Revolving Advance maintained as a Domestic Rate Loan and added to the Obligations. 

4.5. Ownership of Collateral. 
 (a) With respect to the Collateral, at the time the Collateral becomes subject to Agent’s security interest: (i) each Borrower shall be the sole owner of and fully authorized and able to sell,
transfer, pledge and/or grant a first priority security interest in each and every item of the its respective Collateral to Agent; and, except for Permitted Encumbrances the Collateral shall be free and clear of all Liens and encumbrances
whatsoever; (ii) each document and agreement executed by each Borrower or delivered to Agent or any Lender in connection with this Agreement shall be true and correct in all respects; (iii) all signatures and endorsements of each Borrower
that appear on such documents and agreements shall be genuine and each Borrower shall have full capacity to execute same; and (iv) each Borrower’s Equipment and Inventory shall be located as set forth on Schedule 4.5 and shall not be
removed from such location(s) without the prior written consent of Agent except with respect to the sale of Inventory in the Ordinary Course of Business and Equipment to the extent permitted in Section 4.3 hereof. 

  
 48 

 (b) (i) There is no location at which any Borrower has any Inventory (except for Inventory
in transit) other than those locations listed on Schedule 4.5; (ii) Schedule 4.5 hereto contains a correct and complete list, as of the Closing Date, of the legal names and addresses of each warehouse at which Inventory of any Borrower is
stored; none of the receipts received by any Borrower from any warehouse states that the goods covered thereby are to be delivered to bearer or to the order of a named Person or to a named Person and such named Person’s assigns;
(iii) Schedule 4.5 hereto sets forth a correct and complete list as of the Closing Date of (A) each place of business of each Borrower and (B) the chief executive office of each Borrower; and (iv) Schedule 4.5 hereto sets forth a
correct and complete list as of the Closing Date of the location, by state and street address, of all Real Property owned or leased by each Borrower, together with the names and addresses of any landlords. 

4.6. Defense of Agent’s and Lenders’ Interests. Until (a) payment and performance in full of all of the Obligations
and (b) termination of this Agreement, Agent’s interests in the Collateral shall continue in full force and effect. During such period no Borrower shall, without Agent’s prior written consent, pledge, sell (except Inventory in the
Ordinary Course of Business and Equipment to the extent permitted in Section 4.3 hereof), assign, transfer, create or suffer to exist a Lien upon or encumber or allow or suffer to be encumbered in any way except for Permitted Encumbrances, any
part of the Collateral. Each Borrower shall defend Agent’s interests in the Collateral against any and all Persons whatsoever. At any time following demand by Agent for payment of all Obligations, Agent shall have the right to take possession
of the indicia of the Collateral and the Collateral in whatever physical form contained, including: labels, stationery, documents, instruments and advertising materials. If Agent exercises this right to take possession of the Collateral, Borrowers
shall, upon demand, assemble it in the best manner possible and make it available to Agent at a place reasonably convenient to Agent. In addition, with respect to all Collateral, Agent and Lenders shall be entitled to all of the rights and remedies
set forth herein and further provided by the Uniform Commercial Code or other Applicable Law. Each Borrower shall, and Agent may, at its option, instruct all suppliers, carriers, forwarders, warehousers or others receiving or holding cash, checks,
Inventory, documents or instruments in which Agent holds a security interest to deliver same to Agent and/or subject to Agent’s order and if they shall come into any Borrower’s possession, they, and each of them, shall be held by such
Borrower in trust as Agent’s trustee, and such Borrower will immediately deliver them to Agent in their original form together with any necessary endorsement. 
 4.7. Books and Records. Each Borrower shall (a) keep proper books of record and account in which full, true and correct entries will be made of all dealings or transactions of or in relation
to its business and affairs; (b) set up on its books accruals with respect to all taxes, assessments, charges, levies and claims; and (c) on a reasonably current basis set up on its books, from its earnings, allowances against doubtful
Receivables, advances and investments and all other proper accruals (including by reason of enumeration, accruals for premiums, if any, due on required payments and accruals for depreciation, obsolescence, or amortization of properties), which
should be set aside from such earnings in connection with its business. All determinations pursuant to this subsection shall be made in accordance with, or as required by, GAAP consistently applied in the opinion of such independent public
accountant as shall then be regularly engaged by Borrowers. 

  
 49 

 4.8. Financial Disclosure. Each Borrower hereby irrevocably authorizes and directs
all accountants and auditors employed by such Borrower at any time during the Term to exhibit and deliver to Agent and each Lender copies of any of such Borrower’s financial statements, trial balances or other accounting records of any sort in
the accountant’s or auditor’s possession, and to disclose to Agent and each Lender any information such accountants may have concerning such Borrower’s financial status and business operations. Each Borrower hereby authorizes all
Governmental Bodies to furnish to Agent and each Lender copies of reports or examinations relating to such Borrower, whether made by such Borrower or otherwise; however, Agent and each Lender will attempt to obtain such information or materials
directly from such Borrower prior to obtaining such information or materials from such accountants or Governmental Bodies. 

4.9. Compliance with Laws. Each Borrower shall comply in all material respects with all Applicable Laws with respect to the
Collateral or any part thereof or to the operation of such Borrower’s business the non-compliance with which could reasonably be expected to have a Material Adverse Effect. Each Borrower may, however, contest or dispute any Applicable Laws in
any reasonable manner, provided that any related Lien is inchoate or stayed and sufficient reserves are established to the reasonable satisfaction of Agent to protect Agent’s Lien on or security interest in the Collateral. 

4.10. Inspection of Premises. At all reasonable times Agent and each Lender shall have full access to and the right to audit,
check, inspect and make abstracts and copies from each Borrower’s books, records, audits, correspondence and all other papers relating to the Collateral and the operation of each Borrower’s business. Agent, any Lender and their agents may
enter upon any premises of any Borrower at any time during business hours and at any other reasonable time, and from time to time, for the purpose of inspecting the Collateral and any and all records pertaining thereto and the operation of such
Borrower’s business. Notwithstanding the foregoing, so long as no Default or Event of Default has occurred and is continuing, Borrowers shall not be liable for the costs and expenses of more than four (4) such inspections per fiscal year.

 4.11. Insurance. 
 (a) The assets and properties of each Borrower at all times shall be maintained in accordance with the requirements of all insurance carriers which provide insurance with respect to the assets and
properties of such Borrower so that such insurance shall remain in full force and effect. Each Borrower shall bear the full risk of any loss of any nature whatsoever with respect to the Collateral. At each Borrower’s own cost and expense in
amounts and with carriers acceptable to Agent, each Borrower shall (a) keep all its insurable properties and properties in which such Borrower has an interest insured against the hazards of fire, flood, sprinkler leakage, those hazards covered
by extended coverage insurance and such other hazards, and for such amounts, as is customary in the case of companies engaged in businesses similar to such Borrower’s including business interruption insurance; (b) maintain a bond in such
amounts as is customary in the case of companies engaged in businesses similar to such Borrower insuring against larceny, embezzlement or other criminal misappropriation of insured’s officers

  
 50 

 
and employees who may either singly or jointly with others at any time have access to the assets or funds of such Borrower either directly or through authority to draw upon such funds or to
direct generally the disposition of such assets; (c) maintain public and product liability insurance against claims for personal injury, death or property damage suffered by others; (d) maintain all such worker’s compensation or
similar insurance as may be required under the laws of any state or jurisdiction in which such Borrower is engaged in business; (e) furnish Agent with (i) copies of all policies and evidence of the maintenance of such policies by the
renewal thereof at least thirty (30) days before any expiration date, and (ii) appropriate loss payable endorsements in form and substance satisfactory to Agent, naming Agent as a co-insured and lender loss payee as its interests may
appear with respect to all insurance coverage referred to in clauses (a) and (c) above, and providing (A) that all proceeds thereunder shall be payable to Agent, (B) no such insurance shall be affected by any act or neglect of
the insured or owner of the property described in such policy, and (C) that such policy and loss payable clauses may not be cancelled, amended or terminated unless at least thirty (30) days’ prior written notice is given to Agent. In
the event of any loss thereunder, the carriers named therein hereby are directed by Agent and the applicable Borrower to make payment for such loss to Agent and not to such Borrower and Agent jointly. If any insurance losses are paid by check, draft
or other instrument payable to any Borrower and Agent jointly, Agent may endorse such Borrower’s name thereon and do such other things as Agent may deem advisable to reduce the same to cash. Agent is hereby authorized to adjust and compromise
claims under insurance coverage referred to in clauses (a), and (b) above. All loss recoveries received by Agent upon any such insurance may be applied to the Obligations, in such order as Agent in its sole discretion shall determine. Any
surplus shall be paid by Agent to Borrowers or applied as may be otherwise required by law. Any deficiency thereon shall be paid by Borrowers to Agent, on demand. 
 (b) Each Borrower shall take all actions required under the Flood Laws and/or requested by Agent to assist in ensuring that each Lender is in compliance with the Flood Laws applicable to the Collateral,
including, but not limited to, providing Agent with the address and/or GPS coordinates of each structure on any real property that will be subject to a mortgage in favor of Agent, for the benefit of the Lenders, and, to the extent required,
obtaining flood insurance for such property, structures and contents prior to such property, structures and contents becoming Collateral, and thereafter maintaining such flood insurance in full force and effect for so long as required by the Flood
Laws. 
 4.12. Failure to Pay Insurance. If any Borrower fails to obtain insurance as hereinabove provided, or to keep
the same in force, Agent, if Agent so elects, may obtain such insurance and pay the premium therefor on behalf of such Borrower, and charge Borrowers’ Account therefor as a Revolving Advance of a Domestic Rate Loan and such expenses so paid
shall be part of the Obligations. 
 4.13. Payment of Taxes. Each Borrower will pay, when due, all taxes, assessments and
other Charges lawfully levied or assessed upon such Borrower or any of the Collateral including real and personal property taxes, assessments and charges and all franchise, income, employment, social security benefits, withholding, and sales taxes.
If any tax by any Governmental Body is or may be imposed on or as a result of any transaction between any Borrower and Agent or any Lender which Agent or any Lender may be required to withhold or pay or if any taxes, assessments, or other Charges
remain unpaid after the date fixed for their 

  
 51 

 
payment, or if any claim shall be made which, in Agent’s or any Lender’s opinion, may possibly create a valid Lien on the Collateral, Agent may without notice to Borrowers pay the
taxes, assessments or other Charges and each Borrower hereby indemnifies and holds Agent and each Lender harmless in respect thereof. Agent will not pay any taxes, assessments or Charges to the extent that any applicable Borrower has Properly
Contested those taxes, assessments or Charges. The amount of any payment by Agent under this Section 4.13 shall be charged to Borrowers’ Account as a Revolving Advance maintained as a Domestic Rate Loan and added to the Obligations and,
until Borrowers shall furnish Agent with an indemnity therefor (or supply Agent with evidence satisfactory to Agent that due provision for the payment thereof has been made), Agent may hold without interest any balance standing to Borrowers’
credit and Agent shall retain its security interest in and Lien on any and all Collateral held by Agent. 
 4.14. Payment of
Leasehold Obligations. Each Borrower shall at all times pay, when and as due, its rental obligations under all leases under which it is a tenant, and shall otherwise comply, in all material respects, with all other terms of such leases and keep
them in full force and effect and, at Agent’s request will provide evidence of having done so. 
 4.15. Receivables.

 (a) Nature of Receivables. Each of the Receivables shall be a bona fide and valid account representing a bona fide
indebtedness incurred by the Customer therein named, for a fixed sum as set forth in the invoice relating thereto (provided immaterial or unintentional invoice errors shall not be deemed to be a breach hereof) with respect to an absolute sale or
lease and delivery of goods upon stated terms of a Borrower, or work, labor or services theretofore rendered by a Borrower as of the date each Receivable is created. Same shall be due and owing in accordance with the applicable Borrower’s
standard terms of sale without dispute, setoff or counterclaim except as may be stated on the accounts receivable schedules delivered by Borrowers to Agent. 
 (b) Solvency of Customers. Each Customer, to the best of each Borrower’s knowledge, as of the date each Receivable is created, is and will be solvent and able to pay all Receivables on which
the Customer is obligated in full when due or with respect to such Customers of any Borrower who are not solvent such Borrower has set up on its books and in its financial records bad debt reserves adequate to cover such Receivables. 

(c) Location of Borrowers. Each Borrower’s chief executive office is located at 833 West South Boulder Road, Louisville,
Colorado 80027-2452. Until written notice is given to Agent by Borrowing Agent of any other office at which any Borrower keeps its records pertaining to Receivables, all such records shall be kept at such executive office. 

(d) Collection of Receivables. Borrowers shall instruct their Customers to deliver all remittances upon Receivables to such
lockbox account or Blocked Account as Agent shall designate from time to time as contemplated by Section 4.15(h) or as otherwise agreed to from time to time by Agent. Notwithstanding the foregoing, to the extent any Borrower directly receives
any remittances upon Receivables, such Borrower will, at such Borrower’s sole cost and expense, but on Agent’s behalf and for Agent’s account, collect as Agent’s property and in trust for Agent all amounts received on
Receivables, and shall not commingle such collections with 

  
 52 

 
any Borrower’s funds or use the same except to pay Obligations. Each Borrower shall deposit in the Blocked Account or, upon request by Agent, deliver to Agent, in original form and on the
date of receipt thereof, all checks, drafts, notes, money orders, acceptances, cash and other evidences of Indebtedness. 
 (e)
Notification of Assignment of Receivables. At any time following the occurrence of an Event of Default or a Default, Agent shall have the right to send notice of the assignment of, and Agent’s security interest in and Lien on, the
Receivables to any and all Customers or any third party holding or otherwise concerned with any of the Collateral. Thereafter, Agent shall have the sole right to collect the Receivables, take possession of the Collateral, or both. Agent’s
actual collection expenses, including, but not limited to, stationery and postage, telephone and telegraph, secretarial and clerical expenses and the salaries of any collection personnel used for collection, may be charged to Borrowers’ Account
and added to the Obligations. 
 (f) Power of Agent to Act on Borrowers’ Behalf. Agent shall have the right to
receive, endorse, assign and/or deliver in the name of Agent or any Borrower any and all checks, drafts and other instruments for the payment of money relating to the Receivables, and each Borrower hereby waives notice of presentment, protest and
non-payment of any instrument so endorsed. Each Borrower hereby constitutes Agent or Agent’s designee as such Borrower’s attorney with power (i) at any time: (A) to endorse such Borrower’s name upon any notes, acceptances,
checks, drafts, money orders or other evidences of payment or Collateral; (B) to sign such Borrower’s name on any invoice or bill of lading relating to any of the Receivables, drafts against Customers, assignments and verifications of
Receivables; (C) to send verifications of Receivables to any Customer; (D) to sign such Borrower’s name on all financing statements or any other documents or instruments deemed necessary or appropriate by Agent to preserve, protect,
or perfect Agent’s interest in the Collateral and to file same; and (E) to receive, open and dispose of all mail addressed to any Borrower; and (ii) at any time following the occurrence of a Default or Event of Default: (A) to
demand payment of the Receivables; (B) to enforce payment of the Receivables by legal proceedings or otherwise; (C) to exercise all of such Borrower’s rights and remedies with respect to the collection of the Receivables and any other
Collateral; (D) to settle, adjust, compromise, extend or renew the Receivables; (E) to settle, adjust or compromise any legal proceedings brought to collect Receivables; (F) to prepare, file and sign such Borrower’s name on a
proof of claim in bankruptcy or similar document against any Customer; (G) to prepare, file and sign such Borrower’s name on any notice of Lien, assignment or satisfaction of Lien or similar document in connection with the Receivables; and
(H) to do all other acts and things necessary to carry out this Agreement. All acts of said attorney or designee are hereby ratified and approved, and said attorney or designee shall not be liable for any acts of omission or commission nor for
any error of judgment or mistake of fact or of law, unless done maliciously or with gross (not mere) negligence (as determined by a court of competent jurisdiction in a final non-appealable judgment); this power being coupled with an interest is
irrevocable while any of the Obligations remain unpaid. Agent shall have the right at any time following the occurrence of an Event of Default or Default to change the address for delivery of mail addressed to any Borrower. 

(g) No Liability. Neither Agent nor any Lender shall, under any circumstances or in any event whatsoever, have any liability for
any error or omission or delay of 

  
 53 

 
any kind occurring in the settlement, collection or payment of any of the Receivables or any instrument received in payment thereof, or for any damage resulting therefrom. Following the
occurrence of an Event of Default or Default Agent may, without notice or consent from any Borrower, sue upon or otherwise collect, extend the time of payment of, compromise or settle for cash, credit or upon any terms any of the Receivables or any
other securities, instruments or insurance applicable thereto and/or release any obligor thereof. Agent is authorized and empowered to accept, following the occurrence of an Event of Default or Default, the return of the goods represented by any of
the Receivables, without notice to or consent by any Borrower, all without discharging or in any way affecting any Borrower’s liability hereunder. 
 (h) Establishment of a Lockbox Account, Dominion Account. All proceeds of Collateral shall be deposited by Borrowers into either (i) a lockbox account, dominion account or such other
“blocked account” (“Blocked Accounts”) established at a bank or banks (each such bank, a “Blocked Account Bank”) pursuant to an arrangement with such Blocked Account Bank as may be selected by Borrowing Agent and be
acceptable to Agent or (ii) depository accounts (“Depository Accounts”) established at the Agent for the deposit of such proceeds. Each applicable Borrower, Agent and each Blocked Account Bank shall enter into a deposit account
control agreement in form and substance satisfactory to Agent directing such Blocked Account Bank to transfer such funds so deposited to Agent, either to any account maintained by Agent at said Blocked Account Bank or by wire transfer to appropriate
account(s) of Agent. All funds deposited in such Blocked Accounts shall immediately become the property of Agent and Borrowing Agent shall obtain the agreement by such Blocked Account Bank to waive any offset rights against the funds so deposited.
Neither Agent nor any Lender assumes any responsibility for such blocked account arrangement, including any claim of accord and satisfaction or release with respect to deposits accepted by any Blocked Account Bank thereunder. All deposit accounts
and investment accounts of each Borrower and its Subsidiaries are set forth on Schedule 4.15(h). 
 (i) Adjustments. No
Borrower will, without Agent’s consent, compromise or adjust any Receivables (or extend the time for payment thereof) or accept any returns of merchandise or grant any additional discounts, allowances or credits thereon except for those
compromises, adjustments, returns, discounts, credits and allowances as have been heretofore customary in the Ordinary Course of Business of such Borrower. 
 4.16. Inventory. To the extent Inventory held for sale or lease has been produced by any Borrower, it has been and will be produced by such Borrower in accordance with the Federal Fair Labor
Standards Act of 1938, as amended, and all rules, regulations and orders thereunder. 
 4.17. Maintenance of Equipment.
The Equipment shall be maintained in good operating condition and repair (reasonable wear and tear excepted) and all necessary replacements of and repairs thereto shall be made so that the value and operating efficiency of the Equipment shall be
maintained and preserved. No Borrower shall use or operate the Equipment in violation of any law, statute, ordinance, code, rule or regulation. Each Borrower shall have the right to sell Equipment to the extent set forth in Section 4.3 hereof.

 4.18. Exculpation of Liability. Nothing herein contained shall be construed to constitute Agent or any Lender as any
Borrower’s agent for any purpose whatsoever, nor shall 

  
 54 

 
Agent or any Lender be responsible or liable for any shortage, discrepancy, damage, loss or destruction of any part of the Collateral wherever the same may be located and regardless of the cause
thereof. Neither Agent nor any Lender, whether by anything herein or in any assignment or otherwise, assume any of any Borrower’s obligations under any contract or agreement assigned to Agent or such Lender, and neither Agent nor any Lender
shall be responsible in any way for the performance by any Borrower of any of the terms and conditions thereof. 
 4.19.
Environmental Matters. 
 (a) Borrowers shall ensure that the Real Property and all operations and businesses conducted
thereon remains in compliance with all Environmental Laws and they shall not place or permit to be placed any Hazardous Substances on any Real Property except as permitted by Applicable Law or appropriate governmental authorities. 

(b) Borrowers shall establish and maintain a system to assure and monitor continued compliance with all applicable Environmental Laws
which system shall include periodic reviews of such compliance. 
 (c) Borrowers shall (i) employ in connection with the
use of the Real Property appropriate technology necessary to maintain compliance with any applicable Environmental Laws and (ii) dispose of any and all Hazardous Waste generated at the Real Property only at facilities and with carriers that
maintain valid permits under RCRA and any other applicable Environmental Laws. Borrowers shall use their best efforts to obtain certificates of disposal, such as hazardous waste manifest receipts, from all treatment, transport, storage or disposal
facilities or operators employed by Borrowers in connection with the transport or disposal of any Hazardous Waste generated at the Real Property. 
 (d) In the event any Borrower obtains, gives or receives notice of any Release or threat of Release of a reportable quantity of any Hazardous Substances at the Real Property (any such event being
hereinafter referred to as a “Hazardous Discharge”) or receives any notice of violation, request for information or notification that it is potentially responsible for investigation or cleanup of environmental conditions at the Real
Property, demand letter or complaint, order, citation, or other written notice with regard to any Hazardous Discharge or violation of Environmental Laws affecting the Real Property or any Borrower’s interest therein (any of the foregoing is
referred to herein as an “Environmental Complaint”) from any Person, including any state agency responsible in whole or in part for environmental matters in the state in which the Real Property is located or the United States Environmental
Protection Agency (any such person or entity hereinafter the “Authority”), then Borrowing Agent shall, within five (5) Business Days, give written notice of same to Agent detailing facts and circumstances of which any Borrower is
aware giving rise to the Hazardous Discharge or Environmental Complaint. Such information is to be provided to allow Agent to protect its security interest in and Lien on the Real Property and the Collateral and is not intended to create nor shall
it create any obligation upon Agent or any Lender with respect thereto. 
 (e) Borrowing Agent shall promptly forward to Agent
copies of any request for information, notification of potential liability, demand letter relating to potential responsibility with respect to the investigation or cleanup of Hazardous Substances at any other

  
 55 

 
site owned, operated or used by any Borrower to dispose of Hazardous Substances and shall continue to forward copies of correspondence between any Borrower and the Authority regarding such claims
to Agent until the claim is settled. Borrowing Agent shall promptly forward to Agent copies of all documents and reports concerning a Hazardous Discharge at the Real Property that any Borrower is required to file under any Environmental Laws. Such
information is to be provided solely to allow Agent to protect Agent’s security interest in and Lien on the Real Property and the Collateral. 
 (f) Borrowers shall respond promptly to any Hazardous Discharge or Environmental Complaint and take all necessary action in order to safeguard the health of any Person and to avoid subjecting the
Collateral or Real Property to any Lien. If any Borrower shall fail to respond promptly to any Hazardous Discharge or Environmental Complaint or any Borrower shall fail to comply with any of the requirements of any Environmental Laws, Agent on
behalf of Lenders may, but without the obligation to do so, for the sole purpose of protecting Agent’s interest in the Collateral: (i) give such notices or (ii) enter onto the Real Property (or authorize third parties to enter onto
the Real Property) and take such actions as Agent (or such third parties as directed by Agent) deem reasonably necessary or advisable, to clean up, remove, mitigate or otherwise deal with any such Hazardous Discharge or Environmental Complaint. All
reasonable costs and expenses incurred by Agent and Lenders (or such third parties) in the exercise of any such rights, including any sums paid in connection with any judicial or administrative investigation or proceedings, fines and penalties,
together with interest thereon from the date expended at the Default Rate for Domestic Rate Loans constituting Revolving Advances shall be paid upon demand by Borrowers, and until paid shall be added to and become a part of the Obligations secured
by the Liens created by the terms of this Agreement or any other agreement between Agent, any Lender and any Borrower. 
 (g)
Promptly upon the written request of Agent from time to time, Borrowers shall provide Agent, at Borrowers’ expense, with an environmental site assessment or environmental audit report prepared by an environmental engineering firm acceptable in
the reasonable opinion of Agent, to assess with a reasonable degree of certainty the existence of a Hazardous Discharge and the potential costs in connection with abatement, cleanup and removal of any Hazardous Substances found on, under, at or
within the Real Property. Any report or investigation of such Hazardous Discharge proposed and acceptable to an appropriate Authority that is charged to oversee the clean-up of such Hazardous Discharge shall be acceptable to Agent. If such
estimates, individually or in the aggregate, exceed $100,000, Agent shall have the right to require Borrowers to post a bond, letter of credit or other security reasonably satisfactory to Agent to secure payment of these costs and expenses.

 (h) Borrowers shall defend and indemnify Agent and Lenders and hold Agent, Lenders and their respective employees, agents,
directors and officers harmless from and against all loss, liability, damage and expense, claims, costs, fines and penalties, including attorney’s fees, suffered or incurred by Agent or Lenders under or on account of any Environmental Laws,
including the assertion of any Lien thereunder, with respect to any Hazardous Discharge, the presence of any Hazardous Substances affecting the Real Property, whether or not the same originates or emerges from the Real Property or any contiguous
real estate, including any loss of value of the Real Property as a result of the foregoing except to the extent such loss, liability, damage and expense is attributable to any Hazardous Discharge resulting from actions on the

  
 56 

 
part of Agent or any Lender. Borrowers’ obligations under this Section 4.19 shall arise upon the discovery of the presence of any Hazardous Substances at the Real Property, whether or
not any federal, state, or local environmental agency has taken or threatened any action in connection with the presence of any Hazardous Substances. Borrowers’ obligation and the indemnifications hereunder shall survive the termination of this
Agreement. 
 (i) For purposes of Section 4.19 and 5.7, all references to Real Property shall be deemed to include all of
each Borrower’s right, title and interest in and to its owned and leased premises. 
 4.20. Financing Statements.
Except as respects the financing statements filed by Agent and the financing statements described on Schedule 1.2, no financing statement covering any of the Collateral or any proceeds thereof is on file in any public office. 

4.21. Appraisals. Agent may, in its Permitted Discretion, at any time after the Closing Date and from time to time, engage the
services of an independent appraisal firm or firms of reputable standing, satisfactory to Agent, for the purpose of appraising the then current values of Borrowers’ assets; provided however that so long as no Default or Event of Default has
occurred and is continuing, Borrowers shall not be liable for the costs and expenses of more than two such appraisals in any fiscal year. Absent the occurrence and continuance of an Event of Default at such time, Agent shall consult with Borrowers
as to the identity of any such firm. In the event the value of Borrowers’ Inventory, as so determined pursuant to such appraisal, is less than anticipated by Agent or Lenders, such that the Revolving Advances are in excess of such Advances
permitted hereunder, then, promptly upon Agent’s demand for same, Borrowers shall make mandatory prepayments of the then outstanding Revolving Advances so as to eliminate the excess Advances. 

 

	V.	REPRESENTATIONS AND WARRANTIES. 

Each Borrower represents and warrants as follows: 
 5.1. Authority. Each Borrower has full power, authority and legal right to enter into this Agreement and the Other Documents to which it is a party and to perform all its respective Obligations
hereunder and thereunder. This Agreement and the Other Documents to which it is a party have been duly executed and delivered by each Borrower, and this Agreement and the Other Documents to which it is a party constitute the legal, valid and binding
obligation of such Borrower enforceable in accordance with their terms, except as such enforceability may be limited by any applicable bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights generally. The execution,
delivery and performance of this Agreement and of the Other Documents to which it is a party (a) are within such Borrower’s corporate or company powers, as applicable, have been duly authorized by all necessary corporate or company action,
as applicable, are not in contravention of law or the terms of such Borrower’s Organizational Documents or to the conduct of such Borrower’s business or of any Material Contract or undertaking to which such Borrower is a party or by which
such Borrower is bound, including the Acquisition Agreement, (b) will not conflict with or violate any law or regulation, or any judgment, order or decree of any Governmental Body, (c) will not require the Consent of any Governmental Body,
any party to a Material Contract or any other Person, except those Consents 

  
 57 

 
set forth on Schedule 5.1 hereto, all of which will have been duly obtained, made or compiled prior to the Closing Date and which are in full force and effect and (d) will not conflict with,
nor result in any breach in any of the provisions of or constitute a default under or result in the creation of any Lien except Permitted Encumbrances upon any asset of such Borrower under the provisions of any agreement, instrument, or other
document to which such Borrower is a party or by which it or its property is a party or by which it may be bound, including the Acquisition Agreement. 
 5.2. Formation and Qualification. 
 (a) Each Borrower is duly incorporated
or formed, as applicable, and in good standing under the laws of the state listed on Schedule 5.2(a) and is qualified to do business and is in good standing in the states listed on Schedule 5.2(a) which constitute all states in which qualification
and good standing are necessary for such Borrower to conduct its business and own its property and where the failure to so qualify could reasonably be expected to have a Material Adverse Effect on such Borrower. Each Borrower has delivered to Agent
true and complete copies of its Organizational Documents and will promptly notify Agent of any amendment or changes thereto. 

(b) The only Subsidiaries of each Borrower are listed on Schedule 5.2(b). 

5.3. Survival of Representations and Warranties. All representations and warranties of such Borrower contained in this Agreement
and the Other Documents shall be true at the time of such Borrower’s execution of this Agreement and the Other Documents, and shall survive the execution, delivery and acceptance thereof by the parties thereto and the closing of the
transactions described therein or related thereto. 
 5.4. Tax Returns. Each Borrower’s federal tax identification
number is set forth on Schedule 5.4. Each Borrower has filed all federal, state and local tax returns and other reports each is required by law to file and has paid all taxes, assessments, fees and other governmental charges that are due and
payable. Federal, state and local income tax returns of each Borrower have been examined and reported upon by the appropriate taxing authority or closed by applicable statute and satisfied for all fiscal years prior to and including the fiscal year
ending December 31, 2010. The provision for taxes on the books of each Borrower is adequate for all years not closed by applicable statutes, and for its current fiscal year, and no Borrower has any knowledge of any deficiency or additional
assessment in connection therewith not provided for on its books. 
 5.5. Financial Statements. 

(a) The pro forma balance sheet of Borrowers on a Consolidated Basis (the “Pro Forma Balance Sheet”) furnished to Agent on the
Closing Date reflects the consummation of the transactions contemplated by the Acquisition Agreement, and under this Agreement (collectively, the “Transactions”) and is accurate, complete and correct and fairly reflects the financial
condition of Borrowers on a pro forma Consolidated Basis as of the Closing Date after giving effect to the Transactions, and has been prepared in a manner consistent with historic practice of the Borrowers and in accordance with GAAP. The Pro Forma
Balance Sheet has 

  
 58 

 
been certified as accurate, complete and correct in all material respects by the Chief Executive Officer and Chief Financial Officer of Borrowing Agent. All pro forma financial statements
referred to in this subsection 5.5, including the related schedules and notes thereto, have been prepared, in a manner consistent with historic practice of Borrowers and in accordance with GAAP. 

(b) The twelve-month cash flow projections of Borrowers on a pro forma Consolidated Basis and their projected pro forma balance sheets as
of the Closing Date, copies of which are annexed hereto as Exhibit 5.5(b) (the “Projections”) were prepared by the Chief Financial Officer of Gaiam, are based on underlying assumptions which provide a reasonable basis for the projections
contained therein and reflect Borrowers’ judgment based on present circumstances of the most likely set of conditions and course of action for the projected period. The cash flow Projections together with the Pro Forma Balance Sheet, are
referred to as the “Pro Forma Financial Statements”. Agent and Lenders acknowledge that all historical pro forma financial information presented in Exhibit 5.5(b) reflects a compilation of transactions prepared in accordance with GAAP and
includes allocations for certain Gaiam expenses that Borrowers considered reasonable reflections of services provided to or benefit received by Borrows, but such historical pro forma financial information does not meet the GAAP requirements for
“carve-out financials”. 
 (c) The pro forma consolidated and pro forma consolidating balance sheets of Borrowers, and
such other Persons described therein as of February 29, 2012, and the related pro forma statements of income, changes in stockholder’s equity, and changes in cash flow for the period ended on such date have been prepared in a manner
consistent with historical practice of Borrowers and in accordance with GAAP and present fairly the financial position of Borrowers at such date and the results of their operations for such period. Since February 29, 2012 there has been no
change in the condition, financial or otherwise, of Borrowers as shown on the pro forma consolidated balance sheet as of such date and no change in the aggregate value of machinery, equipment and Real Property owned by Borrowers, except changes in
the Ordinary Course of Business, none of which individually or in the aggregate has been materially adverse. 
 5.6. Entity
Names. No Borrower has been known by any other corporate name in the past five years and does not sell Inventory under any other name except as set forth on Schedule 5.6, nor has any Borrower been the surviving corporation or company of a merger
or consolidation or acquired all or substantially all of the assets of any Person during the preceding five (5) years. 

5.7. O.S.H.A. and Environmental Compliance. 
 (a) Each Borrower is in compliance with, and its facilities, business, assets, property, leaseholds, Real Property and Equipment are in compliance with the Federal Occupational Safety and Health Act,
Environmental Laws and there are no outstanding citations, notices or orders of non-compliance issued to any Borrower or relating to its business, assets, property, leaseholds or Equipment under any such laws, rules or regulations. 

  
 59 

 (b) Each Borrower has been issued all required federal, state and local licenses,
certificates or permits (collectively, “Approvals”) relating to all applicable Environmental Laws and all such Approvals are current and in full force and effect. 
 (c) (i) there have been no releases, spills, discharges, leaks or disposal (collectively referred to as “Releases”) of Hazardous Materials at, upon, under or migrating from or onto any Real
Property owned, leased or occupied by any Borrower, except for those Releases which are in full compliance with Environmental Laws; (ii) there are no underground storage tanks or polychlorinated biphenyls on any Real Property, except for such
underground storage tanks or polychlorinated biphenyls that are present in compliance with Environmental Laws; (iii) the Real Property has never been used by any Borrower to dispose of Hazardous Materials, except as authorized by Environmental
Laws; and (iv) no Hazardous Materials are managed by Borrower on any Real Property, excepting such quantities as are managed in accordance with all applicable manufacturer’s instructions and compliance with Environmental Laws and as are
necessary for the operation of the commercial business of any Borrower or of its tenants. 
 (d) All Real Property owned by
Borrowers is insured pursuant to policies and other bonds which are valid and in full force and effect and which provide adequate coverage from reputable and financially sound insurers in amounts sufficient to insure the assets and risks of each
such Borrower in accordance with prudent business practice in the industry of such Borrower. Each Borrower has taken all actions required under the Flood Laws and/or requested by Agent to assist in ensuring that each Lender is in compliance with the
Flood Laws applicable to the Collateral, including, but not limited to, providing Agent with the address and/or GPS coordinates of each structure located upon any Real Property that will be subject to a Mortgage in favor of Agent, for the benefit of
the Lenders, and, to the extent required, obtaining flood insurance for such property, structures and contents prior to such property, structures and contents becoming Collateral. 

5.8. Solvency; No Litigation, Violation, Indebtedness or Default; ERISA Compliance. 

(a) Each Borrower is solvent, able to pay its debts as they mature, has capital sufficient to carry on its business and all businesses in
which it is about to engage, and (i) as of the Closing Date, the fair present saleable value of its assets, calculated on a going concern basis, is in excess of the amount of its liabilities and (ii) subsequent to the Closing Date, the
fair saleable value of its assets (calculated on a going concern basis) will be in excess of the amount of its liabilities. 

(b) Except as disclosed in Schedule 5.8(b), no Borrower has (i) any pending or threatened litigation, arbitration, actions or
proceedings which involve the possibility of having a Material Adverse Effect, and (ii) any liabilities or indebtedness for borrowed money other than the Obligations. 
 (c) No Borrower is in violation of any applicable statute, law, rule, regulation or ordinance in any respect which could reasonably be expected to have a Material Adverse Effect, nor is any Borrower in
violation of any order of any court, Governmental Body or arbitration board or tribunal. Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other federal or state laws. 

  
 60 

 (d) No Borrower or any member of the Controlled Group maintains or is required to contribute
to any Plan other than those listed on Schedule 5.8(d) hereto. (i) Each Borrower and each member of the Controlled Group has met all applicable minimum funding requirements under Section 302 of ERISA and Section 412 of the Code in
respect of each Plan, and each Plan is in compliance with Sections 412, 430 and 436 of the Code and Sections 206(g), 302 and 303 of ERISA, without regard to waivers and variances; (ii) each Plan which is intended to be a qualified plan under
Section 401(a) of the Code as currently in effect has been determined by the Internal Revenue Service to be qualified under Section 401(a) of the Code and the trust related thereto is exempt from federal income tax under
Section 501(a) of the Code or an application for such a determination is currently being processed by the Internal Revenue Code; (iii) neither any Borrower nor any member of the Controlled Group has incurred any liability to the PBGC other
than for the payment of premiums, and there are no premium payments which have become due which are unpaid; (iv) no Plan has been terminated by the plan administrator thereof nor by the PBGC, and there is no occurrence which would cause the
PBGC to institute proceedings under Title IV of ERISA to terminate any Plan; (v) the current value of the assets of each Plan exceeds the present value of the accrued benefits and other liabilities of such Plan and neither any Borrower nor any
member of the Controlled Group knows of any facts or circumstances which would materially change the value of such assets and accrued benefits and other liabilities; (vi) neither any Borrower nor any member of the Controlled Group has breached
any of the responsibilities, obligations or duties imposed on it by ERISA with respect to any Plan; (vii) neither any Borrower nor any member of a Controlled Group has incurred any liability for any excise tax arising under Section 4971,
4972 or 4980B of the Code, and no fact exists which could give rise to any such liability; (viii) neither any Borrower nor any member of the Controlled Group nor any fiduciary of, nor any trustee to, any Plan, has engaged in a “prohibited
transaction” described in Section 406 of the ERISA or Section 4975 of the Code nor taken any action which would constitute or result in a Termination Event with respect to any such Plan which is subject to ERISA; (ix) no
Termination Event has occurred or is reasonably expected to occur; (x) there exists no event described in Section 4043 of ERISA, for which the thirty (30) day notice period has not been waived; (xi) neither any Borrower nor any
member of the Controlled Group has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA; (xii) neither any Borrower nor any member of the Controlled Group maintains or is required to contribute to any Plan
which provides health, accident or life insurance benefits to former employees, their spouses or dependents, other than in accordance with Section 4980B of the Code; (xiii) neither any Borrower nor any member of the Controlled Group has
withdrawn, completely or partially, within the meaning of Section 4203 or 4205 of ERISA, from any Multiemployer Plan so as to incur liability under the Multiemployer Pension Plan Amendments Act of 1980 and there exists no fact which would
reasonably be expected to result in any such liability; and (xiv) no Plan fiduciary (as defined in Section 3(21) of ERISA) has any liability for breach of fiduciary duty or for any failure in connection with the administration or
investment of the assets of a Plan. 
 5.9. Patents, Trademarks, Copyrights and Licenses. All patents, patent
applications, trademarks, trademark applications, service marks, service mark applications, copyrights, copyright applications, design rights, tradenames, assumed names, trade secrets and licenses owned or utilized by any Borrower are set forth on
Schedule 5.9, are valid and have been duly registered or filed with all necessary Governmental Bodies; there is no objection to or pending 

  
 61 

 
challenge to the validity of any such patent, trademark, copyright, design rights, tradename, trade secret or license and no Borrower is aware of any grounds for any challenge, except as set
forth in Schedule 5.9 hereto. Each material patent, patent application, patent license, trademark, trademark application, trademark license, service mark, service mark application, service mark license, design rights, copyright, copyright
application and copyright license owned or held by any Borrower and all material trade secrets used by any Borrower consist of original material or property developed by such Borrower or was lawfully acquired by such Borrower from the proper and
lawful owner thereof. Each of such items has been maintained so as to preserve the value thereof from the date of creation or acquisition thereof. With respect to all software developed by or on behalf of any Borrower, such Borrower is in possession
of all source and object code related to each piece of software or is the beneficiary of a source code escrow agreement, each such source code escrow agreement being listed on Schedule 5.9 hereto. 

5.10. Licenses and Permits. Except as set forth in Schedule 5.10, each Borrower (a) is in compliance with and (b) has
procured and is now in possession of, all material licenses or permits required by any applicable federal, state, provincial or local law, rule or regulation for the operation of its business in each jurisdiction wherein it is now conducting or
proposes to conduct business and where the failure to procure such licenses or permits could have a Material Adverse Effect. 

5.11. Default of Indebtedness. No Borrower is in default in the payment of the principal of or interest on any Indebtedness or
under any instrument or agreement under or subject to which any Indebtedness has been issued and no event has occurred under the provisions of any such instrument or agreement which with or without the lapse of time or the giving of notice, or both,
constitutes or would constitute an event of default thereunder. 
 5.12. No Default. No Borrower is in default in the
payment or performance of any of its contractual obligations, which contractual obligations are in excess of $500,000 annually, and no Default has occurred. 
 5.13. No Burdensome Restrictions. No Borrower is party to any contract or agreement the performance of which could have a Material Adverse Effect. Each Borrower has heretofore delivered to Agent
true and complete copies of all Material Contracts to which it is a party or to which it or any of its properties is subject. No Borrower has agreed or consented to cause or permit in the future (upon the happening of a contingency or otherwise) any
of its property, whether now owned or hereafter acquired, to be subject to a Lien which is not a Permitted Encumbrance. 
 5.14.
No Labor Disputes. No Borrower is involved in any labor dispute; there are no strikes or walkouts or union organization of any Borrower’s employees threatened or in existence and no labor contract is scheduled to expire during the Term
other than as set forth on Schedule 5.14 hereto. 
 5.15. Margin Regulations. No Borrower is engaged, nor will it engage,
principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any “margin stock” within the respective meanings of each of the quoted terms under
Regulation U of the Board of Governors of the Federal Reserve System as now and from time to time hereafter in effect. No part of the proceeds of any Advance will be used for “purchasing” or “carrying” “margin stock” as
defined in Regulation U of such Board of Governors. 

  
 62 

 5.16. Investment Company Act. No Borrower is an “investment company”
registered or required to be registered under the Investment Company Act of 1940, as amended, nor is it controlled by such a company. 
 5.17. Disclosure. No representation or warranty made by any Borrower in this Agreement in the Acquisition Agreement, or in any financial statement, report, certificate or any other document
furnished in connection herewith or therewith contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements herein or therein not misleading. There is no fact known to any Borrower or which
reasonably should be known to such Borrower which such Borrower has not disclosed to Agent in writing with respect to the transactions contemplated by the Acquisition Agreement or this Agreement which could reasonably be expected to have a Material
Adverse Effect. 
 5.18. Delivery of Acquisition Agreement. Agent has received complete copies of the Acquisition
Agreement (including all exhibits, schedules and disclosure letters referred to therein or delivered pursuant thereto, if any) and all amendments thereto, waivers relating thereto and other side letters or agreements affecting the terms thereof.
None of such documents and agreements has been amended or supplemented, nor have any of the provisions thereof been waived, except pursuant to a written agreement or instrument which has heretofore been delivered to Agent. 

5.19. Swaps. No Borrower is a party to, nor will it be a party to, any swap agreement whereby such Borrower has agreed or will
agree to swap interest rates or currencies unless same provides that damages upon termination following an event of default thereunder are payable on an unlimited “two-way basis” without regard to fault on the part of either party.

 5.20. Conflicting Agreements. No provision of any mortgage, indenture, contract, agreement, judgment, decree or order
binding on any Borrower or affecting the Collateral conflicts with, or requires any Consent which has not already been obtained to, or would in any way prevent the execution, delivery or performance of, the terms of this Agreement or the Other
Documents. 
 5.21. Application of Certain Laws and Regulations. Neither any Borrower nor any Affiliate of any Borrower
is subject to any law, statute, rule or regulation which regulates the incurrence of any Indebtedness, including laws, statutes, rules or regulations relative to common or interstate carriers or to the sale of electricity, gas, steam, water,
telephone, telegraph or other public utility services. 
 5.22. Business and Property of Borrowers. Upon and after the
Closing Date, Borrowers do not propose to engage in any business other than the creation, production, licensing and distribution of (a) home, lifestyle, health and wellness goods, equipment and (b) health and entertainment media and
activities necessary to conduct the foregoing. On the Closing Date, each Borrower will own all the property and possess all of the rights and Consents necessary for the conduct of the business of such Borrower. 

  
 63 

 5.23. Section 20 Subsidiaries. Borrowers do not intend to use and shall not use
any portion of the proceeds of the Advances, directly or indirectly, to purchase during the underwriting period, or for 30 days thereafter, Ineligible Securities being underwritten by a Section 20 Subsidiary. 

5.24. Anti-Terrorism Laws. 
 (a) None of the Borrowers, Borrowers’ Affiliates, any Subsidiary of any Borrower, any Guarantor, or any broker or other agent of any of the foregoing acting in any capacity in connection with the
Advances or this Agreement, is or shall be (a) a Blocked Person; (b) engaged in any business involved in making or receiving any contribution of funds, goods or services to or for the benefit of a Blocked Person or in any transaction that
evades or avoids, or has the purpose of evading or avoiding, the prohibitions set forth in any Anti-Terrorism Law, or (c) otherwise in violation of any Anti-Terrorism Law. Borrowers shall deliver to Agent and Lenders any certification or other
evidence requested from time to time by Agent or any Lender in its sole discretion, confirming Borrowers’ compliance with this Section. 
 (b) None of the funds or other assets of any Borrower, any Affiliate or Subsidiary of any Borrower, any Guarantor, or any broker or other agent of any of the foregoing acting in any capacity in connection
with the Advances or this Agreement, constitute property of or are beneficially owned, directly or indirectly, by any Blocked Person or have been derived from any unlawful activity and no Blocked Person has any interest of any nature whatsoever in
any Borrower, any Affiliate or Subsidiary of any Borrower, or any Guarantor, as applicable, which (whether directly or indirectly) is prohibited by Law, could cause the Advances to be in violation of Law or may cause any assets or property of any
Borrower to be subject to forfeiture or seizure. 
 5.25. Trading with the Enemy. No Borrower has engaged, nor does it
intend to engage, in any business or activity prohibited by the Trading with the Enemy Act. 
 5.26. Federal Securities
Laws. Neither any Borrower nor any of its Subsidiaries (i) is required to file periodic reports under the Exchange Act, (ii) has any securities registered under the Exchange Act or (iii) has filed a registration statement that has
not yet become effective under the Securities Act. 
 5.27. Equity Interests. The authorized and outstanding Equity
Interests of each Borrower is as set forth on Schedule 5.27 hereto. All of the Equity Interests of each Borrower has been duly and validly authorized and issued and is fully paid and non-assessable and has been sold and delivered to the holders
hereof in compliance with, or under valid exemption from, all federal and state laws and the rules and regulations of each Governmental Body governing the sale and delivery of securities. Except for the rights and obligations set forth on Schedule
5.27, there are no subscriptions, warrants, options, calls, commitments, rights or agreement by which any Borrower or any of the shareholders of any Borrower is bound relating to the issuance, transfer, voting or redemption of shares of its Equity
Interests or any pre-emptive rights held by 

  
 64 

 
any Person with respect to the Equity Interests of Borrowers. Except as set forth on Schedule 5.27, Borrowers have not issued any securities convertible into or exchangeable for shares of its
Equity Interests or any options, warrants or other rights to acquire such shares or securities convertible into or exchangeable for such shares. 
 5.28. Commercial Tort Claims. No Borrower is a party to any commercial tort claims. 
 5.29. Letter of Credit Rights: As of the Closing Date, no Borrower has any letter of credit rights. 
 5.30. Material Contracts. Schedule 5.30 sets forth all Material Contracts of the Borrowers. All Material Contracts are in full force and effect and no material defaults currently exist thereunder.

 5.31. Gaiam License Agreement. No Borrower is in default in the payment or performance of any of its contractual
obligations under the Gaiam License Agreement, including without limitation, the payment of licensing fees. 
 5.32.
Intercorporate Services Agreement. No Borrower is in default in the payment or performance of any of its contractual obligations under that certain Intercorporate Services Agreement dated as of January 1, 2012 among Gaiam and Borrowers.

  

	VI.	AFFIRMATIVE COVENANTS. 

 Each
Borrower shall, until payment in full of the Obligations and termination of this Agreement: 
 6.1. Payment of Fees. Pay
to Agent on demand all usual and customary fees and expenses which Agent incurs in connection with (a) the forwarding of Advance proceeds and (b) the establishment and maintenance of any Blocked Accounts or Depository Accounts as provided
for in Section 4.15(h). Agent may, without making demand, charge Borrowers’ Account for all such fees and expenses. 

6.2. Conduct of Business and Maintenance of Existence and Assets. (a) Conduct continuously and operate actively its business
according to good business practices and maintain all of its properties useful or necessary in its business in good working order and condition (reasonable wear and tear excepted and except as may be disposed of in accordance with the terms of this
Agreement), including all licenses, patents, copyrights, design rights, tradenames, trade secrets and trademarks and take all actions necessary to enforce and protect the validity of any intellectual property right or other right included in the
Collateral; (b) keep in full force and effect its existence and comply in all material respects with the laws and regulations governing the conduct of its business where the failure to do so could reasonably be expected to have a Material
Adverse Effect; and (c) make all such reports and pay all such franchise and other taxes and license fees and do all such other acts and things as may be lawfully required to maintain its rights, licenses, leases, powers and franchises under
the laws of the United States or any political subdivision thereof where the failure to do so could reasonably be expected to have a Material Adverse Effect. 

  
 65 

 6.3. Violations. Promptly notify Agent in writing of any violation of any law,
statute, regulation or ordinance of any Governmental Body, or of any agency thereof, applicable to any Borrower which could reasonably be expected to have a Material Adverse Effect. 

6.4. Government Receivables. Take all steps necessary to protect Agent’s interest in the Collateral under the Federal
Assignment of Claims Act, the Uniform Commercial Code and all other applicable state or local statutes or ordinances and deliver to Agent appropriately endorsed, any instrument or chattel paper connected with any Receivable arising out of contracts
between any Borrower and the United States, any state or any department, agency or instrumentality of any of them. 
 6.5.
Financial Covenants. 
 (a) Fixed Charge Coverage Ratio. Commencing with the fiscal quarter ending
September 30, 2012, cause to be maintained as of the end of each fiscal quarter, a Fixed Charge Coverage Ratio of not less than 1.10 to 1.0, measured on a trailing twelve (12) month basis; provided however that (i) for the fiscal
quarter ending September 30, 2012, the Fixed Charge Coverage Ratio shall be measured for the one fiscal quarter then ending, (ii) for the fiscal quarter ending December 31, 2012, the Fixed Charge Coverage Ratio shall be measured for
the two consecutive fiscal quarters then ending, and (iii) for the fiscal quarter ending March 31, 2013, the Fixed Charge Coverage Ratio shall be measured for the three consecutive fiscal quarters then ending. 

(b) Minimum EBITDA. Achieve, as of the end of the following periods, EBITDA in an amount not less than the amounts set forth
below, measured for the period set forth below: 
  

			
	 Minimum EBITDA
	 	 Period

	$2,751,000	 	Trailing three month period ending September 30, 2012
	$8,446,000	 	Trailing six month period ending December 31, 2012
	$12,307,000	 	Trailing nine month period ending March 31, 2013
	$14,851,000	 	Trailing twelve month period ending June 30, 2013
	$15,331,000	 	Trailing twelve month period ending on September 30, 2013 and on the last day of each fiscal quarter thereafter

  
 66 

 6.6. Execution of Supplemental Instruments. Execute and deliver to Agent from time to
time, upon demand, such supplemental agreements, statements, assignments and transfers, or instructions or documents relating to the Collateral, and such other instruments as Agent may request, in order that the full intent of this Agreement may be
carried into effect. 
 6.7. Payment of Indebtedness. Pay, discharge or otherwise satisfy at or before maturity (subject,
where applicable, to specified grace periods and, in the case of the trade payables, to normal payment practices) all its obligations and liabilities of whatever nature, except when the failure to do so could not reasonably be expected to have a
Material Adverse Effect or when the amount or validity thereof is currently being Properly Contested, subject at all times to any applicable subordination arrangement in favor of Lenders. 

6.8. Standards of Financial Statements. Cause all financial statements referred to in Sections 9.7, 9.8, 9.9, 9.10, 9.11, 9.12,
and 9.13 as to which GAAP is applicable to be complete and correct in all material respects (subject, in the case of interim financial statements, to normal year-end audit adjustments) and to be prepared in reasonable detail and in accordance with
GAAP applied consistently throughout the periods reflected therein (except as concurred in by such reporting accountants or officer, as the case may be, and disclosed therein). 

6.9. Federal Securities Laws. Promptly notify Agent in writing if any Borrower or any of its Subsidiaries (i) is required to
file periodic reports under the Exchange Act, (ii) registers any securities under the Exchange Act or (iii) files a registration statement under the Securities Act. 
 6.10. Exercise of Rights. Enforce all of its rights under the Acquisition Agreement including, but not limited to, all indemnification rights and pursue all remedies available to it with diligence
and in good faith in connection with the enforcement of any such rights. 
 6.11. Post Closing Covenants. 

(a) Within sixty (60) days after the Closing Date, Borrowers shall deliver to Agent, in form and substance satisfactory to Agent,
Lien Waiver Agreements for the Collateral located at the leased and warehouse locations set forth on Schedule 4.5 attached hereto; provided however that failure to obtain such Lien Waiver Agreements shall not be deemed an Event of Default hereunder,
provided further that Borrowers acknowledge that Agent shall have the right (x) to maintain a reserve under the Formula Amount in an amount not less than three months rent due under the applicable lease or warehouse agreement for any locations
for which a Lien Waiver Agreement is not delivered (it being acknowledged such reserve is in place as of the Closing Date) or (y) deem any Collateral located at such locations as ineligible. For the avoidance of doubt, upon receipt of a Lien
Waiver Agreement in form and substance satisfactory to Agent for any location of Borrowers, any rent reserve in effect that is attributable to such location shall be released. 
 (b) Within sixty (60) days after the Closing Date, Borrowers shall deliver to Agent, in form and substance reasonably satisfactory to Agent, Licensor / Agent Agreements from BV Family Productions,
Inc., Discovery Licensing Inc., Mar Vista Entertainment, Inc. and The Travel Channel, LLC; provided however that failure to obtain such Licensor / Agent Agreements shall not be deemed an Event of Default hereunder, provided further that Borrowers
acknowledge that any Inventory subject to a license agreement for which Agent does not receive a Licensor / Agent agreement shall be deemed ineligible after expiration of the sixty (60) day period. 

  
 67 

	VII.	NEGATIVE COVENANTS. 

 No Borrower
shall, until satisfaction in full of the Obligations and termination of this Agreement: 
 7.1. Merger, Consolidation,
Acquisition and Sale of Assets. 
 (a) Enter into any merger, consolidation or other reorganization with or into any other
Person or acquire all or a substantial portion of the assets or Equity Interests of any Person or permit any other Person to consolidate with or merge with it. 
 (b) Sell, lease, transfer or otherwise dispose of any of its properties or assets, except (i) dispositions of Inventory and Equipment to the extent expressly permitted by Section 4.3 and
(ii) any other sales or dispositions expressly permitted by this Agreement. 
 7.2. Creation of Liens. Create or
suffer to exist any Lien or transfer upon or against any of its property or assets now owned or hereafter acquired, except Permitted Encumbrances. 
 7.3. Guarantees. Become liable upon the obligations or liabilities of any Person by assumption, endorsement or guaranty thereof or otherwise (other than to Lenders) except the endorsement of checks
in the Ordinary Course of Business. 
 7.4. Investments. Purchase or acquire obligations or Equity Interests of, or any
other interest in, any Person, except (a) obligations issued or guaranteed by the United States of America or any agency thereof, (b) commercial paper with maturities of not more than 180 days and a published rating of not less than A-1 or
P-1 (or the equivalent rating), (c) certificates of time deposit and bankers’ acceptances having maturities of not more than 180 days and repurchase agreements backed by United States government securities of a commercial bank if
(i) such bank has a combined capital and surplus of at least $500,000,000, or (ii) its debt obligations, or those of a holding company of which it is a Subsidiary, are rated not less than A (or the equivalent rating) by a nationally
recognized investment rating agency, and (d) U.S. money market funds that invest solely in obligations issued or guaranteed by the United States of America or an agency thereof. 

7.5. Loans. Make advances, loans or extensions of credit to any Person, including any Parent, Subsidiary or Affiliate except with
respect to the extension of commercial trade credit in connection with the sale of Inventory in the Ordinary Course of Business. 
 7.6. Capital Expenditures. Contract for, purchase or make any expenditure or commitments for Capital Expenditures in any fiscal year in an aggregate amount for all Borrowers in excess of $500,000;
provided, however, in the event Capital Expenditures during any fiscal year are less than the amount permitted for such fiscal year, then the unused amount (the “Carryover Amount”) may be carried over and used in the immediately succeeding
fiscal year; provided, further, that any Carryover Amount shall be deemed to be the last amount spent in such succeeding fiscal year. 

  
 68 

 7.7. Distributions. Pay or make any distribution on any Equity Interest of Borrower
or apply any of its funds, property or assets to the purchase, redemption or other retirement of any Equity Interest, or of any options to purchase or acquire any such Equity Interest of any Borrower except that (i) within ten
(10) Business Days of delivery of the audited financials of Borrowers required to be delivered pursuant to Section 9.7 hereof, Borrowers may make distributions on Equity Interests so long as (a) no Default or Event of Default shall
have occurred and be continuing or would occur after giving pro forma effect to the making of such distributions, (b) the Fixed Charge Coverage Ratio of Borrowers for the previous fiscal year was not less than 1.25 to 1.00 and after giving pro
forma effect to the making of such distributions as if they were made on the last day of the most recently ended fiscal quarter, the Fixed Charge Coverage Ratio of Borrowers for the trailing twelve month period ending on the last day of such fiscal
quarter would not be less than 1.25 to 1.00, (c) Borrowers’ average Undrawn Availability for the thirty days prior to such distribution was not less than $3,500,000, (d) Borrowers’ Undrawn Availability after giving pro forma
effect to the making of such distribution is not less than $3,500,000, (e) Borrowers’ projections for the thirty (30) day period after the making of such distribution and after giving effect to the making of such distribution project
Undrawn Availability of greater than $3,500,000 for each day of such period, and (f) such distributions do not exceed an amount equal to 15% of net income from the previous fiscal year; and (ii) so long as (a) a notice of termination
with regard to this Agreement shall not be outstanding, and (b) no Event of Default or Default shall have occurred and would not occur after giving pro forma effect to such payment(s), and (c) the purpose for such purchase, redemption or
distribution shall be as set forth in writing to Agent at least ten (10) days prior to such purchase, redemption or distribution and such purchase, redemption or distribution shall in fact be used for such purpose, any Borrower shall be
permitted to make distributions to its members in an aggregate amount equal to the Increased Tax Burden of its members. Payments to members shall be made so as to be available when the tax is due, including in respect of estimated tax payments. In
the event (x) the actual distribution to members made pursuant to this Section 7.7 exceeds the actual income tax liability of any member due to such Borrower’s status as a limited liability company, or (y) if such Borrower was a
subchapter C corporation, such Borrower would be entitled to a refund of income taxes previously paid as a result of a tax loss during a year in which such Borrower is a limited liability company, then the members shall repay such Borrower the
amount of such excess or refund, as the case may be, no later than the date the annual tax return must be filed by such Borrower (without giving effect to any filing extensions). In the event such amounts are not repaid in a timely manner by any
member, then such Borrower shall not pay or make any distribution with respect to, or purchase, redeem or retire, any membership interest of such Borrower held or controlled by, directly or indirectly, such member until such payment has been made.

 7.8. Indebtedness. Create, incur, assume or suffer to exist any Indebtedness (exclusive of trade debt) except in
respect of (i) Indebtedness to Lenders; (ii) Indebtedness incurred for Capital Expenditures permitted under Section 7.6 hereof, (iii) the Subordinated Indebtedness, and (iv) unsecured intercompany Indebtedness to the extent
such Indebtedness is subordinated to the Obligations on terms and conditions satisfactory to Agent in its reasonable discretion. 

  
 69 

 7.9. Nature of Business. Substantially change the nature of the business in which it
is presently engaged, nor except as specifically permitted hereby purchase or invest, directly or indirectly, in any assets or property other than in the Ordinary Course of Business for assets or property which are useful in, necessary for and are
to be used in its business as presently conducted. 
 7.10. Transactions with Affiliates. Directly or indirectly,
purchase, acquire or lease any property from, or sell, transfer or lease any property to, or otherwise enter into any transaction or deal with, any Affiliate, except (a) transactions disclosed to the Agent, which are in the Ordinary Course of
Business, on an arm’s-length basis on terms and conditions no less favorable than terms and conditions which would have been obtainable from a Person other than an Affiliate, and (b) transactions under the Gaiam License Agreement, and
(c) payment of the Gaiam Services Annual Amount (as defined in that certain Intercorporate Services Agreement dated as of January 1, 2012 among Gaiam and Borrowers as in effect on the date hereof) provided however that Borrowers shall
disclose the Gaiam Services Annual Amount to Agent no later than thirty (30) days after the commencement of each fiscal year and the Gaiam Services Annual Amount for any fiscal year shall not exceed (i) $9,150,000 for the fiscal year
ending December 31, 2012, (ii) $10,061,000 for the fiscal year ending December 31, 2013, (iii) $11,067,000 for the fiscal year ending December 31, 2014, or (iv) $12,174,000 for the fiscal year ending December 31,
2015. 
 7.11. Leases. Enter as lessee into any lease arrangement for real or personal property (unless capitalized and
permitted under Section 7.6 hereof) if after giving effect thereto, aggregate annual rental payments for all leased property would exceed $2,400,000 in any one fiscal year in the aggregate for all Borrowers. 

7.12. Subsidiaries. 
 (a) Form any Subsidiary unless such Subsidiary (i) is not a Foreign Subsidiary, (ii) at Agent’s discretion, (x) expressly joins in this Agreement as a borrower and becomes jointly and
severally liable for the obligations of Borrowers hereunder, under the Notes, and under any other agreement between any Borrower and Lenders, or (y) becomes a Guarantor with respect to the Obligations and executes a Guarantor Security Agreement
in favor of Agent, and (iii) Agent shall have received all documents, including legal opinions, it may reasonably require to establish compliance with each of the foregoing conditions. 

(b) Enter into any partnership, joint venture or similar arrangement. 

7.13. Fiscal Year and Accounting Changes. Change its fiscal year from December 31 or make any significant change (i) in
accounting treatment and reporting practices except as required by GAAP or (ii) in tax reporting treatment except as required by law. 
 7.14. Pledge of Credit. Now or hereafter pledge Agent’s or any Lender’s credit on any purchases or for any purpose whatsoever or use any portion of any Advance in or for any business
other than such Borrower’s business as conducted on the date of this Agreement. 

  
 70 

 7.15. Amendment of Organizational Documents. (i) Change its legal name,
(ii) change its form of legal entity (e.g., converting from a corporation to a limited liability company or vice versa), (iii) change its jurisdiction of organization or become (or attempt or purport to become) organized in more than one
jurisdiction, or (iv) otherwise amend, modify or waive any term or material provision of its Organizational Documents unless required by law, in any such case without (x) giving at least thirty (30) days prior written notice of such
intended change to Agent, (y) having received from Agent confirmation that Agent has taken all steps necessary for Agent to continue the perfection of and protect the enforceability and priority of its Liens in the Collateral belonging to such
Borrower and in the Equity Interests of such Borrower and (z) in any case under clause (iv), having received the prior written consent of Agent and Required Lenders to such amendment, modification or waiver. 

7.16. Compliance with ERISA. (i) (x) Maintain, or permit any member of the Controlled Group to maintain, or
(y) become obligated to contribute, or permit any member of the Controlled Group to become obligated to contribute, to any Plan, other than those Plans disclosed on Schedule 5.8(d), (ii) engage, or permit any member of the Controlled Group
to engage, in any non-exempt “prohibited transaction”, as that term is defined in Section 406 of ERISA or Section 4975 of the Code, (iii) terminate, or permit any member of the Controlled Group to terminate, any Plan where
such event could result in any liability of any Borrower or any member of the Controlled Group or the imposition of a lien on the property of any Borrower or any member of the Controlled Group pursuant to Section 4068 of ERISA, (iv) incur,
or permit any member of the Controlled Group to incur, any withdrawal liability to any Multiemployer Plan; (v) fail promptly to notify Agent of the occurrence of any Termination Event, (vi) fail to comply, or permit a member of the
Controlled Group to fail to comply, with the requirements of ERISA or the Code or other Applicable Laws in respect of any Plan, (vii) fail to meet, permit any member of the Controlled Group to fail to meet, or permit any Plan to fail to meet
all minimum funding requirements under ERISA and the Code, without regard to any waivers or variances, or postpone or delay or allow any member of the Controlled Group to postpone or delay any funding requirement with respect of any Plan, or
(viii) cause, or permit any member of the Controlled Group to cause, a representation or warranty in Section 5.8(d) to cease to be true and correct. 
 7.17. Prepayment of Indebtedness. Except as set forth in Section 7.21, at any time, directly or indirectly, prepay any Indebtedness (other than to Lenders), or repurchase, redeem, retire or
otherwise acquire any Indebtedness of any Borrower. 
 7.18. Anti-Terrorism Laws. No Borrower shall, until satisfaction
in full of the Obligations and termination of this Agreement, nor shall it permit any Affiliate or agent to: 
 (a) Conduct any
business or engage in any transaction or dealing with any Blocked Person, including the making or receiving any contribution of funds, goods or services to or for the benefit of any Blocked Person. 

(b) Deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to the Executive
Order No. 13224. 

  
 71 

 (c) Engage in or conspire to engage in any transaction that evades or avoids, or has the
purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in the Executive Order No. 13224, the USA PATRIOT Act or any other Anti-Terrorism Law. Borrower shall deliver to Lenders any certification or other
evidence requested from time to time by any Lender in its sole discretion, confirming Borrower’s compliance with this Section. 
 7.19. Membership/Partnership Interests. Elect to treat or permit any of its Subsidiaries to (x) treat its limited liability company membership interests or partnership interests, as the case
may be, as securities as contemplated by the definition of “security” in Section 8-102(15) and by Section 8-103 of Article 8 of Uniform Commercial Code or (y) certificate its limited liability company membership interests or
partnership interests, as the case may be. 
 7.20. Trading with the Enemy Act. Engage in any business or activity in
violation of the Trading with the Enemy Act. 
 7.21. Subordinated Indebtedness. At any time, directly or indirectly,
pay, prepay, repurchase, redeem, retire or otherwise acquire, or make any payment on account of any principal of, interest on or premium payable in connection with the repayment or redemption of the Subordinated Indebtedness or any other
Indebtedness owing to any Affiliate except as expressly permitted in the applicable Intercompany Subordination Agreement. 

7.22. Other Agreements. Enter into any material amendment, restatement, waiver or modification of (a) the Acquisition
Agreement or any related agreements, or (b) the Gaiam License Agreement to the extent such amendment or restatement would (i) increase the licensing fees under the Media License Agreement to an amount in excess of 30% of net sales (as
calculated under such agreement as of the date hereof), (ii) increase the licensing fees under the Intellectual Property License Agreement to an amount in excess of 13% of net sales (as calculated under such agreement as of the date hereof), or
(iii) increase any other royalty, licensing or other fees owing to Gaiam thereunder. 
  

	VIII.	CONDITIONS PRECEDENT. 

 8.1.
Conditions to Initial Advances. The agreement of Lenders to make the initial Advances requested to be made on the Closing Date is subject to the satisfaction, or waiver by Agent, immediately prior to or concurrently with the making of such
Advances, of the following conditions precedent: 
 (a) Note. Agent shall have received the Notes duly executed and
delivered by an authorized officer of each Borrower; 
 (b) Other Documents. Agent shall have received each of the
executed Other Documents, as applicable; 
 (c) Financial Condition Certificates. Agent shall have received an executed
Financial Condition Certificate in the form of Exhibit 8.1(c). 

  
 72 

 (d) Closing Certificate. Agent shall have received a closing certificate signed by
the Chief Financial Officer of each Borrower dated as of the date hereof, stating that (i) all representations and warranties set forth in this Agreement and the Other Documents are true and correct on and as of such date, and (ii) on such
date no Default or Event of Default has occurred or is continuing; 
 (e) Borrowing Base. Agent shall have received
evidence from Borrowers that the aggregate amount of Eligible Receivables and Eligible Inventory is sufficient in value and amount to support Advances in the amount requested by Borrowers on the Closing Date; 

(f) Undrawn Availability. After giving effect to the initial Advances hereunder, Borrowers shall have Undrawn Availability of at
least $3,500,000; 
 (g) Blocked Accounts. Borrowers shall have opened the Depository Accounts with Agent or Agent shall
have received duly executed agreements establishing the Blocked Accounts with financial institutions acceptable to Agent for the collection or servicing of the Receivables and proceeds of the Collateral and Agent shall have entered into control
agreements with the applicable financial institutions in form and substance satisfactory to Agent with respect to such Blocked Accounts; 
 (h) Acquisition Agreement. Agent shall have received final executed copies of the Acquisition Agreement, and all related agreements, documents and instruments as in effect on the Closing Date all
of which shall be satisfactory in form and substance to Agent; 
 (i) Filings, Registrations and Recordings. Each
document (including any Uniform Commercial Code financing statement) required by this Agreement, any related agreement or under law or reasonably requested by the Agent to be filed, registered or recorded in order to create, in favor of Agent, a
perfected security interest in or lien upon the Collateral shall have been properly filed, registered or recorded in each jurisdiction in which the filing, registration or recordation thereof is so required or requested, and Agent shall have
received an acknowledgment copy, or other evidence satisfactory to it, of each such filing, registration or recordation and satisfactory evidence of the payment of any necessary fee, tax or expense relating thereto; 

(j) Lien Waiver Agreements. Agent shall have received Lien Waiver Agreements with respect to all locations or places at which
Inventory and books and records are located; 
 (k) Licensor Agent Agreements. Agent shall have received Licensor / Agent
Agreement, in form and substance reasonably satisfactory to Agent, with respect to the Gaiam License and from Reebok International Ltd. (“Reebok”); provided however that Agent will waive the requirement to deliver the Licensor / Agent
Agreement from Reebok as a closing condition provided that any Inventory subject to any license agreement with Reebok shall be ineligible Inventory until such Licensor / Agent Agreement is delivered. 

(l) Secretary’s Certificates, Authorizing Resolutions and Good Standings of Borrowers. Agent shall have received a
certificate of the Secretary or Assistant Secretary (or 

  
 73 

 
other equivalent officer, partner or manager) of each Borrower in form and substance satisfactory to Agent dated as of the Closing Date which shall certify (i) copies of resolutions in form
and substance reasonably satisfactory to Agent, of the board of directors (or other equivalent governing body, member or partner) of such Borrower authorizing (x) the execution, delivery and performance of this Agreement, the Notes and each
Other Document to which such Borrower is a party (including authorization of the incurrence of indebtedness, borrowing of Revolving Advances and requesting of Letters of Credit on a joint and several basis with all Borrowers as provided for herein),
and (y) the granting by such Borrower of the security interests in and liens upon the Collateral to secure all of the joint and several Obligations of the Borrowers (and such certificate shall state that such resolutions have not been amended,
modified, revoked or rescinded as of the date of such certificate), (ii) the incumbency and signature of the officers of such Borrower authorized to execute this Agreement and the Other Documents, (iii) copies of the Organizational
Documents of such Borrower as in effect on such date, complete with all amendments thereto, and (iv) the good standing (or equivalent status) of such Borrower in its jurisdiction of organization and each applicable jurisdiction where the
conduct of such Borrower’s business activities or the ownership of its properties necessitates qualification, as evidenced by good standing certificate(s) (or the equivalent thereof issued by any applicable jurisdiction) dated not more than 20
days prior to the Closing Date, issued by the Secretary of State or other appropriate official of each such jurisdiction; 
 (m)
Collateral. Agent shall have received evidence, satisfactory to Agent, that Borrowers are the owner of all GT Direct Inventory and have rights in and too all Gaiam branded goods. 

(n) Legal Opinion. Agent shall have received the executed legal opinion of Brownstein, Hyatt, Farber, Schreck LLP in form and
substance satisfactory to Agent which shall cover such matters incident to the transactions contemplated by this Agreement, the Notes, the Other Documents, and related agreements as Agent may reasonably require and each Borrower hereby authorizes
and directs such counsel to deliver such opinions to Agent and Lenders; 
 (o) No Litigation. No litigation,
investigation or proceeding before or by any arbitrator or Governmental Body shall be continuing or threatened against any Borrower or against the officers or directors of any Borrower (A) in connection with this Agreement, the Other Documents,
the Acquisition Agreement or any of the transactions contemplated thereby and which, in the reasonable opinion of Agent, is deemed material or (B) which could, in the reasonable opinion of Agent, have a Material Adverse Effect; and (ii) no
injunction, writ, restraining order or other order of any nature materially adverse to any Borrower or the conduct of its business or inconsistent with the due consummation of the Transactions shall have been issued by any Governmental Body;

 (p) Collateral Examination. Agent shall have completed Collateral examinations and received appraisals, the results of
which shall be satisfactory in form and substance to Agent, of the Receivables, Inventory, General Intangibles and equipment of each Borrower and all books and records in connection therewith; 

(q) Fees. Agent shall have received all fees payable to Agent and Lenders on or prior to the Closing Date hereunder, including
pursuant to Article III hereof; 

  
 74 

 (r) Pro Forma Financial Statements. Agent shall have received a copy of the Pro Forma
Financial Statements which shall be satisfactory in all respects to Agent; 
 (s) Insurance. Agent shall have received in
form and substance satisfactory to Agent, (i) evidence that adequate insurance, including without limitation, casualty and liability insurance, required to be maintained under this Agreement is in full force and effect, (ii) insurance
certificates issued by Borrowers’ insurance broker containing such information regarding Borrowers’ casualty and liability insurance policies as Agent shall request and naming Agent as an additional insured, lenders loss payee and/or
mortgagee, as applicable, and (iii) loss payable endorsements issued by Borrowers’ insurer naming Agent as lenders loss payee and mortgagee, as applicable; 
 (t) Payment Instructions. Agent shall have received written instructions from Borrowing Agent directing the application of proceeds of the initial Advances made pursuant to this Agreement;

 (u) Consents. Agent shall have received any and all Consents necessary to permit the effectuation of the transactions
contemplated by this Agreement and the Other Documents, including all Licensor Consents required by Agent; and, Agent shall have received such Consents and waivers of such third parties as might assert claims with respect to the Collateral, as Agent
and its counsel shall deem necessary; 
 (v) No Adverse Material Change. (i) Since February 29, 2012, there
shall not have occurred any event, condition or state of facts which could reasonably be expected to have a Material Adverse Effect and (ii) no representations made or information supplied to Agent or Lenders shall have been proven to be
inaccurate or misleading in any material respect; 
 (w) Contract Review. Agent shall have received and reviewed all
Material Contracts of Borrowers including leases, union contracts, labor contracts, vendor supply contracts, license agreements and distributorship agreements and such contracts and agreements shall be satisfactory in all respects to Agent;

 (x) Compliance with Laws. Agent shall be reasonably satisfied that each Borrower is in compliance with all pertinent
federal, state, local or territorial regulations, including those with respect to the Federal Occupational Safety and Health Act, the Environmental Protection Act, ERISA and the Trading with the Enemy Act; and 

(y) Other. All corporate and other proceedings, and all documents, instruments and other legal matters in connection with the
Transactions shall be satisfactory in form and substance to Agent and its counsel. 
 8.2. Conditions to Each Advance.
The agreement of Lenders to make any Advance requested to be made on any date (including the initial Advance), is subject to the satisfaction of the following conditions precedent as of the date such Advance is made: 

(a) Representations and Warranties. Each of the representations and warranties made by any Borrower in or pursuant to this
Agreement, the Other Documents and 

  
 75 

 
any related agreements to which it is a party, and each of the representations and warranties contained in any certificate, document or financial or other statement furnished at any time under or
in connection with this Agreement, the Other Documents or any related agreement shall be true and correct in all respects on and as of such date as if made on and as of such date; 

(b) No Default. No Event of Default or Default shall have occurred and be continuing on such date, or would exist after giving
effect to the Advances requested to be made, on such date; provided, however that Agent, in its sole discretion, may continue to make Advances notwithstanding the existence of an Event of Default or Default and that any Advances so made shall not be
deemed a waiver of any such Event of Default or Default; and 
 (c) Maximum Advances. In the case of any type of Advance
requested to be made, after giving effect thereto, the aggregate amount of such type of Advance shall not exceed the maximum amount of such type of Advance permitted under this Agreement. 

Each request for an Advance by any Borrower hereunder shall constitute a representation and warranty by each Borrower as of the date of
such Advance that the conditions contained in this subsection shall have been satisfied. 
  

	IX.	INFORMATION AS TO BORROWERS. 

Each Borrower shall, or (except with respect to Section 9.11) shall cause Borrowing Agent on its behalf to, until satisfaction in
full of the Obligations and the termination of this Agreement: 
 9.1. Disclosure of Material Matters. Immediately upon
learning thereof, report to Agent all matters materially affecting the value, enforceability or collectibility of any portion of the Collateral, including any Borrower’s reclamation or repossession of, or the return to any Borrower of, a
material amount of goods or claims or disputes asserted by any Customer or other obligor. 
 9.2. Schedules. Deliver to
Agent (i) on or before the twentieth (20th) day of each month as and for the prior month (a) accounts receivable ageings inclusive of reconciliations to the general ledger, (b) accounts payable schedules inclusive of
reconciliations to the general ledger, (c) Inventory reports, (d) a monthly dilution true-up, and (e) royalties payable, accrued royalties and royalties on Inventory on hand reports; and (ii) on or before Tuesday of each week, a
(a) Borrowing Base Certificate in form and substance satisfactory to Agent (which shall be calculated as of the last day of the prior week and which shall not be binding upon Agent or restrictive of Agent’s rights under this Agreement),
and (b) sales reports, collections and a roll forward for the prior week. In addition, each Borrower will deliver to Agent at such intervals as Agent may require: (i) confirmatory assignment schedules; (ii) copies of Customer’s
invoices; (iii) evidence of shipment or delivery; and (iv) such further schedules, documents and/or information regarding the Collateral as Agent may require including trial balances and test verifications. Agent shall have the right to
confirm and verify all Receivables by any manner and through any medium it considers advisable and do whatever it may deem reasonably necessary to protect its interests hereunder. The items to be provided under this Section are to be in form
satisfactory to Agent and executed by each Borrower and delivered to Agent from time 

  
 76 

 
to time solely for Agent’s convenience in maintaining records of the Collateral, and any Borrower’s failure to deliver any of such items to Agent shall not affect, terminate, modify or
otherwise limit Agent’s Lien with respect to the Collateral. 
 9.3. Environmental Reports. Furnish Agent,
concurrently with the delivery of the financial statements referred to in Sections 9.7 and 9.8, with a certificate signed by the President of Borrowing Agent stating, to the best of his knowledge, that each Borrower is in compliance in all material
respects with all federal, state and local Environmental Laws. To the extent any Borrower is not in compliance with the foregoing laws, the certificate shall set forth with specificity all areas of non-compliance and the proposed action such
Borrower will implement in order to achieve full compliance. 
 9.4. Litigation. Promptly notify Agent in writing of any
claim, litigation, suit or administrative proceeding affecting any Borrower or any Guarantor, whether or not the claim is covered by insurance, and of any litigation, suit or administrative proceeding, which in any such case affects the Collateral
or which could reasonably be expected to have a Material Adverse Effect. 
 9.5. Material Occurrences. Promptly notify
Agent in writing upon the occurrence of: (a) any Event of Default or Default; (b) any event, development or circumstance whereby any financial statements or other reports furnished to Agent fail in any material respect to present fairly,
in accordance with GAAP consistently applied, the financial condition or operating results of any Borrower as of the date of such statements; (c) any accumulated retirement plan funding deficiency which, if such deficiency continued for two
plan years and was not corrected as provided in Section 4971 of the Code, could subject any Borrower to a tax imposed by Section 4971 of the Code; (d) each and every default by any Borrower which might result in the acceleration of
the maturity of any Indebtedness, including the names and addresses of the holders of such Indebtedness with respect to which there is a default existing or with respect to which the maturity has been or could be accelerated, and the amount of such
Indebtedness; and (e) any other development in the business or affairs of any Borrower or any Guarantor which could reasonably be expected to have a Material Adverse Effect; in each case describing the nature thereof and the action Borrowers
propose to take with respect thereto. 
 9.6. Government Receivables. Notify Agent immediately if any of its Receivables
arise out of contracts between any Borrower and the United States, any state, or any department, agency or instrumentality of any of them. 
 9.7. Annual Financial Statements. Furnish Agent and Lenders within ninety (90) days after the end of each fiscal year of Borrowers, audited financial statements of Borrowers on a consolidated
and consolidating basis and audited financial statements of Gaiam and its Subsidiaries on a consolidated and consolidating basis, including, but not limited to, statements of income and stockholders’ equity and cash flow from the beginning of
the current fiscal year to the end of such fiscal year and the balance sheet as at the end of such fiscal year, all prepared in accordance with GAAP applied on a basis consistent with prior practices, and in reasonable detail and reported upon
without qualification by an independent certified public accounting firm selected by Borrowers and satisfactory to Agent (the “Accountants”). The report of the Accountants shall be accompanied by a statement of the Accountants certifying
that (i) they have 

  
 77 

 
caused this Agreement to be reviewed, (ii) in making the examination upon which such report was based either no information came to their attention which to their knowledge constituted an
Event of Default or a Default under this Agreement or any related agreement or, if such information came to their attention, specifying any such Default or Event of Default, its nature, when it occurred and whether it is continuing, and such report
shall contain or have appended thereto calculations which set forth Borrowers’ compliance with the requirements or restrictions imposed by Sections 6.5, 7.4, 7.5, 7.6, 7.7, 7.8 and 7.11 hereof. In addition, the reports shall be accompanied by a
Compliance Certificate. 
 9.8. Quarterly Financial Statements. Furnish Agent and Lenders within forty-five
(45) days after the end of each fiscal quarter, an unaudited balance sheet of Gaiam and its Subsidiaries on a consolidated and consolidating basis and unaudited statements of income and stockholders’ equity and cash flow of Gaiam and its
Subsidiaries on a consolidated and consolidating basis reflecting results of operations from the beginning of the fiscal year to the end of such fiscal quarter and for such fiscal quarter and with a comparison to budget, prepared on a basis
consistent with prior practices and complete and correct in all material respects, subject to normal and recurring year end adjustments that individually and in the aggregate are not material to Borrowers’ business. Such reports shall include
any eliminating entries and shall be accompanied by a Compliance Certificate 
 9.9. Monthly Financial Statements.
Furnish Agent and Lenders within thirty (30) days after the end of each month, an unaudited balance sheet of Borrowers on a consolidated and consolidating basis and unaudited statements of income and stockholders’ equity and cash flow of
Borrowers on a consolidated and consolidating basis reflecting results of operations from the beginning of the fiscal year to the end of such month and for such month and with a comparison to budget, prepared on a basis consistent with prior
practices and complete and correct in all material respects, subject to normal and recurring year end adjustments that individually and in the aggregate are not material to Borrowers’ business. Such reports shall include any eliminating entries
and shall be accompanied by a Compliance Certificate. 
 9.10. Other Reports. Furnish Agent (a) as soon as
available, but in any event within ten (10) days after the issuance thereof with copies of such financial statements, reports and returns as each Borrower shall send to its stockholders or members, as applicable, (b) together with the
monthly Compliance Certificate required by Section 9.9 above, a monthly report of amounts charged by and paid to Cinram Distribution LLC and setting forth the payment terms for any payables and the amount of any payables which are past due more
than fifteen (15) days after their original due date or more than sixty (60) days after the original invoice date, (c) for the fiscal quarters ending September 31, 2012 and December 31, 2012, together with the quarterly
Compliance Certificate for such quarter, a report of License Agreements entered into by Borrowers, and (d) for the month ending January 31, 2013 and each month thereafter, together with the monthly Compliance Certificate for such month, a
report of License Agreements entered into by Borrowers. 
 9.11. Additional Information. Furnish Agent with such
additional information as Agent shall reasonably request in order to enable Agent to determine whether the terms, covenants, provisions and conditions of this Agreement and the Notes have been complied with by Borrowers including, without the
necessity of any request by Agent, (a) copies of all 

  
 78 

 
environmental audits and reviews, (b) at least thirty (30) days prior thereto, notice of any Borrower’s opening of any new office or place of business or any Borrower’s
closing of any existing office or place of business, and (c) promptly upon any Borrower’s learning thereof, notice of any labor dispute to which any Borrower may become a party, any strikes or walkouts relating to any of its plants or
other facilities, and the expiration of any labor contract to which any Borrower is a party or by which any Borrower is bound. 

9.12. Projected Operating Budget. Commencing with fiscal year 2013, furnish Agent and Lenders, no later than the earlier of
(a) ninety (90) days after the beginning of each Borrower’s fiscal years, and (b) approval by the Board of Directors of Gaiam, a month by month projected operating budget and cash flow of Gaiam and its Subsidiaries on a
consolidated and consolidating basis for such fiscal year (including an income statement for each month and a balance sheet as at the end of the last month in each fiscal quarter), such projections to be accompanied by a certificate signed by the
President or Chief Financial Officer of each Borrower to the effect that such projections have been prepared on the basis of sound financial planning practice consistent with past budgets and financial statements and that such officer has no reason
to question the reasonableness of any material assumptions on which such projections were prepared. 
 9.13. Variances From
Operating Budget. Furnish Agent, concurrently with the delivery of the financial statements referred to in Section 9.7 and 9.8, a written report summarizing all material variances from budgets submitted by Borrowers pursuant to
Section 9.12 and a discussion and analysis by management with respect to such variances. 
 9.14. Notice of Suits,
Adverse Events. Furnish Agent with prompt written notice of (i) any lapse or other termination of any Consent issued to any Borrower by any Governmental Body or any other Person that is material to the operation of any Borrower’s
business, (ii) any refusal by any Governmental Body or any other Person to renew or extend any such Consent; and (iii) copies of any periodic or special reports filed by any Borrower or any Guarantor with any Governmental Body or Person,
if such reports indicate any material change in the business, operations, affairs or condition of any Borrower or any Guarantor, or if copies thereof are requested by Lender, and (iv) copies of any material notices and other communications from
any Governmental Body or Person which specifically relate to any Borrower or any Guarantor. 
 9.15. ERISA Notices and
Requests. Furnish Agent with immediate written notice in the event that (i) any Borrower or any member of the Controlled Group knows or has reason to know that a Termination Event has occurred, together with a written statement describing
such Termination Event and the action, if any, which such Borrower or any member of the Controlled Group has taken, is taking, or proposes to take with respect thereto and, when known, any action taken or threatened by the Internal Revenue Service,
Department of Labor or PBGC with respect thereto, (ii) any Borrower or any member of the Controlled Group knows or has reason to know that a prohibited transaction (as defined in Sections 406 of ERISA and 4975 of the Code) has occurred together
with a written statement describing such transaction and the action which such Borrower or any member of the Controlled Group has taken, is taking or proposes to take with respect thereto, (iii) a funding waiver request has been filed with
respect to any Plan together with all communications received by any Borrower or any member of the Controlled Group with respect to such request, (iv) any increase in the benefits of any existing Plan or the establishment

  
 79 

 
of any new Plan or the commencement of contributions to any Plan to which any Borrower or any member of the Controlled Group was not previously contributing shall occur, (v) any Borrower or
any member of the Controlled Group shall receive from the PBGC a notice of intention to terminate a Plan or to have a trustee appointed to administer a Plan, together with copies of each such notice, (vi) any Borrower or any member of the
Controlled Group shall receive any favorable or unfavorable determination letter from the Internal Revenue Service regarding the qualification of a Plan under Section 401(a) of the Code, together with copies of each such letter; (vii) any
Borrower or any member of the Controlled Group shall receive a notice regarding the imposition of withdrawal liability, together with copies of each such notice; (viii) any Borrower or any member of the Controlled Group shall fail to make a
required installment or any other required payment under the Code or ERISA on or before the due date for such installment or payment; or (ix) any Borrower or any member of the Controlled Group knows that (a) a Multiemployer Plan has been
terminated, (b) the administrator or plan sponsor of a Multiemployer Plan intends to terminate a Multiemployer Plan, (c) the PBGC has instituted or will institute proceedings under Section 4042 of ERISA to terminate a Multiemployer
Plan or (d) a Multiemployer Plan is subject to Section 432 of the Code or Section 305 of ERISA. 
 9.16.
Additional Documents. Execute and deliver to Agent, upon request, such documents and agreements as Agent may, from time to time, reasonably request to carry out the purposes, terms or conditions of this Agreement. 

 

	X.	EVENTS OF DEFAULT. 

 The
occurrence of any one or more of the following events shall constitute an “Event of Default”: 
 10.1.
Nonpayment. Failure by any Borrower to pay any principal or interest on the Obligations when due, whether at maturity or by reason of acceleration pursuant to the terms of this Agreement or by notice of intention to prepay, or by required
prepayment or failure to pay when due any other liabilities or make any other payment, fee or charge provided for herein when due or in any Other Document; 
 10.2. Breach of Representation. Any representation or warranty made or deemed made by any Borrower or any Guarantor in this Agreement, any Other Document or any related agreement or in any
certificate, document or financial or other statement furnished at any time in connection herewith or therewith shall prove to have been misleading in any material respect on the date when made or deemed to have been made; 

10.3. Financial Information. Failure by any Borrower to (i) furnish financial information when due or when requested, or
(ii) permit the inspection of its books or records; 
 10.4. Judicial Actions. Issuance of a notice of Lien, levy,
assessment, injunction or attachment against any Borrower’s Inventory or Receivables or against a material portion of any Borrower’s other property which is not stayed or lifted within thirty (30) days; 

10.5. Noncompliance. Except as otherwise provided for in Sections 10.1, 10.3 and 10.5(ii), (i) failure or neglect of any
Borrower or any Guarantor or any Person to perform, keep 

  
 80 

 
or observe any term, provision, condition, covenant herein contained, or contained in any Other Document or any other agreement or arrangement, now or hereafter entered into between any Borrower
or any Guarantor or such Person, and Agent or any Lender, or (ii) failure or neglect of any Borrower to perform, keep or observe any term, provision, condition or covenant, contained in Sections 4.6, 4.7, 4.9, 6.1, 6.3, 6.4, 9.4 or 9.6 hereof
which is not cured within ten (10) days from the occurrence of such failure or neglect; 
 10.6. Judgments. Any
judgment or judgments are rendered against any Borrower or any Guarantor for an aggregate amount in excess of $250,000 or against all Borrowers or Guarantors for an aggregate amount in excess of $250,000 and (i) enforcement proceedings shall
have been commenced by a creditor upon such judgment, (ii) there shall be any period of thirty (30) consecutive days during which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, shall not be in effect,
or (iii) any such judgment results in the creation of a Lien upon any of the Collateral (other than a Permitted Encumbrance); 
 10.7. Bankruptcy. Any Borrower, any Subsidiary of any Borrower or any Guarantor shall (i) apply for, consent to or suffer the appointment of, or the taking of possession by, a receiver,
custodian, trustee, liquidator or similar fiduciary of itself or of all or a substantial part of its property, (ii) make a general assignment for the benefit of creditors, (iii) commence a voluntary case under any state or federal
bankruptcy laws (as now or hereafter in effect), (iv) be adjudicated a bankrupt or insolvent, (v) file a petition seeking to take advantage of any other law providing for the relief of debtors, (vi) acquiesce to, or fail to have
dismissed, within thirty (30) days, any petition filed against it in any involuntary case under such bankruptcy laws, or (vii) take any action for the purpose of effecting any of the foregoing; 

10.8. Inability to Pay. Any Borrower or any Guarantor shall admit in writing its inability, or be generally unable, to pay its
debts as they become due or cease operations of its present business; 
 10.9. Reserved; 

10.10. Material Adverse Effect. The occurrence of any Material Adverse Effect; 

10.11. Lien Priority. Any Lien created hereunder or provided for hereby or under any related agreement for any reason ceases to be
or is not a valid and perfected Lien having a first priority interest; 
 10.12. Reserved; 

10.13. Cross Default. Either (x) any specified “event of default” under any Indebtedness (other than the
Obligations) of any Borrower with a then-outstanding principal balance (or, in the case of any Indebtedness not so denominated, with a then-outstanding total obligation amount) of $500,000 or more, or any other event or circumstance which would
permit the holder of any such Indebtedness of any Borrower to accelerate such Indebtedness (and/or the obligations of Borrower thereunder) prior to the scheduled maturity or termination thereof, shall occur (regardless of whether the holder of such
Indebtedness shall actually accelerate, terminate or otherwise exercise any rights or remedies with respect to such Indebtedness) or (y) a default of 

  
 81 

 
the obligations of any Borrower under any other agreement to which it is a party shall occur which has or is reasonably likely to have a Material Adverse Effect which is not cured within the
applicable grace period; 
 10.14. Breach of Guaranty or Pledge Agreement. Termination or breach of any Guaranty,
Guaranty Security Agreement, Pledge Agreement or similar agreement executed and delivered to Agent in connection with the Obligations of any Borrower, or if any Guarantor attempts to terminate, challenges the validity of, or its liability under, any
such Guaranty, Guaranty Security Agreement, Pledge Agreement or similar agreement; 
 10.15. Change of Ownership. Any
Change of Control shall occur; 
 10.16. Invalidity. Any material provision of this Agreement or any Other Document
shall, for any reason, cease to be valid and binding on any Borrower or any Guarantor, or any Borrower or any Guarantor shall so claim in writing to Agent or any Lender; 
 10.17. Licenses. (i) Any Governmental Body shall (a) revoke, terminate, suspend or adversely modify any license, permit, patent trademark or tradename of any Borrower or any Guarantor,
the continuation of which is material to the continuation of any Borrower’s or Guarantor’s business, or (b) commence proceedings to suspend, revoke, terminate or adversely modify any such license, permit, trademark, tradename or
patent and such proceedings shall not be dismissed or discharged within sixty (60) days, or (c) schedule or conduct a hearing on the renewal of any license, permit, trademark, tradename or patent necessary for the continuation of any
Borrower’s or any Guarantor’s business and the staff of such Governmental Body issues a report recommending the termination, revocation, suspension or material, adverse modification of such license, permit, trademark, tradename or patent;
(ii) any agreement which is necessary or material to the operation of any Borrower’s or any Guarantor’s business shall be revoked or terminated and not replaced by a substitute acceptable to Agent within thirty (30) days after
the date of such revocation or termination, and such revocation or termination and non-replacement would reasonably be expected to have a Material Adverse Effect; 
 10.18. Seizures. Any portion of the Collateral shall be seized or taken by a Governmental Body, or any Borrower or any Guarantor or the title and rights of any Borrower, any Guarantor which is the
owner of any material portion of the Collateral shall have become the subject matter of claim, litigation, suit or other proceeding which could, in the opinion of Agent, upon final determination, be reasonably likely to result in impairment or loss
of the security provided by this Agreement or the Other Documents; 
 10.19. Reserved. 

10.20. Operations. The operations of any Borrower’s distribution facility are interrupted at any time for more than five
consecutive Business Days, unless such Borrower shall (i) be entitled to receive for such period of interruption, proceeds of business interruption insurance sufficient to assure that its per diem cash needs during such period is at least equal
to its average per diem cash needs for the consecutive three month period immediately preceding the initial date of interruption and (ii) receive such proceeds in the amount described in clause (i) preceding not later than thirty
(30) days following the initial date of any such interruption; provided, 

  
 82 

 
however, that notwithstanding the provisions of clauses (i) and (ii) of this section, an Event of Default shall be deemed to have occurred if such Borrower shall be receiving the
proceeds of business interruption insurance for a period of thirty (30) consecutive days; or 
 10.21. Pension
Plans. An event or condition specified in Sections 7.16 or 9.15 hereof shall occur or exist with respect to any Plan and, as a result of such event or condition, together with all other such events or conditions, any Borrower or any member of
the Controlled Group shall incur, or in the opinion of Agent be reasonably likely to incur, a liability to a Plan or the PBGC (or both) which, in the reasonable judgment of Agent, would have a Material Adverse Effect. 

 

	XI.	LENDERS’ RIGHTS AND REMEDIES AFTER DEFAULT. 

 11.1. Rights and Remedies. 
 (a) Upon the occurrence of: (i) an Event
of Default pursuant to Section 10.7 all Obligations shall be immediately due and payable and this Agreement and the obligation of Lenders to make Advances shall be deemed terminated; and, (ii) any of the other Events of Default and at any
time thereafter, at the option of Required Lenders all Obligations shall be immediately due and payable and Lenders shall have the right to terminate this Agreement and to terminate the obligation of Lenders to make Advances; and (iii) a filing
of a petition against any Borrower in any involuntary case under any state or federal bankruptcy laws, all Obligations shall be immediately due and payable and the obligation of Lenders to make Advances hereunder shall be terminated other than as
may be required by an appropriate order of the bankruptcy court having jurisdiction over such Borrower. Upon the occurrence of any Event of Default, Agent shall have the right to exercise any and all rights and remedies provided for herein, under
the Other Documents, under the Uniform Commercial Code and at law or equity generally, including the right to foreclose the security interests granted herein and to realize upon any Collateral by any available judicial procedure and/or to take
possession of and sell any or all of the Collateral with or without judicial process. Agent may enter any of any Borrower’s premises or other premises without legal process and without incurring liability to any Borrower therefor, and Agent may
thereupon, or at any time thereafter, in its discretion without notice or demand, take the Collateral and remove the same to such place as Agent may deem advisable and Agent may require Borrowers to make the Collateral available to Agent at a
convenient place. With or without having the Collateral at the time or place of sale, Agent may sell the Collateral, or any part thereof, at public or private sale, at any time or place, in one or more sales, at such price or prices, and upon such
terms, either for cash, credit or future delivery, as Agent may elect. Except as to that part of the Collateral which is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market, Agent shall give
Borrowers reasonable notification of such sale or sales, it being agreed that in all events written notice mailed to Borrowing Agent at least ten (10) days prior to such sale or sales is reasonable notification. At any public sale Agent or any
Lender may bid for and become the purchaser, and Agent, any Lender or any other purchaser at any such sale thereafter shall hold the Collateral sold absolutely free from any claim or right of whatsoever kind, including any equity of redemption and
all such claims, rights and equities are hereby expressly waived and released by each Borrower. In connection with the exercise of the foregoing remedies, including the sale of Inventory, Agent is granted a perpetual nonrevocable, royalty free,
nonexclusive license and 

  
 83 

 
Agent is granted permission to use all of each Borrower’s (a) trademarks, trade styles, trade names, patents, patent applications, copyrights, service marks, licenses, franchises and
other proprietary rights which are used or useful in connection with Inventory for the purpose of marketing, advertising for sale and selling or otherwise disposing of such Inventory and (b) Equipment for the purpose of completing the
manufacture of unfinished goods. The cash proceeds realized from the sale of any Collateral shall be applied to the Obligations in the order set forth in Section 11.5 hereof. Noncash proceeds will only be applied to the Obligations as they are
converted into cash. If any deficiency shall arise, Borrowers shall remain liable to Agent and Lenders therefor. 
 (b) To the
extent that Applicable Law imposes duties on the Agent to exercise remedies in a commercially reasonable manner, each Borrower acknowledges and agrees that it is not commercially unreasonable for the Agent: (i) to fail to incur expenses
reasonably deemed significant by the Agent to prepare Collateral for disposition or otherwise to complete raw material or work in process into finished goods or other finished products for disposition; (ii) to fail to obtain third party
consents for access to Collateral to be disposed of, or to obtain or, if not required by other law, to fail to obtain governmental or third party consents for the collection or disposition of Collateral to be collected or disposed of; (iii) to
fail to exercise collection remedies against Customers or other Persons obligated on Collateral or to remove Liens on or any adverse claims against Collateral; (iv) to exercise collection remedies against Customers and other Persons obligated
on Collateral directly or through the use of collection agencies and other collection specialists; (v) to advertise dispositions of Collateral through publications or media of general circulation, whether or not the Collateral is of a
specialized nature; (vi) to contact other Persons, whether or not in the same business as any Borrower, for expressions of interest in acquiring all or any portion of such Collateral; (vii) to hire one or more professional auctioneers to
assist in the disposition of Collateral, whether or not the Collateral is of a specialized nature; (viii) to dispose of Collateral by utilizing internet sites that provide for the auction of assets of the types included in the Collateral or
that have the reasonable capacity of doing so, or that match buyers and sellers of assets; (ix) to dispose of assets in wholesale rather than retail markets; (x) to disclaim disposition warranties, such as title, possession or quiet
enjoyment, (xi) to purchase insurance or credit enhancements to insure the Agent against risks of loss, collection or disposition of Collateral or to provide to the Agent a guaranteed return from the collection or disposition of Collateral; or
(xii) to the extent deemed appropriate by the Agent, to obtain the services of other brokers, investment bankers, consultants and other professionals to assist the Agent in the collection or disposition of any of the Collateral. Each Borrower
acknowledges that the purpose of this Section 11.1(b) is to provide non-exhaustive indications of what actions or omissions by the Agent would not be commercially unreasonable in the Agent’s exercise of remedies against the Collateral and
that other actions or omissions by the Agent shall not be deemed commercially unreasonable solely on account of not being indicated in this Section 11.1(b). Without limitation upon the foregoing, nothing contained in this Section 11.1(b)
shall be construed to grant any rights to any Borrower or to impose any duties on Agent that would not have been granted or imposed by this Agreement or by Applicable Law in the absence of this Section 11.1(b). 

11.2. Agent’s Discretion. Agent shall have the right in its sole discretion to determine which rights, Liens, security
interests or remedies Agent may at any time pursue, relinquish, subordinate, or modify or to take any other action with respect thereto and such determination will not in any way modify or affect any of Agent’s or Lenders’ rights
hereunder. 

  
 84 

 11.3. Setoff. Subject to Section 14.12, in addition to any other rights which
Agent or any Lender may have under Applicable Law, upon the occurrence of an Event of Default hereunder, Agent and such Lender shall have a right, immediately and without notice of any kind, to apply any Borrower’s property held by Agent and
such Lender to reduce the Obligations. 
 11.4. Rights and Remedies not Exclusive. The enumeration of the foregoing
rights and remedies is not intended to be exhaustive and the exercise of any rights or remedy shall not preclude the exercise of any other right or remedies provided for herein or otherwise provided by law, all of which shall be cumulative and not
alternative. 
 11.5. Allocation of Payments After Event of Default. Notwithstanding any other provisions of this
Agreement to the contrary, after the occurrence and during the continuance of an Event of Default, all amounts collected or received by the Agent on account of the Obligations or any other amounts outstanding under any of the Other Documents or in
respect of the Collateral may, at Agent’s discretion, be paid over or delivered as follows: 
 FIRST, to the payment of all
reasonable out-of-pocket costs and expenses (including reasonable attorneys’ fees) of the Agent in connection with enforcing its rights and the rights of the Lenders under this Agreement and the Other Documents and any protective advances made
by the Agent with respect to the Collateral under or pursuant to the terms of this Agreement; 
 SECOND, to payment of any fees
owed to the Agent; 
 THIRD, to the payment of all reasonable out-of-pocket costs and expenses (including reasonable
attorneys’ fees) of each of the Lenders to the extent owing to such Lender pursuant to the terms of this Agreement; 

FOURTH, to the payment of all of the Obligations consisting of accrued fees and interest; 

FIFTH, to the payment of the outstanding principal amount of the Obligations (including the payment or cash collateralization of any
outstanding Letters of Credit); 
 SIXTH, to all other Obligations and other obligations which shall have become due and payable
under the Other Documents or otherwise and not repaid pursuant to clauses “FIRST” through “FIFTH” above; and 
 SEVENTH, to the payment of the surplus, if any, to whoever may be lawfully entitled to receive such surplus. 
 In carrying out the foregoing, (i) amounts received shall be applied in the numerical order provided until exhausted prior to application to the next succeeding category; (ii) each of the
Lenders shall receive (so long as it is not a Defaulting Lender) an amount equal to its pro rata share (based on the proportion that the then outstanding Advances held by such Lender bears to 

  
 85 

 
the aggregate then outstanding Advances) of amounts available to be applied pursuant to clauses “FOURTH”, “FIFTH” and “SIXTH” above; and (iii) to the extent
that any amounts available for distribution pursuant to clause “FIFTH” above are attributable to the issued but undrawn amount of outstanding Letters of Credit, such amounts shall be held by the Agent in a cash collateral account and
applied (A) first, to reimburse the Issuer from time to time for any drawings under such Letters of Credit and (B) then, following the expiration of all Letters of Credit, to all other obligations of the types described in clauses
“FIFTH” and “SIXTH” above in the manner provided in this Section 11.5. 
  

	XII.	WAIVERS AND JUDICIAL PROCEEDINGS. 

12.1. Waiver of Notice. Each Borrower hereby waives notice of non-payment of any of the Receivables, demand, presentment, protest
and notice thereof with respect to any and all instruments, notice of acceptance hereof, notice of loans or advances made, credit extended, Collateral received or delivered, or any other action taken in reliance hereon, and all other demands and
notices of any description, except such as are expressly provided for herein. 
 12.2. Delay. No delay or omission on
Agent’s or any Lender’s part in exercising any right, remedy or option shall operate as a waiver of such or any other right, remedy or option or of any Default or Event of Default. 

12.3. Jury Waiver. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION (A) ARISING UNDER THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO
OR ANY OF THEM WITH RESPECT TO THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE AND EACH PARTY HEREBY CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENTS OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. 
  

	XIII.	EFFECTIVE DATE AND TERMINATION. 

13.1. Term. This Agreement, which shall inure to the benefit of and shall be binding upon the respective successors and permitted
assigns of each Borrower, Agent and each Lender, shall become effective on the date hereof and shall continue in full force and effect until July 30, 2015 (the “Term”) unless sooner terminated as herein provided. Borrowers may
terminate this Agreement at any time upon ninety (90) days’ prior written notice upon payment in full of the Obligations. In the event the Obligations are prepaid in full prior to the last day of the Term (the date of such prepayment
hereinafter referred to as the “Early Termination Date”), Borrowers 

  
 86 

 
shall pay to Agent for the benefit of Lenders an early termination fee in an amount equal to (x) two percent (2.0%) of the Maximum Revolving Advance Amount if the Early Termination Date
occurs on or after the Closing Date to and including the date immediately preceding the first anniversary of the Closing Date, and (y) one percent (1.0%) of the Maximum Revolving Advance Amount if the Early Termination Date occurs on or
after the first anniversary of the Closing Date to and including the date immediately preceding the second anniversary of the Closing Date. 
 13.2. Termination. The termination of the Agreement shall not affect any Borrower’s, Agent’s or any Lender’s rights, or any of the Obligations having their inception prior to the
effective date of such termination, and the provisions hereof shall continue to be fully operative until all transactions entered into, rights or interests created or Obligations have been fully and indefeasibly paid, disposed of, concluded or
liquidated. The security interests, Liens and rights granted to Agent and Lenders hereunder and the financing statements filed hereunder shall continue in full force and effect, notwithstanding the termination of this Agreement or the fact that
Borrowers’ Account may from time to time be temporarily in a zero or credit position, until all of the Obligations of each Borrower have been indefeasibly paid and performed in full after the termination of this Agreement or each Borrower has
furnished Agent and Lenders with an indemnification satisfactory to Agent and Lenders with respect thereto. Accordingly, each Borrower waives any rights which it may have under the Uniform Commercial Code to demand the filing of termination
statements with respect to the Collateral, and Agent shall not be required to send such termination statements to each Borrower, or to file them with any filing office, unless and until this Agreement shall have been terminated in accordance with
its terms and all Obligations have been indefeasibly paid in full in immediately available funds. All representations, warranties, covenants, waivers and agreements contained herein shall survive termination hereof until all Obligations are
indefeasibly paid and performed in full. 
  

	XIV.	REGARDING AGENT. 

 14.1.
Appointment. Each Lender hereby designates PNC to act as Agent for such Lender under this Agreement and the Other Documents. Each Lender hereby irrevocably authorizes Agent to take such action on its behalf under the provisions of this
Agreement and the Other Documents and to exercise such powers and to perform such duties hereunder and thereunder as are specifically delegated to or required of Agent by the terms hereof and thereof and such other powers as are reasonably
incidental thereto and Agent shall hold all Collateral, payments of principal and interest, fees (except the fees set forth in Sections 3.3(a) and 3.4), charges and collections (without giving effect to any collection days) received pursuant to this
Agreement, for the ratable benefit of Lenders. Agent may perform any of its duties hereunder by or through its agents or employees. As to any matters not expressly provided for by this Agreement (including collection of the Note) Agent shall not be
required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Required Lenders, and such instructions
shall be binding; provided, however, that Agent shall not be required to take any action which exposes Agent to liability or which is contrary to this Agreement or the Other Documents or Applicable Law unless Agent is furnished with an
indemnification reasonably satisfactory to Agent with respect thereto. 

  
 87 

 14.2. Nature of Duties. Agent shall have no duties or responsibilities except those
expressly set forth in this Agreement and the Other Documents. Neither Agent nor any of its officers, directors, employees or agents shall be (i) liable for any action taken or omitted by them as such hereunder or in connection herewith, unless
caused by their gross (not mere) negligence or willful misconduct (as determined by a court of competent jurisdiction in a final non-appealable judgment), or (ii) responsible in any manner for any recitals, statements, representations or
warranties made by any Borrower or any officer thereof contained in this Agreement, or in any of the Other Documents or in any certificate, report, statement or other document referred to or provided for in, or received by Agent under or in
connection with, this Agreement or any of the Other Documents or for the value, validity, effectiveness, genuineness, due execution, enforceability or sufficiency of this Agreement, or any of the Other Documents or for any failure of any Borrower to
perform its obligations hereunder. Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any of the Other
Documents, or to inspect the properties, books or records of any Borrower. The duties of Agent as respects the Advances to Borrowers shall be mechanical and administrative in nature; Agent shall not have by reason of this Agreement a fiduciary
relationship in respect of any Lender; and nothing in this Agreement, expressed or implied, is intended to or shall be so construed as to impose upon Agent any obligations in respect of this Agreement except as expressly set forth herein.

 14.3. Lack of Reliance on Agent and Resignation. Independently and without reliance upon Agent or any other Lender,
each Lender has made and shall continue to make (i) its own independent investigation of the financial condition and affairs of each Borrower and each Guarantor in connection with the making and the continuance of the Advances hereunder and the
taking or not taking of any action in connection herewith, and (ii) its own appraisal of the creditworthiness of each Borrower and each Guarantor. Agent shall have no duty or responsibility, either initially or on a continuing basis, to provide
any Lender with any credit or other information with respect thereto, whether coming into its possession before making of the Advances or at any time or times thereafter except as shall be provided by any Borrower pursuant to the terms hereof. Agent
shall not be responsible to any Lender for any recitals, statements, information, representations or warranties herein or in any agreement, document, certificate or a statement delivered in connection with or for the execution, effectiveness,
genuineness, validity, enforceability, collectibility or sufficiency of this Agreement or any Other Document, or of the financial condition of any Borrower or any Guarantor, or be required to make any inquiry concerning either the performance or
observance of any of the terms, provisions or conditions of this Agreement, the Note, the Other Documents or the financial condition of any Borrower, or the existence of any Event of Default or any Default. 

Agent may resign on sixty (60) days’ written notice to each of Lenders and Borrowing Agent and upon such resignation, the
Required Lenders will promptly designate a successor Agent reasonably satisfactory to Borrowers. 
 Any such successor Agent
shall succeed to the rights, powers and duties of Agent, and the term “Agent” shall mean such successor agent effective upon its appointment, and the former Agent’s rights, powers and duties as Agent shall be terminated, without any
other or further act or deed on the part of such former Agent. After any Agent’s resignation as Agent, the provisions of this Article XIV shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under
this Agreement. 

  
 88 

 14.4. Certain Rights of Agent. If Agent shall request instructions from Lenders with
respect to any act or action (including failure to act) in connection with this Agreement or any Other Document, Agent shall be entitled to refrain from such act or taking such action unless and until Agent shall have received instructions from the
Required Lenders; and Agent shall not incur liability to any Person by reason of so refraining. Without limiting the foregoing, Lenders shall not have any right of action whatsoever against Agent as a result of its acting or refraining from acting
hereunder in accordance with the instructions of the Required Lenders. 
 14.5. Reliance. Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, statement, certificate, telex, teletype or telecopier message, cablegram, order or other document or telephone message believed by it to be genuine and
correct and to have been signed, sent or made by the proper person or entity, and, with respect to all legal matters pertaining to this Agreement and the Other Documents and its duties hereunder, upon advice of counsel selected by it. Agent may
employ agents and attorneys-in-fact and shall not be liable for the default or misconduct of any such agents or attorneys-in-fact selected by Agent with reasonable care. 
 14.6. Notice of Default. Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder or under the Other Documents, unless Agent has received
notice from a Lender or Borrowing Agent referring to this Agreement or the Other Documents, describing such Default or Event of Default and stating that such notice is a “notice of default”. In the event that Agent receives such a notice,
Agent shall give notice thereof to Lenders. Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders; provided, that, unless and until Agent shall have received such
directions, Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of Lenders. 

14.7. Indemnification. To the extent Agent is not reimbursed and indemnified by Borrowers, each Lender will reimburse and
indemnify Agent in proportion to its respective portion of the Advances (or, if no Advances are outstanding, according to its Commitment Percentage), from and against any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against Agent in performing its duties hereunder, or in any way relating to or arising out of this Agreement or any
Other Document; provided that, Lenders shall not be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from Agent’s gross (not mere)
negligence or willful misconduct (as determined by a court of competent jurisdiction in a final non-appealable judgment). 

14.8. Agent in its Individual Capacity. With respect to the obligation of Agent to lend under this Agreement, the Advances made by
it shall have the same rights and powers hereunder as any other Lender and as if it were not performing the duties as Agent specified herein; and the term “Lender” or any similar term shall, unless the context clearly otherwise indicates,
include 

  
 89 

 
Agent in its individual capacity as a Lender. Agent may engage in business with any Borrower as if it were not performing the duties specified herein, and may accept fees and other consideration
from any Borrower for services in connection with this Agreement or otherwise without having to account for the same to Lenders. 
 14.9. Delivery of Documents. To the extent Agent receives financial statements required under Sections 9.7, 9.8, 9.9, 9.12 and 9.13 or Borrowing Base Certificates from any Borrower pursuant to the
terms of this Agreement which any Borrower is not obligated to deliver to each Lender, Agent will promptly furnish such documents and information to Lenders. 
 14.10. Borrowers’ Undertaking to Agent. Without prejudice to their respective obligations to Lenders under the other provisions of this Agreement, each Borrower hereby undertakes with Agent to
pay to Agent from time to time on demand all amounts from time to time due and payable by it for the account of Agent or Lenders or any of them pursuant to this Agreement to the extent not already paid. Any payment made pursuant to any such demand
shall pro tanto satisfy the relevant Borrower’s obligations to make payments for the account of Lenders or the relevant one or more of them pursuant to this Agreement. 
 14.11. No Reliance on Agent’s Customer Identification Program. Each Lender acknowledges and agrees that neither such Lender, nor any of its Affiliates, participants or assignees, may rely on
the Agent to carry out such Lender’s, Affiliate’s, participant’s or assignee’s customer identification program, or other obligations required or imposed under or pursuant to the USA PATRIOT Act or the regulations thereunder,
including the regulations contained in 31 CFR 103.121 (as hereafter amended or replaced, the “CIP Regulations”), or any other Anti-Terrorism Law, including any programs involving any of the following items relating to or in connection with
any Borrower, its Affiliates or its agents, this Agreement, the Other Documents or the transactions hereunder or contemplated hereby: (1) any identity verification procedures, (2) any record-keeping, (3) comparisons with government
lists, (4) customer notices or (5) other procedures required under the CIP Regulations or such other laws. 
 14.12.
Other Agreements. Each of the Lenders agrees that it shall not, without the express consent of Agent, and that it shall, to the extent it is lawfully entitled to do so, upon the request of Agent, set off against the Obligations, any amounts
owing by such Lender to any Borrower or any deposit accounts of any Borrower now or hereafter maintained with such Lender. Anything in this Agreement to the contrary notwithstanding, each of the Lenders further agrees that it shall not, unless
specifically requested to do so by Agent, take any action to protect or enforce its rights arising out of this Agreement or the Other Documents, it being the intent of Lenders that any such action to protect or enforce rights under this Agreement
and the Other Documents shall be taken in concert and at the direction or with the consent of Agent or Required Lenders. 
  

	XV.	BORROWING AGENCY. 

 15.1.
Borrowing Agency Provisions. 
 (a) Each Borrower hereby irrevocably designates Borrowing Agent to be its attorney and
agent and in such capacity to borrow, sign and endorse notes, and execute and 

  
 90 

 
deliver all instruments, documents, writings and further assurances now or hereafter required hereunder, on behalf of such Borrower or Borrowers, and hereby authorizes Agent to pay over or credit
all loan proceeds hereunder in accordance with the request of Borrowing Agent. 
 (b) The handling of this credit facility as a
co-borrowing facility with a borrowing agent in the manner set forth in this Agreement is solely as an accommodation to Borrowers and at their request. Neither Agent nor any Lender shall incur liability to Borrowers as a result thereof. To induce
Agent and Lenders to do so and in consideration thereof, each Borrower hereby indemnifies Agent and each Lender and holds Agent and each Lender harmless from and against any and all liabilities, expenses, losses, damages and claims of damage or
injury asserted against Agent or any Lender by any Person arising from or incurred by reason of the handling of the financing arrangements of Borrowers as provided herein, reliance by Agent or any Lender on any request or instruction from Borrowing
Agent or any other action taken by Agent or any Lender with respect to this Section 15.1 except due to willful misconduct or gross (not mere) negligence by the indemnified party (as determined by a court of competent jurisdiction in a final and
non-appealable judgment). 
 (c) All Obligations shall be joint and several, and each Borrower shall make payment upon the
maturity of the Obligations by acceleration or otherwise, and such obligation and liability on the part of each Borrower shall in no way be affected by any extensions, renewals and forbearance granted to Agent or any Lender to any Borrower, failure
of Agent or any Lender to give any Borrower notice of borrowing or any other notice, any failure of Agent or any Lender to pursue or preserve its rights against any Borrower, the release by Agent or any Lender of any Collateral now or thereafter
acquired from any Borrower, and such agreement by each Borrower to pay upon any notice issued pursuant thereto is unconditional and unaffected by prior recourse by Agent or any Lender to the other Borrowers or any Collateral for such Borrower’s
Obligations or the lack thereof. Each Borrower waives all suretyship defenses. 
 15.2. Waiver of Subrogation. Each
Borrower expressly waives any and all rights of subrogation, reimbursement, indemnity, exoneration, contribution of any other claim which such Borrower may now or hereafter have against the other Borrowers or other Person directly or contingently
liable for the Obligations hereunder, or against or with respect to the other Borrowers’ property (including, without limitation, any property which is Collateral for the Obligations), arising from the existence or performance of this
Agreement, until termination of this Agreement and repayment in full of the Obligations. 
  

	XVI.	MISCELLANEOUS. 

 16.1.
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York applied to contracts to be performed wholly within the State of New York. Any judicial proceeding brought by or against any
Borrower with respect to any of the Obligations, this Agreement, the Other Documents or any related agreement may be brought in any court of competent jurisdiction in the State of New York, United States of America, and, by execution and delivery of
this Agreement, each Borrower accepts for itself and in connection with its properties, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts, and irrevocably agrees to be bound by any judgment rendered thereby in
connection with this Agreement. Each Borrower hereby waives personal service of any and all 

  
 91 

 
process upon it and consents that all such service of process may be made by registered mail (return receipt requested) directed to Borrowing Agent at its address set forth in Section 16.6
and service so made shall be deemed completed five (5) days after the same shall have been so deposited in the mails of the United States of America, or, at the Agent’s option, by service upon Borrowing Agent which each Borrower
irrevocably appoints as such Borrower’s Agent for the purpose of accepting service within the State of New York. Nothing herein shall affect the right to serve process in any manner permitted by law or shall limit the right of Agent or any
Lender to bring proceedings against any Borrower in the courts of any other jurisdiction. Each Borrower waives any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction
or venue or based upon forum non conveniens. Each Borrower waives the right to remove any judicial proceeding brought against such Borrower in any state court to any federal court. Any judicial proceeding by any Borrower against Agent or any Lender
involving, directly or indirectly, any matter or claim in any way arising out of, related to or connected with this Agreement or any related agreement, shall be brought only in a federal or state court located in the County of New York, State of New
York. 
 16.2. Entire Understanding. 
 (a) This Agreement and the documents executed concurrently herewith contain the entire understanding between each Borrower, Agent and each Lender and supersedes all prior agreements and understandings, if
any, relating to the subject matter hereof. Any promises, representations, warranties or guarantees not herein contained and hereinafter made shall have no force and effect unless in writing, signed by each Borrower’s, Agent’s and each
Lender’s respective officers. Neither this Agreement nor any portion or provisions hereof may be changed, modified, amended, waived, supplemented, discharged, cancelled or terminated orally or by any course of dealing, or in any manner other
than by an agreement in writing, signed by the party to be charged. Each Borrower acknowledges that it has been advised by counsel in connection with the execution of this Agreement and Other Documents and is not relying upon oral representations or
statements inconsistent with the terms and provisions of this Agreement. 
 (b) The Required Lenders, Agent with the consent in
writing of the Required Lenders, and Borrowers may, subject to the provisions of this Section 16.2 (b), from time to time enter into written supplemental agreements to this Agreement or the Other Documents executed by Borrowers, for the purpose
of adding or deleting any provisions or otherwise changing, varying or waiving in any manner the rights of Lenders, Agent or Borrowers thereunder or the conditions, provisions or terms thereof or waiving any Event of Default thereunder, but only to
the extent specified in such written agreements; provided, however, that no such supplemental agreement shall, without the consent of all Lenders: 
 (i) increase the Commitment Percentage, the maximum dollar commitment of any Lender or the Maximum Revolving Advance Amount; 
 (ii) extend the maturity of any Note or the due date for any amount payable hereunder, or decrease the rate of interest or reduce any fee payable by Borrowers to Lenders pursuant to this Agreement;

  
 92 

 (iii) alter the definition of the term Required Lenders or alter, amend or modify this
Section 16.2(b); 
 (iv) release any Collateral during any calendar year (other than in accordance with the provisions of
this Agreement) having an aggregate value in excess of $1,000,000; 
 (v) change the rights and duties of Agent; 

(vi) permit any Revolving Advance to be made if after giving effect thereto the total of Revolving Advances outstanding hereunder would
exceed the Formula Amount for more than sixty (60) consecutive Business Days or exceed one hundred and ten percent (110%) of the Formula Amount; 
 (vii) increase the Advance Rates above the Advance Rates in effect on the Closing Date; or 
 (viii) release any Guarantor. 
 Any such supplemental agreement shall apply
equally to each Lender and shall be binding upon Borrowers, Lenders and Agent and all future holders of the Obligations. In the case of any waiver, Borrowers, Agent and Lenders shall be restored to their former positions and rights, and any Event of
Default waived shall be deemed to be cured and not continuing, but no waiver of a specific Event of Default shall extend to any subsequent Event of Default (whether or not the subsequent Event of Default is the same as the Event of Default which was
waived), or impair any right consequent thereon. 
 In the event that Agent requests the consent of a Lender pursuant to this
Section 16.2 and such consent is denied, then PNC may, at its option, require such Lender to assign its interest in the Advances to PNC or to another Lender or to any other Person designated by the Agent (the “Designated Lender”), for
a price equal to (i) the then outstanding principal amount thereof plus (ii) accrued and unpaid interest and fees due such Lender, which interest and fees shall be paid when collected from Borrowers. In the event PNC elects to require any
Lender to assign its interest to PNC or to the Designated Lender, PNC will so notify such Lender in writing within forty five (45) days following such Lender’s denial, and such Lender will assign its interest to PNC or the Designated
Lender no later than five (5) days following receipt of such notice pursuant to a Commitment Transfer Supplement executed by such Lender, PNC or the Designated Lender, as appropriate, and Agent. 

Notwithstanding (a) the existence of a Default or an Event of Default, (b) that any of the other applicable conditions
precedent set forth in Section 8.2 hereof have not been satisfied or (c) any other provision of this Agreement, Agent may at its discretion and without the consent of the Required Lenders, voluntarily permit the outstanding Revolving
Advances at any time to exceed the Formula Amount by up to ten percent (10%) of the Formula Amount for up to sixty (60) consecutive Business Days (the “Out-of-Formula Loans”). If Agent is willing in its sole and absolute
discretion to make such Out-of-Formula Loans, such Out-of-Formula Loans shall be payable on demand and shall bear interest at the Default Rate for Revolving Advances consisting 

  
 93 

 
of Domestic Rate Loans; provided that, if Lenders do make Out-of-Formula Loans, neither Agent nor Lenders shall be deemed thereby to have changed the limits of Section 2.1(a). For purposes
of this paragraph, the discretion granted to Agent hereunder shall not preclude involuntary overadvances that may result from time to time due to the fact that the Formula Amount was unintentionally exceeded for any reason, including, but not
limited to, Collateral previously deemed to be either “Eligible Receivables” or “Eligible Inventory”, as applicable, becomes ineligible, collections of Receivables applied to reduce outstanding Revolving Advances are thereafter
returned for insufficient funds or overadvances are made to protect or preserve the Collateral. In the event Agent involuntarily permits the outstanding Revolving Advances to exceed the Formula Amount by more than ten percent (10%), Agent shall use
its efforts to have Borrowers decrease such excess in as expeditious a manner as is practicable under the circumstances and not inconsistent with the reason for such excess. Revolving Advances made after Agent has determined the existence of
involuntary overadvances shall be deemed to be involuntary overadvances and shall be decreased in accordance with the preceding sentence. 
 In addition to (and not in substitution of) the discretionary Revolving Advances permitted above in this Section 16.2, the Agent is hereby authorized by Borrowers and the Lenders, from time to time
in the Agent’s sole discretion, (A) after the occurrence and during the continuation of a Default or an Event of Default, or (B) at any time that any of the other applicable conditions precedent set forth in Section 8.2 hereof
have not been satisfied, to make Revolving Advances to Borrowers on behalf of the Lenders which the Agent, in its reasonable business judgment, deems necessary or desirable (a) to preserve or protect the Collateral, or any portion thereof,
(b) to enhance the likelihood of, or maximize the amount of, repayment of the Advances and other Obligations, or (c) to pay any other amount chargeable to Borrowers pursuant to the terms of this Agreement; provided, that at any time after
giving effect to any such Revolving Advances the outstanding Revolving Advances do not exceed one hundred and ten percent (110%) of the Formula Amount. 
 16.3. Successors and Assigns; Participations; New Lenders. 
 (a) This
Agreement shall be binding upon and inure to the benefit of Borrowers, Agent, each Lender, all future holders of the Obligations and their respective successors and assigns, except that no Borrower may assign or transfer any of its rights or
obligations under this Agreement without the prior written consent of Agent and each Lender. 
 (b) Each Borrower acknowledges
that in the regular course of commercial banking business one or more Lenders may at any time and from time to time sell participating interests in the Advances to other financial institutions (each such transferee or purchaser of a participating
interest, a “Participant”). Each Participant may exercise all rights of payment (including rights of set-off) with respect to the portion of such Advances held by it or other Obligations payable hereunder as fully as if such Participant
were the direct holder thereof provided that Borrowers shall not be required to pay to any Participant more than the amount which it would have been required to pay to Lender which granted an interest in its Advances or other Obligations payable
hereunder to such Participant had such Lender retained such interest in the Advances hereunder or other Obligations payable hereunder and in no event shall Borrowers be required to pay any such amount arising from the same circumstances and with
respect to the same Advances or other Obligations payable hereunder to both such Lender and such Participant. 

  
 94 

 
Each Borrower hereby grants to any Participant a continuing security interest in any deposits, moneys or other property actually or constructively held by such Participant as security for the
Participant’s interest in the Advances. 
 (c) Any Lender, with the consent of Agent which shall not be unreasonably
withheld or delayed, may sell, assign or transfer all or any part of its rights and obligations under or relating to Revolving Advances under this Agreement and the Other Documents to one or more additional banks or financial institutions and one or
more additional banks or financial institutions may commit to make Advances hereunder (each a “Purchasing Lender”), in minimum amounts of not less than $3,000,000, pursuant to a Commitment Transfer Supplement, executed by a Purchasing
Lender, the transferor Lender, and Agent and delivered to Agent for recording. Upon such execution, delivery, acceptance and recording, from and after the transfer effective date determined pursuant to such Commitment Transfer Supplement,
(i) Purchasing Lender thereunder shall be a party hereto and, to the extent provided in such Commitment Transfer Supplement, have the rights and obligations of a Lender thereunder with a Commitment Percentage as set forth therein, and
(ii) the transferor Lender thereunder shall, to the extent provided in such Commitment Transfer Supplement, be released from its obligations under this Agreement, the Commitment Transfer Supplement creating a novation for that purpose. Such
Commitment Transfer Supplement shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of such Purchasing Lender and the resulting adjustment of the Commitment Percentages arising from the
purchase by such Purchasing Lender of all or a portion of the rights and obligations of such transferor Lender under this Agreement and the Other Documents. Each Borrower hereby consents to the addition of such Purchasing Lender and the resulting
adjustment of the Commitment Percentages arising from the purchase by such Purchasing Lender of all or a portion of the rights and obligations of such transferor Lender under this Agreement and the Other Documents. Borrowers shall execute and
deliver such further documents and do such further acts and things in order to effectuate the foregoing. 
 (d) Any Lender, with
the consent of Agent which shall not be unreasonably withheld or delayed, may directly or indirectly sell, assign or transfer all or any portion of its rights and obligations under or relating to Revolving Advances under this Agreement and the Other
Documents to an entity, whether a corporation, partnership, trust, limited liability company or other entity that (i) is engaged in making, purchasing, holding or otherwise investing in bank loans and similar extensions of credit in the
ordinary course of its business and (ii) is administered, serviced or managed by the assigning Lender or an Affiliate of such Lender (a “Purchasing CLO” and together with each Participant and Purchasing Lender, each a
“Transferee” and collectively the “Transferees”), pursuant to a Commitment Transfer Supplement modified as appropriate to reflect the interest being assigned (“Modified Commitment Transfer Supplement”), executed by any
intermediate purchaser, the Purchasing CLO, the transferor Lender, and Agent as appropriate and delivered to Agent for recording. Upon such execution and delivery, from and after the transfer effective date determined pursuant to such Modified
Commitment Transfer Supplement, (i) Purchasing CLO thereunder shall be a party hereto and, to the extent provided in such Modified Commitment Transfer Supplement, have the rights and obligations of a Lender thereunder and (ii) the
transferor Lender thereunder shall, to the extent provided in such Modified Commitment Transfer Supplement, be released from its obligations under this Agreement, the Modified Commitment Transfer Supplement

  
 95 

 
creating a novation for that purpose. Such Modified Commitment Transfer Supplement shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition
of such Purchasing CLO. Each Borrower hereby consents to the addition of such Purchasing CLO. Borrowers shall execute and deliver such further documents and do such further acts and things in order to effectuate the foregoing. 

(e) Agent shall maintain at its address a copy of each Commitment Transfer Supplement and Modified Commitment Transfer Supplement
delivered to it and a register (the “Register”) for the recordation of the names and addresses of each Lender and the outstanding principal, accrued and unpaid interest and other fees due hereunder. The entries in the Register shall be
conclusive, in the absence of manifest error, and each Borrower, Agent and Lenders may treat each Person whose name is recorded in the Register as the owner of the Advance recorded therein for the purposes of this Agreement. The Register shall be
available for inspection by Borrowing Agent or any Lender at any reasonable time and from time to time upon reasonable prior notice. Agent shall receive a fee in the amount of $3,500 payable by the applicable Purchasing Lender and/or Purchasing CLO
upon the effective date of each transfer or assignment (other than to an intermediate purchaser) to such Purchasing Lender and/or Purchasing CLO. 
 (f) Each Borrower authorizes each Lender to disclose to any Transferee and any prospective Transferee any and all financial information in such Lender’s possession concerning such Borrower which has
been delivered to such Lender by or on behalf of such Borrower pursuant to this Agreement or in connection with such Lender’s credit evaluation of such Borrower. 
 16.4. Application of Payments. Agent shall have the continuing and exclusive right to apply or reverse and re-apply any payment and any and all proceeds of Collateral to any portion of the
Obligations. To the extent that any Borrower makes a payment or Agent or any Lender receives any payment or proceeds of the Collateral for any Borrower’s benefit, which are subsequently invalidated, declared to be fraudulent or preferential,
set aside or required to be repaid to a trustee, debtor in possession, receiver, custodian or any other party under any bankruptcy law, common law or equitable cause, then, to such extent, the Obligations or part thereof intended to be satisfied
shall be revived and continue as if such payment or proceeds had not been received by Agent or such Lender. 
 16.5.
Indemnity. Each Borrower shall indemnify Agent, each Lender and each of their respective officers, directors, Affiliates, attorneys, employees and agents from and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses and disbursements of any kind or nature whatsoever (including fees and disbursements of counsel) which may be imposed on, incurred by, or asserted against Agent or any Lender in any claim, litigation,
proceeding or investigation instituted or conducted by any Governmental Body or instrumentality or any other Person with respect to any aspect of, or any transaction contemplated by, or referred to in, or any matter related to, this Agreement or the
Other Documents, whether or not Agent or any Lender is a party thereto, except to the extent that any of the foregoing arises out of the willful misconduct of the party being indemnified (as determined by a court of competent jurisdiction in a final
and non-appealable judgment). Without limiting the generality of the foregoing, this indemnity shall extend to any liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses and

  
 96 

 
disbursements of any kind or nature whatsoever (including fees and disbursements of counsel) asserted against or incurred by any of the indemnitees described above in this Section 16.5 by
any Person under any Environmental Laws or similar laws by reason of any Borrower’s or any other Person’s failure to comply with laws applicable to solid or hazardous waste materials, including Hazardous Substances and Hazardous Waste, or
other Toxic Substances. Additionally, if any taxes (excluding taxes imposed upon or measured solely by the net income of Agent and Lenders, but including any intangibles taxes, stamp tax, recording tax or franchise tax) shall be payable by Agent,
Lenders or Borrowers on account of the execution or delivery of this Agreement, or the execution, delivery, issuance or recording of any of the Other Documents, or the creation or repayment of any of the Obligations hereunder, by reason of any
Applicable Law now or hereafter in effect, Borrowers will pay (or will promptly reimburse Agent and Lenders for payment of) all such taxes, including interest and penalties thereon, and will indemnify and hold the indemnitees described above in this
Section 16.5 harmless from and against all liability in connection therewith. 
 16.6. Notice. Any notice or request
hereunder may be given to Borrowing Agent or any Borrower or to Agent or any Lender at their respective addresses set forth below or at such other address as may hereafter be specified in a notice designated as a notice of change of address under
this Section. Any notice, request, demand, direction or other communication (for purposes of this Section 16.6 only, a “Notice”) to be given to or made upon any party hereto under any provision of this Loan Agreement shall be given or
made by telephone or in writing (which includes by means of electronic transmission (i.e., “e-mail”) or facsimile transmission or, solely for the purpose of notices among Agent and Lenders, by setting forth such Notice on a site on the
World Wide Web (a “Website Posting”) if Notice of such Website Posting (including the information necessary to access such site) has previously been delivered to the applicable parties hereto by another means set forth in this
Section 16.6) in accordance with this Section 16.6. Any such Notice must be delivered to the applicable parties hereto at the addresses and numbers set forth under their respective names on Section 16.6 hereof or in accordance with
any subsequent unrevoked Notice from any such party that is given in accordance with this Section 16.6. Any Notice shall be effective: 
 (a) In the case of hand-delivery, when delivered; 
 (b) If given by mail, four
days after such Notice is deposited with the United States Postal Service, with first-class postage prepaid, return receipt requested; 
 (c) In the case of a telephonic Notice, when a party is contacted by telephone, if delivery of such telephonic Notice is confirmed no later than the next Business Day by hand delivery, a facsimile or
electronic transmission, a Website Posting or an overnight courier delivery of a confirmatory Notice (received at or before noon on such next Business Day); 
 (d) In the case of a facsimile transmission, when sent to the applicable party’s facsimile machine’s telephone number, if the party sending such Notice receives confirmation of the delivery
thereof from its own facsimile machine; 
 (e) In the case of electronic transmission, when actually received; 

  
 97 

 (f) In the case of a Website Posting, upon delivery of a Notice of such posting (including
the information necessary to access such site) by another means set forth in this Section 16.6; and 
 (g) If given by any
other means (including by overnight courier), when actually received. 
 Any Lender giving a Notice to Borrowing Agent or any
Borrower shall concurrently send a copy thereof to the Agent, and the Agent shall promptly notify the other Lenders of its receipt of such Notice. 
  

					
	 (A)
	    	If to Agent or PNC at:
		
		    	PNC Bank, National Association
		    	2 North Lake Avenue, Suite 440
		    	Pasadena, CA 91101
		    	Attention:	    	Albert Sarkis
		    	Telephone:	    	626-432-6102
		    	Facsimile:	    	                             
               
		
		    	with a copy to:
		
		    	Blank Rome LLP
		    	The Chrysler Building
		    	405 Lexington Avenue
		    	New York, NY 10174
		    	Attn:	    	Lawrence F. Flick II, Esquire
		    	Telephone:	    	212-885-5556
		    	Facsimile:	    	215-832-5556
		
	 (B)
	    	If to a Lender other than Agent, as specified on the signature pages hereof
		
	 (C)
	    	If to Borrowing Agent or any Borrower:
		
		    	Gaiam Americas, Inc.
		    	833 West South Boulder
		    	Louisville, CO 80027
		    	Attention:	    	General Counsel
		    	Telephone:	    	303-222-3809
		    	Facsimile:	    	303-222-3700
		
		    	with a copy to:
		
		    	Brownstein Hyatt Farber Schreck, LLP
		    	410 17th Street, Suite 2200
		    	Denver, Colorado 80202
			
		    	Attention:	    	Jennifer Eiteljorg
		    	Telephone:	    	303-223-1162
		    	Facsimile:	    	303-223-0962

  
 98 

 16.7. Survival. The obligations of Borrowers under Sections 2.2(f), 3.7, 3.8, 3.9,
4.19(h), and 16.5 and the obligations of Lenders under Section 14.7, shall survive termination of this Agreement and the Other Documents and payment in full of the Obligations. 

16.8. Severability. If any part of this Agreement is contrary to, prohibited by, or deemed invalid under Applicable Laws or
regulations, such provision shall be inapplicable and deemed omitted to the extent so contrary, prohibited or invalid, but the remainder hereof shall not be invalidated thereby and shall be given effect so far as possible. 

16.9. Expenses. All costs and expenses including attorneys’ fees (including the allocated costs of in house counsel) and
disbursements incurred by Agent on its behalf or on behalf of Lenders (a) in all efforts made to enforce payment of any Obligation or effect collection of any Collateral or enforcement of this Agreement or any of the Other Documents, or
(b) in connection with the entering into, modification, amendment and administration of this Agreement or any of the Other Documents or any consents or waivers hereunder or thereunder and all related agreements, documents and instruments, or
(c) in instituting, maintaining, preserving, enforcing and foreclosing on Agent’s security interest in or Lien on any of the Collateral, or maintaining, preserving or enforcing any of Agent’s or any Lender’s rights hereunder or
under any of the Other Documents and under all related agreements, documents and instruments, whether through judicial proceedings or otherwise, or (d) in defending or prosecuting any actions or proceedings arising out of or relating to
Agent’s or any Lender’s transactions with any Borrower or any Guarantor or (e) in connection with any advice given to Agent or any Lender with respect to its rights and obligations under this Agreement or any of the Other Documents
and all related agreements, documents and instruments, may be charged to Borrowers’ Account and shall be part of the Obligations. 
 16.10. Injunctive Relief. Each Borrower recognizes that, in the event any Borrower fails to perform, observe or discharge any of its obligations or liabilities under this Agreement, or threatens to
fail to perform, observe or discharge such obligations or liabilities, any remedy at law may prove to be inadequate relief to Lenders; therefore, Agent, if Agent so requests, shall be entitled to temporary and permanent injunctive relief in any such
case without the necessity of proving that actual damages are not an adequate remedy. 
 16.11. Consequential Damages.
Neither Agent nor any Lender, nor any agent or attorney for any of them, shall be liable to any Borrower or any Guarantor (or any Affiliate of any such Person) for indirect, punitive, exemplary or consequential damages arising from any breach of
contract, tort or other wrong relating to the establishment, administration or collection of the Obligations or as a result of any transaction contemplated under this Agreement or any Other Document. 

16.12. Captions. The captions at various places in this Agreement are intended for convenience only and do not constitute and
shall not be interpreted as part of this Agreement. 

  
 99 

 16.13. Counterparts; Facsimile Signatures. This Agreement may be executed in any
number of and by different parties hereto on separate counterparts, all of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same agreement. Any signature delivered by a party by facsimile
or electronic transmission shall be deemed to be an original signature hereto. 
 16.14. Construction. The parties
acknowledge that each party and its counsel have reviewed this Agreement and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this
Agreement or any amendments, schedules or exhibits thereto. 
 16.15. Confidentiality; Sharing Information. Agent, each
Lender and each Transferee shall hold all non-public information obtained by Agent, such Lender or such Transferee pursuant to the requirements of this Agreement in accordance with Agent’s, such Lender’s and such Transferee’s
customary procedures for handling confidential information of this nature; provided, however, Agent, each Lender and each Transferee may disclose such confidential information (a) to its examiners, Affiliates, outside auditors, counsel and
other professional advisors, (b) to Agent, any Lender or to any prospective Transferees, and (c) as required or requested by any Governmental Body or representative thereof or pursuant to legal process; provided, further that
(i) unless specifically prohibited by Applicable Law, Agent, each Lender and each Transferee shall use its reasonable best efforts prior to disclosure thereof, to notify the applicable Borrower of the applicable request for disclosure of such
non-public information (A) by a Governmental Body or representative thereof (other than any such request in connection with an examination of the financial condition of a Lender or a Transferee by such Governmental Body) or (B) pursuant to
legal process and (ii) in no event shall Agent, any Lender or any Transferee be obligated to return any materials furnished by any Borrower other than those documents and instruments in possession of Agent or any Lender in order to perfect its
Lien on the Collateral once the Obligations have been paid in full and this Agreement has been terminated. Each Borrower acknowledges that from time to time financial advisory, investment banking and other services may be offered or provided to such
Borrower or one or more of its Affiliates (in connection with this Agreement or otherwise) by any Lender or by one or more Subsidiaries or Affiliates of such Lender and each Borrower hereby authorizes each Lender to share any information delivered
to such Lender by such Borrower and its Subsidiaries pursuant to this Agreement, or in connection with the decision of such Lender to enter into this Agreement, to any such Subsidiary or Affiliate of such Lender, it being understood that any such
Subsidiary or Affiliate of any Lender receiving such information shall be bound by the provisions of this Section 16.15 as if it were a Lender hereunder. Such authorization shall survive the repayment of the other Obligations and the
termination of this Agreement. 
 16.16. Publicity. Each Borrower and each Lender hereby authorizes Agent to make
appropriate announcements of the financial arrangement entered into among Borrowers, Agent and Lenders, including announcements which are commonly known as tombstones, in such publications and to such selected parties as Agent shall in its sole and
absolute discretion deem appropriate. 
 16.17. Certifications From Banks and Participants; USA PATRIOT Act. Each Lender
or assignee or participant of a Lender that is not incorporated under the Laws of the United States 

  
 100

 
of America or a state thereof (and is not excepted from the certification requirement contained in Section 313 of the USA PATRIOT Act and the applicable regulations because it is both
(i) an affiliate of a depository institution or foreign bank that maintains a physical presence in the United States or foreign country, and (ii) subject to supervision by a banking authority regulating such affiliated depository
institution or foreign bank) shall deliver to the Agent the certification, or, if applicable, recertification, certifying that such Lender is not a “shell” and certifying to other matters as required by Section 313 of the USA PATRIOT
Act and the applicable regulations: (1) within 10 days after the Closing Date, and (2) as such other times as are required under the USA PATRIOT Act. 

  
 101

 Each of the parties has signed this Agreement as of the day and year first above written.

  

			
	GAIAM AMERICAS, INC.
		
	By:	 	/s/ Steve Thomas
	Name:	 	Steve Thomas
	Title:	 	Chief Financial Officer
	
	SPRI PRODUCTS, INC.
		
	By:	 	/s/ Steve Thomas
	Name:	 	Steve Thomas
	Title:	 	Chief Financial Officer
	
	GT DIRECT, INC.
		
	By:	 	/s/ Steve Thomas
	Name:	 	Steve Thomas
	Title:	 	Chief Financial Officer
	
	VE NEWCO, LLC
		
	By:	 	/s/ Steve Thomas
	Name:	 	Steve Thomas
	Title:	 	Chief Financial Officer

 [SIGNATURE PAGE TO REVOLVING CREDIT AND SECURITY AGREEMENT] 

			
	PNC BANK, NATIONAL ASSOCIATION, as
	Agent and Lender
		
	By:	 	/s/ Albert Sarkis
	Name:	 	Albert Sarkis
	Title:	 	Vice President
	
	2 North Lake Avenue
	Pasadena, CA 91101
	
	Commitment Percentage: 100%

 [SIGNATURE PAGE TO REVOLVING CREDIT AND SECURITY AGREEMENT]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00209-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00209-of-00352.parquet"}]]