Document:

Exhibit

PROMISSORY NOTE

Honolulu, Hawaii
US $60,000,000.00    Effective Date: August 1, 2016

FOR VALUE RECEIVED, the undersigned, ABL MANOA MARKETPLACE LF LLC, a Hawaii limited liability company (“ABL-LF”), A&B MANOA LLC, a Hawaii limited liability company (“ABML”), ABL MANOA MARKETPLACE LH LLC, a Hawaii limited liability company (“ABL-LH”), and ABP MANOA MARKETPLACE LH LLC, a Hawaii limited liability company (“ABP-LH”) (each individually, a “Borrower Entity” and collectively, the “Borrower”) promise to pay to the order of FIRST HAWAIIAN BANK, a Hawaii corporation (the “Lender”), the principal sum of SIXTY MILLION AND NO/100 DOLLARS (US $60,000,000.00) with interest thereon from the Effective Date, computed on the principal balance from time to time outstanding at the applicable interest rate determined as set forth below.  This Note evidences a term loan (the “Loan”) made available by the Lender to the Borrower and governed by, among other things, that certain Loan Agreement dated the Effective Date (the “Loan Agreement”).  Capitalized terms not specifically defined herein shall have the same meaning as provided in the Loan Agreement.

1.Term.  The term of the Loan shall begin on the Effective Date and shall consist of a thirty‐six (36) month interest only payment period ending on July 31, 2019 (the “Interest Only Period”), followed by a one hundred twenty (120) month principal and interest payment period ending on the Maturity Date (the “Amortization Period”).
2.    Interest.  From the Effective Date of this Promissory Note through the end of the Interest Only Period, interest shall accrue at a rate per annum equal to one and 35/100 percentage points (1.35%) (the “Margin”) higher than the “LIBOR Rate” (as hereinafter defined), and shall be adjusted monthly on the first Business Day of each calendar month during the term of the Loan (each such date being referred to as an “Interest Adjustment Date”), to a rate equal to the LIBOR Rate in effect on such date, plus the Margin.  
Interest shall be computed on the basis of a year of 360 days, and the actual number of days elapsed.
As used herein, the term “LIBOR Rate” shall mean the offered rate of interest which appears on the Bloomberg Official BBAM LIBOR Rates page as of 11:00 a.m. London Time on the day that is two (2) LIBOR Banking Days prior to the next Interest Adjustment Date, for deposits, in U.S. Dollars, for a period of one (1) month (“LIBOR”); provided that the LIBOR Rate shall not be less than zero, and if the above described offered rate of interest is a negative number, the LIBOR Rate will be zero.  A “LIBOR Banking Day” means a day on which London banks are open for business for trading inter-bank U.S. Dollar deposits.
If any law or regulation, or any change therein, shall make it unlawful for interest to be calculated using the LIBOR Rate, the Borrower shall have no right to have interest based on the LIBOR Rate, and interest on the outstanding principal balance shall automatically, upon notice given by the Lender to the Borrower, accrue at a fluctuating rate per annum equal to the 

5839894.12    

WSJ Prime Rate in effect from time to time plus the WSJ Margin.  Each change in such fluctuating rate shall take effect simultaneously with the effective date of the corresponding change in the WSJ Prime Rate.  “WSJ Prime Rate” shall mean the prime rate as reported in the money rates column of the “Wall Street Journal” on the date of determination or on the last preceding Business Day.  If the Wall Street Journal shall cease reporting such prime rate, then WSJ Prime Rate shall mean the lending rate of interest announced publicly by First Hawaiian Bank from time to time as its “prime interest rate”, which rate shall not necessarily be the best or lowest rate charged by First Hawaiian Bank from time to time (herein referred to as the “Prime Rate”). “WSJ Margin” shall mean the amount by which the interest rate specified in this Agreement which would be charged on the principal balance in the absence of default exceeds the WSJ Prime Rate.  At any particular date, the WSJ Margin shall be determined as of last preceding date upon which the interest rate for the Loan is determined using the LIBOR Rate, and the WSJ Margin shall not in any event be less than zero.
In addition, if no rates appear on the Bloomberg Official BBAM LIBOR Rates page for deposits, in U.S. Dollars, for a period of one (1) month, interest shall accrue at a fluctuating rate per annum equal to the WSJ Prime Rate in effect from time to time plus the WSJ Margin, until the first Business Day of the calendar month next following the date after one or more rates do appear on the Bloomberg Official BBAM LIBOR Rates page for deposits, in U.S. Dollars, for a period of one (1) month.  

3.    Payments.
(A)    Time and Amount of Payments.  The Borrower shall make monthly payments of principal and interest as follows:
		
	(i)
	During the Interest Only Period, the Borrower shall make monthly payments of accrued interest only on the first Business Day of each calendar month and continuing on the first Business Day of each and every calendar month thereafter to and including July 31, 2019.

		
	(ii)
	During the Amortization Period, the Borrower shall make monthly payments of accrued interest plus principal payments on the first Business Day of each calendar month and continuing on the first Business Day of each and every calendar month thereafter until paid in full, which principal payments shall be in accordance with the payment schedule (“the Payment Schedule”) attached to this Note as Attachment “1”.

(B)    Method and Application of Payments.  All payments on this Note shall be made at the offices of the Lender located at 999 Bishop Street, Honolulu, Hawaii 96813, or to such other place as the holder of this Note may designate from time to time.  All payments on this Note shall be payable only in lawful money of the United States of America.  All sums received by the Lender shall be applied first to advances made by the Lender or costs incurred by the Lender, then to late payment charges, then to interest, and then to principal; provided, however, that in an Event of Default, the Lender shall be entitled to allocate all payments 

2

received by the Lender to principal, interest, late payment charges, advances and/or costs in such order as the Lender may elect.  The receipt of a check shall not, in itself, constitute payment hereunder unless and until the check is honored.
(C)    Maturity Date.  The unpaid principal balance, together with any accrued interest thereon as well as all other unpaid fees, charges, and expenses due hereunder or under any instrument or document securing this Note, shall be due and payable in full, without notice or demand, on August 1, 2029 (the “Maturity Date”), unless sooner due as provided in Section 6 below.
(D)    Balloon Payment.  The monthly payments of principal during the Amortization Period are lower than the amount needed to pay the loan in full by the Maturity Date.  This means that on the Maturity Date, the Borrower will still owe some part of the principal.  A single payment, called a “balloon payment”, equal to the unpaid part of the principal, plus any interest and other charges then due, must be paid by the Borrower on the Maturity Date.  The Lender will have no obligation to refinance the Loan at that time.  The Borrower will, therefore, be required to make payment out of other assets that the Borrower may own, or the Borrower will have to find a lender, which may be the Lender or some other lender, willing to lend the Borrower the money.  If the Borrower refinances the Loan at maturity, the Borrower may have to pay some or all of the closing costs normally associated with a new loan, even if the Borrower obtains refinancing from the Lender.
4.    Prepayment.  The Borrower shall have the option to prepay principal in whole or in part, plus all accrued interest without a prepayment charge, provided that a minimum of three (3) business days’ notice is given to the Lender, and provided that the Borrower shall be liable for any swap termination or adjustment costs.  No amounts repaid or prepaid may be re-borrowed.  All such prepayments shall be applied to accrued but unpaid interest before being applied to principal.  Partial prepayments shall be applied against payments of the most remote maturity.  Until the Loan is paid in full (principal and interest), no optional prepayment shall be credited to or relieve the Borrower to any extent from its obligation thereafter to pay any monthly installment of interest, any monthly installment of principal, any required payment, or any other payment required under the Loan.
5.    Late Charge.  If any monthly installment payment shall not have been paid within ten (10) days after the same becomes due and payable, the Lender, in addition to its other remedies, may collect, and the Borrower shall pay on demand, a late charge equal to five percent (5%) of the amount overdue.
6.    Default.  If an Event of Default, as defined in the Loan Agreement, shall occur (this Note, the Loan Agreement and all other agreements and security instruments referred to therein as “Loan Documents”, being hereinafter called the “Loan Documents”), then, and in any such event, the Lender shall have the option to declare the unpaid principal sum of this Note, together with all interest accrued thereon, and all fees, charges and other sums payable under the Loan Documents, to be immediately due and payable, and such principal sum and interest, and all such fees, charges and other sums, shall thereupon become and be due and payable without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived, and, upon such maturity, by acceleration or otherwise, the unpaid principal balance, all accrued 

3

but unpaid interest, and all such fees, charges and other sums, shall thereafter bear interest until fully paid at a rate per annum equal to four percentage points (4.0%) higher than the higher of: (a) the rate that would otherwise be in effect from time to time under this Note; or (b) the fluctuating Prime Rate (the “Default Rate”).  Failure to exercise this option shall not constitute a waiver of the right to exercise the same in the event of the same or any subsequent default.
7.    Reasonableness of Default Charges.  The Borrower acknowledges that nonpayment of any monthly payment when due and nonpayment at maturity (whether or not resulting from acceleration due to an Event of Default under the Loan Documents) will result in damages to the holder of this Note by reason of the additional expenses incurred in servicing the indebtedness evidenced by this Note and/or by reason of the loss to the holder of the use of the money due and frustration to the holder in meeting its other commitments.  The Borrower also acknowledges and agrees that the occurrence of any other Event of Default under the Loan Documents will result in damages to the holder by reason of the detriment caused thereby.  The Borrower further acknowledges that it is and will be extremely difficult and impracticable to ascertain the extent of such damages caused by nonpayment of any sums when due or resulting from any other event of default under the Loan Documents.  The Borrower and the holder agree that a reasonable estimate of such damages must be based in part upon the duration of the default and that the late charge specified above with respect to delinquent payments and the Default Rate of interest prescribed above with respect to the amount due and payable after maturity or acceleration or any other Event of Default under the Loan Documents would not unreasonably compensate the holder for such damages.
8.    Costs.  If this Note is not paid when due, whether at maturity or by acceleration, the Borrower promises to pay all costs and expenses of collection (including, but not limited to, attorneys’ fees) and all expenses incurred in connection with the protection or realization of the collateral or enforcement of any guaranty, incurred by the Lender on account of such collection, whether or not suit is filed hereon.
9.    Waiver.  The Borrower, and any endorsers or guarantors of this Note, severally waive diligence, presentment, protest and demand and also notice of protest, demand, dishonor and nonpayment of this Note, and expressly agree that this Note, or any payment hereunder, may be extended from time to time, and consent to the acceptance of further security or the release of any security for this Note, all without notice to any endorsers or guarantors hereof.  No extension of time for the payment of this Note, or any installment hereof, made by agreement by the Lender with any person now or hereafter liable for the payment of this Note, shall affect the original liability under this Note or the Borrower, even if the Borrower shall not be a party to such agreement.
10.    Joint and Several Liability and Limited Recourse.  Subject to limitations on recourse contained in Section 6.2 of the Loan Agreement, all of the Borrower Entities and any other persons and entities encompassed by the term “Borrower” shall be jointly and severally liable for the obligations, covenants, warranties and representations of the Borrower hereunder.  Except as otherwise specifically and explicitly provided herein, all waivers, acknowledgments, consents, approvals, representations, warranties, and other actions given, taken or agreed upon by the Borrower hereunder shall be considered to be given or taken or agreed upon by each Borrower Entity individually and by all of the Borrower Entities collectively, and shall be 

4

binding upon the Borrower Entities jointly and severally and their respective successors and assigns.  
Recourse under this Note shall be limited to the Mortgaged Property, Collateral, and Assigned Property, and any other collateral that may be granted to the Lender from time to time. Notwithstanding the foregoing, nothing contained in this Note shall limit the liability of the Borrower for damages and losses arising directly or indirectly from the matters described in Section 6.2 of the Loan Agreement. 
11.    Applicable Law.  This Note shall be governed and controlled as to validity, enforcement, interpretation, construction, effect and in all other respects by the laws and decisions of the State of Hawaii.
The Borrower hereby submits to the jurisdiction of the courts of the State of Hawaii and agrees that any judgment of the courts of the State of Hawaii, including any in personam judgment, shall be deemed to have the same force and effect as that obtained from the courts in the jurisdiction in which the Borrower resides.  The Borrower hereby waives any right which the Borrower may have to transfer or change the venue of any litigation brought against the Borrower by the Lender in accordance with this paragraph.
12.    Maximum Interest Rate.  All agreements between the Borrower and the Lender are expressly limited so that in no contingency or event whatsoever, whether by reason of advancement of the proceeds hereof, acceleration of the maturity of the unpaid principal balance hereof or otherwise, shall the amount paid or agreed to be paid to the Lender for the use, forbearance or detention of the money to be advanced hereunder exceed the highest lawful rate permissible under any law which a court of competent jurisdiction may deem applicable hereto.  If, for any reason whatsoever, performance, when due, of any provision of this Note or of any mortgage, security agreement or other agreement securing this Note would result in exceeding the highest lawful rate of interest which a court of competent jurisdiction may deem applicable hereto, then ipso facto, the interest rate hereunder shall be reduced to such highest lawful rate.  If, notwithstanding the foregoing limitations, any excess interest shall at the maturity of this Note be determined to have been received, the same shall be deemed to have been held as additional security.  The foregoing provisions shall never be suspended or waived and shall control every other provision of all agreements between the Lender and the Borrower.
13.    Loan Not Assumable.  The Borrower understands and agrees that the Loan evidenced by this Note is personal to the Borrower and may not be assumed by or assigned to any other person or entity.  The identity of the Borrower (including each Borrower Entity) is material to the Lender and therefore, the Lender, in its sole discretion, may withhold its consent to any request for assumption/assignment of the Loan for any reason or no reason.
14.    No Waiver by the Lender.  No single or partial release of any power hereunder, or under any mortgage, security agreement or other agreement securing this Note, shall preclude any other or further exercise thereof or the exercise of any other power.  The Lender shall at all times have the right to proceed against any portion of the security for this Note in such order and manner as the Lender may deem fit, without waiving any rights with respect to any other 

5

security.  No delays or omission on the part of the Lender in exercising any right hereunder shall operate as a waiver of such right or of any other right under this Note.
15.    Notices.  All notices, requests, demands or documents that are required or permitted to be given or served hereunder shall be in writing and personally delivered, or sent by registered or certified mail addressed, or by facsimile or email with confirming hard copy of such facsimile or email sent, as follows:
To Borrower at:    In care of 
Alexander & Baldwin, LLC
822 Bishop Street
Honolulu, HI  96813
Attn: Paul K. Ito
Facsimile No.: (808) 525-6652
Email: pito@abinc.com

		
	with a copy to:
	Alexander & Baldwin, LLC

822 Bishop Street
Honolulu, Hawaii 96813
Attention:  Nelson N.S. Chun
Telephone No.: (808) 525-6622
Facsimile No.: (808) 525-6616
Email: nchun@abinc.com

		
	To Lender at:
	First Hawaiian Bank

999 Bishop Street
Honolulu, Hawaii 96813
Attn: Commercial Real Estate Division, George Leong
Facsimile No.: (808) 525-8141
Email: gleong@fhb.com

		
	with copy to:
	Goodsill Anderson Quinn & Stifel

999 Bishop Street, Suite 1600
Honolulu, Hawaii 96813
Attention: Leighton Yuen, Esq.
Facsimile No. (808) 441-1235
Email: lyuen@goodsill.com

The addresses may be changed from time to time by the addressee by serving notice as heretofore provided.  Service of such notice or demand shall be deemed complete on the date of actual delivery as shown by the addressee’s registry or certification receipt or at the expiration of the second day after the date of mailing, whichever is earlier in time.
The Borrower hereby irrevocably authorizes the Lender to accept facsimile (“FAX”) transmissions of such notices, requests, demands and documents, provided such transmission is signed by Paul K. Ito.  The Borrower shall and does hereby hold the Lender

6

 harmless from, and indemnify the Lender against, any loss, cost, expense, claim or demand which may be incurred by or asserted against the Lender by virtue of the Lender acting upon any such notices, requests, demands or documents transmitted in accordance with the above provisions.  Any such FAX transmission shall, at the Lender’s request, be separately confirmed by telephone conference between the Lender and the person described above, and shall be followed by transmission of the actual “hard copy” of the notice, request, demand or document in question.
16.    Severability.  If any provision of this Note shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision hereof.
17.    Successors and Assigns.  This Note and all of the obligations hereunder shall be the joint and several obligations of all makers of this Note (referred to jointly and severally as the “Borrower” in this Note).  This Note shall be binding upon and inure to the benefit of the Borrower and the Lender and their respective successors and assigns.  It is understood and agreed that the Lender may assign this Note to any person or entity without notice to or the consent of the Borrower.  
18.    Paragraph Headings.  The headings of the paragraphs herein are for convenience and reference only and shall not be considered as defining or limiting in any way the scope or intent of any provision of this Note.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

7

IN WITNESS WHEREOF, this instrument has been duly executed as of the day and year first above written. 

ABL MANOA MARKETPLACE LF LLC, 
a Hawaii limited liability company 

By  Alexander & Baldwin, LLC
       Its Sole Manager

       
By  /s/ Nelson N.S. Chun         
              Nelson N. S. Chun
              Its Senior Vice President and
              Chief Legal Officer

       By  /s/ Paul K. Ito            
               Paul K. Ito
               Its Senior Vice President,
               Chief Financial Officer & Treasurer

A&B MANOA LLC, 
a Hawaii limited liability company 

By  A & B Properties, Inc.
       Its Sole Manager

        By  /s/ Paul K. Ito            
               Paul K. Ito
               Its Treasurer

   By  /s/ David I Haverly        
                 David I. Haverly
                 Its Senior Vice President

8

ABL MANOA MARKETPLACE LH LLC, 
a Hawaii limited liability company 

By  Alexander & Baldwin, LLC
       Its Sole Manager

       
By  /s/ Nelson N.S. Chun         
              Nelson N. S. Chun
              Its Senior Vice President and
              Chief Legal Officer

       By  /s/ Paul K. Ito            
               Paul K. Ito
               Its Senior Vice President, 
               Chief Financial Officer & Treasurer
    
    

ABP MANOA MARKETPLACE LH LLC, 
a Hawaii limited liability company 

By  A & B Properties, Inc.
       Its Sole Manager

        By  /s/ Paul K. Ito            
               Paul K. Ito
               Its Treasurer

   By  /s/ David I Haverly        
                 David I. Haverly
                 Its Senior Vice President

“Borrower”

9

STATE OF HAWAII                )
)  SS.
CITY & COUNTY OF HONOLULU    )

On this the 27th day of July, 2016, before me personally appeared Nelson N. S. Chun qpersonally known to me -OR- ýproved to me on the basis of satisfactory evidence who, being by me duly sworn or affirmed, did say that such person executed the foregoing instrument as the free act and deed of such person, and if applicable in the capacities shown, having been duly authorized to execute such instrument in such capacities.

/s/ Camille D. Adams                
Printed Name:    Camille D. Adams        
Notary Public, State of Hawaii
My Commission Expires:  April 9, 2018    

	
	
	NOTARY CERTIFICATE STATEMENT

Document Identification or Description:  Promissory Note

ýDoc. Date:  August 1, 2016 or  ̈  Undated at time of notarization.
No. of Pages: 16
Jurisdiction:     First    Circuit (in which notarial act is performed)

/s/ Camille D. Adams                                July 27, 2016                                                                                                                       
Signature of Notary                                  Date of Notarization &
                                                                  Certification Statement

Camille D. Adams                                                                             
Printed Name of Notary                                                                      (Official Stamp or Seal)

10

STATE OF HAWAII                )
)  SS.
CITY & COUNTY OF HONOLULU    )

On this the 27th day of July, 2016, before me personally appeared Paul K. Ito qpersonally known to me -OR- ýproved to me on the basis of satisfactory evidence who, being by me duly sworn or affirmed, did say that such person executed the foregoing instrument as the free act and deed of such person, and if applicable in the capacities shown, having been duly authorized to execute such instrument in such capacities.

/s/ Camille D. Adams                
Printed Name:    Camille D. Adams        
Notary Public, State of Hawaii
My Commission Expires:  April 9, 2018    

	
	
	NOTARY CERTIFICATE STATEMENT

Document Identification or Description:  Promissory Note

ýDoc. Date:  August 1, 2016 or  ̈  Undated at time of notarization.
No. of Pages: 16
Jurisdiction:     First    Circuit (in which notarial act is performed)

/s/ Camille D. Adams                                July 27, 2016                                                                                                                       
Signature of Notary                                  Date of Notarization &
                                                                  Certification Statement

Camille D. Adams                                                                             
Printed Name of Notary                                                                      (Official Stamp or Seal)

11

STATE OF HAWAII                )
)  SS.
CITY & COUNTY OF HONOLULU    )

On this the  27th day of July, 2016, before me personally appeared David I. Haverly qpersonally known to me -OR- ýproved to me on the basis of satisfactory evidence who, being by me duly sworn or affirmed, did say that such person executed the foregoing instrument as the free act and deed of such person, and if applicable in the capacities shown, having been duly authorized to execute such instrument in such capacities.

/s/ Camille D. Adams                
Printed Name:    Camille D. Adams        
Notary Public, State of Hawaii
My Commission Expires:  April 9, 2018    

	
	
	NOTARY CERTIFICATE STATEMENT

Document Identification or Description:  Promissory Note

ýDoc. Date:  August 1, 2016 or  ̈  Undated at time of notarization.
No. of Pages: 16
Jurisdiction:     First    Circuit (in which notarial act is performed)

/s/ Camille D. Adams                                July 27, 2016                                                                                                                       
Signature of Notary                                  Date of Notarization &
                                                                  Certification Statement

Camille D. Adams                                                                             
Printed Name of Notary                                                                      (Official Stamp or Seal)

12

ATTACHMENT “1”
PAYMENT SCHEDULE FOR PRINCIPAL (DPI005903)

	
								
	Calculation Period
	USD Notional Amount
	

	USD Notional Adjustment
	

	(from and including to, 
but excluding)
	 
	(at end of period)
	

	Start Date
	End Date
	 
	 

	01-Aug-16
	01-Sep-16
	

	$60,000,000.00
	

	

	$0.00
	

	01-Sep-16
	03-Oct-16
	

	$60,000,000.00
	

	

	$0.00
	

	03-Oct-16
	01-Nov-16
	

	$60,000,000.00
	

	

	$0.00
	

	01-Nov-16
	01-Dec-16
	

	$60,000,000.00
	

	

	$0.00
	

	01-Dec-16
	03-Jan-17
	

	$60,000,000.00
	

	

	$0.00
	

	03-Jan-17
	01-Feb-17
	

	$60,000,000.00
	

	

	$0.00
	

	01-Feb-17
	01-Mar-17
	

	$60,000,000.00
	

	

	$0.00
	

	01-Mar-17
	03-Apr-17
	

	$60,000,000.00
	

	

	$0.00
	

	03-Apr-17
	01-May-17
	

	$60,000,000.00
	

	

	$0.00
	

	01-May-17
	01-Jun-17
	

	$60,000,000.00
	

	

	$0.00
	

	01-Jun-17
	03-Jul-17
	

	$60,000,000.00
	

	

	$0.00
	

	03-Jul-17
	01-Aug-17
	

	$60,000,000.00
	

	

	$0.00
	

	01-Aug-17
	01-Sep-17
	

	$60,000,000.00
	

	

	$0.00
	

	01-Sep-17
	02-Oct-17
	

	$60,000,000.00
	

	

	$0.00
	

	02-Oct-17
	01-Nov-17
	

	$60,000,000.00
	

	

	$0.00
	

	01-Nov-17
	01-Dec-17
	

	$60,000,000.00
	

	

	$0.00
	

	01-Dec-17
	02-Jan-18
	

	$60,000,000.00
	

	

	$0.00
	

	02-Jan-18
	01-Feb-18
	

	$60,000,000.00
	

	

	$0.00
	

	01-Feb-18
	01-Mar-18
	

	$60,000,000.00
	

	

	$0.00
	

	01-Mar-18
	02-Apr-18
	

	$60,000,000.00
	

	

	$0.00
	

	02-Apr-18
	01-May-18
	

	$60,000,000.00
	

	

	$0.00
	

	01-May-18
	01-Jun-18
	

	$60,000,000.00
	

	

	$0.00
	

	01-Jun-18
	02-Jul-18
	

	$60,000,000.00
	

	

	$0.00
	

	02-Jul-18
	01-Aug-18
	

	$60,000,000.00
	

	

	$0.00
	

	01-Aug-18
	04-Sep-18
	

	$60,000,000.00
	

	

	$0.00
	

	04-Sep-18
	01-Oct-18
	

	$60,000,000.00
	

	

	$0.00
	

	01-Oct-18
	01-Nov-18
	

	$60,000,000.00
	

	

	$0.00
	

	01-Nov-18
	03-Dec-18
	

	$60,000,000.00
	

	

	$0.00
	

	03-Dec-18
	02-Jan-19
	

	$60,000,000.00
	

	

	$0.00
	

	02-Jan-19
	01-Feb-19
	

	$60,000,000.00
	

	

	$0.00
	

	01-Feb-19
	01-Mar-19
	

	$60,000,000.00
	

	

	$0.00
	

	01-Mar-19
	01-Apr-19
	

	$60,000,000.00
	

	

	$0.00
	

	01-Apr-19
	01-May-19
	

	$60,000,000.00
	

	

	$0.00
	

	01-May-19
	03-Jun-19
	

	$60,000,000.00
	

	

	$0.00
	

	03-Jun-19
	01-Jul-19
	

	$60,000,000.00
	

	

	$0.00
	

13

	
								
	01-Jul-19
	01-Aug-19
	

	$60,000,000.00
	

	

	$0.00
	

	01-Aug-19
	03-Sep-19
	

	$60,000,000.00
	

	

	$131,643.74
	

	03-Sep-19
	01-Oct-19
	

	$59,868,356.26
	

	

	$131,643.74
	

	01-Oct-19
	01-Nov-19
	

	$59,736,712.52
	

	

	$131,643.74
	

	01-Nov-19
	02-Dec-19
	

	$59,605,068.78
	

	

	$131,643.74
	

	02-Dec-19
	02-Jan-20
	

	$59,473,425.04
	

	

	$131,643.74
	

	02-Jan-20
	03-Feb-20
	

	$59,341,781.30
	

	

	$131,643.74
	

	03-Feb-20
	02-Mar-20
	

	$59,210,137.56
	

	

	$131,643.74
	

	02-Mar-20
	01-Apr-20
	

	$59,078,493.82
	

	

	$131,643.74
	

	01-Apr-20
	01-May-20
	

	$58,946,850.08
	

	

	$131,643.74
	

	01-May-20
	01-Jun-20
	

	$58,815,206.34
	

	

	$131,643.74
	

	01-Jun-20
	01-Jul-20
	

	$58,683,562.60
	

	

	$131,643.74
	

	01-Jul-20
	03-Aug-20
	

	$58,551,918.86
	

	

	$131,643.74
	

	03-Aug-20
	01-Sep-20
	

	$58,420,275.12
	

	

	$137,666.18
	

	01-Sep-20
	01-Oct-20
	

	$58,282,608.94
	

	

	$137,666.18
	

	01-Oct-20
	02-Nov-20
	

	$58,144,942.76
	

	

	$137,666.18
	

	02-Nov-20
	01-Dec-20
	

	$58,007,276.58
	

	

	$137,666.18
	

	01-Dec-20
	04-Jan-21
	

	$57,869,610.40
	

	

	$137,666.18
	

	04-Jan-21
	01-Feb-21
	

	$57,731,944.22
	

	

	$137,666.18
	

	01-Feb-21
	01-Mar-21
	

	$57,594,278.04
	

	

	$137,666.18
	

	01-Mar-21
	01-Apr-21
	

	$57,456,611.86
	

	

	$137,666.18
	

	01-Apr-21
	03-May-21
	

	$57,318,945.68
	

	

	$137,666.18
	

	03-May-21
	01-Jun-21
	

	$57,181,279.50
	

	

	$137,666.18
	

	01-Jun-21
	01-Jul-21
	

	$57,043,613.32
	

	

	$137,666.18
	

	01-Jul-21
	02-Aug-21
	

	$56,905,947.14
	

	

	$137,666.18
	

	02-Aug-21
	01-Sep-21
	

	$56,768,280.96
	

	

	$142,097.83
	

	01-Sep-21
	01-Oct-21
	

	$56,626,183.13
	

	

	$142,097.83
	

	01-Oct-21
	01-Nov-21
	

	$56,484,085.30
	

	

	$142,097.83
	

	01-Nov-21
	01-Dec-21
	

	$56,341,987.47
	

	

	$142,097.83
	

	01-Dec-21
	03-Jan-22
	

	$56,199,889.64
	

	

	$142,097.83
	

	03-Jan-22
	01-Feb-22
	

	$56,057,791.81
	

	

	$142,097.83
	

	01-Feb-22
	01-Mar-22
	

	$55,915,693.98
	

	

	$142,097.83
	

	01-Mar-22
	01-Apr-22
	

	$55,773,596.15
	

	

	$142,097.83
	

	01-Apr-22
	02-May-22
	

	$55,631,498.32
	

	

	$142,097.83
	

	02-May-22
	01-Jun-22
	

	$55,489,400.49
	

	

	$142,097.83
	

	01-Jun-22
	01-Jul-22
	

	$55,347,302.66
	

	

	$142,097.83
	

	01-Jul-22
	01-Aug-22
	

	$55,205,204.83
	

	

	$142,097.83
	

	01-Aug-22
	01-Sep-22
	

	$55,063,107.00
	

	

	$146,266.52
	

	01-Sep-22
	03-Oct-22
	

	$54,916,840.48
	

	

	$146,266.52
	

	03-Oct-22
	01-Nov-22
	

	$54,770,573.96
	

	

	$146,266.52
	

	01-Nov-22
	01-Dec-22
	

	$54,624,307.44
	

	

	$146,266.52
	

	01-Dec-22
	03-Jan-23
	

	$54,478,040.92
	

	

	$146,266.52
	

	03-Jan-23
	01-Feb-23
	

	$54,331,774.40
	

	

	$146,266.52
	

14

	
								
	01-Feb-23
	01-Mar-23
	

	$54,185,507.88
	

	

	$146,266.52
	

	01-Mar-23
	03-Apr-23
	

	$54,039,241.36
	

	

	$146,266.52
	

	03-Apr-23
	01-May-23
	

	$53,892,974.84
	

	

	$146,266.52
	

	01-May-23
	01-Jun-23
	

	$53,746,708.32
	

	

	$146,266.52
	

	01-Jun-23
	03-Jul-23
	

	$53,600,441.80
	

	

	$146,266.52
	

	03-Jul-23
	01-Aug-23
	

	$53,454,175.28
	

	

	$146,266.52
	

	01-Aug-23
	01-Sep-23
	

	$53,307,908.76
	

	

	$150,627.88
	

	01-Sep-23
	02-Oct-23
	

	$53,157,280.88
	

	

	$150,627.88
	

	02-Oct-23
	01-Nov-23
	

	$53,006,653.00
	

	

	$150,627.88
	

	01-Nov-23
	01-Dec-23
	

	$52,856,025.12
	

	

	$150,627.88
	

	01-Dec-23
	02-Jan-24
	

	$52,705,397.24
	

	

	$150,627.88
	

	02-Jan-24
	01-Feb-24
	

	$52,554,769.36
	

	

	$150,627.88
	

	01-Feb-24
	01-Mar-24
	

	$52,404,141.48
	

	

	$150,627.88
	

	01-Mar-24
	01-Apr-24
	

	$52,253,513.60
	

	

	$150,627.88
	

	01-Apr-24
	01-May-24
	

	$52,102,885.72
	

	

	$150,627.88
	

	01-May-24
	03-Jun-24
	

	$51,952,257.84
	

	

	$150,627.88
	

	03-Jun-24
	01-Jul-24
	

	$51,801,629.96
	

	

	$150,627.88
	

	01-Jul-24
	01-Aug-24
	

	$51,651,002.08
	

	

	$150,627.88
	

	01-Aug-24
	03-Sep-24
	

	$51,500,374.20
	

	

	$155,886.25
	

	03-Sep-24
	01-Oct-24
	

	$51,344,487.95
	

	

	$155,886.25
	

	01-Oct-24
	01-Nov-24
	

	$51,188,601.70
	

	

	$155,886.25
	

	01-Nov-24
	02-Dec-24
	

	$51,032,715.45
	

	

	$155,886.25
	

	02-Dec-24
	02-Jan-25
	

	$50,876,829.20
	

	

	$155,886.25
	

	02-Jan-25
	03-Feb-25
	

	$50,720,942.95
	

	

	$155,886.25
	

	03-Feb-25
	03-Mar-25
	

	$50,565,056.70
	

	

	$155,886.25
	

	03-Mar-25
	01-Apr-25
	

	$50,409,170.45
	

	

	$155,886.25
	

	01-Apr-25
	01-May-25
	

	$50,253,284.20
	

	

	$155,886.25
	

	01-May-25
	02-Jun-25
	

	$50,097,397.95
	

	

	$155,886.25
	

	02-Jun-25
	01-Jul-25
	

	$49,941,511.70
	

	

	$155,886.25
	

	01-Jul-25
	01-Aug-25
	

	$49,785,625.45
	

	

	$155,886.25
	

	01-Aug-25
	02-Sep-25
	

	$49,629,739.20
	

	

	$160,246.82
	

	02-Sep-25
	01-Oct-25
	

	$49,469,492.38
	

	

	$160,246.82
	

	01-Oct-25
	03-Nov-25
	

	$49,309,245.56
	

	

	$160,246.82
	

	03-Nov-25
	01-Dec-25
	

	$49,148,998.74
	

	

	$160,246.82
	

	01-Dec-25
	02-Jan-26
	

	$48,988,751.92
	

	

	$160,246.82
	

	02-Jan-26
	02-Feb-26
	

	$48,828,505.10
	

	

	$160,246.82
	

	02-Feb-26
	02-Mar-26
	

	$48,668,258.28
	

	

	$160,246.82
	

	02-Mar-26
	01-Apr-26
	

	$48,508,011.46
	

	

	$160,246.82
	

	01-Apr-26
	01-May-26
	

	$48,347,764.64
	

	

	$160,246.82
	

	01-May-26
	01-Jun-26
	

	$48,187,517.82
	

	

	$160,246.82
	

	01-Jun-26
	01-Jul-26
	

	$48,027,271.00
	

	

	$160,246.82
	

	01-Jul-26
	03-Aug-26
	

	$47,867,024.18
	

	

	$160,246.82
	

	03-Aug-26
	01-Sep-26
	

	$47,706,777.36
	

	

	$166,520.25
	

15

	
								
	01-Sep-26
	01-Oct-26
	

	$47,540,257.11
	

	

	$166,520.25
	

	01-Oct-26
	02-Nov-26
	

	$47,373,736.86
	

	

	$166,520.25
	

	02-Nov-26
	01-Dec-26
	

	$47,207,216.61
	

	

	$166,520.25
	

	01-Dec-26
	04-Jan-27
	

	$47,040,696.36
	

	

	$166,520.25
	

	04-Jan-27
	01-Feb-27
	

	$46,874,176.11
	

	

	$166,520.25
	

	01-Feb-27
	01-Mar-27
	

	$46,707,655.86
	

	

	$166,520.25
	

	01-Mar-27
	01-Apr-27
	

	$46,541,135.61
	

	

	$166,520.25
	

	01-Apr-27
	03-May-27
	

	$46,374,615.36
	

	

	$166,520.25
	

	03-May-27
	01-Jun-27
	

	$46,208,095.11
	

	

	$166,520.25
	

	01-Jun-27
	01-Jul-27
	

	$46,041,574.86
	

	

	$166,520.25
	

	01-Jul-27
	02-Aug-27
	

	$45,875,054.61
	

	

	$166,520.25
	

	02-Aug-27
	01-Sep-27
	

	$45,708,534.36
	

	

	$171,548.11
	

	01-Sep-27
	01-Oct-27
	

	$45,536,986.25
	

	

	$171,548.11
	

	01-Oct-27
	01-Nov-27
	

	$45,365,438.14
	

	

	$171,548.11
	

	01-Nov-27
	01-Dec-27
	

	$45,193,890.03
	

	

	$171,548.11
	

	01-Dec-27
	03-Jan-28
	

	$45,022,341.92
	

	

	$171,548.11
	

	03-Jan-28
	01-Feb-28
	

	$44,850,793.81
	

	

	$171,548.11
	

	01-Feb-28
	01-Mar-28
	

	$44,679,245.70
	

	

	$171,548.11
	

	01-Mar-28
	03-Apr-28
	

	$44,507,697.59
	

	

	$171,548.11
	

	03-Apr-28
	01-May-28
	

	$44,336,149.48
	

	

	$171,548.11
	

	01-May-28
	01-Jun-28
	

	$44,164,601.37
	

	

	$171,548.11
	

	01-Jun-28
	03-Jul-28
	

	$43,993,053.26
	

	

	$171,548.11
	

	03-Jul-28
	01-Aug-28
	

	$43,821,505.15
	

	

	$171,548.11
	

	01-Aug-28
	01-Sep-28
	

	$43,649,957.04
	

	

	$177,098.90
	

	01-Sep-28
	02-Oct-28
	

	$43,472,858.14
	

	

	$177,098.90
	

	02-Oct-28
	01-Nov-28
	

	$43,295,759.24
	

	

	$177,098.90
	

	01-Nov-28
	01-Dec-28
	

	$43,118,660.34
	

	

	$177,098.90
	

	01-Dec-28
	02-Jan-29
	

	$42,941,561.44
	

	

	$177,098.90
	

	02-Jan-29
	01-Feb-29
	

	$42,764,462.54
	

	

	$177,098.90
	

	01-Feb-29
	01-Mar-29
	

	$42,587,363.64
	

	

	$177,098.90
	

	01-Mar-29
	02-Apr-29
	

	$42,410,264.74
	

	

	$177,098.90
	

	02-Apr-29
	01-May-29
	

	$42,233,165.84
	

	

	$177,098.90
	

	01-May-29
	01-Jun-29
	

	$42,056,066.94
	

	

	$177,098.90
	

	01-Jun-29
	02-Jul-29
	

	$41,878,968.04
	

	

	$177,098.90
	

	02-Jul-29
	01-Aug-29
	

	$41,701,869.14
	

	

	$41,701,869.14
	

16Exhibit 4.18

 

LOAN AND SECURITY AGREEMENT

 

THIS LOAN AND SECURITY
AGREEMENT (the “Security Agreement”) is made and entered into as of February 5, 2016 (the “Effective Date”),
by and between DRAKER CORPORATION, a corporation organized under the laws of the state of Delaware in the United States
of America with its principal office located at 431 Pine Street, Suite 114, Burlington, VT 05401 (“Borrower”), and
ESOL B.V., a company organized under the laws of Netherlands, with its principal office located at Startbaan 8, 1185XXR Amstelveen,
Netherlands, on behalf of itself and any holder(s) of the Loans (the “Secured Party”).

 

W I T N E S S E T H

 

WHEREAS, the Secured
Party has agreed to make certain Loans (defined below) to Borrower as Borrower may from time to time request, provided, however
that the aggregate principal balance of Loans to be advanced by Secured Party shall not exceed ONE MILLION FIVE HUNDRED THOUSAND
and NO/100 U.S. Dollars ($1,500,000.00) plus interest accrued, costs and fees in accordance with the terms hereof, as evidenced
by that certain Secured Note of Borrower of even date herewith payable to the order of the Secured Party, acceptance of which by
the Secured Party is conditioned on execution and delivery of this Security Agreement.

 

NOW, THEREFORE,
for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and in order to induce the Secured
Party to accept the Note (defined below), Borrower hereby agrees as follows:

 

1.Defined Terms.
For the purposes of this Security Agreement, the following capitalized words and phrases shall have the meanings set forth below.

 

“Business Day”
shall mean any day other than a Saturday, Sunday or a legal holiday on which banks are authorized or required to be closed for
the conduct of commercial banking business in Burlington, United States of America.

 

“Collateral”
shall mean all of the assets of Borrower.

 

“Commitment Fee”
shall mean a one-time fee equal to 2.0% of the maximum principal amount of the Loans drawn.

 

“Default Rate”
shall mean a per annum rate of interest equal to the Interest Rate plus 500 basis points.

 

“Interest Rate”
shall mean a per annum rate of interest equal to 10.0% per annum (calculated monthly based on the maximum outstanding balance for
each such calendar month)

 

“Loan Documents”
shall mean this Security Agreement, the Note, and any other agreements, instruments, or documents evidencing or otherwise relating
to the Loans.

 

    1 

     

    

 

“Note”
shall mean that certain Secured Note of Borrower of even date herewith payable to the order of the Secured Party, which Note shall
be in the form attached hereto as Exhibit A.

 

“Loan”
and “Loans” shall mean, respectively, each advance and the aggregate of all such advances, from time to time,
made by Secured Party to Borrower under and pursuant to this Agreement, as set forth in Section 2 of this Security Agreement plus
accrued interest, fees and costs payable hereunder.

 

“Loan Availability”
shall mean the Loan Commitment amount minus the total then-outstanding balance of all Loans.

 

“Loan Commitment”
shall mean One Million Five Hundred Thousand and No/100 Dollars ($1,500,000.00).

 

“Loan Maturity
Date”: means October 30, 2017.

 

2.Commitment
of Secured Party.

 

(a)Loans.

 

i.Loan Commitment.
Subject to the terms and conditions of this Security Agreement and the other Loan Documents, and in reliance upon the representations
and warranties of Borrower set forth herein and in the other Loan Documents, Secured Party agrees to make such Loans at such times
as Borrower may from time to time request, and in such amounts as Borrower may from time to time request, provided, however, that
the aggregate principal balance of all Loans outstanding at any time shall not exceed the Loan Availability. Loans made by Secured
Party may be repaid and, subject to the terms and conditions hereof, borrowed again up to, but not including the Loan Maturity
Date unless the Loans are otherwise accelerated, terminated or extended as provided in this Security Agreement. The Loans shall
be used by Borrower for the purpose of paying business expenses of Borrower and other working capital needs.

 

ii.Loan
Interest and Payments. Except as otherwise provided in this Section 2(ii), the principal amount of the Loans outstanding from
time to time shall bear interest at the Interest Rate. Accrued and unpaid interest on the unpaid principal balance of all Loans
outstanding from time to time shall be due and payable monthly on the first day of each calendar month. Lender shall have the right
to deduct from Borrower’s account any interest due hereunder and shall add to the unpaid principal balance of the Loan any
as if it were a Drawdown.

 

iii.Loan
Principal Payments. All Loans hereunder shall be repaid by Borrower on the Loan Maturity Date, unless payable sooner pursuant
to the provisions of this Agreement. In the event the aggregate outstanding principal balance of all Loans hereunder exceeds the
Loan Availability, Borrower shall, without notice or demand of any kind, immediately, make such repayments of the Loans or take
such other actions as are satisfactory to Secured Party as shall be necessary to eliminate such excess. Borrower may from time
to time prepay the Loans, in whole or in part, without any prepayment penalty whatsoever.

 

    2 

     

    

 

(b)Interest
and Fee Computation; Collection of Funds. Except as otherwise set forth herein, all interest and fees shall be calculated on
the basis of a year consisting of 365 days and shall be paid for the actual number of days elapsed. Principal payments submitted
in funds not immediately available shall continue to bear interest until collected. If any payment to be made by Borrower hereunder
or under the Note shall become due on a day other than a Business Day, such payment shall be made on the next succeeding Business
Day and such extension of time shall be included in computing any interest in respect of such payment. Notwithstanding anything
to the contrary contained herein, the final payment due under any of the Loans must be made by wire transfer or other immediately
available funds. All payments made by Borrower hereunder or under any of the Loan Documents shall be made without setoff, counterclaim,
or other defense. To the extent permitted by applicable law, all payments hereunder or under any of the Loan Documents (including
any payment of principal, interest, or fees) to, or for the benefit, of any Person shall be made by Borrower free and clear of,
and without deduction or withholding for, or account of, any taxes now or hereinafter imposed by any taxing authority.

 

(c)Default
Rate. Any amount of principal or interest on the Loans which is not paid when due, whether at stated maturity, by acceleration
or otherwise, shall bear interest payable on demand at the Default Rate.

 

3.Conditions
Of Borrowing. Notwithstanding any other provision of this Security Agreement, Secured Party shall not be required to disburse,
make or continue all or any portion of the Loans, if any of the following conditions shall have occurred (which conditions may
be waived or adjusted at Secured Party’s discretion).

 

(a)Loan
Documents. Borrower shall have failed to execute and deliver to Secured Party any of the Loan Documents in form reasonably
satisfactory to Secured Party and Secured Party’s counsel in form, substance, and execution.

 

(b)Default.
Any Default, or any event which, with notice or lapse of time, or both, would constitute a Default, shall have occurred and be
continuing.

 

(c)Adverse
Changes. A material adverse change in the financial condition or affairs of the Borrower, as determined in the Secured Party’s
reasonable discretion, shall have occurred.

 

(d)Litigation.
Any litigation or governmental proceeding shall have been instituted against Borrower that in the reasonable discretion of the
Secured Party, materially adversely affects the financial condition or continued operation of the Borrower.

 

    3 

     

    

 

(e)Representations
and Warranties. Any representation or warranty of Borrower contained herein or in any Loan Document shall be untrue or incorrect
as of the date of any Loan as though made on such date, except to the extent such representation or warranty expressly relates
to an earlier date.

 

4.Notes Evidencing
Loans. The Loans shall be evidenced by the Note. At the time of the initial disbursement of a Loan and at each time any
additional Loan shall be requested hereunder or a repayment made in whole or in part thereon, a notation thereof shall be made
on the books and records of the Secured Party.

 

5.Manner of Borrowing.

 

(a)The first
Loan shall be disbursed from Secured Party to Borrower on the Effective Date as provided below the original principal sum of Six
Hundred Thousand and No/100 U.S. Dollars ($600,000.00), or such other amount as mutually agreed, shall be disbursed to Borrower
by depositing such amount in the account of Borrower established with Lender.

 

(b)Each subsequent
Loan shall be made available to Borrower upon its request, from any Person whose authority to so act has not been revoked by the
Borrower in writing previously received by Secured Party. The proceeds of each Loan shall be made available to Borrower within
three (3) Business Days of written request therefor by depositing such amount in the account of Borrower established with Lender.

 

6.Grant of Security.
Borrower hereby assigns and pledges to the Secured Party, and hereby grants to the Secured Party a senior security interest in,
all of Borrower’s right, title and interest in all of Borrower’s accounts receivable, notes receivable, chattel paper
and other intangible rights to receive payment or repayment from any person or entity;

 

7.Security for
Obligations. This Security Agreement secures the payment of all obligations of Borrower now or hereafter existing under
the Note, whether for principal, interest, fees, expenses or otherwise, all obligations of Borrower now or hereafter existing under
this Security Agreement and all other obligations of Borrower to the Secured Party, however created (all such obligations of Borrower
being the “Obligations”).

 

8.Representations
and Warranties. Borrower represents and warrants as follows:

 

(a)Except
as provided in the next sentence, no effective financing statement or other instrument similar in effect covering all or any part
of the Collateral is on file in any recording office, except such as may have been filed in favor of the Secured Party relating
to this Security Agreement. Borrower has outstanding to Vermont Economic Development Authority (“VEDA”) a secured
loan of approximately $150,000 (the “VEDA Loan”).

 

(b)Borrower
has title to the Collateral in the same condition as transferred to it, and the Secured Party will acquire a first lien and senior
security interest in and to the Collateral free and clear of any liens, adverse claims or encumbrances, including without limitation,
any liens which can be perfected without filing a financing statement with the appropriate office.

 

    4 

     

    

 

(c)Borrower
is a company duly organized, validly existing and in good standing under the laws of the state of Delaware in the United States
of America, and has all requisite power and authority to enter into the Note and this Security Agreement and to carry out the other
transactions and agreements contemplated hereby. Borrower is in good standing and duly authorized to do business in all states
and other jurisdictions in which the ownership or leasing of its assets or the conduct of its business requires such authorization,
and no other jurisdiction has demanded, requested or otherwise indicated that Borrower is required so to qualify. Borrower has
requisite company power and authority to own or lease and to operate and use its assets and to carry on its business as now conducted
or proposed to be conducted.

 

(d)Borrower
has all requisite company power and authority to execute, deliver and perform the Note and this Security Agreement. The Note and
this Security Agreement have been duly authorized, executed and delivered by Borrower and are the legal, valid and binding obligations
of Borrower enforceable against Borrower in accordance with their terms.

 

(e)The execution
and delivery of the Note and this Security Agreement by Borrower do not, and the consummation by Borrower of the transactions contemplated
hereby will not, violate, conflict with or result in a breach of any provision of, or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a default) under, or result in the termination of, or accelerate the performance
required by, or result in a right of termination or acceleration under, any of the terms, conditions or provisions of (a) the Articles
of Organization or Operating Agreement of Borrower, (b) any statute, law, ordinance, rule, regulation, judgment, decree, order,
injunction, writ, permit or license of any court or governmental authority applicable to Borrower, or (c) any agreement, note,
bond, mortgage, indenture, deed of trust, license, franchise, permit, concession, lease or other instrument, obligation or agreement
of any kind to which Borrower is now a party or by which Borrower or any of its properties or assets may be bound or affected.

 

9.Further Assurances.

 

(a)Borrower
agrees that from time to time, at Borrower’s sole expense, Borrower will promptly execute and deliver all further instruments
and documents, and take all further action that the Secured Party may reasonably request in order to perfect and protect any security
interest granted hereby or to enable the Secured Party to exercise and enforce its rights and remedies hereunder with respect to
any Collateral. Without limiting the generality of the foregoing, Borrower will execute such financing or continuation statements,
or amendments thereto, and such other instruments or notices as the Secured Party may reasonably request, in order to perfect and
preserve the security interests granted or purported to be granted hereby.

 

    5 

     

    

 

(b)Borrower
authorizes the Secured Party to file one or more financing or continuation statements, and amendments thereto, relative to all
or any part of the Collateral without the signature of Borrower where permitted by law. A carbon, photographic or other reproduction
of this Security Agreement or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing
statement where permitted by law.

 

(c)Borrower
will furnish to the Secured Party from time to time statements and schedules further identifying and describing the Collateral
and such other reports in connection with the Collateral as the Secured Party may reasonably request, all in reasonable detail.

 

10.Borrower’s Covenants.
Borrower agrees that, so long as any of the Obligations are outstanding, it shall:

 

(a)Taxes
and Liens. Pay promptly when due all property and other taxes, assessments and governmental charges or levies imposed upon,
and all claims (including claims for labor, materials and supplies) against the Collateral, except to the extent the validity thereof
is being contested in good faith.

 

(b)Preservation
of Company Existence, Etc. Preserve and maintain its company existence, rights and franchises.

 

(c)Compliance
with Laws, Etc. Comply with the requirements of all applicable laws, rules, regulations and orders of any governmental authority,
non-compliance with which would materially adversely affect its business or credit.

 

(d)Inspection
of the Secured Party. Permit Secured Party and Secured Party’s representatives to enter the Premises at reasonable times
upon reasonable advance notice to inspect the Collateral.

 

(e)Keeping
of Books. Keep proper books of record and account, in which full and correct entries shall be made of all financial transactions
and the assets and business of Borrower in accordance with reasonable accounting principles consistently applied.

 

(f)Maintenance
of Properties, Etc. Maintain and preserve all of its properties that are used or useful in the conduct of its business in good
working order and condition, ordinary wear and tear and casualty excepted.

 

(g)Reporting
Requirements. Furnish to the Secured Party (i) immediately after the commencement thereof, notice of all material actions,
suits and proceedings before any court or governmental department, commission, board, bureau, agency or instrumentality, domestic
or foreign, affecting Borrower and (ii) an aged accounts receivable balance on the first business day of each calendar month.

 

    6 

     

    

 

(h)No
Guarantee of Indebtedness. Not directly or indirectly assume or guaranty the obligations of any other person or entity, except
by reason of endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of
business.

 

(i)No
Mergers, Etc. Not merge with or into or consolidate with or into, or convey, transfer, lease or otherwise dispose of (whether
in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired)
to any person or entity or issue any additional capital stock.

 

(j)No
Sales, Etc. of Collateral. Not sell, assign, lease, transfer or otherwise dispose of any substantial part of any of the Collateral,
or agree to do any of the foregoing, except in the ordinary course of its business.

 

(k)No
Liens. Other than the lien in favor of VEDA, not create or suffer to exist any lien, security interest or other charge or encumbrance
upon or with respect to any of the Collateral except to secure indebtedness of Borrower to the Secured Party and, except as may
be expressly agreed to in writing by the Secured Party; and arrange, as promptly as practicable, the release of the lien in favor
of VEDA or the subordination of such lien to the lien of Lender.

 

(l)Investments
in Other Persons. Not make any loan or advance to any person or entity; or purchase or otherwise acquire any capital stock,
obligations or other securities of, make any capital contribution to, or otherwise invest in, any other person or entity.

 

(m)Dividends,
Etc. Not declare or pay any dividends, purchase, redeem, retire or otherwise acquire for value any of its membership interest
now or hereafter outstanding, return any capital to its members as such, or make any distribution to its members as such other
than those required under the Preference Shares currently on issue by the Borrower.

 

(n)Change
in Nature of Business. Not make any material change in the nature of the Borrower’s business.

 

(o)Maintain
Contracts. Not default under or suffer a termination of any material agreements to which Borrower is a party without prior
written notice to the Secured Party.

 

11.Secured Party
May Perform. If Borrower fails to perform any agreement contained herein, after the occurrence and continuance of a Default
(as defined below) beyond any applicable cure period, then upon advance written notice to Borrower the Secured Party may itself
perform, or cause performance of, such agreement, and the expenses of the Secured Party incurred in connection therewith shall
be payable by Borrower under Section 14(b) below.

 

    7 

     

    

 

12.The Secured
Party’s Duties. The powers conferred on the Secured Party hereunder are solely to protect its interest in the Collateral
and shall not impose any duty upon it to exercise any such powers. Except for the safe custody of any Collateral in its possession
and the accounting for moneys actually received by it hereunder, the Secured Party shall have no duty as to any Collateral or as
to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.

 

13.Default and
Remedies.

 

(a)Default
Defined. The occurrence of any of the following events shall constitute a default under this Security Agreement (a “Default”):

 

i.if default
shall be made in a payment which is due under the Note shall occur; or

 

ii.if default
shall be made by Borrower in the performance of, or compliance with, any other provision of this Security Agreement and such default
is not cured within ten (10) days after written notice thereof to Borrower, or such longer period of time as may be required to
cure such default with diligent effort; or

 

iii.if a proceeding
shall have been instituted in a court seeking a decree or order for relief in respect to Borrower in an involuntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or other similar official) of Borrower or for any substantial part of the property
of Borrower, or for the winding-up or liquidation of the affairs of Borrower and such proceeding shall remain undismissed or unstayed
and in effect for a period of sixty (60) days or such court shall enter a decree or order granting the relief sought in such proceeding;
or

 

iv.if Borrower
shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall
consent to the entry of an order for relief in an involuntary case under any such law, or shall consent to the appointment of or
taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of Borrower
or shall make a general assignment for the benefit of creditors, or shall take any company action to authorize any of the foregoing;
or

 

v.if Borrower’s
existence shall be terminated.

 

(b)Remedies
Upon a Default.

 

i.If any Default
described in subsections (v) or (vi) of Section 13(a) shall occur, then without notice or any other action by the Secured Party,
and if any other Default shall occur and remain uncured, then at Secured Party’s option, the entire unpaid indebtedness (principal,
interest, fees, costs and otherwise) remaining unpaid under the Note shall become immediately due and payable without notice or
demand.

 

    8 

     

    

 

ii.The Secured
Party may exercise in respect to the Collateral, in addition to other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a secured party on default under the Uniform Commercial Code of the relevant jurisdiction
(the “Code”) (whether or not the Code applies to the affected Collateral) and any other applicable law upon default
by a debtor, and also may: (i) require Borrower to, and Borrower hereby agrees that it shall at its expense and upon request of
the Secured Party forthwith, assemble all or part of the Collateral as directed by the Secured Party and make it available to the
Secured Party at the address, stated in Secured Party’s notice requiring such assembly; and (ii) upon not less than five
(5) days prior written notice to Borrower, sell the Collateral or any part thereof in one or more parcels at public or private
sale, at the address stated in the Secured Party’s notice or elsewhere, for cash, on credit or for future delivery, and upon
such other terms as the Secured Party may deem commercially reasonable. The Secured Party shall not be obligated to make any sale
of Collateral regardless of notice of sale having been given. The Secured Party may adjourn any public or private sale from time
to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned.

 

iii.All cash
proceeds received by the Secured Party in respect to any sale of, collection from, or other realization upon all or any part of’
the Collateral may, in the discretion of the Secured Party, be held by the Secured Party as collateral for, and/or then or at any
time thereafter applied (after payment of any amounts payable to the Secured Party pursuant to Section 14) in whole or in part
by the Secured Party against, all or any part of the Obligations in such order as the Secured Party shall elect. Any surplus of
such cash or cash proceeds held by the Secured Party and remaining after payment in full of all the Obligations shall be paid over
to Borrower or to whomsoever may be lawfully entitled to receive such surplus.

 

14.Indemnity and Expenses.

 

(a)Borrower
agrees to indemnify the Secured Party from and against any and all claims, losses and liabilities growing out of or resulting from
this Security Agreement (including, without limitation, enforcement of this Security Agreement) except claims, losses or liabilities
resulting from the Secured Party’s negligence or willful misconduct.

 

(b)Borrower
shall, upon written demand of the Secured Party, pay to the Secured Party the amount of any and all reasonable expenses, including
the reasonable fees and disbursements of its counsel and of any experts and agents, which the Secured Party may reasonably incur
in connection with (i) the documentation of the Loans and this Security Agreement (including recording and perfection thereof,
(ii) the custody, preservation, use or operation of, or the sale of, collection from, or other realization upon, any of the Collateral,
(iii) the exercise or enforcement of any of the rights of the Secured Party hereunder or (iv) the failure by Borrower to perform
or observe any of the provisions hereof.

 

    9 

     

    

 

15.Amendments,
Etc. No amendment or waiver of any provision of this Security Agreement nor consent to any departure by Borrower herefrom
shall in any event be effective unless the same shall be in writing and signed by the Secured Party, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose for which given.

 

16.Notices.
All notices required or permitted hereunder shall be in writing, signed by an officer of the party giving notice and shall
be deemed to have been given when delivered by personal delivery, facsimile, or FedEx or similar courier service, or three (3)
days after being deposited in the United States mail, registered or certified, with postage prepaid, addressed as follows:

 

(a) if to Borrower, at:

 

Draker Corporation

431 Pine Street, Suite 114

Burlington, VT 05401

Attn: Richard Pillinger, Director

 

 

 

(b) if to the Secured Party
at:

 

ESOL B.V.

Startbaan 8

1185XR Amstelveen

Netherlands

Attn: Gilbert Armenta

 

or such other address(es) as any party may
designate for itself by notice given to the other party from time to time in accordance with the provisions hereof.

 

17.Continuing
Security Interest; Transfer of Note. This Security Agreement shall create a continuing security interest in the Collateral
and shall: (i) remain in full force and effect until payment in full of the Obligations; (ii) be binding upon Borrower, its successors
and assigns; and (iii) inure to the benefit of the Secured Party and its successors, transferees and assigns. Without limiting
the generality of the foregoing clause (iii), the Secured Party may assign the Note or any portion thereof held by it to any other
person or entity, and such other person or entity shall thereupon become vested, ratably, with all the benefits in respect thereof
granted to the Secured Party herein or otherwise. Upon the payment in full of the Obligations, the security interest granted hereby
shall terminate and all rights to the Collateral shall revert to Borrower. Upon any such termination, the Secured Party will, at
its expense, execute and deliver to Borrower such documents as Borrower shall reasonably request to evidence such termination.

 

    10 

     

    

 

18.Governing
Law; Terms. This Agreement shall be controlled, construed and enforced in accordance with the laws of the U.S. state of
Vermont, applicable to agreements made and to be performed entirely within that State, without regard to any choice of law or conflict
of law provision or rule (whether of such state or any other jurisdiction) that would cause the application of the law of any jurisdiction
other than the U.S. state of Vermont.

 

19.Forum Selection
and Consent to Jurisdiction. Any litigation based hereon, or arising out of, under, or in connection with this Security
Agreement or the Note shall be brought and maintained exclusively in the courts of the U.S. state of Vermont.

 

20.Waiver of
Jury Trial. Secured Party and Borrower, after consulting or having had the opportunity to consult with counsel, each knowingly,
voluntarily and intentionally waive irrevocably, any right to a trial by jury in any action or proceeding to enforce or defend
any rights under or in connection with this Security Agreement and the Note, any of the other obligations, the collateral, or any
amendment, instrument, document or agreement delivered or which may in the future be delivered in connection herewith or therewith
or arising from any lending relationship existing in connection with any of the foregoing, or any course of conduct or course of
dealing in which the Secured Party and Borrower are adverse parties, and each agrees that any such action or proceeding shall be
tried before a court and not before a jury. This provision is a material inducement for the Secured Party granting any financial
accommodation to Borrower.

 

21.Miscellaneous.
The Recitals set forth above are incorporated by reference. One or more counterparts of this Security Agreement may be delivered
via fax, with the intention that they shall have the same effect as an original counterpart hereof. Whenever the term “include,”
“including,” or “included” is used in this Security Agreement, it shall mean “including without limiting
the generality of the foregoing”. The headings of paragraphs and sub-paragraphs contained in this Security Agreement are
merely for convenience of reference and shall not affect the interpretation of any of the provisions of this Security Agreement.
This Security Agreement is deemed to have been drafted jointly by the parties to this Security Agreement, and any uncertainty or
ambiguity shall not be construed for or against any party as an attribution of drafting to any party. This Security Agreement may
be executed in counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and
the same instrument. Signatures transmitted by facsimile or as emailed PDF copies shall be binding as originals, and each party
hereby waives any defenses to the enforcement of the terms of this Security Agreement sent by facsimile or emailed PDF based upon
the manner of transmission or form of signature (electronic, facsimile or “ink original”).

 

Remainder of this Page Intentionally
Left Blank.

Signature Page Follows.

 

    11 

     

    

 

IN WITNESS WHEREOF,
the parties have caused this Security Agreement to be duly executed and delivered by their duly authorized agents as of the date
first above written.

 

	SECURED PARTY: 	 	BORROWER:
	 	 	 	 	 
	ESOl
B.V., a j company organized under the laws of Netherlands	 	DRAKER
CORPORATIO a Delaware (USA) company
	 	 	 	 	 
	By:	 	 	By:	 
	Name:	 	 	Name:	William
C. Morro
	Its:	Authorized
Representative	 	Its:	President
	 	 	 	 	 

 

    12 

     

    

 

EXHIBIT A

 

FORM OF SECURED NOTE

 

A-1

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