Document:

Exhibit 10.23

  

EXECUTION VERSION

 

SECOND AMENDMENT TO
LOAN

AND SECURITY AGREEMENT

 

This SECOND AMENDMENT
TO LOAN AND SECURITY AGREEMENT (this "Amendment"), is dated as of November 26, 2019, by and among the lenders
identified on the signature pages hereof (each of such lenders, together with its successors and permitted assigns, is referred
to hereinafter as a "Lender"), ENCINA BUSINESS CREDIT, LLC, a Delaware limited liability company, as administrative
agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, "Agent"),
and HYDROFARM, LLC, a California limited liability company, SUNBLASTER LLC, a Delaware limited liability company,
SUNBLASTER HOLDINGS ULC, a British Columbia unlimited liability company, and EDDI'S WHOLESALE GARDEN SUPPLIES LTD.,
a British Columbia company and HYDROFARM CANADA, LLC, a Delaware limited liability company (each a "Borrower"
and collectively the "Borrowers"), and HYDROFARM HOLDINGS LLC, a Delaware limited liability company ("Holdings"),
and EHH HOLDINGS, LLC a Delaware limited liability company ("EHH") (Holdings and EHH each a "Loan
Party Obligor" and collectively the "Loan Party Obligors").

 

WITNESSETH:

 

WHEREAS, Borrowers,
Loan Party Obligors, Lenders and Agent are parties to that certain Loan and Security Agreement, dated as of July 11, 2019 (the
 "Loan Agreement");

 

WHEREAS, Borrowers
and Loan Party Obligors have requested that Agent and the Lenders agree to increase the Inventory Sublimit, on a temporary basis,
in accordance with the terms and conditions hereof; and

 

WHEREAS, Agent
and the Lenders agree to amend the Loan Agreement, in each case, subject to the terms and conditions set forth herein;

 

NOW THEREFORE,
in consideration of the premises and the mutual cove ants contained herein, and other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

 

SECTION 1.
Defined Terms. Unless otherwise defined herein, all capitalized terms used herein have the meanings assigned to such terms
in the Loan Agreement, as amended hereby.

 

SECTION 2.
Amendments.

 

(a) Upon the Second
Amendment Effective Date, the following definition of "Second Amendment Effective Date" is hereby added
to Section 1.1 of the Loan Agreement in a manner that maintains alphabetical order:

 

““Second
Amendment Effective Date” means November 26, 2019.”

 

 

 

SECOND
Amendment to

loan and security agreement

 

    1 

     

    

  

EXECUTION VERSION

 

(b)   Upon the Second
Amendment Effective Date, the amount set forth in Section1(d) of Annex I ($20,000,000) is hereby deleted in its entirety and
replaced with:

 

"$21,500,000 through February 5, 2020;

 

$21,125,000 from February 6, 2020 through February
12, 2020;

 

$20,750,000 from
February 13, 2020 through February 19, 2020;

 

$20,375,000 from February 20, 2020 through February
26, 2020; and

 

$20,000,000 thereafter."

 

SECTION 3.
Representations, Warranties and Covenants of Each of Borrower and each Loan Party Obligor. Each Borrower and Loan Party
Obligors represents and warrants to the Lenders and Agent and agrees that:

 

(a)
the representations and warranties contained in the Loan Agreement (as amended hereby) and the other outstanding Loan Documents
are true and correct in all material respects at and as of the date hereof as though made on and as of the date hereof, except
(i) to the extent specifically made with regard to a particular date, and (ii) for such changes that are a result of any act or
omission specifically permitted under the Loan Agreement (or under any Loan Document), or as otherwise specifically permitted
by the Lenders;

 

(b)
on the Second Amendment Effective Date, after giving effect to this Amendment, no Default or Event of Default will have occurred
and be continuing;

 

(c)
the execution, delivery and performance of this Amendment have been duly authorized by all necessary action on the part of, and
duly executed and delivered by each of Borrower and each Loan Party Obligor, and this Amendment is a legal, valid and binding
obligation of each of Borrower and each Loan Party Obligor, enforceable against such Person in accordance with its terms, except
as the enforcement thereof may be subject to the effect of any applicable bankruptcy, insolvency, reorganization, moratorium,
or similar laws affecting creditors' rights generally and general principles of equity (regardless of whether such enforcement
is sought in a proceeding in equity or at law); and

 

(d)
the execution, delivery and performance of this Amendment do not conflict with or result in a breach by Borrower or any Loan Party
Obligor of any term of any material contract, loan agreement, indenture or other agreement or instrument to which such Person
is a party or is subject.

 

SECTION 4.
Conditions Precedent to Effectiveness of Amendment. This Amendment shall become effective (the "Second Amendment
Effective Date") upon satisfaction of each of the following conditions:

 

 

 

SECOND
Amendment to

loan and security agreement

 

    2

     

    

  

EXECUTION VERSION

 

 

(a)
Each of Borrower, the Loan Party Obligors, the Lenders and Agent shall have executed and delivered to the Agent this Amendment
and such other documents as the Agent may reasonably request;

 

(b)
All legal matters incident to the transactions contemplated hereby shall be reasonably satisfactory to counsel for the Agent;
and

 

(c)
 Ultimate Parent shall have caused not less than an additional $3,000,000 in cash to be infused into the U.S. Obligors for working
capital purposes on terms satisfactory to Agent.

 

SECTION 6. 
Costs and Expenses. Borrower hereby affirms its obligation under the Loan Agreement to reimburse the Agent for all fees
and expenses paid or incurred by the Agent in connection with the preparation, negotiation, execution and delivery of this Amendment,
including, but not limited to, the internal and external attorneys' fees and expenses of attorneys for the Agent with respect
thereto.

 

SECTION 7. GOVERNING
LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUCTED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE INTERNAL CONFLICTS OF LAWS PROVISIONS THEREOF.

 

SECTION 8. 
Effect of Amendment; Reaffirmation of Loan Documents. (a) Nothing contained in this Amendment in any manner or respect
limits or terminates any of the provisions of the Loan Agreement or the other outstanding Loan Documents other than as expressly
set forth herein. The Loan Agreement (as amended hereby) and each of the other outstanding Loan Documents remain and continue
in full force and effect and are hereby ratified and reaffirmed in all respects. Borrower and the Loan Party Obligors hereby further
ratify and reaffirm the validity and enforceability of all of the Liens heretofore granted, pursuant to and in connection with
the Loan Agreement or any other Loan Document to the Agent on behalf and for the benefit of the Lenders, as collateral security
for the Obligations under the Loan Documents, in accordance with their respective terms, and acknowledges that all of such Liens,
and all collateral heretofore pledged as security for such Obligations, continues to be and remain collateral for such obligations
from and after the date hereof. Upon the effectiveness of this Amendment, each reference in the Loan Agreement to "this Agreement",
 "hereunder", "hereof', "herein" or words of similar import shall mean and be a reference to the Loan
Agreement as amended hereby.

 

(b)
Execution of this Amendment by the Lenders and Agent (i) shall not constitute a waiver of any Default or Event of Default that
may currently exist or hereafter arise under the Loan Agreement, (ii) shall not impair, modify, restrict or limit any right, power,
privilege or remedy of the Lenders or Agent with respect to any Default or Event of Default that may now exist or hereafter arise
under the Loan Agreement or any of the other Loan Documents, and (iii) shall not constitute any custom, course of dealing or other
basis for altering any obligation of Borrower or any Loan Party Obligor or any right, power, privilege or remedy of the Lenders
and Agent under the Loan Agreement or any of the other Loan Documents.

 

 

 

SECOND
Amendment to

loan and security agreement

 

    3

     

    

    

EXECUTION VERSION

 

 

(c)
The amendments, consents, modifications and other agreements set forth herein are limited to the specifics hereof, shall not apply
with respect to any facts or occurrences other than those on which the same are based, shall neither excuse any future non- compliance
with the Loan Agreement or any other Loan Document, nor operate as a waiver of any Default or Event of Default.

  

(d) This
Amendment is a Loan Document.

 

(d)
To the extent that any terms and conditions in any of the Loan Documents shall contradict or be in conflict with any terms or
conditions of the Loan Agreement, after giving effect to this Amendment, such terms and conditions are hereby deemed modified
or amended accordingly to reflect the terms and conditions of the Loan Agreement and the Loan Documents as modified or amended
hereby.

 

SECTION 9.
Headings. Section headings in this Amendment are included herein for convenience of any reference only and shall not constitute
a part of this Amendment for any other purposes.

 

SECTION 10.
Release. EACH OF BORROWER AND THE LOAN PARTY OBLIGORS HEREBY ACKNOWLEDGES THAT AS OF THE DATE HEREOF IT HAS NO DEFENSE,
COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE
ALL OR ANY PART OF THEIR LIABILITY TO REPAY THE OBLIGATIONS OR TO SEEK AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM
LENDERS, AGENT, OR THEIR RESPECTIVE AFFILIATES, PARTICIPANTS OR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS, MANAGERS,
MEMBERS, EMPLOYEES OR ATTORNEYS. EACH OF BORROWER AND THE LOAN PARTY OBLIGORS HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER
DISCHARGES LENDERS, AGENT, THEIR RESPECTIVE AFFILIATES AND PARTICIPANTS, AND THEIR PREDECESSORS, AGENTS, MANAGERS, MEMBERS, OFFICERS,
DIRECTORS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES,
AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL,
AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AMENDMENT IS EXECUTED, WHICH PARENT OR BORROWER
MAY NOW OR HEREAFTER HAVE AGAINST LENDERS, AGENT, OR THEIR RESPECTIVE PREDECESSORS, AGENTS, MANAGERS, MEMBERS, OFFICERS, DIRECTORS,
EMPLOYEES, SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION
OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING FROM THE LIABILITIES, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE LOAN
AGREEMENT OR OTHER LOAN DOCUMENTS, AND NEGOTIATION FOR AND EXECUTION OF THIS AMENDMENT. EACH OF BORROWER AND THE LOAN PARTY OBLIGORS
HEREBY COVENANTS AND AGREES NEVER TO INSTITUTE ANY ACTION OR SUIT AT LAW OR IN EQUITY, NOR INSTITUTE, PROSECUTE, OR IN ANY WAY
AID IN THE INSTITUTION OR PROSECUTION OF ANY CLAIM, ACTION OR CAUSE OF ACTION, RIGHTS TO RECOVER DEBTS OR DEMANDS OF ANY NATURE
AGAINST LENDERS, AGENT, THEIR RESPECTIVE AFFILIATES AND PARTICIPANTS, OR THEIR RESPECTIVE SUCCESSORS, AGENTS, MANAGERS, MEMBERS,
ATTORNEYS, OFFICERS, DIRECTORS, EMPLOYEES, AND PERSONAL AND LEGAL REPRESENTATIVES ARISING ON OR BEFORE THE DATE HEREOF OUT OF
OR RELATED TO LENDERS' OR AGENT'S ACTIONS, OMISSIONS, STATEMENTS, REQUESTS OR DEMANDS IN ADMINISTERING, ENFORCING, MONITORING,
COLLECTING OR ATTEMPTING TO COLLECT THE OBLIGATIONS OF BORROWER OR ANY LOAN PARTY OBLIGOR TO LENDERS AND AGENT, WHICH OBLIGATIONS
ARE EVIDENCED BY THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS.

 

 

 

SECOND
Amendment to

loan and security agreement

 

    4

     

    

   

EXECUTION VERSION

 

SECTION 11.
Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall
be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall
not in any way be affected or impaired thereby.

 

SECTION 12.
Entire Agreement. This Amendment, and terms and provisions hereof, the Credit Agreement and the other Loan Documents constitute
the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes any
and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied,
oral or written and is the final expression and agreement of the parties hereto with respect to the subject matter hereof

 

SECTION 13.
Execution in Counterparts. This Amendment may be executed in counterparts, each of which when so executed and delivered
shall be deemed to be an original and all of which taken together shall constitute but one and the same instrument.

 

[Remainder of page intentionally left blank with signature
pages immediately to follow]

 

 

SECOND
Amendment to

loan and security agreement

  

    5

     

    

 

IN WITNESS WHEREOF, the
parties hereto have caused this Amendment to be executed and delivered as of the date first above written.

 

	LENDER:	ENCINA BUSINESS CREDIT SPV, LLC, a
	 	Delaware limited liability company
	 	 	 
	 	By:	/s/ Tracy Salyers
	 	Name:	 Tracy Salyers
	 	Title: 	Manager
	 	 	 
	 	 	 
	AGENT:	ENCINA BUSINESS CREDIT, LLC,
	 	a Delaware limited liability company
	 	 	 
	 	By: 	/s/  Tracy Salyers
	 	Name: 	 Tracy Salyers
	 	Title: 	Manager

 

[Signature Pages Continue] 

 

Signature
Page to

Ninth Amendment to Loan and Security Agreement

 

     

     

    

 

	Borrowers:	 
	 	 	 
	HYDROFARM, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	SUNBLASTER, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	SUNBLASTER HOLDINGS, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	EDDI’S WHOLESALE GARDEN SUPPLIES LTD.	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 

 

     

     

    

  

EXECUTION VERSION

 

 

	HYDROFARM CANADA, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	 	 	 
	Loan Party Obligors:	 
	 	 	 
	 	 	 
	EHH HOLDINGS, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	HYDROFARM HOLDINGS, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFOExhibit 10.24

 

THIRD
AMENDMENT TO LOAN

AND
SECURITY AGREEMENT

 

This
THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”), is dated as of April 3. 2020, by
and among the lenders identified on the signature pages hereof (each of such lenders, together with its successors and permitted
assigns, is referred to hereinafter as a “Lender”), ENCINA BUSINESS CREDIT, LLC, a Delaware limited
liability company. as administrative agent for the Lenders (in such capacity, together with its successors and assigns in such
capacity. “Agent”), and HYDROFARM, LLC, a California limited liability company, SUNBLASTER LLC,
a Delaware limited liability company, SUNBLASTER HOLDINGS ULC, a British Columbia unlimited liability company, and EDDI'S
WHOLESALE GARDEN SUPPLIES LTD., a British Columbia company and HYDROFARM CANADA, LLC, a Delaware limited liability
company (each a "Borrower'' and collectively the "Borrowers"), and HYDROFARM HOLDINGS LLC, a Delaware limited
liability company (“Holdings”). and EHH HOLDINGS, LLC a Delaware limited liability company “EHH”)
(Holdings and EHH each a "Loan Party Obligor" and collectively the "Loan Party Obligors").

 

WITNESSETH:

 

WHEREAS,
Borrowers, Loan Party Obligors, Lenders and Agent are parties to that certain Loan and Security Agreement, dated as of July
11, 2019 (the "Original Loan Agreement");

 

WHEREAS,
the Original Loan Agreement was amended pursuant to that certain first Amendment to Loan and Security Agreement dated as of October
15, 2019 (the “First Amendment") and that certain Second Amendment to Loan and Security Agreement dated as of
November 26, 2019 (the “Second Amendment”):

 

WHEREAS.,Borrowers
and Loan Party Obligors have requested that Agent and the Lenders agree to further amend the Original Loan Agreement as
amended by the First Amendment and the Second Amendment (the "Loan Agreement") (i) to replace the existing minimum
availability/springing fixed charge covenant with an availability block and (ii) to increase the Inventory Sublimit on a
seasonal basis. in accordance with the terms and conditions hereof; and

 

WHEREAS,
Agent and the Lenders agree to amend the Loan Agreement, in each case, subject to the terms and conditions set forth herein:

 

NOW
THEREFORE, in consideration of the premises and the mutual covenants contained herein, and other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

  

SECTION
1. Defined Terms. Unless otherwise defined herein, all capitalized terms used herein have the meanings assigned to
such terms in the Loan Agreement as amended hereby.

  

    	 		 

     

    

   

SECTION 2.    Amendments.

 

The Loan Agreement is hereby amended (a) to delete the red or
green stricken text (indicated textually in the same manner as the following examples: stricken
text and stricken text) and (b) to add the blue or green double-underlined
text (indicated textually in the same manner as the following examples: double-underlined
text and double-underlined text). in each case,
as set forth in the marked copy of the Loan Agreement attached hereto as Exhibit A hereto and made a part hereof for all purposes.

 

SECTION
3.     Representations. Warranties and Covenants of Each of Borrower and each Loan Party Obligor. Each Borrower and Loan
Party Obligors represents and warrants to the Lenders and Agent and agrees that:

 

(a)    
the representations and warranties contained in the Loan Agreement (as amended hereby) and the other outstanding Loan Documents
are true and correct in all material respects at and as of the date hereof as though made on and as of the date hereof, except
(i) to the extent specifically made with regard to a particular date, and (ii) for such changes that are a result of any act or
omission specifically permitted under the Loan Agreement (or under any Loan Document), or as otherwise specifically permitted
by the Lenders:

 

(b)    
on the Third Amendment Effective Date, after giving effect to this Amendment, no Default or Event of Default will have occurred
and be continuing;

 

(c)    
the execution, delivery and performance of this Amendment have been duly authorized by all necessary action on the part of,
and duly executed and delivered by each of Borrower and each Loan Party Obligor, and this Amendment is a legal, valid and
binding obligation of each of Borrower and each Loan Party Obligor, enforceable against such Person in accordance with its
terms, except as the enforcement thereof may be subject to the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting creditors’ rights generally and general
principles of equity (regardless of whether such enforcement is sought in a proceeding in equity or at law); and

 

(d)    
the execution, delivery and performance of this Amendment do not conflict with or
result in a breach by Borrower or any Loan Party Obligor of any term of any material contract, loan agreement, indenture or
other agreement or instrument to which such Person is a party or is subject.

 

SECTION
4.     Conditions Precedent to Effectiveness of Amendment. This Amendment shall become effective
(the "Third Amendment Effective Date") upon satisfaction of each of the following conditions:

 

(a)
Each of Borrower, the Loan Party Obligors, the Lenders and Agent shall have executed and delivered to the Agent this Amendment
and such other documents as the Agent may reasonably request;

 

    	 	2	 

     

    

 

(b)    
Agent shall have received any and all fees due and payable to Agent as a result of the transactions contemplated by this
Amendment (including. but not limited to a $10,000 amendment fee), which fees Borrowers agree may be charged to the Loan Account as Obligations; and

 

(c)     All
legal matters incident to the transactions contemplated hereby shall be reasonably satisfactory to counsel for the Agent.

 

SECTION
6.     Costs and Expenses. Borrower hereby affirms its obligation under the Loan Agreement to reimburse the Agent for
all fees and expenses paid or incurred by the Agent in connection with the preparation. negotiation, execution and delivery
of this Amendment, including, but not limited to, the internal and external  attorneys' fees and expenses of
attorneys for the Agent with respect thereto.

 

SECTION
7.    GOVERNING LAW.  THIS  AMENDMENT  SHALL  BE GOVERNED BY AND CONSTRUCTED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK,  WITHOUT REGARD TO THE INTERNAL CONFLICTS OF LAWS PROVISIONS THEREOF
..

 

SECTION
8.     Effect of Amendment: Reaffirmation of Loan Documents. (a) Nothing contained in this Amendment in any manner or
respect limits or terminates any of the provisions of the Loan Agreement or the other outstanding Loan Documents other than
as expressly set forth herein. The Loan Agreement (as amended hereby) and each of the other outstanding Loan Documents remain
and continue in full force and effect and are hereby ratified and reaffirmed in all respects. Borrower and the Loan Party
Obligors hereby further ratify and reaffirm the validity and enforceability of all of the Liens heretofore granted, pursuant
to and in connection with the Loan Agreement or any other Loan Document to the Agent on behalf and for the benefit of the
Lenders, as collateral security for the Obligations under the Loan Documents. in accordance with their respective terms, and
acknowledges that all of such Liens, and all collateral heretofore pledged as security for such Obligations, continues to be
and remain collateral for such obligations from and after the date hereof. Upon the effectiveness of this Amendment, each
reference in the Loan Agreement to “this Agreement”, “hereunder”, “hereof”,
 “herein” or words of similar import shall mean and be a reference to the Loan Agreement as amended
hereby.

 

(b)    
Execution of this Amendment by the Lenders and Agent (i) shall not constitute a waiver of any Default or Event of Default
that may currently exist or hereafter arise under the Loan Agreement, (ii) shall not impair, modify, restrict or limit
any right, power, privilege or remedy of the Lenders or Agent with respect to any Default or Event of Default that may now
exist or hereafter arise under the Loan Agreement or any of the other Loan Documents. and (iii) shall not constitute any
custom, course of dealing or other basis for altering any obligation of Borrower or any Loan Party Obligor or any right,
power, privilege or remedy of the Lenders and Agent under the Loan Agreement or any of the other Loan
Documents.

 

(c)    
The amendments, consents, modifications and other agreements set forth herein are limited to the specifics hereof, shall not
apply with respect to any facts or occurrences other than those on which the same are based, shall neither excuse any
future non-compliance with the Loan Agreement or any other Loan Document, nor operate as a waiver of any Default or Event
of Default.

 

    	 	3	 

     

    

 

(d)    
This Amendment is a Loan Document.

 

(d)    
To the extent that any terms and conditions in any of the Loan Documents shall contradict or be in conflict with any terms
or conditions of the Loan Agreement, after giving effect to this Amendment, such terms and conditions are hereby deemed modified
or amended accordingly to reflect the terms and conditions of the Loan Agreement and the Loan Documents as modified or amended
hereby.

 

SECTION
9.     Headings. Section headings in this Amendment are included herein for convenience of any
reference only and shall not constitute a part of this Amendment for any other purposes.

 

SECTION
10.     Release. EACH OF BORROWER AND THE LOAN PARTY OBLIGORS HEREBY ACKNOWLEDGES THAT AS OF THE DATE HEREOF
IT HAS NO DEFENSE, COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE WHATSOEVER
THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART OF THEIR LIABILITY TO REPAY THE OBLIGATIONS OR TO SEEK
AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM LENDERS, AGENT, OR THEIR RESPECTIVE AFFILIATES. PARTICIPANTS
OR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS, MANAGERS, MEMBERS, EMPLOYEES OR ATTORNEYS. EACH OF
 BORROWER AND THE  LOAN PARTY  OBLIGORS  HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER
DISCHARGES LENDERS, AGENT, THEIR RESPECTIVE AFFILIATES AND PARTICIPANTS, AND THEIR   PREDECESSORS.
AGENTS, MANAGERS,  MEMBERS,  OFFICERS, DIRECTORS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE
CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION,  DAMAGES, COSTS, EXPENSES, AND LIABILITIES  WHATSOEVER,
 KNOWN OR  UNKNOWN, ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED CONTINGENT. OR CONDITIONAL, AT LAW
OR TN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AMENDMENT IS EXECUTED, WHICH PARENT OR BORROWER MAY
NOW OR HEREAFTER HAVE AGAINST LENDERS, AGENT, OR THEIR RESPECTIVE PREDECESSORS, AGENTS, MANAGERS, MEMBERS, OFFICERS,
DIRECTORS, EMPLOYEES, SUCCESSORS AND  ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF CONTRACT,
TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING FROM THE LIABILITIES, THE EXERCISE OF ANY RIGHTS AND
REMEDIES UNDER THE LOAN AGREEMENT OR OTHER LOAN DOCUMENTS,  AND  NEGOTIATION   FOR  AND EXECUTION OF
 THIS AMENDMENT.  EACH OF BORROWER AND THE LOAN PARTY OBLIGORS HEREBY COVENANTS AND AGREES NEVER TO
INSTITUTE ANY ACTION OR SUIT AT LAW OR IN EQUITY, NOR INSTITUTE, PROSECUTE, OR IN ANY WAY AID IN THE INSTITUTION
OR PROSECUTION OF ANY CLAIM, ACTION OR CAUSE OF ACTION, RIGHTS TO RECOVER DEBTS OR DEMANDS OF ANY NATURE AGAINST
LENDERS, AGENT, THEIR RESPECTIVE AFFILIATES AND PARTICIPANTS, OR THEIR RESPECTIVE SUCCESSORS, AGENTS, MANAGERS, MEMBERS,
ATTORNEYS, OFFICERS, DIRECTORS, EMPLOYEES, AND PERSONAL AND LEGAL REPRESENTATIVES ARISING ON OR BEFORE THE DATE HEREOF OUT
OF OR RELATED TO LENDERS' OR AGENT'S ACTIONS, OMISSIONS, STATEMENTS, REQUESTS OR DEMANDS IN ADMINISTERING, ENFORCING,
MONITORING, COLLECTING OR ATTEMPTING TO COLLECT THE OBLIGATIONS OF BORROWER OR ANY LOAN PARTY OBLIGOR TO LENDERS AND
AGENT, WHICH OBLIGATIONS ARE EVIDENCED BY THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS.

 

    	 	4	 

     

    

 

SECTION 11.    
Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall
be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall
not in any way be affected or impaired thereby.

 

SECTION 12.    
Entire Agreement. This Amendment, and terms and provisions hereof, the Credit Agreement and the other Loan Documents constitute
the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes any
and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied,
oral or written and is the final expression and agreement of the parties hereto with respect to the subject matter hereof

 

SECTION 13.    
Execution in Counterparts. This Amendment may be executed in counterparts. each of which when so executed and delivered
shall be deemed to be an original and all of which taken together shall constitute but one and the same instrument.

 

[Remainder
of page intentionally left blank with signature pages immediately to follow]

  

    	 	5	 

     

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed
and delivered as of
the date first above written.

 

 

	LENDER:	ENCINA BUSINESS CREDIT SPY, LLC, a
	 	Delaware limited liability company
	 	 	 
	 	By:	/s/ Tracy Salyers
	 	Name:	Tracy Salyers
	 	Title: 	Authorized Signatory
	 	 	 
	 	 	 
	AGENT:	ENCINA BUSINESS CREDIT, LLC,
	 	a Delaware limited liability company
	 	 	 
	 	By: 	/s/ Tracy Salyers
	 	Name: 	Tracy Salyers
	 	Title: 	Authorized Signatory

   

 

[Signature
Pages Continue] 

 

 

Signature
Page to

Third
Amendment to Loan and Security Agreement

 

    	 	 	 

     

    

 

	Borrowers:	 
	 	 	 
	HYDROFARM, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	SUNBLASTER, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	SUNBLASTER HOLDINGS, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	EDDI’S WHOLESALE GARDEN SUPPLIES LTD.	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 

 

     

     

    

  

	HYDROFARM CANADA, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	 	 	 
	Loan Party Obligors:	 
	 	 	 
	 	 	 
	EHH HOLDINGS, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 
	 	 	 
	 	 	 
	HYDROFARM HOLDINGS, LLC	 
	 	 	 
	By:	/s/ Jeff Peterson	 
	 	 	 
	Name:	Jeff Peterson	 
	 	 	 
	Its:	CFO	 

  

    	 	 	 

     

    

 

Conformed Through SecondExhibit
A to Third Amendment

  

 

 

 

  

 

 

LOAN AND SECURITY
AGREEMENT

 

Dated as of JULY
11, 2019

  

by and among 

 

HYDROFARM, LLC

SUNBLASTER LLC

SUNBLASTER HOLDINGS
ULC

HYDROFARM CANADA,
LLC

EDDI’S WHOLESALE
GARDEN SUPPLIES LTD.,

 

as Borrowers, 

 

EHH HOLDINGS,
LLC

HYDROFARM HOLDINGS
LLC,

as Loan Party
Obligors,

 

 

the Lenders from
time to time party hereto,

 

and

 

 

ENCINA BUSINESS
CREDIT, LLC,

as Agent

 

 

 

 

 

    	 	 	 

     

    

 

TABLE OF CONTENTS

 

	 	 	 	Page
	 	 	 	 
	1.	DEFINITIONS 	1
	 	 	 	 
	 	1.1.	Certain
    Defined Terms	1
	 	1.2.	Accounting
    Terms and Determinations	28
	 	1.3.	Other
    Definitional Provisions and References	28
	 	 	 	 
	2.	LOANS 	29
	 	 	 	 
	 	2.1.	Amount
    of Loans	29
	 	2.2. 	Protective
    Advances; Overadvances 	29
	 	2.3.	Notice
    of Borrowing; Manner of Revolving Loan Borrowing 	30
	 	2.4.	Swingline
    Loans	31
	 	2.5.	Repayments
    	 32
	 	2.6.	Prepayments
    / Voluntary Termination / Application of Prepayments 	32
	 	2.7.	Obligations
    Unconditional	33
	 	2.8.	Reversal
    of Payments	34
	 	2.9.	Notes	34
	 	2.10.	Defaulting
    Lenders	 34
	 	2.11.	Appointment
    of Borrower Representative	 35
	 	2.12.	Joint
    and Several Liability	 35
	 	 	 	 
	3. 	INTEREST
    AND FEES; LOAN ACCOUNT 	37
	 	 	 	 
	 	3.1.	Interest	37
	 	3.2.	Fees	38
	 	3.3.	Computation
    of Interest and Fees	39
	 	3.4.	Loan Account;
    Monthly Accountings	39
	 	3.5. 	Further
    Obligations; Maximum Lawful Rate	39
	 	3.6. 	Certain
    Provisions Regarding LIBOR Loans; Replacement of Lenders	40
	 	 	 	 
	4.	CONDITIONS
    PRECEDENT 	41
	 	 	 	 
	 	4.1.	Conditions
    to Initial Loans	41
	 	4.2.	Conditions
    to all Loans 	42
	 	 	 	 
	5. 	COLLATERAL 	42
	 	 	 	 
	 	5.1.	Grant
    of Security Interest	42
	 	5.2.	Possessory
    Collateral	43
	 	5.3.	Further
    Assurances	43
	 	5.4.	UCC Financing
    Statements	43
	 	5.5.	Excluded
    Property	43
	 	 	 	 
	6. 	CERTAIN
    PROVISIONS REGARDING ACCOUNTS, INVENTORY, COLLECTIONS AND APPLICATIONS OF PAYMENTS 	44
	 	 	 	 
	 	6.1.	Lock Boxes
    and Blocked Accounts	44
	 	6.2. 	Application
    of Payments	44
	 	6.3. 	Notification;
    Verification	45
	 	6.4. 	Power
    of Attorney	45
	 	6.5. 	Disputes	46
	 	6.6. 	Invoices	47
	 	6.7. 	Inventory	47

  

    	 	 i	 

     

    

 

	7. 	REPRESENTATIONS,
    WARRANTIES AND AFFIRMATIVE COVENANTS 	48
	 	 	 	 
	 	7.1. 	Existence
    and Authority	47
	 	7.2. 	Names;
    Trade Names and Styles	48
	 	7.3.  	Title
    to Collateral; Third Party Locations; Permitted Liens	48
	 	7.4.  	Accounts
    and Chattel Paper	49
	 	7.5. 	Electronic
    Chattel Paper	49
	 	7.6. 	Capitalization;
    Investment Property	49
	 	7.7. 	Commercial
    Tort Claims	51
	 	7.8. 	Jurisdiction
    of Organization; Location of Collateral	51
	 	7.9.	Financial
    Statements and Reports; Solvency	51
	 	7.10.  	Tax Returns
    and Payments; Pension Contributions	52
	 	7.11.  	Compliance
    with Laws; Intellectual Property; Licenses	52
	 	7.12. 	Litigation	53
	 	7.13.  	Use of
    Proceeds	53
	 	7.14.  	Insurance
    	54
	 	7.15.  	Financial,
    Collateral and Other Reporting / Notices	55
	 	7.16. 	Litigation
    Cooperation	56
	 	7.17.	Maintenance
    of Collateral, Etc.	57
	 	7.18.	Material
    Contracts	57
	 	7.19. 	No Default	57
	 	7.20.	No Material
    Adverse Change	57
	 	7.21.	Full Disclosure	57
	 	7.22.	Sensitive
    Payments	57
	 	7.23.	Holdings	58
	 	7.24.	Term Loan
    Facility.	 58
	 	7.25. 	Subordinated
    Debt; HHG Note	59
	 	7.26. 	Access
    to Collateral, Books and Records	59
	 	7.27.	Appraisals	60
	 	7.28. 	Lender
    Meetings	60
	 	7.29.	Interrelated
    Businesses	60
	 	7.30. 	Canadian
    Benefit Plans	60
	 	7.31.	Canadian
    Pension Plans	61
	 	7.32. 	Post-Closing
    Matters	 61
	 	 	 	 
	8.	NEGATIVE
    COVENANTS 	61
	 	 	 	 
	9.	FINANCIAL
    COVENANTS 	64
	 	 	 	 
	 	9.1.	Fixed
    Charge Coverage Ratio/ Minimum Excess AvailabilityReserved	65
	 	9.2.	Capital
    Expenditure Limitation	65
	 	 	 	 
	10.	RELEASE,
    LIMITATION OF LIABILITY AND INDEMNITY	65
	 	 	 	 
	 	10.1. 
    	Release	65
	 	10.2. 	Limitation
    of Liability	65
	 	10.3. 	Indemnity	65
	 	 	 	 
	11	EVENTS
    OF DEFAULT AND REMEDIES	66
	 	 	 	 
	 	11.1.	Events
    of Default	66
	 	11.2. 	Remedies
    with Respect to Lending Commitments/Acceleration, Etc.	69
	 	11.3.
    	Remedies
    with Respect to Collateral	 6969
	 	 	 	 
	12.	LOAN
    GUARANTY	75
	 	 	 	 
	 	12.1.	Guaranty	75

 

    	 	 ii	 

     

    

  

	 	12.2.	Guaranty
    of Payment	7575
	 	12.3.	No Discharge
    or Diminishment of Loan Guaranty	75
	 	12.4.	Defenses
    Waived	76
	 	12.5.	Rights
    of Subrogation	76
	 	12.6.  	Reinstatement;
    Stay of Acceleration	76
	 	12.7.	Information	 76
	 	12.8.	Termination	77
	 	12.9.	Maximum
    Liability	77
	 	12.10.
    	Contribution	 77
	 	12.11.
    	Liability
    Cumulative	 78
	 	 	 	 
	13.	PAYMENTS
    FREE OF TAXES; OBLIGATION TO WITHHOLD; PAYMENTS ON ACCOUNT OF TAXES	 79
	 	 	 	 
	14.	AGENT
     	 81
	 	 	 	 
	 	14.1. 	Appointment	81
	 	14.2.	Rights
    as a Lender	 81
	 	14.3. 	Duties
    and Obligations	81
	 	14.4. 	Reliance	82
	 	14.5. 	Actions
    through Sub-Agents	82
	 	14.6. 	Resignation	82
	 	14.7.
    	Non-Reliance	8383
	 	14.8. 	Not Partners
    or Co-Venturers; Agent as Representative of the Secured Parties	84
	 	14.9. 	Credit
    Bidding	85
	 	14.10.
    	Certain
    Collateral Matters	85
	 	14.11.
    	Restriction
    on Actions by Lenders	86
	 	14.12.
    	Expenses	86
	 	14.13.
    	Notice
    of Default or Event of Default	86
	 	14.14.
    	Liability
    of Agent	86
	 	 	 	 
	15.	GENERAL
    PROVISIONS	87
	 	 	 	 
	 	15.1.	Notices	87
	 	15.2. 	Severability	88
	 	15.3.	Integration	89
	 	15.4. 	Waivers	89
	 	15.5. 	Amendments	89
	 	15.6. 	Time of
    Essence	90
	 	15.7.	Expenses,
    Fee and Costs Reimbursement	90
	 	15.8. 	Benefit
    of Agreement; Assignability	91
	 	15.9. 	Assignments	91
	 	15.10.
    	Participations	9292
	 	15.11.
    	Headings;
    Construction	92
	 	15.12.
    	USA PATRIOT
    Act Notification	93
	 	15.13.
    	Counterparts;
    Fax/Email Signatures	93
	 	15.14.
    	GOVERNING
    LAW	93
	 	15.15.
    	CONSENT
    TO JURISDICTION; WAIVER OF JURY TRIAL; CONSENT TO SERVICE OF PROCESS	93
	 	15.16.
    	Publication	94
	 	15.17.
    	Confidentiality	94
	 	15.18.
    	INTERCREDITOR
    AGREEMENT	94

   

    	 	 iii	 

     

    

 

Perfection
Certificate

Annex
I Description of Certain Terms

Annex
II Reporting

Annex
III Commitment Schedule

Annex
IV Pricing Grid

Annex
V Disqualified Institutions

Exhibit
A Form of Notice of Borrowing

Exhibit
B Closing Checklist

Exhibit
C Client User Form

Exhibit
D Authorized Accounts Form

Exhibit
E Form of Account Debtor Notification

Exhibit
F Form of Compliance Certificate

Exhibit
G Form of Assignment and Assumption Agreement

Schedule
7.32 Post-Closing Matters

 

    	 	 iv	 

     

    

 

Loan and Security
Agreement

  

This Loan and Security
Agreement (as it may be amended, restated or otherwise modified from time to time, this "Agreement") is
entered into on July 11, 2019, by and among HYDROFARM, LLC, a California limited liability company, SUNBLASTER LLC, a Delaware
limited liability company, SUNBLASTER HOLDINGS ULC, a British Columbia unlimited liability company, and EDDI’S WHOLESALE
GARDEN SUPPLIES LTD., a British Columbia company and HYDROFARM CANADA, LLC, a Delaware limited liability company (each a "Borrower"
and collectively the "Borrowers"), and HYDROFARM HOLDINGS LLC, a Delaware limited liability company (“Holdings”),
and EHH HOLDINGS, LLC a Delaware limited liability company (“EHH”), as Loan Party Obligors (as
defined herein), the Lenders party hereto from time to time and ENCINA BUSINESS CREDIT, LLC, a Delaware limited liability company,
as agent for the Lenders (in such capacity, "Agent"). The Schedules and Exhibits to this Agreement are
an integral part of this Agreement and are incorporated herein by reference.

 

1.       DEFINITIONS.

 

1.1.       Certain
Defined Terms.

 

Unless
otherwise defined herein, the following terms are used herein as defined in the UCC or, in the case of the Canadian Obligors, the
PPSA, as applicable: Accounts, Account Debtor, As- Extracted Collateral, Certificated Security, Chattel Paper, Commercial Tort
Claims, Consumer Goods, Debtor, Deposit Accounts, Documents, Documents of Title, Electronic Chattel Paper, Equipment, Farm Products,
Financing Statement, Fixtures, General Intangibles, Goods, Health- Care-Insurance Receivables, Instruments, Intangible, Inventory,
Letter-of-Credit Rights, Money, Payment Intangible, Proceeds, Secured Party, Securities Accounts, Security Agreement, Supporting
Obligations and Tangible Chattel Paper.

 

As used in this Agreement, the following terms have
the following meanings:

 

“ABL Priority
Collateral” means (a) as defined in the Intercreditor Agreement (it being understood and agreed that any time the
Term Loan Facility is not in effect, the term “ABL Priority Collateral” shall mean all Collateral) and (b) the Collateral
of any Canadian Obligors on which a Lien is granted to Agent hereunder or under any loan document.

 

"ABLSoft"
means the electronic and/or internet-based system approved by Agent for the purpose of making notices, requests, deliveries, communications
and for the other purposes contemplated in this Agreement or otherwise approved by Agent, whether such system is owned, operated
or hosted by Agent, any of its Affiliates or any other Person.

  

"Accounts
Advance Rate" means the percentage set forth in Section 1(b)(i) of Annex I.

 

“Adjusted
Borrowing Base” means the Borrowing Base, without giving effect to clauses (c) and (d) of the definition of “Borrowing
Base”.

  

"Advance
Rates" means, collectively, the Accounts Advance Rate and the Inventory Advance Rate. 

 

    	 	1	 

     

    

 

"Affiliate"
means, with respect to any Person, any other Person in control of, controlled by, or under common control with the first Person,
and any other Person who has a substantial interest, direct or indirect, in the first Person or any of its Affiliates, including,
any officer or director of the first Person or any of its Affiliates (and if that Person is an individual, any member of the immediate
family (including parents, siblings, spouse, children, stepchildren, nephews, nieces and grandchildren) of such individual and
any trust whose principal beneficiary is such individual or one or more members of such immediate family and any Person who is
controlled by any such member or trust); provided, that neither Agent, any Lender nor any of their respective Affiliates
shall be deemed an "Affiliate" of Borrower for any purposes of this Agreement. For the purpose of this
definition, a "substantial interest" shall mean the direct or indirect legal or beneficial ownership of
more than ten (10%) percent of any class of equity or similar interest.

 

"Agent"
means Encina in its capacity as agent for the Lenders hereunder, and any successor agent.

 

"Agent-Related
Persons" means Agent, together with its Affiliates, officers, directors, employees, members, managers, attorneys,
and agents.

 

"Agent
Professionals" means attorneys, accountants, appraisers, auditors, business valuation experts, liquidation agents,
collection agencies, auctioneers, environmental engineers or consultants, turnaround consultants, and other professionals and
experts retained by Agent.

 

"Agreement"
and "this Agreement" has the meaning set forth in the preamble to this Agreement.

 

“Applicable
Margin” has the meaning set forth in Annex IV.

 

"Approved
Electronic Communication" means each notice, demand, communication, information, document and other material transmitted,
posted or otherwise made or communicated by e-mail, facsimile, ABLSoft or any other equivalent electronic service, whether owned,
operated or hosted by Agent, any of its Affiliates or any other Person, that any party is obligated to, or otherwise chooses to,
provide to Agent pursuant to this Agreement or any other Loan Document, including any financial statement, financial and other
report, notice, request, certificate and other information or material; provided, that Approved Electronic Communications shall
not include any notice, demand, communication, information, document or other material that Agent specifically instructs a Person
to deliver in physical form.

 

"Approved
Fund" means any Bona Fide Debt Fund and any other Person (other than a natural person) that is (or will be) engaged
in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course
of business, in each case that is administered, managed, advised or underwritten by (a) a Lender, (b) an Affiliate of a Lender
or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

 

"Assignment
of Claims Act", means the Assignment of Claims Act of 1940, as amended, currently codified at 31 U.S.C. 3727 and
41 U.S.C. 6305, and includes the prior historically referenced Federal Anti-Claims Act (31 U.S.C. 3727) and the Federal Anti-Assignment
Act (41 U.S.C. 6305).

 

"Assignee"
has the meaning set forth in Section 15.9(a).

 

"Assignment
and Assumption" means an assignment and assumption agreement substantially in the form of Exhibit G.

 

“Asset Disposition”
means a sale, lease, license, consignment, transfer, return, liquidation, or other disposition of Property of an Obligor, including
any disposition in connection with a sale-leaseback transaction or synthetic lease.

 

    	 	2	 

     

    

 

“Asset Acquisition”
means the acquisition by GSD of substantially all of the assets of Greenstar Plant Products Inc.’s distribution business
for a purchase price of $8,873,926 pursuant to and in accordance with the Asset Purchase Agreement.

 

“Asset Acquisition
Earnout Amount” means the amount of the Earnout Obligations which are paid by a Loan Party or any Subsidiary of
a Loan Party; provided that commencing on the first day of the month following the first full month after the payment of such
Earnout Obligations and on the first day of each month thereafter, such amount shall be reduced by 1/12th of the amount paid until
reduced to $0.

 

“Asset Acquisition
Earnout Obligations” means any obligation of any Subsidiary of Holdings to pay a deferred purchase price with respect
to the Asset Acquisition pursuant to Section 2.6 of the Asset Purchase Agreement (as in effect on the Amendment No. 2 Effective
Date).

 

“Asset Purchase
Agreement” means the asset purchase agreement dated October 20, 2017 among Greenstar Plant Products Inc., as vendor,
GSD, as purchaser, and Hydrofarm, as guarantor.

 

“Availability
Block” means the amount set forth in Section 1(f) of Annex I hereto, and after
the Availability Block Release Date, zero dollars ($0).,
for any date of determination, an amount equal to the greater of (a) $2,000,000 and (b) ten percent (10.0%) of the Adjusted Borrowing
Base.

 

“Availability
Block Release Date” means the date, if it ever occurs, following the delivery of the audited financial statements
for Fiscal Year 2019 by Borrower Representative to Agent in compliance with Section 7.15(a) hereof (the “2019 Audited Financials”),
that either (a) the 2019 Audited Financials or (b) any interim financial statements subsequently delivered by Borrower Representative
to Agent in compliance with Section 7.15(b) hereof, show that the Fixed Charge Coverage Ratio is in excess of 1.05:1.00 for the
applicable FCCR Measurement Period.

  

"Bankruptcy
Code" means the United States Bankruptcy Code (11 U.S.C. § 101 et seq.).

 

"Base Rate"
means, for any day, the greatest of (a) the Federal Funds Rate plus

1⁄2%, (b) the LIBOR
Rate (which rate shall be calculated based upon a one (1) month period and shall be determined on a daily basis), (c) one percent
(1.0%), and (d) the rate of interest announced, from time to time, within Wells Fargo Bank, N.A. at its principal office in San
Francisco as its "prime rate", with the understanding that the "prime rate" is one of Wells Fargo Bank, N.A.’s
base rates (not necessarily the lowest of such rates) and serves as the basis upon which effective rates of interest are calculated
for those loans making reference thereto and is evidenced by the recording thereof after its announcement in such internal publications
as Wells Fargo Bank, N.A. may designate (or, if such rate ceases to be so published, as quoted from such other generally available
and recognizable source as Agent may select).

 

"Base Rate
Loan" means any Loan which bears interest at or by reference to the Base Rate.

 

"Blocked
Account" has the meaning set forth in Section 6.1.

 

“Bona Fide
Debt Fund” means any debt fund affiliate of the entities mentioned in the definition of "Disqualified Institution"
that is primarily engaged in, or advises funds or other investment vehicles that are primarily engaged in, making, purchasing,
holding or otherwise investing in commercial loans, notes, bonds and similar extensions of credit or securities in the ordinary
course of its business and whose managers are not in control of with the equity investment decisions of such entities.

 

    	 	3	 

     

    

  

"Borrower"
and "Borrowers" has the meaning set forth in the preamble to this Agreement.

 

“Borrower
Representative” means Hydrofarm, in such capacity pursuant to the provisions of Section 2.9, or any permitted successor
Borrower Representative selected by Borrowers and approved by Lender.

 

“Borrowing
Base” means, as of any date of determination, the Dollar Equivalent Amount as of such date of determination of (a) the
aggregate amount of Eligible Accounts multiplied by the Accounts Advance Rate, plus (b) the lower of (i) cost or market
value of Eligible Inventory multiplied by the applicable Inventory Advanced Rate(s) and (ii) NOLV of Eligible Inventory multiplied
by the applicable Inventory Advance Rate(s), but in no event to exceed the Inventory Sublimit(s) and minus (c) all Reserves
which Agent has established pursuant to Section 2.1(b) (including those to be established in connection with any requested Revolving
Loan); minus (d) the Availability Block.

 

“Borrowing
Base Certificate” a report of the Borrowing Base, in a form and substance satisfactory to Agent in its Permitted
Discretion.

 

“Business
Day” means a day other than a Saturday or Sunday or any other day on which Agent or banks in New York are authorized
to close and: (a) in the case of a Business Day which relates to a LIBOR Loan, any day on which dealings are carried on in the
London Interbank Eurodollar market, and (b) in the case of delivery of a Loan to a Funding Account located in a jurisdiction other
than the United States, the term “Business Day” shall also exclude any day on which commercial banks in such jurisdiction
are authorized or required by law to remain closed.

 

“Canadian
Account” means any account invoiced and payable in Canadian Dollars

 

"Canadian
Benefit Plans" means all material employee benefit plans or arrangements subject to the application of any Canadian
benefit plan statutes or regulations that are maintained or contributed to by the Loan Parties that are not Canadian Pension Plans,
including all profit sharing, savings, supplemental retirement, retiring allowance, severance, pension, deferred compensation,
welfare, bonus, incentive compensation, phantom stock, legal services, supplementary unemployment benefit plans or arrangements
and all life, health, dental and disability plans and arrangements in which the employees or former employees of the Loan Parties
participate or are eligible to participate but excluding all stock option or stock purchase plans.

 

“Canadian
Borrowers” means Sunblaster Holdings ULC, a British Columbia unlimited liability company, and Eddi’s Wholesale
Garden Supplies Ltd., a British Columbia company.

 

“Canadian
Defined Benefit Pension Plan” means a Canadian Pension Plan which contains a “defined benefit provision”
as defined in subsection 147.1(1) of the Income Tax Act (Canada), as amended.

 

"Canadian
Dollars" or "C$" means Canadian Dollars.

 

“Canadian
Loan Limit” means $15,000,000.

 

    	 	4	 

     

    

 

“Canadian
Multi-Employer Plan” means a “multi-employer pension plan”, as such term is defined in the Pension Benefits
Standards Act (British Columbia), as amended, or any similar plan registered under pension standards legislation of another jurisdiction
in Canada to which the Borrowers, including a Canadian Borrower, contributes for its employees or former employees employed in
Canada.

 

"Canadian
Obligor(s)" means any Borrower or Loan Party Obligor organized under the laws of Canada or any province thereof.

 

"Canadian
Pension Plan" means all plans or arrangements which are considered to be pension plans under, and are subject to
the application of, any applicable pension benefits standards statute or regulation in Canada established, maintained or contributed
to by the Loan Parties for its employees or former employees.

 

"Canadian
Security Agreement" means that certain General Security Agreement, dated as of the Closing Date, between Agent and
the Canadian Borrowers.

 

"Capital
Expenditures" means all expenditures which, in accordance with GAAP, would be required to be capitalized and shown
on the consolidated balance sheet of Borrowers, but excluding expenditures made in connection with the acquisition, replacement,
substitution or restoration of assets to the extent financed (a) from insurance proceeds (or other similar recoveries) paid on
account of the loss of or damage to the assets being replaced or restored, (b) with cash awards of compensation arising from the
taking by eminent domain or condemnation of the assets being replaced, (c) the net cash proceeds received by Borrowers in cash
or cash equivalents from a Permitted Asset Disposition, and (d) the cumulative amount of net cash proceeds from the issuance of
equity interests by Ultimate Parent.

 

"Capitalized
Lease" means any lease which is or should be capitalized on the balance sheet of the lessee thereunder in accordance
with GAAP.

 

"Closing
Date" means July 11, 2019.

 

"Code"
means the Internal Revenue Code of 1986, as amended.

 

"Collateral"
means all property and interests in property in or upon which a security interest, mortgage, pledge or other Lien is granted pursuant
to this Agreement or the other Loan Documents, including all of the property of each Loan Party Obligor described in Section 5.1.

 

"Collections"
has the meaning set forth in Section 6.1.

 

"Commitment"
and "Commitments" means, individually or collectively as required by the context, the Revolving Loan Commitment.

  

"Commitment
Schedule" means the Commitment Schedule attached hereto as Annex III.

 

"Compliance
Certificate" means a compliance certificate substantially in the form of Exhibit F hereto to be signed by the Chief
Financial Officer or President of Borrower Representative.

 

"Confidential
Information" means confidential information that any Loan Party furnishes to the Agent pursuant to any Loan Document
concerning any Loan Party's business, but does not include any such information once such information has become, or if such information
is, generally available to the public or available to the Agent (or other applicable Person) from a source other than the Loan
Parties which is not, to the Agent's knowledge, bound by any confidentiality agreement in respect thereof.

 

    	 	5	 

     

    

 

“Consolidated
Amortization Expense” means the amount of amortization expense deducted in determining Net Income.

 

“Consolidated
Depreciation Expense” means the amount of depreciation expense deducted in determining Net Income.

 

“Consolidated
Tax Expenses” means federal, state, provincial and local income tax expenses of Holdings, the Borrowers and their
Subsidiaries.

 

“Control
Agent” means, at the time of determination, whichever of the Term Loan Agent or Agent has the right under the Term
Loan Intercreditor Agreement to take remedial action with respect to the Collateral at issue.

 

“Control
Group” means (i) Hawthorn Equity Partners and its Controlled Investment Affiliates,
(ii) Broadband Capital Investments and its Controlled Investment Affiliates, (iii) Serruya Private Equity and its Controlled Investment
Affiliates, (iv) BCM X3 Holdings, LLC and its Controlled Investment Affiliates, (v) Aaron Serruya, Michael Serruya, Simon Serruya
and Jacques Serruya, individually and each such individual’s Controlled Investment Affiliates, (vi) Peter Wardenburg and
his Controlled Investment Affiliates and (vii) any shareholders of any of the individuals or entities in (i) through (vi) that
have designated their voting rights to such individual or entity.

 

“Controlled
Investment Affiliate” means, as to any Person, any other Person that (a) directly or indirectly, is in control of,
is controlled by, or is under common control with, such Person and (b) is organized by such Person primarily for the purpose of
making equity or debt investments in one or more companies. For purposes of this definition, “control” of a Person
means the power, directly or indirectly, to direct or cause the direction of the management and policies of such Person whether
by contract or otherwise.

 

"Default"
means any event or circumstance which with notice or passage of time, or both, would constitute an Event of Default.

 

"Default
Rate" has the meaning set forth in Section 3.1.

 

"Defaulting
Lender" means any Lender that (a) has failed, within one Business Day of the date required to be funded or paid,
to (i) fund any portion of its Loans or (ii) pay over to Agent or any other Lender any other amount required to be paid by it
hereunder, (b) has notified Borrower Representative or Agent in writing, or it or its parent has made a public statement, to the
effect that it does not intend or expect to comply with any of its funding obligations under this Agreement or generally under
other agreements in which it or its parent commits to extend credit, (c) has failed, within two Business Days after request by
Agent, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply
with its obligations (and is financially able to meet such obligations) to fund prospective Loans under this Agreement, provided
that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon Agent's receipt of such certification
in form and substance satisfactory to Agent, (d) had an involuntary proceeding commenced or an involuntary petition filed seeking
(i) liquidation, reorganization or other relief in respect of such Lender or its parent or its or its parent’s debts, or
of a substantial part of its or its parent’s assets, under any federal, state or foreign bankruptcy, insolvency, receivership
or similar Law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator
or similar official for such Lender or its parent or for a substantial part of its or its parent’s assets, or (e) shall
have or whose parent shall have (i) voluntarily commenced any proceeding or filed any petition seeking liquidation, reorganization
or other relief under any federal, state or foreign bankruptcy, insolvency, receivership or similar Law now or hereafter in effect
(ii) consented to the institution of, or failed to contest in a timely and appropriate manner, any proceeding or petition described
in clause (d) of this definition, (iii) applied for or consented to the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for it or a substantial part of its assets, (iv) filed an answer admitting the material allegations
of a petition filed against it in any such proceeding, (v) made a general assignment for the benefit of creditors or (vi) taken
any action for the purpose of effecting any of the foregoing.

 

    	 	6	 

     

    

 

"Dilution"
means, as of any date of determination, a percentage, based upon the experience of the immediately prior twelve (12) months, that
is the result of dividing the Dollar Equivalent Amount of (a) bad debt write-downs, discounts, advertising allowances, credits,
or other dilutive items with respect to a Borrower's Accounts during such period by (b)such Borrower's billings with respect to
Accounts during such period.

 

"Dilution
Reserve" has the meaning set forth in Section 1(b)(i) of Annex I.

 

“Disqualified
Institution” means (i) certain financial institutions and other entities set forth on Annex V hereto; (ii)
other financial institutions and other entities identified in writing by Borrower to Lender from time to time (and Affiliates
of such identified entities (other than Bona Fide Debt Funds) that are reasonably identifiable as Affiliates solely on the basis
of their name (provided Lender shall have no obligations to carry out due diligence in order to identify such Affiliates)) acceptable
to Lender in its sole discretion; and (iii) bona fide competitors of the Borrower and its Subsidiaries identified in writing from
time to time (and Affiliates thereof) (other than Bona Fide Debt Funds) that are reasonably identifiable as Affiliates solely
on the basis of their name (provided that Lender shall have no obligation to carry out due diligence in order to identify such
Affiliates)).

 

“Distribution
Payment Conditions” means, as to the making of any payment or distribution of any dividends or other distributions
on any Loan Party Obligor’s stock or other equity interest (other than Permitted Tax Distributions), the satisfaction as
of the making of each such payment or distribution and after giving pro forma effect thereto, of each of the following conditions:
(a) No Default or Event of Default exists or has occurred and is continuing, (b) the Fixed Charge Coverage Ratio for the applicable
FCCR Measurement Period is greater than 1.25:1.0, and (c) Excess Availability is greater than $3,000,000.

 

“Division”
in reference to any Person which is an entity, means the division of such Person into two (2) or more separate such
Persons, with the dividing Person either continuing or terminating its existence as part of such division, including as contemplated
under Section 18-217 of the Delaware Limited Liability Act for limited liability companies formed under Delaware law, or any analogous
action taken pursuant to any other applicable law with respect to any corporation, limited liability company, partnership or other
entity. The word “Divide” when capitalized, shall have a correlative meaning.

 

"Dollar Equivalent
Amount" means, at any time, (a) as to any amount denominated in Dollars, the amount hereof at such time, and (b)
as to any amount denominated in a currency other than Dollars, the equivalent amount in Dollars as determined by Agent at such
time that such amount could be converted into Dollars by Agent according to prevailing exchange rates selected by Agent.

 

    	 	7	 

     

    

 

"Dollars"
or "$" means United States Dollars.

 

"E-Signature"
means the process of attaching to or logically associating with an Approved Electronic Communication an electronic symbol, encryption,
digital signature or process (including the name or an abbreviation of the name of the party transmitting the Approved Electronic
Communication) with the intent to sign, authenticate or accept such Approved Electronic Communication.

  

"Early Payment/Termination
Premium" has the meaning set forth in Section 3.2(e).

 

"EBITDA"
means, for any period for which the amount thereof is to be determined, an amount equal to Net Income for such measurement period:
plus (a) the following, without duplication, in each case to the extent deducted in calculating such Net Income: (i) Consolidated
Interest Expense during such period means, for the applicable period, for the Loan Party Obligors on a consolidated basis, (ii)
Consolidated Amortization Expense during such period (iii) Consolidated Depreciation Expense during such period (iv) Consolidated
Tax Expenses paid or accrued during such period and the amount of any Tax Distributions made in cash during such period (v) any
non-cash losses arising from the sale of capital assets during such period (vi) extraordinary non-cash losses with respect to
such period (other than with respect to the write-downs of accounts receivable or inventory), (vii) to the extent actually reimbursed
in cash from insurance proceeds, the amount of expenses for such period with respect to any business interruption, (viii) non-recurring
fees and expenses approved by Agent in its Permitted Discretion (ix) the amount of business restructuring charges and fees, costs
and expenses incurred between October 1, 2019 and December 31, 2019 approved by Agent in its Permitted Discretion, minus (b) to
the extent added in calculating such Net Income, the aggregate amount of: (i) any non-cash gains during such period arising from
the sale of capital assets, (ii) any non-cash gains during such period arising from the write-up of assets (other than with respect
to accounts receivable or inventory), and (iii) any non-cash extraordinary gains during such period.

 

"Eligible
Account" means, at any time of determination and subject to the criteria below, an Account of a Borrower, which was
generated and billed by a Borrower in the Ordinary Course of Business, and which Agent, in its Permitted Discretion, deems to
be an Eligible Account. The net amount of an Eligible Account at any time shall be the face amount of such Eligible Account as
originally billed minus all customer deposits, unapplied cash collections and other Proceeds of such Account received from or
on behalf of the Account Debtor thereunder as of such date and any and all returns, rebates, discounts (which may, at Agent's
option, be calculated on shortest terms), credits, allowances or excise taxes of any nature at any time issued, owing, claimed
by Account Debtors, granted, outstanding or payable in connection with such Accounts at such time. Without limiting the generality
of the foregoing, the following Accounts shall not be Eligible Accounts:

  

(i)        the Account Debtor
or any of its Affiliates is an Affiliate of any Loan Party;

 

(ii)       it
remains unpaid longer than the earlier to occur of (A) the number of days after the original invoice date set forth in Section
4(a) of Annex I or (B) the number of days after the original invoice due date set forth in Section 4(b) of Annex I;

 

    	 	8	 

     

    

 

(iii)      the
Account Debtor or its Affiliates are past any of the applicable dates referenced in clause (ii) above on other Accounts owing to
a Borrower comprising more than twenty-five (25%) percent of all of the Accounts owing to a Borrower by such Account Debtor or
its Affiliates;

 

(iv)      all
Accounts owing by the Account Debtor or its Affiliates represent more than ten percent (10%) of all otherwise Eligible Accounts;
provided, that such percentage for Amazon.com, Inc. shall be twenty-five percent (25%) of all otherwise Eligible US Accounts, and
such percentage for Nurseryland shall be twenty percent (20%) of all otherwise Eligible Canadian Accounts, in each case unless
otherwise determined by Agent in its Permitted Discretion; provided, further, that Accounts which are deemed to be ineligible solely
by reason of this clause (iv) shall be considered Eligible Accounts to the extent of the amount thereof which does not exceed the
applicable percentages of all otherwise Eligible Accounts;

 

(v)        a
covenant, representation or warranty contained in this Agreement or any other Loan Document with respect to such Account (including
any of the representations set forth in Section 7.4) has been breached;

 

(vi)      the
Account is subject to any contra relationship, counterclaim, dispute or set-off; provided, that Accounts which are deemed to be
ineligible by reason of this clause (vi) shall be considered ineligible only to the extent of such applicable contra relationship,
counterclaim, dispute or set-off;

 

(vii)      the
Account Debtor's chief executive office or principal place of business is located outside of the United States or Canada;

 

(viii)     it is payable in a currency other
than Dollars or Canadian Dollars;

 

(ix)       it (a) is not absolutely
owing to a Borrower or (b) arises from a sale on a bill-and-hold, guarantied sale, sale-or-return, sale-on-approval, consignment,
retainage or any other repurchase or return basis or (c) consist of progress billings or other advance billings that are due prior
to the completion of performance by a Borrower of the subject contract for goods or services;

 

(x)       the
Account Debtor is (A) the United States of America or any state or political subdivision (or any department, agency or instrumentality
thereof), unless such Borrower has complied with the Assignment of Claims Act or other applicable similar state or local law in
a manner reasonably satisfactory to Agent, (B) Her Majesty the Queen in Right of Canada or any department, agency or instrumentality
thereof, unless such Borrower grants to the Agent by way of absolute assignment and as security, its right to payment of such Account
pursuant to and in full compliance with, and all other steps deemed necessary by the Agent have been taken under, the Financial
Administration Act (Canada), as amended, or (C) a Crown corporation, any other government or other governmental body if such Account
cannot be the object of a valid first ranking Lien in favor of the Agent without special formalities or requirements, unless such
formalities or requirements have been performed to the full satisfaction of the Agent;

 

(xi)      it
is not at all times subject to Agent's duly perfected, first-priority security interest or is subject to any other Lien that is
not a Permitted Lien, or the goods giving rise to such Account were, at the time of sale, subject to any Lien that is not a Permitted
Liens;

 

    	 	9	 

     

    

 

(xii)       
it is evidenced by Chattel Paper or an Instrument of any kind (unless such Chattel Paper or Instrument is delivered to Agent in
accordance with Section 5.2) or has been reduced to judgment;

 

(xiii)       
the Account Debtor's total indebtedness to Borrowers exceeds the amount of any credit limit established by Borrowers or Agent or
the Account Debtor is otherwise deemed not to be creditworthy by Agent in its Permitted Discretion; provided, that Accounts which
are deemed to be ineligible solely by reason of this clause (xiii) shall be considered Eligible Accounts to the extent the amount
of such Accounts does not exceed the lower of such credit limits;

 

(xiv)        there
are facts or circumstances existing, or which could reasonably be anticipated to occur, which might result in an adverse change
in the Account Debtor's financial condition or impair or delay the collectability of all or any portion of such Account as determined
by Agent in its Permitted Discretion;

 

(xv)        Agent
has not been furnished with all documents and other information pertaining to such Account which Agent has requested, or which
any Borrower is obligated to deliver to Agent, pursuant to this Agreement;

 

(xvi)
        Any Borrower has made an agreement with the Account Debtor to extend the time of payment thereof beyond the time periods set forth
in clause (ii) above;

 

(xvii)       
Any Borrower has posted a surety or other bond in respect of the contract or transaction under which such Account arose;

 

(xviii)
      the Account Debtor is subject to any proceeding seeking liquidation, reorganization or other relief with respect to it or its debts
under any bankruptcy, insolvency or other similar applicable law;

 

(xix)       
the sale giving rise to such Account is on cash in advance or cash on delivery terms;

 

(xx)        the
goods giving rise to such Account have been sold by a Borrower to the Account Debtor outside such Borrower’s Ordinary Course
of Business or the services giving rise to such Account have been performed by Borrower outside such Borrower’s Ordinary
Course of Business;

 

(xxi)        Accounts
with respect to which (i) the goods giving rise to such Account have not been shipped and billed to the Account Debtor, or (ii)
the services giving rise to such Account have not been performed and billed to the Account Debtor;

 

(xxii)      
the Account Debtor on such Accounts is located in any jurisdiction which adopts a statute or other requirement that any Person
that obtains business from within such jurisdiction or is otherwise subject to such jurisdiction’s tax law must file a “Business
Activity Report” (or other applicable report) or make any required filings in a timely manner in order to enforce its claims
in such jurisdiction’s courts or arising under such jurisdiction’s laws; provided, however, that such Accounts shall
nonetheless be Eligible Accounts if such Borrower has filed a “Business Activity Report” (or other applicable report
or required filing); or

 

(xxiii)      
Accounts arising from a sale for personal, family or household purposes or defined as Consumer Goods.

 

    	 	10	 

     

    

 

"Eligible
Inventory" means, at any time of determination and subject to the criteria below, Inventory owned by Borrower consisting
of finished goods, merchantable and readily saleable in the Borrower’s Ordinary Course of Business which Agent, in its Permitted
Discretion, deems to be Eligible Inventory. Without limiting the generality of the foregoing, the following Inventory will not
be Eligible Inventory:

 

(xxiv)        it consists of work-in-progress;

 

(xxv)        it is not in good, new and saleable condition;

 

(xxvi)       
it is slow-moving, obsolete, damaged, contaminated, unmerchantable, returned, rejected, discontinued or repossessed;

 

(xxvii)
       it is in the possession of a processor, consignee or bailee, or located on premises leased or subleased to a Borrower, or on premises
subject to a mortgage in favor of a Person other than Agent, unless such processor, consignee, bailee or mortgagee or the lessor
or sublessor of such premises, as the case may be, has executed and delivered all documentation which Agent shall require to evidence
the subordination or other limitation or extinguishment of such Person's rights with respect to such Inventory and Agent's right
to gain access thereto; provided, that, at the election of Agent in its sole discretion, this clause (iv) may be waived by Agent
in its sole discretion;

 

(xxviii)     it consists of fabricated parts, consigned items,
supplies or packaging;

  

(xxix)        it fails to
meet all standards imposed by any Governmental Authority;

 

(xxx)       
it does not conform in all respects to any covenants, warranties and representations set forth in this Agreement and each other
Loan Document;

 

(xxxi)
       it is not at all times subject to Agent's duly perfected, first priority security interest and no other Lien except a Permitted
Lien;

 

(xxxii)      
it is purchased or manufactured pursuant to a license agreement that is not assignable to each of Agent and its transferees;

 

(xxxiii)     
it is situated at a Collateral location not listed in Section 1(c) of the Perfection Certificate or other location of which Agent
has been notified as required by Section 7.8 (or it is in-transit other than in transit between a Borrower’s facilities or
is at a location described in Section 6.7(b)(iv) and (v));

 

(xxxiv)      it is located
at any third-party site if the aggregate book value of all Inventory located at such site is less than $100,000 or if it is at
a location described in Section 6.7(b)(iv) and (v);

 

(xxxv)      it is located outside of the continental
United States or Canada; and

 

(xxxvi)      it is aged over
(a) 24 months for inventory of Hydrofarm, LLC (b) 12 months for inventory of Hydrofarm Canada, LLC or (b) 12 months for inventory
of Sunblaster Holdings ULC.

 

    	 	11	 

     

    

  

"Encina"
means Encina Business Credit, LLC, a Delaware limited liability company.

 

"Enforcement
Action" means any action to enforce any Obligations or Loan Documents or to exercise any rights or remedies relating
to any Collateral, whether by judicial action, selfhelp, notification of Account Debtors, setoff or recoupment, credit bid, deed
in lieu of foreclosure, action in any proceeding seeking liquidation, reorganization or other relief with respect to it or its
debts under any bankruptcy, insolvency or other similar applicable law or otherwise.

 

"ERISA"
means the Employee Retirement Income Security Act of 1974 and all rules, regulations and orders promulgated thereunder.

 

"ERISA Affiliate"
means any trade or business (whether or not incorporated) under common control with a Loan Party within the meaning of Section
414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code
and Section 302 of ERISA).

 

"ERISA Event"
means: (a) a Reportable Event with respect to a Pension Plan; (b) the withdrawal of any Loan Party or any ERISA Affiliate from
a Pension Plan subject to Section 4063 of ERISA 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 ERISA; (c) a complete or partial withdrawal by a Loan Party or any ERISA Affiliate from a Multiemployer Plan or notification
that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Pension
Plan amendment as a termination under Section 4041 or 4041A of ERISA; (e) the institution by the PBGC of proceedings to terminate
a Pension Plan; (f) any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Pension Plan; (g) the determination that any Pension Plan is considered an at-risk
plan or a plan in endangered or critical status within the meaning of Sections 430, 431 and 432 of the Code or Sections 303, 304
and 305 of ERISA; or (h) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent
under Section 4007 of ERISA, upon a Loan Party or any ERISA Affiliate.

 

"Event of
Default" has the meaning set forth in Section 11.1.

 

"Excess Availability"
means the amount, as determined by Agent, calculated at any date, equal to the(a) the lesser of (i) the Maximum Revolving Facility
Amount minus (A) Reserves, minus (B) the Availability Block and (ii) the Borrowing Base, minus (b) the sum
of (i) the outstanding balance of all Revolving Loans plus (ii) fees and expenses which are due and payable by any Borrower
under this Agreement but which have not been paid or charged to the Loan Account; provided, that if any of the Loan Limits for
Revolving Loans is exceeded as of the date of calculation, then Excess Availability shall be zero.

 

    	 	12	 

     

    

 

“Excluded
Property” means (i) any Restricted Account; (ii) any equipment or goods that is subject to a “purchase money
security interest” to the extent that such purchase money security interest (x) constitutes a Permitted Lien under this
Agreement and (y) prohibits the creation by an Obligor of a junior security interest therein, unless the holder thereof has consented
to the creation of such a junior security interest; (iii) any equity interest in any Foreign Subsidiary (x) that is not a first-tier
Subsidiary of an Obligor, (y) that the granting of a Lien thereon is prohibited by the laws of the jurisdiction of organization
of such Foreign Subsidiary or (z) to the extent the same represents, for all Obligors in the aggregate, more than 65% of the total
combined voting power ofall classes of capital stock or similar equity interests of such Foreign Subsidiary which are entitled
tovote; (iv) any general intangible, instrument, software, license, permit, lease, contract, governmental approval or franchise
(but not the proceeds thereof), if the grant of a Lien in such general intangible, instrument, software, license, permit, lease,
contract, governmental approval or franchise in the manner contemplated by the Loan Documents is prohibited by the terms of such
general intangible, instrument, software, license, permit, lease, contract, governmental approval or franchise and would result
in the termination of such general intangible, instrument, software, license, permit, lease, contract, governmental approval or
franchise, but only to the extent that any such prohibition is not rendered ineffective pursuant to the Uniform Commercial Code,
the PPSA or any other Applicable Law or principles of equity; (v) upon the written consent of Agent, any equity interests in any
pledged entity acquired on or after the Closing Date that is not a Subsidiary of an Obligor, if the terms of the Governing Documents
of such pledged entity do not permit the grant of a security interest in such equity interests by the owner thereof or the applicable
Obligor has been unable to obtain any approval or consent to the creation of a security interest therein which is required under
such Governing Documents, (vi) any property or asset to the extent the burden of perfection would exceed the benefit to the Lenders
as determined in writing by Agent in its Permitted Discretion (including without limitation the annotation of vehicle and other
titles to reflect the Liens granted by the Loan Documents) provided, however, the foregoing exclusions shall in no way be construed
(a) to apply if any such prohibition would be rendered ineffective under the UCC (including Sections 9-406, 9- 407 and 9-408 thereof),
the PPSA or other Applicable Law (including the Bankruptcy Code) or principles of equity, (b) so as to limit, impair or otherwise
affect Agent’s unconditional continuing Liens upon any rights or interests of any Obligor in or to the proceeds thereof
(including proceeds from the sale, license, lease or other disposition thereof), including monies due or to become due under any
such lease, license, contract, or agreement (including any Accounts), or (c) to apply atsuch time as the condition causing such
prohibition shall be remedied (including pursuant to a waiver thereof or a consent related thereto) and, to the extent severable,
 “Collateral” shall include any portion of such lease, license, contract, agreement or assets subject thereto that
does not result in such prohibition.

 

"Excluded
Taxes" means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted
from a payment to a Recipient: (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch
profits Taxes, in each case, imposed as a result of such Recipient being organized under the laws of, or having its principal
office or, in the case of Agent or any Lender, its Lending Office located in, the jurisdiction imposing such Tax (or any political
subdivision thereof); (b) in the case of a Non-U.S. Recipient (as defined in Section 13(e)), U.S. federal withholding Taxes imposed
on amounts payable to or for the account of such Non-U.S. Recipient with respect to an applicable interest in a Loan or Commitment
pursuant to a law in effect on the date on which Non-U.S. Recipient becomes a party to this Agreement or acquires a participation,
except in each case to the extent that, pursuant to Section 13 amounts with respect to such Taxes were payable to such Non-U.S.
Recipient assignor (or Lender granting such participation) immediately before such assignment or grant of participation; (c) United
States federal withholding Taxes that would not have been imposed but for such Recipient's failure to comply with Section 13(e)
(except where the failure to comply with Section 13(e) was the result of a change in law, ruling, regulation, treaty, directive,
or interpretation thereof by a Governmental Authority after the date the Recipient became a party to this Agreement or a Participant)
and (d) any U.S. federal withholding Taxes imposed pursuant to FATCA.

 

    	 	13	 

     

    

 

“Existing
ABL Agreement” means that certain Amended and Restated Loan Agreement dated as of November 8, 2017 by and among
the Bank of America, NA (the “Prior ABL Lender”) and the Loan Party Obligors, as amended by that certain Forbearance
Agreement and First Amendment to Amended and Restated Loan and Security Agreement dated as of May 18, 2018 (the “ABL Forbearance
Agreement”), that certain First Amendment to Forbearance Agreement and Second Amendment to Amended and Restated Loan and
Security Agreement dated as of July 16, 2018 (the “ABL Second Amendment”), that certain Waiver and Third Amendment
to Amended and Restated Loan and Security Agreement dated as of August 24, 2018 (the “ABL Third Amendment”) and that
certain Fourth Amendment to Amended and Restated Loan Agreement dated as of March 15, 2019 (the “ABL Fourth Amendment”).

 

"FATCA"
means 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.

 

“FCCR Measurement
Period” means the applicable time period set forth below for such date:

 

	Date	Period
	December 31, 2019	Three-month period ended on that date
	January 31, 2020	Four-month period ended on that date
	February 29, 2020	Five-month period ended on that date
	March 31, 2020	Six-month period ended on that date
	April 30, 2020	Seven-month period ended on that date
	May 31, 2020	Eight-month period ended on that date
	June 30, 2020	Nine-month period ended on that date
	July 31, 2020	Ten-month period ended on that date
	August 31, 2020	Eleven-month period ended on that date
	
        Last day of each month

        thereafter
	Twelve-month period ended on that date

 

 

"FIRREA"
means the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended.

 

“First Amendment
Effective Date” means October 15, 2019.

 

"Fiscal Year"
means the fiscal year of Borrowers which ends on December 31 of each year.

 

"Fixed Charge
Coverage Ratio" means the ratio, determined in a manner acceptable to Agent in its Permitted Discretion, as to any
FCCR Measurement Period, of (a) EBITDA for such period, minus unfinanced Capital Expenditures of the Loan Party Obligors on a
consolidated basis for such period, to (b) Fixed Charges for such period.

 

"Fixed Charges"
means, for the period in question, on a consolidated basis, the sum of (a) all principal payments scheduled or required to be
made during or with respect to such period in respect of Indebtedness of the Loan Party Obligors, plus (b) all Interest
Expense of the Loan Party Obligors for such period paid or required to be paid in cash attributable to such period, plus
(c) all taxes of the Loan Party Obligors paid or required to be paid for such period and plus (d) all cash distributions
(including Permitted Tax Distributions, if applicable), dividends, redemptions and other cash payments made or required to be
made during such period with respect to equity securities or subordinated debt issued by any Loan Party Obligors (other than payments
with respect to the HHG Note).

 

    	 	14	 

     

    

 

“Foreign
Plan” means any employee benefit plan or arrangement (a) maintained or contributed to by any Obligor or Subsidiary
that is not subject to the laws of the United States or Canada; or (b) mandated by a government other than the United States or
Canada for employees of any Obligor or Subsidiary.

 

"Foreign
Subsidiary" means a Subsidiary that is a “controlled foreign corporation” under Section 957 of the Code,
such that a guaranty by such Subsidiary of the Obligations or a Lien on the assets of such Subsidiary or a pledge of more than
65% of the voting equity of such Subsidiary, in each case to secure the Obligations, would result in material tax liability to
Borrowers.

 

"FRB"
means the Board of Governors of the Federal Reserve System or any successor thereto.

 

"Funding
Account" has the meaning set forth in Section 2.3(b).

 

"GAAP"
means generally accepted accounting principles set forth from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of comparable stature and authority within the United States accounting
profession) which are applicable to the circumstances as of the date of determination, in each case consistently applied.

 

"Governing
Documents" means, with respect to any Person, the certificate of incorporation, articles of incorporation, certificate
of formation, certificate of limited partnership, by-laws, operating agreement, limited liability company agreement, limited partnership
agreement or other similar governance document of such Person.

 

"Governmental
Authority" means the government of the United States of America, Canada or any other nation, or of any political
subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining
to government (including any supra-national bodies such as the European Union or the European Central Bank) and having jurisdiction
over this account.

 

"Guaranty"
or "Guarantied", as applied to any Indebtedness, liability or other obligation, means (a) a guaranty,
directly or indirectly, in any manner, including by way of endorsement (other than endorsements of negotiable instruments for
collection in the Ordinary Course of Business), of any part or all of such Indebtedness, liability or obligation and (b) an agreement,
contingent or otherwise, and whether or not constituting a guaranty, assuring, or intended to assure, the payment or performance
(or payment of damages in the event of non- performance) of any part or all of such Indebtedness, liability or obligation by any
means (including the purchase of securities or obligations, the purchase or sale of property or services or the supplying of funds).

 

“HHG Note”
means the Subordinated Unsecured Promissory Note dated as of the date hereof issued by Holdings to Ultimate Parent, as such HHG
Note may be amended, restated and increased from time to time in accordance with this Agreement and the HHG Subordination Agreement.

 

“HHG Subordination
Agreement” means the Subordination Agreement, dated as of the date hereof, by and among the Agent, the Borrowers
and the Loan Party Obligors.

  

“Holdings”
means Hydrofarm Holdings, LLC, a Delaware limited liability company.  

 

    	 	15	 

     

    

 

“Hydrofarm”
means Hydrofarm, LLC, a California limited liability company.

 

"Indebtedness"
means (without duplication), with respect to any Person, (a) all obligations or liabilities, contingent or otherwise, for borrowed
money, (b) all obligations represented by promissory notes, bonds, debentures or the like, or on which interest charges are customarily
paid, (c) all liabilities secured by any Lien on property owned or acquired, whether or not such liability shall have been assumed,
(d) all obligations of such Person under conditional sale or other title-retention agreements relating to property or assets purchased
by such Person, (e) all obligations of such Person issued or assumed as the deferred purchase price of property or services (other
than (i) trade accounts and accrued expenses payable in the ordinary course of business and (A) not overdue by more than 90 days
or (B) to the extent overdue by more than 90 days (but not more than 270 days) are being Properly Contested, (ii) any earn-out
obligation to the extent such obligation is not required to be reflected on such Person’s balance sheet in accordance with
GAAP, (iii) accruals for payroll and other liabilities accrued in the Ordinary Course of Business), (f) all Capitalized Leases
of such Person, (g) all obligations (contingent or otherwise) of such Person as an account party or applicant in respect of letters
of credit and bankers' acceptances or in respect of financial or other hedging obligations, (h) all equity interests issued by
such Person subject to repurchase or redemption at any time on or prior to the Scheduled Maturity Date, other than voluntary repurchases
or redemptions that are at the sole option of such Person, (i) all principal outstanding under any synthetic lease, off-balance
sheet loan or similar financing product and (j) all Guaranties, endorsements (other than for collection in the Ordinary Course
of Business) and other contingent obligations in respect of the obligations of others.

 

"Indemnified
Taxes" means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account
of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in clause (a), Other
Taxes.

 

"Intellectual
Property" means the collective reference to all rights, priorities and privileges relating to intellectual property,
whether arising under United States, Canadian multinational or foreign laws or otherwise, including copyrights, copyright licenses,
patents, patent licenses, trademarks and trademark licenses and all rights to sue at law or in equity for any infringement or
other impairment thereof, including the right to receive all proceeds and damages therefrom.

 

“Intercreditor
Agreement” means the Intercreditor Agreement dated as of the Closing Date among Agent, Term Loan Agent, and the
Loan Party Obligors, as the same may be amended, amended and restated, and/or modified from time to time in accordance with the
terms thereof and hereof.

 

"Interest
Expense" means, for any period for which the amount thereof is to be determined, the consolidated interest expense
of Holdings, the Borrowers and their Subsidiaries, including (i) all interest on Indebtedness (including imputed interest related
to Capital Leases), (ii) all amortization of debt discount and expense, (iii) all commissions, discounts and other fees and charges
owed with respect to letters of credit or bankers’ acceptances and (iv) Swap Obligations of such Person and its Subsidiaries,
to the extent required to be reflected on the income statement of such Person on a consolidated basis in accordance with GAAP.

  

"Inventory
Advance Rate" means the percentage(s) set forth in Section 1(b)(ii) of Annex I.

 

"Inventory
Sublimit" means the amount(s) set forth in Section 1(d) of Annex I.

 

    	 	16	 

     

    

 

"Investment
Affiliate" means any fund or investment vehicle that (a) is organized by a Person for the purpose of making equity
or debt investments in one or more companies and (b) is controlled by, or under common control with, such Person. For purposes
of this definition "control" means the power to direct or cause the direction of management and policies of a Person,
whether by contract or otherwise.

 

“Investment
Corp” means Hydrofarm Investment Corp, a Delaware corporation.

 

"Investment
Property" means the collective reference to (a) all "investment property" as such term is defined in Section
9-102 of the UCC (or, in the case of Canadian Borrowers, the PPSA, as applicable), (b) all "financial assets" as such
term is defined in Section 8-102(a)(9) of the UCC (or in the case of Canadian Borrowers, the PPSA, as applicable) and (c) whether
or not constituting "investment property" as so defined, all Pledged Equity.

 

"Issuers"
means the collective reference to each issuer of Investment Property.

 

"Lender"
means each Person listed on the Commitment Schedule and any other Person that shall have become a Lender hereunder pursuant
to an Assignment and Assumption, other than any such Person that ceases to be a Lender hereunder pursuant to an Assignment and
Assumption. Unless the context expressly provides otherwise, "Lender" shall include the Swingline Lender.

 

"LIBOR Loan"
means any Loan which bears interest at a rate determined by reference to the LIBOR Rate.

 

"LIBOR Rate"
means, for any calendar month, the rate (expressed as a percentage per annum and rounded upward, if necessary, to the
next nearest 1/100 of 1%) for deposits in Dollars, for a one-month period, that appears on Bloomberg Screen US0001M (or the successor
thereto) as the London interbank offered rate for deposits in Dollars as of 11:00 a.m., London time, as of two Business Days prior
to the first day of such calendar month (and, in no event shall the LIBOR Rate shall be less than 1.75%), which determination
shall be made by Agent and shall be conclusive in the absence of manifest error. For the sake of clarity, the LIBOR Rate shall
be adjusted monthly on the first day of each month.

 

"Lien"
means any mortgage, deed of trust, pledge, hypothecation, assignment, charge, deposit arrangement, encumbrance, easement, lien
(statutory or other), security interest or other security arrangement and any other preference, priority, or preferential arrangement
in the nature of a security interest of any kind or nature whatsoever, including any conditional sale contract or other title-retention
agreement, the interest of a lessor under a Capitalized Lease and any synthetic or other financing lease having substantially
the same economic effect as any of the foregoing.

 

"Loan Account"
has the meaning set forth in Section 3.4.

 

"Loan Documents"
means, collectively, this Agreement (including the Perfection Certificate(s) and all other attachments, annexes and exhibits hereto)
and all notes, guaranties, security agreements, mortgages, Borrowing Base Certificates, Compliance Certificates, other certificates,
pledge agreements, landlord's agreements, Lock Box and Blocked Account agreements, the Canadian Security Agreement, the Subordinated
Debt Subordination Agreement, the Intercreditor Agreement and all other agreements, documents and instruments now or hereafter
executed or delivered by any Borrower, any Loan Party, or any Other Obligor in connection with, or to evidence the transactions
contemplated by, this Agreement.

 

    	 	17	 

     

    

 

"Loan Guaranty"
means the obligations of Obligors pursuant to Section 12.

 

"Loan Limits"
means, collectively, the Loan Limits for Revolving Loans set forth in Section 1 of Annex I, the Canadian Loan Limit and all other
limits on the amount of Loans set forth in this Agreement.

 

"Loan Party"
means, individually, each Borrower, or any Subsidiary that is a Loan Party; and "Loan Parties" means, collectively,
each Borrower and all Subsidiaries.

 

"Loan Party
Obligor" means, individually, each Borrower, or any Obligor that is a Loan Party, Holdings and EHH and any Person
identified in the Preamble as a Loan Party Obligor; and "Loan Party Obligors" means, collectively, each Borrower, and
each Loan Party Obligor.

 

"Loans"
means, collectively, the Revolving Loans (including any Protective Advances and Overadvances) and the Swingline Loans.

 

"Lock Box"
has the meaning set forth in Section 6.1.

 

"Material
Adverse Effect" means any event, act, omission, condition or circumstance which, which individually or in the aggregate,
has or could reasonably be expected to have a material adverse effect on (a) the business, operations, properties, assets or financial
condition of any Loan Party or any Other Obligor, as applicable, (b) the ability of any Loan Party or any Other Obligor, as applicable,
to perform any of its obligations under any of the Loan Documents, (c) the validity or enforceability of, or Lender's rights and
remedies under, any of the Loan Documents, (d) the ability of Agent and Lenders realize upon any ABL Priority or any other material
Collateral in which Agent has previously perfected a Lien or (e) the existence, perfection or priority of any security interest
granted in any Loan Document and covering ABL Priority Collateral or any other material Collateral in which Agent has previously
perfected a Lien.

 

"Material
Contract" means, any agreement or arrangement to which an Obligor or Subsidiary is party (other than the Loan Documents
and the Term Loan Documents) (a) that is deemed to be a material contract under any securities law applicable to such Person,
including the Securities Act of 1933; (b) for which breach, termination, nonperformance or failure to renew could reasonably be
expected to have a Material Adverse Effect; or (c) that relates to either (x) Subordinated Debt or (y) Debt, in the case of this
clause (y), in an aggregate amount of $500,000 or more.

 

"Maturity
Date" means the earlier of (i) Scheduled Maturity Date, (ii) the Termination Date, or (iii) such earlier date as
the Obligations may be accelerated in accordance with the terms of this Agreement (including pursuant to Section 11.2).

 

"Maximum
Lawful Rate" has the meaning set forth in Section 3.5.

 

"Maximum
Liability" has the meaning set forth in Section 12.9.

 

"Maximum
Revolving Facility Amount" means the amount set forth in Section 1(a) of Annex I.

 

“Merge”
in reference to any Person which is an entity, means the amalgamation or merger between two (2) or more separate Persons into
one (1) surviving entity.

 

“Minimum Excess Availability
Amount” means $5,000,000.

 

    	 	18	 

     

    

 

"Multiemployer
Plan" means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which a Loan Party
or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been
obligated to make contributions.

 

“Net Income”
means, for any fiscal period, the Net Income (or loss) of Holdings, the Borrowers and their Subsidiaries determined on a consolidated
basis in accordance with GAAP; provided that there shall be excluded from such net income (to the extent otherwise included therein),
without duplication: (a) the net income (or loss) of any Person (other than a Subsidiary of Holdings) in which any Person other
than Holdings, a Borrower or any of their Subsidiaries has an ownership interest, except to the extent that cash in an amount
equal to any such income has actually been received by Holdings, a Borrower or any of their Subsidiaries from such Person during
such period, (b) the net income (or loss) of any Person accrued prior to the date it becomes a Subsidiary of Holdings or is merged
into or consolidated with Holdings, a Borrower or any of their Subsidiaries or that Person’s assets are acquired by Holdings,
a Borrower or any of their Subsidiaries, (c) the net income of any Subsidiary of Holdings during such period to the extent that
the declaration and/or payment of dividends or similar distributions by such Subsidiary of that income is not permitted by operation
of the terms of its organizational documents or any agreement, instrument, order or other legal requirement applicable to that
Subsidiary or its equityholders during such period, and (d) the cumulative effect of a change in accounting principles.

 

"NOLV"
means the applicable Net Orderly Liquidation Value as determined by the most current third-party appraisal report, performed by
an appraisal firm retained by the Agent for such appraisal project with respect to the Eligible Inventory, and in form and substance
acceptable to Agent.

 

"Non-Consenting
Lender" has the meaning set forth in Section 15.5(b).

 

"Non-Paying
Guarantor" has the meaning set forth in Section 12.10.

 

"Non-U.S.
Recipient" has the meaning set forth in Section 13(e)(ii).

 

"Notice of
Borrowing" has the meaning set forth in Section 2.3.

 

"Obligations"
means all present and future Loans, advances, debts, liabilities, fees, expenses, obligations, guaranties, covenants, duties and
indebtedness at any time owing by any Borrower or any Loan Party Obligor to Agent and Lenders, whether evidenced by this Agreement,
any other Loan Document or otherwise, whether arising from an extension of credit, guaranty, indemnification or otherwise, whether
direct or indirect (including those acquired by assignment and any participation by any Lender in any Borrower's indebtedness
owing to others), whether absolute or contingent, whether due or to become due and whether arising before or after the commencement
of a proceeding under the Bankruptcy Code or any similar statute.

 

"Obligor"
means any guarantor, endorser, acceptor, surety or other Person liable on, or with respect to, any of the Obligations or who is
the owner of any property which is security for any of the Obligations, other than Borrower.

 

"Ordinary
Course of Business" means, in respect of any transaction involving any Person, the ordinary course of business of
such Person, as conducted by such Person as of the Closing Date and any practices that are utilized to improve past practices
or to conform with customary operating procedures for a similar business, as reasonably determined by such Person.

 

"Other Obligor"
means any Obligor other than any Loan Party Obligor.

 

    	 	19	 

     

    

 

"Other Taxes"
means all present or future stamp, court or documentary, property, excise, intangible, recording, filing or similar Taxes that
arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt
or perfection of a security interest under, or otherwise with respect to, any Loan Document.

 

"Overadvances"
has the meaning set forth in Section 2.2(b)."Participant" has the meaning set forth in Section 15.10(b).

 

"Paying Guarantor"
has the meaning set forth in Section 12.10.

 

"PBGC"
means the Pension Benefit Guaranty Corporation.

 

"Pension
Act" means the Pension Protection Act of 2006.

 

"Pension
Funding Rules" means the rules of the Code and ERISA regarding minimum required contributions (including any installment
payment thereof) to Pension Plans and Multiemployer Plans and set forth in, with respect to plan years ending prior to the effective
date of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter,
Section 412, 430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA, and any sections of the Code or ERISA
related thereto that are enacted after the date of this Agreement.

 

"Pension
Plan" means any employee pension benefit plan (including a Multiple Employer Plan or a Multiemployer Plan) that is
maintained or is contributed to by a Loan Party and any ERISA Affiliate and is either covered by Title IV of ERISA or is subject
to the minimum funding standards under Section 412 of the Code.

 

“Perfection
Certificate” means the Perfection Certificate completed by Borrowers and Obligors and attached hereto and incorporated
herein by this reference, and any supplements or updates thereto delivered to Lender in accordance herewith.

 

“Permitted
Affiliate Sub Debt” means (x) Indebtedness of Holdings to an Affiliate, (y) the HHG Note and (z) solely to the extent
funded in its entirety from the proceeds of Permitted Affiliate Sub Debt of Holdings to an Affiliate, Indebtedness of the Borrower
Representative to Holdings, in each case, that (a) is unsecured, (b) is fully and completely subordinated to the prior payment
in full of the Obligations for the benefit of, and to, the Lenders pursuant to a subordination agreement, which shall, in each
case, be in form and substance satisfactory to Agent in its sole discretion, (c) has a final maturity date that is not earlier
than, and provides for no scheduled payments of principal or mandatory redemption obligations prior to, December 31, 2022, (d)
provides for payments of interest solely in- kind (and not in cash) until not earlier than December 31, 2022, (e) does not contain
any financial covenants, (f) is not cross-defaulted (but may be cross- accelerated) to the Loan Documents, and (g) is subject
to permanent standstill provisions.

  

    	 	20	 

     

    

 

“Permitted
Asset Disposition” means an Asset Disposition that is (a) a sale or lease of Inventory in the Ordinary Course of
Business; (b) termination of a lease of real or personal Property that is not necessary for the Ordinary Course of Business, could
not reasonably be expected to have a Material Adverse Effect and does not result from an Obligor’s default; (c) a lease
or sublease of Real Estate in the Ordinary Course of Business; (d) a license or sublicense of Intellectual Property (including
any non-exclusive license of Intellectual Property) entered into in the Ordinary Course of Business; (e) an Asset Disposition,
abandonment or lapse of Intellectual Property that is immaterial or no longer used or the expiration of Intellectual Property
in accordance with its statutory term; (f) an Asset Disposition of cash equivalents in the Ordinary Course of Business; (g) an
Asset Disposition of Property to a Borrower or any Wholly Owned Loan Party (other than Holdings); (h) Restricted Payments by the
Loan Parties and their Subsidiaries, in each case to the extent expressly permitted by Section 8(l); (i) the discount, write-down,
sale or other Asset Disposition in the Ordinary Course of Business of trade or accounts receivable more than 120 days past due
in an aggregate amount not to exceed $500,000 during any 12-month fiscal period; (j) approved in writing by Agent; or (k) as long
as no Default or Event of Default exists, (i) an Asset Disposition of any Property which is to be replaced, and is in fact replaced,
or subject toa binding contract to be replaced, within 180 days with another asset useful in the Obligors’ business (so
long as Agent has a first priority and perfected Lien on any newly acquired asset, subject to the terms of the Intercreditor Agreement),
(ii) Asset Dispositions of Property (other than Accounts or Inventory) that, in the aggregate during any 12-month fiscal period,
has a fair market or book value (whichever is more) of $500,000 or less, (iii) Asset Dispositions of Property (other than Accounts
or Inventory) that is obsolete or no longer used or useful in the business or Inventory that is unmerchantable or otherwise unsalable
in the Ordinary Course of Business, or (iv) replacement of Equipment that is worn, damaged or obsolete with Equipment of like
function and value, if the replacement Equipment is acquired substantially contemporaneously with such disposition (or such longer
period consented to by Agent) and is free of Liens other than Permitted Liens.

 

"Permitted
Discretion" means a determination made by Agent in good faith and in the exercise of reasonable (from the perspective
of an asset-based secured lender) business judgment.

 

"Permitted
Indebtedness" means: (a) the Obligations; (b) the Indebtedness existing on the date hereof described in Section
7 of the Perfection Certificate; in each case along with extensions, refinancings, modifications, amendments and restatements
thereof; provided, that (i) the principal amount thereof is not increased (other than by accrued interest that is added to the
principal amount of such Indebtedness), (ii) if secured by a Permitted Lien, no additional collateral beyond that existing as
of the Closing Date is granted to secure such Indebtedness; (iii) if such Indebtedness is subordinated to any or all of the Obligations,
the applicable subordination terms shall not be modified without the prior written consent of Agent and (iv) the terms thereof
are not modified to impose more burdensome terms upon any Loan Party (v) it has a final maturity date no sooner than, a weighted
average life no less than, and an interest rate no greater than, the Indebtedness being extended, renewed, or refinanced; (c)
Permitted Purchase Money Debt; (d) Indebtedness incurred as a result of endorsing negotiable instruments received in the Ordinary
Course of Business; (e) Subordinated Debt (other than HHG Note) in an aggregate amount outstanding at any time not in excess of
$1,000,000 and then solely to the extent the applicable Subordinated Debt is subject to, and permitted by, the applicable Subordinated
Debt Subordination Agreement; (f) Indebtedness in respect of appeal bonds, workers’ compensation claims, self- insurance
obligations and bankers acceptances, in each case, issued for the account of any Obligor in the Ordinary Course of Business, including
guarantees or obligations of any Obligor with respect to Letters of Credit supporting such appeal bonds, workers’ compensation
claims, self-insurance obligations and bankers acceptances (in each case other than for an obligation for borrowed money); (g)
the Term Loan Obligations so long as the loans thereunder do not exceed the Term Loan Maximum Amount (as defined in the Intercreditor
Agreement), subject to the limitations set forth in the Intercreditor Agreement; (h) Permitted Intercompany Loans; (i) Indebtedness
arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except
in the case of daylight overdrafts) drawn against insufficient funds in the Ordinary Course of Business; (j) Subordinated Debt
of any Loan Party to repurchase equity interests from any employee, officer, director or such person’s spouse, estate or
estate planning vehicle upon the death, disability or termination of employment of such employee, officer or director so long
as (x) no Default or Event of Default has occurred and is continuing or would occur as a result thereof, and (y) the aggregate
amount of Indebtedness outstanding under this clause (j) does not exceed $1,000,000 in the aggregate at any time; (k) arising
as a result of an unsecured Guaranty by Holdings of the Indebtedness, Real Property lease or other obligation of a Loan Party
permitted by this Agreement (provided, that if any such Indebtedness, lease or other obligation is subordinated to the Obligations,
any such Holdings guaranty shall be subordinated to the Obligations on terms no less favorable to the Agent and the Lenders as
compared to the subordination terms applicable to such Indebtedness, lease or other obligations) (l) Indebtedness consisting of
any final judgment rendered against any Loan Party that has not been paid, discharged or vacated or had execution thereof stayed
pending appeal prior to such final judgment constitution an Event of Default in accordance with Section 11(d) hereof; (m) Indebtedness
that is not included in any of the preceding clauses of this Definition, is not secured by a Lien and does not exceed $500,000;
(n) all premium (if any), interest, fees, expenses, charges and additional or contingent interest on obligations described in
clauses (a) through (m) above, (p) the Asset Acquisition Earnout Obligations; (q) any Indebtedness associated with sections (d),
(e), (i) and (n) of the Permitted Liens as defined below and (r) the HHG Note.

 

    	 	21	 

     

    

 

“Permitted
Intercompany Loans” means (a) intercompany loans by a U.S. Obligor to another U.S. Obligor, (b) intercompany loans
by a Canadian Obligor to another Canadian Obligor, (c) intercompany loans by a U.S. Obligor to a Canadian Obligor in an amount
not to exceed $500,000 at any time and so long as immediately before and after giving effect to such loans by a U.S. Obligor to
a Canadian Obligor, and no Default or Event of Default exists, and (d) intercompany loans by a Canadian Obligor to a U.S. Obligor.

 

"Permitted
Liens" means (a) Liens securing Permitted Purchase Money Debt; (b) liens for taxes, fees, assessments, or other governmental
charges or levies, either not delinquent or being contested in good faith by appropriate proceedings (which proceedings have the
effect of preventing the enforcement of such lien) for which adequate reserves in accordance with GAAP are being maintained provided
the same have no priority over any of Agent's security interests; (c) liens incurred or deposits made in the Ordinary Course of
Business to secure the performance of government tenders, bids, contracts, statutory obligations and other similar obligations,
as long as such liens are at all times junior to the liens in favor of the Agent; (d) liens existing on the Closing Date and set
forth in Section 8 of the Perfection Certificate; (e) leases, subleases, licenses or sublicenses of the Property of any Loan Party,
in each case entered into in the Ordinary Course of Business of such Loan Party which do not (i) interfere in any material respect
with the business of any Loan Party or any Subsidiary and (ii) secure any Indebtedness; (f) the filing of UCC financing statements
solely as a precautionary measure in connection with operating leases or consignment of goods; (g) liens of materialmen, mechanics,
carriers, or other similar liens arising in the Ordinary Course of Business and securing obligations which are not delinquent
or are being contested in good faith by appropriate proceedings (which proceedings have the effect of preventing the enforcement
of such lien) for which adequate reserves in accordance with GAAP are being maintained; (h) liens which constitute banker's liens,
rights of set-off, or similar rights as to deposit accounts or other funds maintained with a bank or other financial institution
(but only to the extent such banker's liens, rights of set-off or other rights are in respect of customary service charges relative
to such deposit accounts and other funds, and not in respect of any loans or other extensions of credit by such bank or other
financial institution to any Loan Party); (i) cash deposits or pledges of an aggregate amount not to exceed $100,000 to secure
the payment of worker's compensation, unemployment insurance, or other social security benefits or obligations, public or statutory
obligations, surety or appeal bonds, bid or performance bonds, or other obligations of a like nature incurred in the Ordinary
Course of Business; (j) judgment Liens in respect of judgments that do not constitute an Event of Default; (k) easements, rights-of-way,
restrictions, covenants or other agreements of record, and other similar charges or encumbrances, or any encroachments, on Real
Estate, that do not secure any monetary obligation and do not interfere with the Ordinary Course of Business; (l) leases, subleases,
licenses or sublicenses of the Property of any Loan Party, in each case entered into in the Ordinary Course of Business of such
Loan Party which do not (i) interfere in any material respect with the business of any Loan Party or any Subsidiary and (ii) secure
any Indebtedness; (m) licenses or sublicenses of Intellectual Property granted by any Obligor in the Ordinary Course of Business;
(n) Liens on an insurance policy of any Obligor and the identifiable cash proceeds thereof in favor of the issuer of such policy
and securing Debt permitted to finance the premiums of such policies; and (o) Liens securing the Term Loan Obligations as permitted
by, and subject to, the Intercreditor Agreement.

 

    	 	22	 

     

    

 

“Permitted
Purchase Money Debt” means Purchase Money Debt of the Loan Parties and Subsidiaries that is unsecured or secured
only by a Purchase Money Lien, as long as the aggregate amount of Permitted Purchase Money Debt outstanding does not exceed $1,000,000
at any time.

 

“Permitted
Tax Distributions” means, with respect to any taxable year with respect to which Hydrofarm is a disregarded entity
for U.S. federal and state income tax purposes and is a partnership for U.S. federal and state income tax purposes, distributions
by Hydrofarm (which may further distribute to its direct owner(s)) in an aggregate amount equal to the sum of (x) the product
of (i) the aggregate net taxable income for such taxable year (or portion thereof), taking into account any depreciation (or other
cost recovery) in respect of basis adjustments under Section 734 or Section 743 of the Code, and reduced by any cumulative net
taxable losses with respect to all prior taxable years (determined as if all such periods were one period) to the extent such
cumulative net taxable loss is of the same character (ordinary or capital) and (ii) the lesser of (a) the highest combined marginal
federal and state income tax rate (taking into account the deductibility of state and local income taxes for U.S. federal income
tax purposes and the character of the taxable income in question (i.e., long term capital gain, qualified dividend income, etc.))
applicable to an individual resident in California for the taxable year in question (or portion thereof) and (b) 40%, plus (y)
solely to the extent that (A) one or more holders of equity interests is a resident of California (each such holder that is a
resident of California is herein referred to as an “Applicable Holder”), and (B) the amount of such Tax Distribution
is determined by reference to clause (x)(ii)(b) above, the aggregate amount by which the actual federal and state income tax liability
of each such Applicable Holder for such taxable year with respect to the net tax taxable income of allocated to such Applicable
Holder (such Applicable Holder’s “Allocated Taxable Income”) for such taxable year exceeds the product
of (a) 40%, times (b) such Allocated Taxable Income; provided that such cash distributions shall be reduced by amounts
withheld by any Obligor (or otherwise paid directly to any taxing authority) with respect to any taxable income or gain of or
any Subsidiary (including all amounts paid with composite tax returns and amounts paid by any Obligor pursuant to Section 6225
of the Code) and any income tax credits allocated to any direct or indirect members of (to the extent reasonably determines that
such tax credits may be utilized by the direct or indirect owners of Holdings).

 

"Person"
means any individual, sole proprietorship, partnership, joint venture, limited liability company, trust, unincorporated organization,
association, corporation, government or any agency or political division thereof, or any other entity.

 

"Plan"
means any employee benefit plan within the meaning of Section 3(3) of ERISA (including a Pension Plan) maintained for employees
of any Loan Party or any such plan to which any Loan Party (or with respect to any plan subject to Section 412 of the Code or
Section 302 or Title IV of ERISA, any ERISA Affiliate) is required to contribute on behalf of any of its employees.

  

    	 	23	 

     

    

 

"Pledged
Equity" means the equity interests listed on Sections 1(f) and 1(g) of the Perfection Certificate, together with
any other equity interests, certificates, options, or rights or instruments of any nature whatsoever in respect of the equity
interests of any Person that may be issued or granted to, or held by, any Loan Party Obligor while this Agreement is in effect,
and including, to the extent attributable to, or otherwise related to, such pledged equity interests, all of such Loan Party Obligor's
(a) interests in the profits and losses of each Issuer, (b) rights and interests to receive distributions of each Issuer's assets
and properties and (c) rights and interests, if any, to participate in the management of each Issuer related to such pledged equity
interests.

 

“PPSA”
means, at any given time, the personal property security legislation as adopted and in effect at such time in the applicable Canadian
province or territory where a Canadian Borrower is subsisting, located, or has assets.

 

“Pro Rata
Share" means with respect to all matters relating to any Lender the percentage obtained by dividing (i) the Loan
Commitment of that Lender by (ii) the aggregate Loan Commitments of all Lenders, in each case as any such percentages may be adjusted
by assignments pursuant to an Assignment and Assumption

 

"Protective
Advances" has the meaning set forth in Section 2.2(a).

 

“Properly
Contested” means with respect to any obligation of an Obligor, (a) the obligation is subject to a bona fide dispute
regarding amount or the Obligor’s liability to pay; (b) the obligation is being properly contested in good faith by appropriate
proceedings promptly instituted and diligently pursued; (c) appropriate reserves have been established in accordance with GAAP;
(d) non-payment would not have a Material Adverse Effect, nor result in forfeiture or sale of any assets of the Obligor; (e) no
Lien is imposed on assets of the Obligor, unless bonded and stayed to the satisfaction of Agent; and (f) if the obligation results
from entry of a judgment or other order, such judgment or order is stayed pending appeal or other judicial review.

 

“Purchase
Money Debt” means (a) Indebtedness (other than the Obligations) for payment of any of the purchase price of fixed
assets or payments pursuant to a Capital Lease of fixed assets, (b) Indebtedness (other than the Obligations) incurred within
ten (10) days before or after acquisition of any fixed assets, for the purpose of financing any of the purchase price thereof,
and (c) any renewals, extensions or refinancings (but not increases) thereof; provided, that, in no event shall the amount of
Purchase Money Debt exceed the purchase price of the assets being financed in respect thereof.

 

“Purchase
Money Lien” means a Lien that secures Purchase Money Debt, encumbering only the fixed assets acquired with such
Indebtedness and constituting a Capital Lease or a purchase money security interest under the Uniform Commercial Code or the PPSA.

 

“Real Estate”
all right, title and interest (whether as owner, lessor or lessee) in any real property or any buildings, structures, parking
areas or other improvements thereon.

 

"Recipient"
means any Agent, any Lender, any Participant, or any other recipient of any payment to be made by or on account of any Obligation
of any Loan Party under this Agreement or any other Loan Document, as applicable.

 

"Register"
has the meaning set forth in Section 15.9(c).

 

"Released
Parties" has the meaning set forth in Section 10.1.

 

"Replacement
Lender" has the meaning set forth in Section 3(c).

 

    	 	24	 

     

    

 

"Reportable
Event" means any of the events set forth in Section 4043(c) of ERISA, other than events for which the thirty-day
notice period has been waived.

 

"Required
Lenders" means at any time Lenders (other than Defaulting Lenders) then holding at least fifty-one (51%) percent
of the sum of the aggregate Loan Commitment then in effect; provided, that if there are two or more Lenders, then Required
Lenders shall include at least two Lenders (Lenders that are Affiliates or Approved Funds of one another being considered as one
Lender for purposes of this proviso).

 

"Reserves"
has the meaning set forth in Section 2.1(b).

 

"Restricted
Accounts" means Deposit Accounts (a) established and used (and at all times will be used) solely for the purpose
of paying current payroll obligations of Loan Parties (and which do not (and will not at any time) contain any deposits other
than those necessary to fund current payroll), in each case in the Ordinary Course of Business, or (b) maintained (and at all
times will be maintained) solely in connection with an employee benefit plan, but solely to the extent that all funds on deposit
therein are solely held for the benefit of, and owned by, employees (and will continue to be so held and owned) pursuant to such
plan.

 

“Restricted
Investment” means any investment by a Loan Party other than investments permitted by Section 8(f).

 

“Restricted
Payment” means (a) any declaration or payment of a distribution, interest or dividend on, any payment on account
of, or any setting apart assets for a sinking or other analogous fund for, any Equity Interest or Equity Interests Equivalents,
(b) any distribution, advance or repayment of any Indebtedness to a direct or indirect holder of Equity Interests or Equity Interests
Equivalents, or (c) any purchase, redemption, or other acquisition or retirement for value of, or any setting apart assets for
a sinking or other analogous fund for the purchase, redemption, or other acquisition or retirement for value of, any Equity Interest
or Equity Interests Equivalents.

 

"Revolving
Loan Commitment" means (a) as to any Lender, the aggregate commitment of such Lender to make Revolving Loans as set
forth in the Commitment Schedule or in the most recent Assignment and Assumption to which it is a party (as adjusted to reflect
any assignments as permitted hereunder) and (b) as to all Lenders, the aggregate commitment of all Lenders to make Revolving Loans,
which aggregate commitment shall be in an amount equal to the Maximum Revolving Facility Amount.

 

"Revolving
Loans" has the meaning set forth in Section 2.1(a).

 

"Scheduled
Maturity Date" means the earlier of the date (a) set forth in Section 6 of Annex I or (b) that is 90 days prior to
the scheduled maturity date of the Term Loan Facility.

 

“Second
Amendment Effective Date” means November 26, 2019.

 

"Securities
Act" means the Securities of Act of 1933, as amended.

 

"Settlement"
has the meaning set forth in Section 2.4(c).

 

"Settlement
Date" has the meaning set forth in Section 2.4(c).

 

“Sponsor
Group” means (i) Hawthorn Equity Partners and its Controlled Investment Affiliates, (ii) Broadband Capital Investments
and its Controlled Investment Affiliates, (iii) Serruya Private Equity and its Controlled Investment Affiliates, (iv) BCM X3 Holdings,
LLC and its Controlled Investment Affiliates, (v) Aaron Serruya, Michael Serruya, Simon Serruya and Jacques Serruya, individually
and each such individual’s Controlled Investment Affiliates.

 

    	 	25	 

     

    

 

"Stated Rate"
has the meaning set forth in Section 3.5.

 

"Subordinated
Debt" means (a) any Permitted Affiliate Sub Debt and (b) any other Indebtedness incurred by an Obligor that (i) is
unsecured, (ii) is fully and completely subordinated to the prior payment in full of the Obligations for the benefit of, and to,
the Lenders pursuant to a subordination agreement, which shall, in each case, be in form and substance satisfactory to Agent in
its sole discretion, (iii) has a final maturity date that is not earlier than, and provides for no scheduled payments of principal
or mandatory redemption obligations prior to, December 31, 2022 (iv) provides for payments of interest solely in-kind (and not
in cash) until not earlier than December 31, 2022, (v) does not contain any financial covenants, (vi) is not cross-defaulted (but
may be cross-accelerated) to the Loan Documents, (vii) is subject to permanent standstill provisions, and (viii) is otherwise
on terms (including maturity, interest, fees, repayment, covenants and subordination) satisfactory to Agent in its sole discretion.
For the avoidance of doubt, Subordinated Debt shall not include the HHG Note.

 

"Subordinated
Debt Documents" means all documents governing any Subordinated Debt as permitted under the applicable Subordinated
Debt Subordination Agreement as amended, restated or otherwise modified from time to time.

 

"Subordinated
Debt Subordination Agreement" means any subordination agreement governing Subordinated Debt entered into by Agent
and the applicable holder of such Subordinated Debt (or agent thereof) as amended, restated or otherwise modified from time to
time.

 

"Subsidiary"
means any corporation or other entity of which a Person owns, directly or indirectly, through one or more intermediaries, more
than 50% of the capital stock or other equity interest at the time of determination. Unless the context indicates otherwise, references
to a Subsidiary shall be deemed to refer to a Subsidiary of Borrower.

 

“Swap Obligations”
means with respect to any Borrower or Guarantor, any obligation to pay or perform under any agreement, contract or transaction
that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act, as amended from time
to time.

  

"Swingline
Lender" means Encina in its capacity as lender of Swingline Loans hereunder.

 

"Swingline
Loans" has the meaning set forth in Section 2.4(a).

 

"Taxes"
means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments,
fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable
thereto.

 

“Term Loan
Agent” means Brightwood Loan Services LLC, in its capacity as administrative agent under the Term Loan Facility,
as its successors and assigns.

 

“Term Loan
Documents” has the meaning assigned to the term “Term Loan Documents” in the Intercreditor Agreement.

  

    	 	26	 

     

    

 

“Term Loan
Facility” (i) that certain Credit Agreement, dated as of May 12, 2017 among the Obligors, the Term Loan Agent and
the Term Loan Lenders, as amended by that certain Amendment No. 1 to Credit Agreement dated as of September 21, 2017 (“TL
Amendment No. 1”), that certain Amendment No. 2 to Credit Agreement dated as of November 8, 2017 (“TL
Amendment No. 2”), that certain Forbearance Agreement and Amendment to Credit Agreement dated as of May 18, 2018
(the “TL Forbearance”), that certain Amendment No. 1 to Forbearance Agreement dated as of July 16, 2018
(the “TL Forbearance Amendment”), that certain Waiver and Amendment No. 3 to Credit Agreement dated
as of August 24, 2018 (“TL Amendment No. 3”), that certain Amendment No. 4 to Credit Agreement dated
as of March 15, 2019 (“TL Amendment No. 4”), that certain Amendment No. 5 to Credit Agreement dated
as of the Closing Date and as may be further amended, amended and restated, modified or supplemented from time to time in accordance
with the terms hereof and of the Intercreditor Agreement, and (ii) any other credit agreement, debt facility, loan agreement,
note agreement, promissory note, indenture or other agreement or instrument evidencing or governing the terms of any Indebtedness
or other financial accommodation that has been incurred to increase, extend (subject to the limitations set forth herein and in
the Intercreditor Agreement), replace or refinance in whole or in part the Indebtedness and other obligations outstanding under
(x) the credit agreement referred to in clause (i) or (y) any subsequent credit agreement, unless such agreement or instrument
expressly provides that it is not intended to be and is not a Term Loan Facility hereunder, in any case, in accordance with the
Intercreditor Agreement. Any reference to the Term Loan Facility hereunder shall be deemed a reference to any Term Loan Facility
then in existence.

 

“Term Loan
Lenders” has the meaning assigned to the term “Term Loan Lenders”

in the Intercreditor Agreement.

 

“Term Loan
Obligations” shall mean the “Obligations” as such term is defined in the Term Loan Facility or any equivalent
term used to describe the obligations arising thereunder and in connection therewith.

 

“Term Loan
Priority Collateral” has the meaning assigned to such term in the Intercreditor Agreement.

 

“Term Loan
Side Letter Agreement” means the letter agreement, together with the amendment thereto attached as Exhibit A to
that certain First Amendment to Loan and Security Agreement, dated as of October 15, 2019, among Agent and the Loan Party Obligors.

 

"Termination
Date" means the date on which all of the Obligations have been paid in full in cash and all of Agent and Lenders'
lending commitments under this Agreement and under each of the other Loan Documents have been terminated.

 

"UCC"
means, at any given time, the Uniform Commercial Code as adopted and in effect at such time in the State of New York or other
applicable jurisdiction.

  

“Ultimate
Parent” means Hydrofarm Holdings Group, Inc., a Delaware corporation.

 

“U.S. Account”
means any account invoiced and payable in Dollars.

 

"U.S. Obligor(s)"
means any Borrower or Loan Party Obligor organized under the laws of United States of America or any state thereof.

 

    	 	27	 

     

    

 

1.2.       Accounting
Terms and Determinations.

 

Unless otherwise specified
herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder (including determinations
made pursuant to the exhibits hereto) shall be made, and all financial statements required to be delivered hereunder shall be
prepared on a consolidated basis in accordance with GAAP consistently applied. If at any time any change in GAAP would affect
the computation of any financial ratio or financial requirement set forth in any Loan Document, and either Borrower Representative
or Agent shall so request, Required Lenders and Borrower Representative shall negotiate in good faith to amend such ratio or requirement
to preserve the original intent thereof in light of such change in GAAP; provided that, until so amended, (a) such
ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (b) Borrower Representative
shall provide to Agent and Lenders financial statements and other documents required under this Agreement and the other Loan Documents
which include a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change
in GAAP. Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall
be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to any election
under Statement of Financial Accounting Standards 159 (Codification of Accounting Standards 825-10) to value any Indebtedness
or other liabilities of any Loan Party at "fair value", as defined therein.

 

Notwithstanding anything
to the contrary contained in the paragraph above or the definitions of Capital Expenditures or Capitalized Leases, in the event
of a change in GAAP after the Closing Date requiring all leases to be capitalized, only those leases (assuming for purposes of
this paragraph that they were in existence on the Closing Date) that would constitute Capitalized Leases on the Closing Date shall
be considered Capitalized Leases (and all other such leases shall constitute operating leases) and all calculations and deliverables
under this Agreement or the other Loan Documents shall be made in accordance therewith (other than the financial statements delivered
pursuant to this Agreement; provided that all such financial statements delivered to Agent and Lenders in accordance
with the terms of this Agreement after the date of such change in GAAP shall contain a schedule showing the adjustments necessary
to reconcile such financial statements with GAAP as in effect immediately prior to such change).

 

1.3.       Other
Definitional Provisions and References.

 

References in this Agreement
to "Articles", "Sections", "Annexes", "Exhibits"
or "Schedules" shall be to Articles, Sections, Annexes, Exhibits or Schedules of or to this Agreement
unless otherwise specifically provided. Any term defined herein may be used in the singular or plural. "Include",
 "includes" and "including" shall be deemed to be followed by "without
limitation". "Or" shall be construed to mean "and/or". Except as
otherwise specified or limited herein, references to any Person include the successors and assigns of such Person. References
 "from" or "through" any date mean, unless otherwise specified, "from
and including" or "through and including", respectively. No provision of any Loan Documents
shall be construed against any party by reason of such party having, or being deemed to have, drafted the provision. Unless otherwise
specified herein, the settlement of all payments and fundings hereunder between or among the parties hereto shall be made in lawful
money of the United States and in immediately available funds. Time is of the essence for each performance obligation of the Loan
Parties under this Agreement and each Loan Document. All amounts used for purposes of financial calculations required to be made
herein shall be without duplication. References to any statute or act shall include all related current regulations and all amendments
and any successor statutes, acts and regulations. References to any agreement, instrument or document (a) shall include all schedules,
exhibits, annexes and other attachments thereto and (b) shall be construed as referring to such agreement, instrument or other
document as from time to time amended, amended and restated, restated, supplemented or otherwise modified (subject to any restrictions
on such amendments, restatements, supplements or modifications set forth herein or in any other Loan Document). The words "asset"
and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible
and intangible assets and properties, including cash, securities, accounts and contract rights. Unless otherwise specified herein
Dollar ($) baskets set forth in the representations and warranty, covenants and event of default provisions of this Agreement
(and other similar baskets) are calculated as of each date of measurement by the Dollar Equivalent Amount thereof as of such date
of measurement. Reference to a Loan Party’s "knowledge" or similar concept means actual knowledge of a senior
officer, or knowledge that a senior officer would have obtained if he or she had engaged in good faith and diligent performance
of his or her duties, including reasonably specific inquiries of employees or agents and a good faith attempt to ascertain the
matter.

 

    	 	28	 

     

    

 

2.       LOANS.

 

2.1.       Amount
of Loans.

 

(a)        Revolving Loans.
Subject to the terms and conditions of this Agreement, each Lender with a Revolving Loan Commitment will severally (and not jointly),
from time to time prior to the Maturity Date, at Borrower Representative's request, make revolving loans to Borrowers ("Revolving
Loans"); provided, that after giving effect to each such Revolving Loan, (A) the outstanding balance
of all Revolving Loans plus fees and expenses which are due and payable by Borrower under this Agreement but which have not been
paid or charged to the Loan Account will not exceed the lesser of (x) the Maximum Revolving Facility Amount minus the amount of
Reserves established against the Maximum Revolving Facility Amount and (y) the Borrowing Base, (B) the aggregate outstanding principal
balance of all Revolving Loans to the Canadian Borrowers shall not be in excess of the Canadian Loan Limit, (C) the sum of each
Lender's outstanding balance of Revolving Loans will not exceed such Lender's Revolving Loan Commitment and (d) none of the other
Loan Limits for Revolving Loans will be exceeded. All Revolving Loans shall be made in and repayable in Dollars.

 

(b)        Reserves.
Agent may, with or without notice to Borrower Representative, from time to time establish and revise reserves against the Borrowing
Base and the Maximum Revolving Facility Amount in such amounts and of such types as Agent deems appropriate in its Permitted Discretion
("Reserves") to reflect (i) events, conditions, contingencies or risks which affect or may affect
(A) the ABL Priority Collateral or its value, or the enforceability, perfection or priority of the security interests and other
rights of Agent in the ABL Priority Collateral or (B) the assets, business or prospects of any Borrower or any Loan Party Obligor
(including the Dilution Reserve), (ii) Agent's good faith concern that any Collateral report or financial information furnished
by or on behalf of any Borrower or any Loan Party Obligor to Agent is or may have been incomplete, inaccurate or misleading in
any material respect, (iii) any fact or circumstance which Agent determines in good faith constitutes, or could constitute, a
Default or Event of Default, or (iv) past due Taxes, or (v) any other events or circumstances which Agent determines in good faith
make the establishment or revision of a Reserve prudent. In no event shall the establishment of a Reserve in respect of a particular
actual or contingent liability obligate Agent to make advances to pay such liability or otherwise obligate Agent with respect
thereto.

 

(c)        Reserved.

 

2.2.       Protective
Advances; Overadvances.

 

(a)       Notwithstanding
any contrary provision of this Agreement or any other Loan Document, at any time (i) after the occurrence and during the continuance
of a Default or Event of Default or (ii) that any of the other applicable conditions precedent set forth in Section 4 or otherwise
are not satisfied, Agent is authorized by each Borrower and each Lender, from time to time, in Agent's sole discretion, to make
such Revolving Loans to, or for the benefit of, any Borrower, as Agent in its sole discretion deems necessary or desirable (1)
to preserve or protect the Collateral, or any portion thereof, or (2) to enhance the likelihood of repayment of the Obligations
(the Revolving Loans described in this Section 2.2 shall be referred to as "Protective Advances"). Notwithstanding
any contrary provision of this Agreement or any other Loan Document, Agent may disburse the proceeds of any Protective Advance
to any Borrower or to such other Person(s) as Agent determines in its sole discretion. All Protective Advances shall be payable
immediately upon demand. Notwithstanding the foregoing, (i) the aggregate amount of all Protective Advances outstanding at any
time shall not exceed an amount equal to ten percent (10%) of the Maximum Revolving Facility Amount and (ii) after giving effect
to any such Protective Advances, the outstanding balance of all Revolving Loans will not exceed the Maximum Revolving Facility
Amount.

 

    	 	29	 

     

    

 

(b)        Notwithstanding
any contrary provision of this this Agreement, at the request of Borrower Representative, Agent may in its sole discretion (but
with absolutely no obligation), make Revolving Loans to any Borrower, on behalf of the Lenders with a Revolving Loan Commitment,
in amounts that exceed Excess Availability (any such excess Revolving Loans are herein referred to herein, collectively, as "Overadvances");
provided, that, no Overadvance shall result in a Default due to any Borrower's failure to comply with Section 2.1(a)
for so long as such Overadvance remains outstanding in accordance with the terms of this paragraph, but solely with respect to
the amount of such Overadvance. Overadvances may be made even if the conditions precedent set forth in Section 4.2 have not been
satisfied. The authority of Agent to make Overadvances is limited to an aggregate amount not to exceed an amount equal to ten
percent (10%) of the Maximum Revolving FacilityAmount at any time. No Overadvance may remain outstanding for more than thirty
(30) days and no Overadvance shall cause any Lender's outstanding balance of Revolving Loans to exceed its Revolving Commitment.
Required Lenders may, at any time, revoke Agent's authorization to make Overadvances, provided that any such revocation
must be in writing and shall become effective prospectively upon Agent's receipt thereof.

 

(c)        Upon
the making of any Protective Advance or Overadvance (whether before or after the occurrence of a Default), each Lender with a Revolving
Loan Commitment shall be deemed, without further action by any party hereto, to have unconditionally and irrevocably purchased
from Agent, without recourse or warranty, an undivided interest and participation in such Protective Advance or Overadvance, as
applicable, in proportion to its Pro Rata Share of the Revolving Loan Commitment. Agent may, at any time, require the applicable
Lenders to fund their participations. From and after the date, if any, on which any Lender is required to fund its participation
in any Protective Advance or Overadvance, as applicable, purchased hereunder, Agent shall promptly distribute to such Lender, such
Lender's Pro Rata Share of all payments of principal and interest and all proceeds of Collateral received by such Agent in respect
of such Loan. Each Lender acknowledges and agrees that (i) Agent may elect to fund a Protective Advance or Overadvance through
one or more of its Affiliates (including Encina Business Credit SPV, LLC) on behalf of Agent for administrative convenience and
(ii) any such funding shall constitute a Protective Advance or Overadvance, as applicable, as if made by Agent subject to the terms
and conditions of this Agreement.

 

2.3.       Notice
of Borrowing; Manner of Revolving Loan Borrowing.

 

(a)        Borrower Representative
shall request each Revolving Loan by submitting such request by ABLSoft (or, if requested by Agent, by delivering, in writing
or by an Approved Electronic Communication, a Notice of Borrowing substantially in the form of Exhibit A hereto) (each such request
a "Notice of Borrowing"). Subject to the terms and conditions of this Agreement, Agent shall, except as
provided in Section 2.2, deliver the amount of the Revolving Loan requested in the Notice of Borrowing for credit to any account
of Borrower as Borrower Representative may specify at a bank acceptable to Agent (provided, that such account must
be one identified on Section 3 of the Perfection Certificate and approved by Agent as an account to be used for funding of Loan
proceeds) (any such account, a "Funding Account") by wire transfer of immediately available funds (i)
on the same day if the Notice of Borrowing is received by Agent on or before 11:00 a.m. Central Time on a Business Day or (ii)
on the immediately following Business Day if the Notice of Borrowing is received by Agent after 11:00 a.m. Central Time on a Business
Day or on a day that is not a Business Day. Agent shall charge to the Revolving Loan Agent's usual and customary fees for the
wire transfer of each Loan.

 

    	 	30	 

     

    

 

(b)        Promptly
following receipt of a Notice of Borrowing in accordance with this Section, Agent shall advise each Lender of the details thereof
and of the amount of such Lender's Revolving Loan to be made as part of the requested borrowing. Each Lender shall make each Revolving
Loan to be made by such Lender hereunder on the proposed date thereof by wire transfer of immediately available funds by 2:00 p.m.,
Central Time, to the account of Agent most recently designated by it for such purpose by notice to the Lenders in an amount equal
to such Lender's Pro Rata Share. Unless Agent shall have received notice from a Lender prior to the proposed date of any borrowing
that such Lender will not make available to Agent such Lender's share of such borrowing, Agent may assume that such Lender has
made (or will make) such share available on such date in accordance with this Section and may, in reliance upon such assumption,
make available to Borrowers a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable
borrowing available to Agent, then the applicable Lender and Borrowers severally agree to pay to Agent forthwith on demand such
corresponding amount with interest thereon, for each day from and including the date such amount is made available to Borrowers
to but excluding the date of payment to Agent, at the interest rate applicable to such Revolving Loans. If such Lender pays such
amount to Agent, then such amount shall constitute such Lender's Revolving Loan included in such borrowing.

 

2.4.       Swingline
Loans.

 

(a)        Agent, Swingline
Lender and the Lenders agree that in order to facilitate the administration of this Agreement and the other Loan Documents, promptly
after Borrower Representative requests a Revolving Loan, the Swingline Lender may elect to have the terms of this Section 2.4
apply to such borrowing request by advancing, on behalf of the Lenders with a Revolving Loan Commitment and in the amount requested,
same day funds to Borrowers (each such Loan made solely by the Swingline Lender pursuant to this Section 2.4 is referred to in
this Agreement as a "Swingline Loan"), with settlement among them as to the Swingline Loans to take place
on a periodic basis as set forth in Section 2.4(c). Each Borrower hereby authorizes the Swingline Lender to, and Swingline Lender
shall, subject to the terms and conditions set forth herein (but without any further written notice required), deliver the amount
of the Swingline Loan requested to the applicable Funding Account (i) on the same day if the Notice of Borrowing is received by
Agent on or before 11:00 a.m. Central Time on a Business Day or (ii) on the immediately following Business Day if the Notice of
Borrowing is received by Agent after 11:00 p.m. Central Time on a Business Day or on a day that is not a Business Day. The aggregate
amount of Swingline Loans outstanding at any time shall not exceed $2,000,000. Swingline Lender shall not make any Swingline Loan
if the requested Swingline Loan exceeds Excess Availability (before giving effect to such Swingline Loan).

 

(b)        Upon
the making of a Swingline Loan (whether before or after the occurrence of a Default and regardless of whether a Settlement has
been requested with respect to such Swingline Loan), each Lender with a Revolving Commitment shall be deemed, without further action
by any party hereto, to have unconditionally and irrevocably purchased from the Swingline Lender, without recourse or warranty,
an undivided interest and participation in such Swingline Loan in proportion to its Pro Rata Share of the Revolving Commitment.
The Swingline Lender may, at any time, require the applicable Lenders to fund their participations. From and after the date, if
any, on which any Lender is required to fund its participation in any Swingline Loan purchased hereunder, Agent shall promptly distribute to such Lender, such Lender's
Pro Rata Share of all payments of principal and interest and all proceeds of Collateral received by such Agent in respect of such
Loan.

 

    	 	31	 

     

    

 

(c)        Agent, on behalf
of Swingline Lender, shall request settlement (a "Settlement") with respect to Swingline Loans with the
Lenders holding a Revolving Commitment on at least a weekly basis or on any date that Agent elects, by notifying the applicable
Lenders of such requested Settlement by facsimile, telephone, or e-mail no later than 12:00 p.m. Central Time on the date of such
requested Settlement (the "Settlement Date"). Each applicable Lender (other than the Swingline Lender)
shall transfer the amount of such Lender's Pro Rata Share of the outstanding principal amount of the Swingline Loan with respect
to which Settlement is requested to Agent, to such account of Agent as Agent may designate, not later than 2:00 p.m., Central
Time, on such Settlement Date. Settlements may occur during the existence of an event of Default and whether or not the applicable
conditions precedent set forth in Section 4.2 have then been satisfied. Such amounts transferred to Agent shall be applied against
the amounts of the Swingline Lender's Swingline Loans and, together with such Swingline Lender's Pro Rata Share of such Swingline
Loan, shall constitute Revolving Loans of such Lenders, respectively. If any such amount is not transferred to Agent by any applicable
Lender on such Settlement Date, the Swingline Lender shall be entitled to recover such amount on demand from such Lender together
with interest thereon.

 

2.5.       Repayments.

 

(a)        Revolving Loans.
If at any time for any reason whatsoever (including as a result of currency fluctuations) (i) the outstanding balance of all Revolving
Loans exceeds the lesser of (x) the Maximum Revolving Facility Amount minus the amount of Reserves established against the Maximum
Revolving Facility Amount and (y) the Borrowing Base or (ii) any of the Loan Limits for Revolving Loans are exceeded, then, in
each case, Borrowers will immediately pay to Agent such amounts as shall cause Borrowers to eliminate such excess.

 

(b)        Reserved.

 

(c)        Maturity Date
Payments. All remaining outstanding monetary Obligations (including, all accrued and unpaid fees described in Section 3.2)
shall be payable in full on the Maturity Date.

 

2.6.       Prepayments
/ Voluntary Termination / Application of Prepayments.

 

(a)        Reserved.

 

(b)       Reserved.

 

(c)       Reserved.

 

(d)       Voluntary Termination
of Loan Facilities. Borrower Representative may, on at least thirty days prior written notice received by Agent, permanently
terminate the Loan facilities by repaying all of the outstanding Obligations, including all principal, interest and fees with
respect to the Revolving Loans, and an Early Payment/Termination Premium in the amount specified in Section 3.2(e). From and after
such date of termination, Agent shall have no obligation whatsoever to extend any additional Loans, and all of its lending commitments
hereunder shall be terminated.

 

(e)       Reserved.

 

    	 	32	 

     

    

 

2.7.       Obligations
Unconditional.

 

(a)        The
payment and performance of all Obligations shall constitute the absolute and unconditional obligations of each Loan Party Obligor,
and shall be independent of any defense or right of set-off, recoupment or counterclaim that any Loan Party Obligor or any other
Person might otherwise have against Agent, any Lender or any other Person. All payments required by this Agreement or the other
Loan Documents shall be made in Dollars (unless payment in a different currency is expressly provided otherwise in the applicable
Loan Document) and paid free of any deductions or withholdings for any taxes or other amounts and without abatement, diminution
or set-off. If any Loan Party Obligor is required by applicable law to make such a deduction or withholding from a payment under
this Agreement or under any other Loan Document, such Loan Party Obligor shall pay to Agent such additional amount as shall be
necessary to ensure that, after the making of such deduction or withholding, Agent receives (free from any liability in respect
of any such deduction or withholding) a net sum equal to the sum which it would have received and so retained had no such deduction
or withholding been made or required to be made. Each Loan Party Obligor shall (a) pay the full amount of any deduction or withholding
that it is required to make by law, to the relevant authority within the payment period set by applicable law and (b) promptly
after any such payment, deliver to Agent an original (or certified copy) official receipt issued by the relevant authority in respect
of the amount withheld or deducted or, if the relevant authority does not issue such official receipts, such other evidence of
payment of the amount withheld or deducted as is reasonably acceptable to Agent.

 

(b)        If,
at any time and from time to time after the Closing Date (or at any time before or after the Closing Date with respect to the Dodd-Frank
Wall Street Reform and Consumer Protection Act and all requests, rules, regulations, guidelines or directives thereunder or issued
in connection therewith), (a) any change in any existing law, regulation, treaty or directive or in the interpretation or application
thereof, (b) any new law, regulation, treaty or directive enacted or application thereof or (c) compliance by Agent with any request
or directive (whether or not having the force of law) from any Governmental Authority, central bank or comparable agency (i) subjects
Agent or any Lender to any tax, levy, impost, deduction, assessment, charge or withholding of any kind whatsoever with respect
to any Loan Document, or changes the basis of taxation of payments to Agent or any Lender of any amount payable thereunder (except
for net income taxes, or franchise taxes imposed in lieu of net income taxes, imposed generally by federal, state, provincial,
local or other taxing authorities with respect to interest or fees payable hereunder or under any other Loan Document or changes
in the rate of tax on the overall net income of Agent, any Lender or their respective members) or (ii) imposes, modifies or deems
applicable any reserve (including any reserve imposed by the FRB, but excluding any reserve included in the determination of the
LIBOR Rate), special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended
by Agent or any Lender or imposes on Agent or any Lender any other condition affecting its LIBOR Loans or its obligation to make
LIBOR Loans, the result of which is to increase the cost to (or to impose a cost on) Agent or any Lender of making or maintaining
any LIBOR Loan or (iii) imposes on Agent or any Lender any other condition or increased cost in connection with the transactions
contemplated thereby or participations therein, and the result of any of the foregoing is to increase the cost to Agent or any
Lender of making or continuing any Loan or to reduce any amount receivable hereunder or under any other Loan Documents, then, in
each such case, Borrowers shall promptly pay to Agent or such Lender, when notified to do so by Agent or such Lender, any additional
amounts necessary to compensate Agent or such Lender, on an after-tax basis, for such additional cost or reduced amount as determined
by Agent or such Lender. Each such notice of additional amounts payable pursuant to this Section 2.7(b) submitted by Agent or any
Lender, as applicable, to Borrower Representative shall, absent manifest error, be final, conclusive and binding for all purposes.

 

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(c)        This
Section 2.7 shall remain operative even after the Termination Date and shall survive the payment in full of all of the Loans.

 

2.8.        Reversal of
Payments. To the extent that any payment or payments made to or received by Agent or any Lender pursuant to this Agreement
or any other Loan Document are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be
repaid to any trustee, receiver or other Person under any state, federal or other bankruptcy or other such applicable law, then,
to the extent thereof, such amounts (and all Liens, rights and remedies relating thereto) shall be revived as Obligations (secured
by all such Liens) and continue in full force and effect under this Agreement and under the other Loan Documents as if such payment
or payments had not been received by Agent or such Lender. This Section 2.8 shall remain operative even after the Termination
Date and shall survive the payment in full of all of the Loans.

 

2.9.        Notes.
The Loans and Commitments shall, at the request of any Lender, be evidenced by one or more promissory notes in form and substance
reasonably satisfactory to such Lender. However, if such Loans are not so evidenced, such Loans may be evidenced solely by entries
upon the books and records maintained by Agent.

 

2.10.      Defaulting
Lenders. Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, the following
provisions shall apply for so long as such Lender is a Defaulting Lender:

 

(a)        Unused
Line Fees pursuant to Section 3.2(c) shall cease to accrue on the unfunded portion of the Revolving Commitment of such Defaulting
Lender.

 

(b)        Any amount payable
to a Defaulting Lender hereunder (whether on account of principal, interest, fees or otherwise) shall, in lieu of being distributed
to such Defaulting Lender, be retained by Agent in a segregated account and, subject to any applicable requirements of law, be
applied at such time or times as may be determined by Agent (i) first, to the payment of any amounts owing by such Defaulting
Lender to Agent hereunder, (ii) second, to the funding of any Revolving Loan in respect of which such Defaulting Lender has failed
to fund its portion thereof as required by this Agreement, as determined by Agent, (iii) third, if so determined by Agent and
Borrowers, held in such account as cash collateral for future funding obligations of the Defaulting Lender under this Agreement,
(iv) fourth, pro rata, to the payment of any amounts owing to Borrowers or the Lenders as a result of any judgment of a court
of competent jurisdiction obtained by Borrowers or any Lender against such Defaulting Lender as a result of such Defaulting Lender's
breach of its obligations under this Agreement, and (v) fifth, to such Defaulting Lender or as otherwise directed by a court of
competent jurisdiction; provided, that if such payment is made at a time when the conditions set forth in Section
4.2 are satisfied, such payment shall be applied solely to prepay the Loans of all Revolving Lenders that are not Defaulting Lenders
pro rata prior to being applied to the prepayment of any Loans, or reimbursement obligations owed to, any Defaulting Lender.

 

(c)        No
Defaulting Lender shall have any right to approve or disapprove any amendment, waiver, consent or any other action the Lenders
or the Required Lenders have taken or may take hereunder, provided that any waiver, amendment or modification requiring the consent
of all Lenders or each directly affected Lender which affects such Defaulting Lender differently than other affected Lenders shall
require the consent of such Defaulting Lender.

 

    	 	34	 

     

    

 

2.11.       Appointment
of Borrower Representative.

 

(a)        Each
Borrower hereby irrevocably appoints and constitutes Borrower Representative as its agent and attorney-in-fact to request and
receive Loans in the name or on behalf of such Borrower and any other Borrowers, deliver Notices of Borrowing, and Borrowing Base
Certificates, give instructions with respect to the disbursement of the proceeds of the Loans, giving and receiving all other
notices and consents hereunder or under any of the other Loan Documents and taking all other actions (including in respect of
compliance with covenants) in the name or on behalf of any Borrower or Borrowers pursuant to this Agreement and the other Loan
Documents. Lender may disburse the Loans to such bank account of Borrower Representative or a Borrower or otherwise make such
Loans to a Borrower, in each case as Borrower Representative may designate or direct, without notice to any other Borrower. Notwithstanding
anything to the contrary contained herein, Lender may at any time and from time to time require that Loans to or for the account
of any Borrower be disbursed directly to an operating account of such Borrower.

 

(b)        Borrower
Representative hereby accepts the appointment by Borrowers to act as the agent and attorney-in-fact of Borrowers pursuant to this
Section 2.9. Borrower Representative shall ensure that the disbursement of any Loans that are at any time requested by or to be
remitted to or for the account of a Borrower requested on behalf of a Borrower hereunder, shall be remitted or issued to or for
the account of such Borrower.

 

(c)        Each
Borrower hereby irrevocably appoints and constitutes Borrower Representative as its agent to receive statements on account and
all other notices from Lender with respect to the Obligations or otherwise under or in connection with this Agreement and the other
Loan Documents.

 

(d)        Any
notice, election, representation, warranty, agreement or undertaking made or delivered by or on behalf of any Borrower by Borrower
Representative shall be deemed for all purposes to have been made or delivered by such Borrower, as the case may be, and shall
be binding upon and enforceable against such Borrower to the same extent as if made or delivered directly by such Borrower.

 

(e)        No
resignation by or termination of the appointment of Borrower Representative as agent and attorney-in-fact as aforesaid shall be
effective, except after ten (10) Business Days’ prior written notice to Lender. If the Borrower Representative resigns under
this Agreement, Borrowers shall be entitled to appoint a successor Borrower Representative (which shall be a Borrower and shall
be reasonably acceptable to Lender as such successor). Upon the acceptance of its appointment as successor Borrower Representative
hereunder, such successor Borrower Representative shall succeed to all the rights, powers and duties of the retiring Borrower Representative
and the term “Borrower Representative” shall mean such successor Borrower Representative for all purposes of this Agreement
and the other Loan Documents, and the retiring or terminated Borrower Representative’s appointment, powers and duties as
Borrower Representative shall be thereupon terminated.

 

2.12.       Joint
and Several Liability

 

(b)        Joint
and Several. Each Borrower hereby agrees that such Borrower is jointly and severally liable for the full and prompt payment
(whether at stated maturity, by acceleration or otherwise) and performance of, all Obligations owed or hereafter owing to Agent
and Lenders by each other Borrower. Each Borrower agrees that its obligation hereunder shall not be discharged until payment and
performance, in full, of the Obligations has occurred, and that its obligations under this Section 2.12 shall be absolute and unconditional,
irrespective of, and unaffected by,

 

(i)        the
genuineness, validity, regularity, enforceability or any future amendment of, or change in, this Agreement, any other Loan Document
or any other agreement, document or instrument to which any Borrower is or may become a party;

 

    	 	35	 

     

    

 

(ii)        the
absence of any action to enforce this Agreement (including this Section 2.12) or any other Loan Document or the waiver or consent
by Agent or any Lender with respect to any of the provisions thereof;

 

(iii)        the
existence, value or condition of, or failure to perfect Agent's Lien against, any security for the Obligations or any action, or
the absence of any action, by Agent in respect thereof (including the release of any such security);

 

(iv)        the insolvency of any Loan Party or Other
Obligor; or

 

(v)        any
other action or circumstances that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor.

 

(c)        Waivers
by Borrowers. Each Borrower expressly waives all rights it may have now or in the future under any statute, or at common law,
or at law or in equity, or otherwise, to compel Agent to marshal assets or to proceed in respect of the Obligations against any
other Loan Party or Other Obligor, any other party or against any security for the payment and performance of the Obligations before
proceeding against, or as a condition to proceeding against, such Borrower. It is agreed among each Borrower, Agent and Lenders
that the foregoing waivers are of the essence of the transaction contemplated by this Agreement and the other Loan Documents and
that, but for the provisions of this Section 2.12 and such waivers, Agent and Lenders would decline to enter into this Agreement.

 

(d)        Benefit
of Joint and Several Obligations. Each Borrower agrees that the provisions of this Section 2.12 are for the benefit of Agent
and Lenders and their successors, transferees, endorsees and assigns, and nothing herein contained shall impair, as between any
other Borrower, Agent and any Lender, the obligations of such other Borrower under the Loan Documents.

 

(e)        Subordination
of Subrogation, Etc. Notwithstanding anything to the contrary in this Agreement or in any other Loan Document, each Borrower
hereby expressly and irrevocably subordinates to payment of the Obligations any and all rights at law or in equity to subrogation,
reimbursement, exoneration, contribution, indemnification or set off and any and all defenses available to a surety, guarantor
or accommodation co-obligor with respect to any other Loan Party or any Other Obligor until the Obligations are indefeasibly paid
in full in cash. Each Borrower acknowledges and agrees that this subordination is intended to benefit Agent and Lenders and shall
not limit or otherwise affect such Borrower's liability hereunder or the enforceability of this Section 2.12, and that Agent and
Lenders and their successors and assigns are intended third party beneficiaries of the waivers and agreements set forth in this
Section 2.12(d).

 

(f)        Election
of Remedies. If Agent may, under applicable law, proceed to realize its benefits under any of the Loan Documents giving Agent
a Lien upon any Collateral, whether owned by any Borrower or by any other Person, either by judicial foreclosure or by non-judicial
sale or enforcement, Agent may, at its sole option, determine which of its remedies or rights it may pursue without affecting any
of its rights and remedies under this Section 2.12. If, in the exercise of any of its rights and remedies, Agent shall forfeit
any of its rights or remedies, including its right to enter a deficiency judgment against any Borrower or any other Person, whether
because of any applicable laws pertaining to "election of remedies" or the like, each Borrower hereby consents to such
action by Agent and waives any claim based upon such action, even if such action by Agent shall result in a full or partial loss
of any rights of subrogation that each Borrower might otherwise have had but for such action by Agent.

 

    	 	36	 

     

    

 

(g)        Contribution
with Respect to Guaranty Obligations.

 

(i)        To the extent that
any Borrower shall make a payment under this Section 2.12 of all or any of the Obligations (other than Loans made to that Borrower
for which it is primarily liable) (a "Guarantor Payment") that, taking into account all other Guarantor
Payments then previously or concurrently made by any other Borrower, exceeds the amount that such Borrower would otherwise have
paid if each Borrower had paid the aggregate Obligations satisfied by such Guarantor Payment in the same proportion that such
Borrower's "Allocable Amount" (as defined below) (as determined immediately prior to such Guarantor Payment) bore to
the aggregate Allocable Amounts of each of the Borrowers as determined immediately prior to the making of such Guarantor Payment,
then, following indefeasible payment in full in cash of the Obligations and termination of the Commitments, such Borrower shall
be entitled to receive contribution and indemnification payments from, and be reimbursed by, each other Borrower for the amount
of such excess, pro rata based upon their respective Allocable Amounts in effect immediately prior to such Guarantor Payment.

 

(ii)        As of any date
of determination, the "Allocable Amount" of any Borrower shall be equal to the maximum amount of the claim
that could then be recovered from such Borrower under this Section 2.12 without rendering such claim voidable or avoidable under
Section 548 of Chapter 11 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent
Conveyance Act or similar statute or common law.

 

(iii)       
This Section 2.12(f) is intended only to define the relative rights of Borrowers and nothing set forth in this Section 2.12(f)
is intended to or shall impair the obligations of Borrowers, jointly and severally, to pay any amounts as and when the same shall
become due and payable in accordance with the terms of this Agreement, including Section 2.12(a). Nothing contained in this Section
2.12(f) shall limit the liability of any Borrower to pay the Loans made directly or indirectly to that Borrower and accrued interest,
fees and expenses with respect thereto for which such Borrower shall be primarily liable.

 

(iv)        The
parties hereto acknowledge that the rights of contribution and indemnification hereunder shall constitute assets of each Borrower
to which such contribution and indemnification is owing.

 

(v)        The
rights of the indemnifying Borrowers against other Loan Parties under this Section 2.12(f) shall be exercisable upon the full and
indefeasible payment of the Obligations and the termination of the Commitments.

 

(h)        Liability
Cumulative. The liability of Borrowers under this Section 2.12 is in addition to and shall be cumulative with all liabilities
of each Borrower to Agent and Lenders under this Agreement and the other Loan Documents to which such Borrower is a party or in
respect of any Obligations or obligation of the other Borrower, without any limitation as to amount, unless the instrument or agreement
evidencing or creating such other liability specifically provides to the contrary.

 

3.       INTEREST
AND FEES; LOAN ACCOUNT.

 

3.1.        Interest.
All Loans and other monetary Obligations shall bear interest at the interest rate(s) set forth in Section 3 of Annex I, and accrued
interest shall be payable (a) on the first day of each month in arrears, (b) upon a prepayment of Loan in accordance with Section
2.6 and (c) on the Maturity Date; provided, that after the occurrence and during the continuation of an Event of
Default and upon written demand by Agent (excluding an Event of Default under Section 11.1(g) or (h)), all Loans and other monetary
Obligations shall bear interest at a rate per annum equal to two (2) percentage points (2.00%) in excess of the rate otherwise
applicable thereto (the "Default Rate"), and all such interest shall be payable on demand. Changes in
the interest rate shall be effective as of the first day of each month based on the LIBOR Rate or Base Rate, as applicable, in
effect on such date. Subject to Section 3.6 and so long as no Event of Default shall have occurred and be continuing, all Loans
shall constitute LIBOR Loans. Upon the occurrence and during the continuance of an Event of Default, at the election of Agent
or Required Lenders, all Loans shall constitute Base Rate Loans.

 

    	 	37	 

     

    

 

3.2.        Fees.
Borrowers shall pay Agent the following fees on the dates provided therefor, which fees are in addition to all fees and other
sums payable by Borrowers or any other Person to Agent under this Agreement or under any other Loan Document and, in each case,
are not refundable once paid:

 

(a)        Closing Fee. A fee, for the ratable
benefit of the Lenders, equal to $495,000 (the "Closing Fee"), which shall be deemed to be fully
earned and payable as of the Closing Date.

 

(b)        Monthly Administration
Fee. A monthly fee, for the sole benefit of Agent, equal to $3,000 (the "Monthly Administration Fee")
for each month, or part thereof prior to the Termination Date. The Monthly Administration Fee shall payable monthly in advance
due and on the first day of each month following the Closing Date.

 

(c)        Unused Line Fee.
An unused line fee (the "Unused Line Fee"), for the ratable benefit of the Lenders, equal to one half
of one percent (0.50%) per annum of the amount by which (i) the Maximum Revolving Facility Amount, calculated without giving effect
to any Reserves or the Availability Block applied to the Maximum Revolving Facility Amount, exceeds (ii) the average daily outstanding
principal balance of the Revolving Loans during the immediately preceding month (or part thereof), which fee shall be deemed to
be fully earned and payable, in arrears, on the first day of each month until the Termination Date.

 

(d)        Reserved.

 

(e)        Early Payment/Termination
Premium. In the event that, for any reason (including as a result of any voluntary or mandatory prepayment of the Loans, any
acceleration of the Loans resulting from an Event of Default, any foreclosure and sale of Collateral, or any sale of Collateral
in any bankruptcy or insolvency proceeding), all or any portion of the Lenders' commitment to make Revolving Loans is terminated
prior to the Scheduled Maturity Date, in each case pursuant to Section 2.6(d), Section 11.2 or otherwise, then in each such case,
in addition to the payment of the principal amount and all unpaid accrued interest and other amounts due thereon, Borrowers immediately
shall be required to pay to Agent, for the ratable benefit of the Lenders, a premium (each, an "Early Payment/Termination
Premium") (as liquidated damages and compensation for the cost of the Lenders being prepared to make funds available
under this Agreement with respect to such Loans during the scheduled term of this Agreement) in an amount equal to the Applicable
Percentage (as defined below) of the amount of any such Revolving Loan commitment termination, as applicable. In each such case,
the "Applicable Percentage" shall be (A) two percent (2.0%), if such event occurs on or before the first
anniversary of the Closing Date, or (B) one percent (1.0%) if such event occurs after the first anniversary of the Closing Date,
but on or before the second anniversary of the Closing Date, or (C) zero percent (0.0%) if after the second anniversary of the
Closing Date. Each Borrower acknowledges and agrees that (x) the provisions of this paragraph shall remain in full force and effect
notwithstanding any rescission by Agent of an acceleration with respect to all or any portion of the Obligations pursuant to Section
11.2 or otherwise, (y) payment of any Early Payment/Termination Premium under this paragraph constitutes liquidated damages and
not a penalty and (z) the actual amount of damages to Lenders or profits lost by Lenders as a result of such early payment or
termination would be impracticable and extremely difficult to ascertain, and the Early Payment/Termination Premium under this
paragraph is provided by mutual agreement of Borrowers and Lenders as a reasonable estimation and calculation
of such lost profits or damages of Borrowers and Lenders.

 

    	 	38	 

     

    

 

3.3.       Computation
of Interest and Fees.

 

(a)       All
interest and fees shall be calculated daily on the outstanding monetary Obligations based on the actual number of days elapsed
in a year of 360 days.

 

(b)        For
the purposes of the Interest Act (Canada), as amended, and disclosure under such act, whenever interest to be paid under this Agreement
is to be calculated on the basis of a year of 365 or 366 days or any other period of time that is less than a calendar year, the
yearly rate of interest to which the rate determined pursuant to such calculation is equivalent is the rate so determined multiplied
by the actual number of days in the calendar year in which the same is to be ascertained and divided by either 365 or 366 or such
other period of time, as the case may be.

 

3.4.        Loan Account;
Monthly Accountings. Agent shall maintain a loan account for Borrowers reflecting all outstanding Loans, along with interest
accrued thereon and such other items reflected therein (the "Loan Account"), and shall provide Borrower
Representative with a monthly accounting reflecting the activity in the Loan Account, viewable by Borrowers on ABLSoft. Each accounting
shall be deemed correct, accurate and binding on Borrowers and an account stated (except for reverses and reapplications of payments
made and corrections of errors discovered by Agent), unless Borrower Representative notifies Agent in writing to the contrary
within thirty days after such account is rendered, describing the nature of any alleged errors or omissions. However, Agent's
failure to maintain the Loan Account or to provide any such accounting shall not affect the legality or binding nature of any
of the Obligations. Interest, fees and other monetary Obligations due and owing under this Agreement may, in Agent's discretion,
be charged to the Loan Account, and will thereafter be deemed to be Revolving Loans and will bear interest at the same rate as
other Revolving Loans.

 

3.5.        Further Obligations;
Maximum Lawful Rate. With respect to all monetary Obligations for which the interest rate is not otherwise specified herein
(whether such Obligations arise hereunder or under any other Loan Document, or otherwise), such Obligations shall bear interest
at the rate(s) in effect from time to time with respect to the Revolving Loans and shall be payable upon demand by Agent. In no
event shall the interest charged with respect to any Loan or any other Obligation exceed the maximum amount permitted under applicable
law. Notwithstanding anything to the contrary herein or elsewhere, if at any time the rate of interest payable or other amounts
hereunder or under any other Loan Document (the "Stated Rate") would exceed the highest rate of interest
or other amount permitted under any applicable law to be charged (the "Maximum Lawful Rate"), then for
so long as the Maximum Lawful Rate would be so exceeded, the rate of interest and other amounts payable shall be equal to the
Maximum Lawful Rate; provided, that if at any time thereafter the Stated Rate is less than the Maximum Lawful Rate,
Borrowers shall, to the extent permitted by applicable law, continue to pay interest and such other amounts at the Maximum Lawful
Rate until such time as the total interest and other such amounts received is equal to the total interest and other such amounts
which would have been received had the Stated Rate been (but for the operation of this provision) the interest rate payable or
such other amounts payable. Thereafter, the interest rate and such other amounts payable shall be the Stated Rate unless and until
the Stated Rate again would exceed the Maximum Lawful Rate, in which event this provision shall again apply. In no event shall
the total interest or other such amounts received by Agent exceed the amount which it could lawfully have received had the interest
and other such amounts been calculated for the full term hereof at the Maximum Lawful Rate. If, notwithstanding the prior sentence,
Agent has received interest or other such amounts hereunder in excess of the Maximum Lawful Rate, such excess amount shall be
applied to the reduction of the principal balance of the Loans or to other Obligations (other than interest) payable hereunder,
and if no such principal or other Obligations are then outstanding, such excess or part thereof remaining shall be paid to Borrowers.
In computing interest payable with reference to the Maximum Lawful Rate applicable to any Lender, such interest shall be calculated
at a daily rate equal to the Maximum Lawful Rate divided by the number of days in the year in which such calculation is made.

 

    	 	39	 

     

    

 

3.6.       Certain
Provisions Regarding LIBOR Loans; Replacement of Lenders.

 

(a)        Inadequate or
Unfair Basis. If Agent or any Lender reasonably determines (which determination shall be binding and conclusive on Borrowers)
that, by reason of circumstances affecting the interbank Eurodollar market, adequate and reasonable means do not exist for ascertaining
the applicable LIBOR Rate, then Agent or such Lender shall promptly notify Borrower Representative (and Agent, if applicable)
thereof and, so long as such circumstances shall continue, (i) Agent and/or such Lender shall be under no obligation to make any
LIBOR Loans and (ii) on the last day of the current calendar month, each LIBOR Loan shall, unless then repaid in full, automatically
convert to a Base Rate Loan.

 

(b)        Change in Law.
If any change in, or the adoption of any new, law, treaty or regulation, or any change in the interpretation of any applicable
law or regulation by any Governmental Authority charged with the administration thereof, would make it (or in the good faith judgment
of Agent or the applicable Lender cause a substantial question as to whether it is) unlawful for Agent or such Lender to make,
maintain or fund LIBOR Loans, then Agent or such Lender shall promptly notify Borrower Representative and, so long as such circumstances
shall continue, (i) Agent or such Lender shall have no obligation to make any LIBOR Loan and (ii) on the last day of the current
calendar month for each LIBOR Loan (or, in any event, on such earlier date as may be required by the relevant law, regulation
or interpretation), such LIBOR Loan shall, unless then repaid in full, automatically convert to a Base Rate Loan.

 

(c)        If any Borrower
becomes obligated to pay additional amounts to any Lender pursuant to Section 2.7(b), or any Lender gives notice of the occurrence
of any circumstances described in Section 2.7(b), or if Lender becomes a Defaulting Lender, Borrowers may designate another Person
engaged in the making of commercial loans in the ordinary course of business which is acceptable to Agent in its sole discretion
(such other Person being called a "Replacement Lender") to purchase the Loans and Commitments of such
Lender and such Lender's rights hereunder, without recourse to or warranty by, or expense to, such Lender, for a purchase price
equal to the outstanding principal amount of the Loans payable to such Lender plus any accrued but unpaid interest on such Loans
and all accrued but unpaid fees owed to such Lender and any other amounts payable to such Lender under this Agreement, and to
assume all the obligations of such Lender hereunder, and, upon such purchase and assumption (pursuant to an Assignment and Assumption),
such Lender shall no longer be a party hereto or have any rights hereunder (other than rights with respect to indemnities and
similar rights applicable to such Lender prior to the date of such purchase and assumption) and shall be relieved from all obligations
to Borrowers hereunder, and the Replacement Lender shall succeed to the rights and obligations of such Lender hereunder.

 

(d)        LIBOR Discontinuation.
Notwithstanding anything contained herein to the contrary, if Agent reasonably determines after the Closing Date that the LIBOR
Rate has been discontinued or is no longer available as a benchmark interest rate, Agent shall select a comparable successor rate
in its reasonable discretion (in consultation with the Borrowers), which successor rate shall be applied in a manner consistent
with market practice taking into account the benchmark interest rates applicable to funding sources for the Lenders, and will
promptly so notify each Lender.

 

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4.       CONDITIONS
PRECEDENT.

 

4.1.       Conditions
to Initial Loans.

 

Each Lender's
obligation to fund the initial Loans under this Agreement is subject to the following conditions precedent (as well as any other
conditions set forth in this Agreement or any other Loan Document), all of which must be satisfied in a manner acceptable to Agent
(and as applicable, pursuant to documentation which in each case is in form and substance acceptable to Agent):

 

(a)        each
Loan Party Obligor shall have duly executed and/or delivered, or, as applicable, shall have caused such other applicable Persons
to have duly executed and or delivered, to Agent such agreements, instruments, documents, proxies, financial statements, projections,
lien searches, legal opinions, title insurances, assessments, appraisals, and certificates as Agent may require, including such
other agreements, instruments, documents, proxies, financial statements, projections, lien searches, legal opinions, title insurance,
assessments, appraisals, and certificates listed on the closing checklist attached hereto as Exhibit B;

 

(b)        Agent
shall have completed its business and legal due diligence pertaining to the Loan Parties and their respective businesses and assets,
with results thereof satisfactory to Agent in its sole discretion;

 

(c)        each
Lender's obligations and commitments under this Agreement shall have been approved by such Lender's Credit Committee;

 

(d)        after
giving effect to such Loans, as well as to the payment of all trade payables older than sixty days past due and the consummation
of all transactions contemplated hereby to occur on the Closing Date, closing costs and any book overdraft, Excess Availability
shall be no less than $2,000,000;

 

(e)        since
December 31, 2018, no event shall have occurred which has had, or could reasonably be expected to have, a Material Adverse Effect
on any Loan Party;

 

(f)        Borrowers
shall have paid to Agent all fees due on the date hereof, and shall have paid or reimbursed Agent for all of Agent's costs, charges
and expenses incurred through the Closing Date (and in connection herewith, Borrowers hereby irrevocably authorizes Agent to charge
such fees, costs, charges and expenses as Revolving Loans);

 

(g)        the
HHG Note shall have been funded; and

 

(h)        Agent
shall have received PDFs of the following that shall have been delivered to the Term Loan Agent: (i) original stock certificates
or other certificates evidencing the Pledged Equity pledged pursuant to the Security Documents (as defined in the Term Loan Documents),
together with an undated stock (or equivalent) power for each such certificate duly executed in blank by the registered owner thereof
and (ii) each original promissory note pledged pursuant to the Security Documents (as defined in the Term Loan Documents), if any,
together with an undated endorsement for each such promissory note duly executed in blank by the holder thereof.

 

4.2.       Conditions
to all Loans. No Lender shall be obligated to fund any Loans, unless the following conditions are satisfied:

 

    	 	41	 

     

    

 

(a)        Borrower
Representative shall have provided to Agent such information as Agent may require in order to determine the Borrowing Base (including
the items set forth in Section 7.15(a), (b) and (c) (as applicable)), as of such borrowing or issue date, after giving effect
to such Loans;

 

(b)        each
of the representations and warranties set forth in this Agreement and in the other Loan Documents shall be true and correct in
all respects as of the date such Loan is made (or, to the extent any representations or warranties are expressly made solely as
of an earlier date, such representations and warranties shall be true and correct as of such earlier date), both before and after
giving effect thereto;

 

(c)        no
Default or Event of Default shall be in existence, both before and after giving effect thereto; and

 

(d)        no
event shall have occurred or circumstance shall exist that has or could reasonably be expected to have a Material Adverse Effect.

 

Each request
(or deemed request) by Borrowers for funding of a Loan shall constitute a representation by each Borrower that the foregoing conditions
are satisfied on the date of such request and on the date of such funding or issuance. As an additional condition to any funding,
issuance or grant, Agent shall have received such other information, documents, instruments and agreements as it deems appropriate
in connection therewith.

 

5.       COLLATERAL.

 

5.1.        Grant of Security
Interest. To secure the full payment and performance of all of the Obligations, each Loan Party Obligor hereby assigns to
Agent and grants to Agent, for itself and on behalf of the Lenders, a continuing security interest in all property of each Loan
Party Obligor, whether tangible or intangible, real or personal, now or hereafter owned, existing, acquired or arising and wherever
now or hereafter located, and whether or not eligible for lending purposes, including: (a) all Accounts (whether or not Eligible
Accounts) and all Goods whose sale, lease or other disposition by any Loan Party Obligor has given rise to Accounts and have been
returned to, or repossessed or stopped in transit by, any Loan Party Obligor; (b) all Chattel Paper (including Electronic Chattel
Paper), Instruments, Documents, and General Intangibles (including all patents, patent applications, trademarks, trademark applications,
trade names, trade secrets, goodwill, copyrights, copyright applications, registrations, licenses, software, franchises, customer
lists, tax refund claims, claims against carriers and shippers, guaranty claims, contracts rights, payment intangibles, security
interests, security deposits and rights to indemnification); (c) all Inventory (whether or not Eligible Inventory); (d) all Goods
(other than Inventory), including Equipment, vehicles, and Fixtures; (e) all Investment Property, including all rights, privileges,
authority, and powers of each Loan Party Obligor as an owner or as a holder of Pledged Equity, including all economic rights,
all control rights, authority and powers, and all status rights of each Loan Party Obligor as a member, equity holder or shareholder,
as applicable, of each Issuer and any rights related to any Loan Party Obligors' capital account within the Issuer in respect
of Investment Property; (f) all Deposit Accounts, bank accounts, deposits, money and cash; (g) all Letter-of-Credit Rights; (h)
all Commercial Tort Claims listed in Section 2 of the Perfection Certificate; (i) all Supporting Obligations; (j) all life insurance
policies; (k) all leases; (l) any other property of any Loan Party Obligor now or hereafter in the possession, custody or control
of Agent or any agent or any parent, Affiliate or Subsidiary of Agent, any Lender or any Participant with Lender in the Loans,
for any purpose (whether for safekeeping, deposit, collection, custody, pledge, transmission or otherwise); and (n) all additions
and accessions to, substitutions for, and replacements, products and Proceeds of the foregoing property, including proceeds of
all insurance policies insuring the foregoing property (including hazard, flood and credit insurance), and all of each Loan Party
Obligor's books and records relating to any of the foregoing and to any Loan Party's business.

 

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5.2.        Possessory
Collateral. Promptly, but in any event no later than five Business Days after any Loan Party Obligor's receipt of any portion
of the Collateral evidenced by an agreement, Instrument or Document that is ABL Priority Collateral, including any Tangible Chattel
Paper and any Investment Property consisting of certificated securities, such Loan Party Obligor shall deliver the original thereof
to Agent together with an appropriate endorsement or other specific evidence of assignment thereof to Agent (in form and substance
acceptable to Agent). If an endorsement or assignment of any such items shall not be made for any reason, Agent is hereby irrevocably
authorized, as attorney and agent-in-fact (coupled with an interest) for each Loan Party Obligor, to endorse or assign the same
on such Loan Party Obligor's behalf. To the extent that such Collateral is Term Loan Priority Collateral, the Loan Party Obligor
shall deliver copies of the Collateral delivered to the Term Loan Agent.

 

5.3.        Further Assurances.
Each Loan Party Obligor shall, at its own cost and expense, promptly and duly take, execute, acknowledge and deliver (or cause
each other applicable Person to take, execute, acknowledge and deliver) all such further acts, documents, agreements and instruments
as may from time to time be necessary or desirable or as Agent may from time to time require in order to (a) carry out the intent
and purposes of the Loan Documents and the transactions contemplated thereby, (b) establish, create, preserve, protect and perfect
a first priority lien (subject only to Permitted Liens) in favor of Agent in all the ABL Priority Collateral (wherever located)
from time to time owned by the Loan Party Obligors and a second priority lien (subject only to Permitted Liens) in favor of Agent
in all capital stock and other equity from time to time issued by the Loan Parties (including appraisals of real property in compliance
with FIRREA), (c) cause each Subsidiary of any Borrower to guaranty all of the Obligations, all pursuant to documentation that
is in form and substance reasonably satisfactory to Agent and (d) facilitate the collection of the Collateral. Without limiting
the foregoing, each Loan Party Obligor shall, at its own cost and expense, promptly and duly take, execute, acknowledge and deliver
(or cause each other applicable Person to take, execute, acknowledge and deliver) to Agent all promissory notes, security agreements,
agreements with landlords, mortgagees and processors and other bailees, subordination and intercreditor agreements and other agreements,
instruments and documents, in each case in form and substance reasonably acceptable to Agent, as Agent may request from time to
time to perfect, protect and maintain Agent's security interests in the Collateral, including the required priority thereof, and
to fully carry out the transactions contemplated by the Loan Documents.

 

5.4.        UCC Financing
Statements. Each Loan Party Obligor authorizes Agent to file, transmit or communicate, as applicable, from time to time, Financing
Statements under the UCC and/or PPSA, along with amendments and modifications thereto, in all filing offices selected by Agent,
listing such Loan Party Obligor as the Debtor and Agent as the Secured Party, and describing the collateral covered thereby in
such manner as Agent may elect, including using descriptions such as "all personal property of debtor" or "all
assets of debtor," or words of similar effect, in each case without such Loan Party Obligor's signature. Each Loan Party
Obligor also hereby ratifies its authorization for Agent to have filed, in any filing office, any Financing Statements filed prior
to the date hereof.

 

5.5.        Excluded Property.
Notwithstanding anything in Section 5.1 or any other provision of this Agreement or any other Loan Document, the “Collateral”
shall exclude any Excluded Property; provided, if and when any Property shall cease to be Excluded Property, such Property shall
be deemed, at all times from and after such date and so long as such Property of the type set forth in clauses (a) through (n)
of Section 5.1 does not at any time thereafter become an Excluded Property, to constitute Collateral. For the avoidance of doubt,
Excluded Property shall not include any proceeds, products, substitutions or replacements of Excluded Property (unless such proceeds,
products, substitutions or replacements would otherwise constitute Excluded Property).

 

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6.        CERTAIN PROVISIONS
REGARDING ACCOUNTS, INVENTORY, COLLECTIONS AND APPLICATIONS OF PAYMENTS. Until the Termination Date:

 

6.1.        Lock Boxes
and Blocked Accounts. Each Loan Party Obligor hereby represents and warrants that all Deposit Accounts and all other depositary
and other accounts maintained by each Loan Party Obligor as of the Closing Date are described in Section 3 of the Perfection Certificate,
which description includes for each such account the name of the Loan Party Obligor maintaining the account, the name of the financial
institution at which the account is maintained, the account number and the purpose of the account. Within 45 days after the Closing
Date, Section 3 of the Perfection Certificate shall be updated to reflect the new accounts and the existing accounts shall be
closed. After the Closing Date, no Loan Party Obligor shall open any new Deposit Account or any other depositary or other account
without the prior written consent of Agent and without updating Section 3 of the Perfection Certificate to reflect such Deposit
Account or other account. No Deposit Account or other account of any Loan Party Obligor shall at any time constitute a Restricted
Account other than accounts expressly indicated on Section 3 of the Perfection Certificate as being Restricted Accounts (and each
Loan Party Obligor hereby represents and warrants that each such account shall at all times meet the requirements set forth in
the definition of Restricted Account to qualify as a Restricted Account). Each Loan Party Obligor will, at its expense, establish
(and revise from time to time as Agent may require) procedures acceptable to Agent, in Agent's sole discretion, for the collection
of checks, wire transfers and all other proceeds of all of such Loan Party Obligor's Accounts and other Collateral ("Collections"),
which shall include (a) directing all Account Debtors to send all Account proceeds directly to a post office box designated by
Agent either in the name of such Loan Party Obligor (but as to which Agent has exclusive access) or, at Agent's option, in the
name of Agent (a "Lock Box") and (b) depositing all Collections received by such Loan Party Obligor into
one or more bank accounts maintained in the name of such Loan Party Obligor (but as to which Agent has exclusive access) or, at
Agent's option, in the name of Agent (each, a "Blocked Account"), under an arrangement acceptable to Agent
with a depository bank acceptable to Agent, pursuant to which all funds deposited into each Blocked Account are to be transferred
to Agent in such manner, and with such frequency, as Agent shall specify, and/or (c) a combination of the foregoing. Each Loan
Party Obligor agrees to execute, and to cause its depository banks and other account holders to execute, such Lock Box and Blocked
Account control agreements and other documentation as Agent shall require from time to time in connection with the foregoing,
all in form and substance acceptable to Agent, and in any event such arrangements and documents must be in place on the date hereof
with respect to accounts in existence on the date hereof, or prior to any such account being opened with respect to any such account
opened after the date hereof, in each case excluding Restricted Accounts. Prior to the Closing Date, Borrowers shall deliver to
Agent a complete and executed Authorized Accounts form regarding each Borrower's operating account(s) into which the proceeds
of Loans are to be paid in the form of Exhibit D annexed hereto.

 

6.2.        Application
of Payments. All amounts paid to or received by Agent in respect of monetary Obligations, from whatever source (whether from
any Borrower or any other Loan Party Obligor pursuant to such other Loan Party Obligor's guaranty of the Obligations, any realization
upon any Collateral or otherwise) shall be applied by Agent to the Obligations in such order as Agent may elect, and absent such
election shall be applied as follows:

 

(i)        FIRST, to
reimburse Agent for all out-of-pocket costs and expenses, and all indemnified losses, incurred by Agent which are reimbursable
to Agent in accordance with this Agreement or any of the other Loan Documents; 

 

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(ii)        SECOND,
to any accrued but unpaid interest on any Protective Advances;

 

(iii)        THIRD,
to the outstanding principal of any Protective Advances;

 

(iv)        FOURTH,
to any accrued but unpaid fees owing to Agent and Lenders under this Agreement and/or any other Loan Documents;

 

(v)        FIFTH, to
any unpaid accrued interest on the Obligations;

 

(vi)        SIXTH, to
the outstanding principal of the Loans; and

  

(vii)       SEVENTH,
to the payment of any other outstanding Obligations; and after payment in full in cash of all of the outstanding monetary Obligations,
any further amounts paid to or received by Agent in respect of the Obligations (so long as no monetary Obligations are outstanding)
shall be paid over to Borrowers or such other Person(s) as may be legally entitled thereto.

 

For
purposes of determining the Borrowing Base, such amounts will be credited to the Loan Account and the Collateral balances to which
they relate upon Agent's receipt of an advice from Agent's Bank (set forth in Section 5 of Annex I) that such items have been
credited to Agent's account at Agent's Bank (or upon Agent's deposit thereof at Agent's Bank in the case of payments received
by Agent in kind), in each case subject to final payment and collection. However, for purposes of computing interest on the Obligations,
such items shall be deemed applied by Agent three Business Days after Agent 's receipt of advice of deposit thereof at Agent's
Bank.

 

6.3.        Notification;
Verification. Agent or its designee may, from time to time: (a) whether or not a Default or Event of Default has occurred
and is continuing, verify directly with the Account Debtors of the Loan Party Obligors (or by any manner and through any medium
Agent considers advisable) the validity, amount and other matters relating to the Accounts and Chattel Paper of the Loan Party
Obligors, by means of mail, telephone or otherwise, either in the name of the applicable Loan Party Obligor or Agent or such other
name as Agent may choose (provided, however, that no Default or Event of Default has occurred or is continuing, Agent shall consult
with Borrower Representative on the method of such verification); (b) whether or not a Default or Event of Default has occurred,
notify Account Debtors of the Loan Party Obligors that Agent has a security interest in the Accounts of the Loan Party Obligors
and direct such Account Debtors to make payment thereof directly to Agent; each such notification to be sent on the letterhead
of such Loan Party Obligor and substantially in the form of Exhibit E annexed hereto; and (c) following the occurrence and during
the continuance of a Default or Event of Default, demand, collect or enforce payment of any Accounts and Chattel Paper (but without
any duty to do so) and, in furtherance of the foregoing, each Loan Party Obligor hereby authorizes Account Debtors to make payments
directly to Agent and to rely on notice from Agent without further inquiry. Agent may on behalf of each Loan Party Obligor endorse
all items of payment received by Agent that are payable to such Loan Party Obligor for the purposes described above.

 

6.4.         Power
of Attorney.

 

Without
limiting any of Agent's and the other Lenders' other rights under this Agreement or any other Loan Document, each Loan Party Obligor
hereby grants to Agent an irrevocable power of attorney, coupled with an interest, authorizing and permitting Agent (acting through
any of its officers, employees, attorneys or agents), at Agent's option but without obligation, with or without notice to such
Loan Party Obligor, and at each Loan Party Obligor's expense, to do any or all of the following, in such Loan Party Obligor's name
or otherwise:

 

    	 	45	 

     

    

 

(a)        at
any time, whether or not an Event of Default has occurred or is continuing, (i) execute on behalf of such Loan Party Obligor any
documents that Agent may, in its sole discretion, deem advisable in order to perfect, protect and maintain Agent's security interests,
and priority thereof, in the Collateral and to fully consummate all the transactions contemplated by this Agreement and the other
Loan Documents (including such Financing Statements and continuation Financing Statements, and amendments or other modifications
thereto, as Agent shall deem necessary or appropriate) and to notify Account Debtors of the Loan Party Obligors in the manner contemplated
by Section 6.3, (ii) endorse such Loan Party Obligor's name on all checks and other forms of remittances received by Agent, (iii)
pay any sums required on account of such Loan Party Obligor's taxes or to secure the release of any Liens therefor, (iv) pay any
amounts necessary to obtain, or maintain in effect, any of the insurance described in Section 7.14, (v) receive and otherwise take
control in any manner of any cash or non-cash items of payment or Proceeds of Collateral, (vi) receive and open all mail addressed
to such Loan Party Obligor at any post office box or lockbox maintained by Agent for such Loan Party Obligor or at any other business
premises of Agent and (vii) endorse or assign to Agent on such Loan Party Obligor's behalf any portion of Collateral evidenced
by an agreement, Instrument or Document if an endorsement or assignment of any such items is not made by such Loan Party Obligor
pursuant to Section 5.2; and

 

(b)        at
any time, after the occurrence and during the continuance of an Event of Default, (i) execute on behalf of such Loan Party Obligor
any document exercising, transferring or assigning any option to purchase, sell or otherwise dispose of or lease (as lessor or
lessee) any real or personal property which is ABL Priority Collateral, (ii) execute on behalf of such Loan Party Obligor any invoices
relating to any Accounts, any draft against any Account Debtor, any proof of claim in bankruptcy, any notice of Lien or claim,
and any assignment or satisfaction of mechanic's, materialman's or other Lien, (iii) execute on behalf of such Loan Party Obligor
any notice to any Account Debtor, (iv) pay, contest or settle any Lien, charge, encumbrance, security interest and adverse claim
in or to any of the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same,
(v) grant extensions of time to pay, compromise claims relating to, and settle Accounts, Chattel Paper and General Intangibles
for less than face value and execute all releases and other documents in connection therewith, (vi) settle and adjust, and give
releases of, any insurance claim that relates to any of the ABL Priority Collateral and obtain payment therefor, (vii) instruct
any third party having custody or control of any ABL Priority Collateral or books or records belonging to, or relating to, such
Loan Party Obligor to give Agent the same rights of access and other rights with respect thereto as Agent has under this Agreement
or any other Loan Document, (viii) change the address for delivery of such Loan Party Obligor's mail, and (ix) vote any right or
interest with respect to any Investment Property (if it is the Control Agent), and (x) instruct any Account Debtor to make all
payments due to any Loan Party Obligor directly to Agent.

 

Any
and all sums paid, and any and all costs, expenses, liabilities, obligations and reasonable attorneys' fees (internal and external
counsel) of Agent with respect to the foregoing shall be added to and become part of the Obligations, shall be payable on demand,
and shall bear interest at a rate equal to the highest interest rate applicable to any of the Obligations. Each Loan Party Obligor
agrees that Agent's rights under the foregoing power of attorney and any of Agent's other rights under this Agreement or the other
Loan Documents shall not be construed to indicate that Agent or any Lender is in control of the business, management or properties
of any Loan Party Obligor.

 

6.5.        Disputes.
Each Loan Party Obligor shall promptly notify Agent of all disputes or claims relating to its Accounts and Chattel Paper in each
case in excess of $100,000. Each Loan Party Obligor agrees that it will not, without Agent's prior written consent, compromise
or settle any of its Accounts or Chattel Paper for less than the full amount thereof, grant any extension of time for payment
of any of its Accounts or Chattel Paper, release (in whole or in part) any Account Debtor or other person liable for the payment
of any of its Accounts or Chattel Paper or grant any credits, discounts, allowances, deductions, return authorizations or the
like with respect to any of its Accounts or Chattel Paper; except (unless otherwise directed by Agent during the existence of
a Default or an Event of Default) such Loan Party Obligor may take any of such actions in the Ordinary Course of Business consistent
with past practices.

 

    	 	46	 

     

    

 

6.6.        Invoices.
Within a reasonable time following Agent's request, each Loan Party Obligor will cause all invoices and statements that it sends
to Account Debtors or other third parties to be marked and authenticated, in a manner reasonably satisfactory to Agent, to reflect
Agent's security interest therein and payment instructions (including, but not limited to, in a manner to meet the requirements
of Section 9-404(a)(2) of the UCC or, in the case of the Canadian Borrowers, the PPSA, as applicable).

 

6.7.        Inventory.

 

(a)        Returns.
No Loan Party Obligor will accept returns of any Inventory from any Account Debtor except in the Ordinary Course of Business.
In the event the value of returned Inventory in any one calendar month exceeds $500,000 (collectively for all Loan Party Obligors),
Borrower Representative will immediately notify Agent (which notice shall specify the value of all such returned Inventory, the
reasons for such returns, and the locations and the condition of such returned Inventory).

 

(b)        Third Party Locations.
No Loan Party Obligor will, without Agent's prior written consent, at any time, store any Inventory with any warehouseman or other
third party other than (i) as set forth in Section 1(d) of the Perfection Certificate, (ii) Permitted Asset Dispositions, (iii)
at other locations in the United States or Canada, upon 30 Business Days’ prior written notice to Agent (and Section 1(d)
of the Perfection Certificate will be updated to reflect such location), (iv) transport Collateral to trade shows or other industry
expositions for marketing purposes in the Ordinary Course of Business, (v) send Equipment to repair facilities in the Ordinary
Course of Business, and (iv) allow employees to utilize Collateral at remote locations in the Ordinary Course of Business.

 

(c)        Sale on Return,
etc. No Loan Party Obligor will, without Agent's prior written consent, at any time, sell any Inventory on a sale-or-return,
guarantied sale, consignment, or other contingent basis.

 

(d)        Fair Labor Standards
Act. Each Loan Party Obligor represents, warrants and covenants that, at all times, all of the Inventory of each Loan Party
Obligor has been, at all times will be, produced only in accordance with the Fair Labor Standards Act of 1938 and all rules, regulations
and orders promulgated thereunder.

 

(e)        Eligibility.
As of each date reported by any Borrower, all Inventory which such Borrower has then reported to Agent as then being Eligible
Inventory comply in all respects with the criteria for eligibility set forth in the definition of Eligible Inventory.

 

7.       REPRESENTATIONS,
WARRANTIES AND AFFIRMATIVE COVENANTS.

 

To induce Agent and the Lenders to enter into this Agreement, each Loan Party Obligor
represents, warrants and covenants as follows (it being understood and agreed that (a) each such representation and warranty (i)
will be made as of the date hereof and be deemed remade as of each date on which any Loan is made (except to the extent any such
representation or warranty expressly relates only to any earlier or specified date, in which case such representation or warranty
will be made as of such earlier or specified date) and (ii) shall not be affected by any knowledge of, or any investigation by,
Agent or any Lender and (b) each such covenant shall continuously apply with respect to all times commencing on the date hereof
and continuing until the Termination Date):

 

    	 	47	 

     

    

 

7.1.        Existence
and Authority. Each Loan Party is duly organized, validly existing and in good standing under the laws of its jurisdiction
of organization (which jurisdiction is identified in Section 1(a) of the Perfection Certificate) and is qualified to do business
in each jurisdiction in which the failure to be qualified would have a Material Adverse Effect. Each Loan Party has all requisite
power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted,
to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby. The execution,
delivery and performance by each Loan Party Obligor of this Agreement and all of the other Loan Documents to which such Loan Party
Obligor is a party have been duly and validly authorized, do not violate such Loan Party Obligor's Governing Documents or any
law or any material agreement or instrument or any court order which is binding upon any Loan Party or its property, do not constitute
grounds for acceleration of any Indebtedness or obligation under any material agreement or instrument which is binding upon any
Loan Party or its property, and do not require the consent of any Person. Each Loan Party Obligor shall preserve and maintain
all of its leases, licenses, permits, franchises qualifications, and rights except where the failure to so maintain would be reasonably
likely to have a Material Adverse Effect. No Loan Party is required to obtain any government approval, consent, or authorization
from, or to file any declaration or statement with, any Governmental Authority in connection with or as a condition to the execution,
delivery or performance of any of the Loan Documents. This Agreement and each of the other Loan Documents have been duly executed
and delivered by, and are enforceable against, each of the Loan Party Obligors who have signed them, in accordance with their
respective terms. Section 1(f) of the Perfection Certificate sets forth the ownership of each Borrower and its Subsidiaries.

 

7.2.        Names; Trade
Names and Styles. The name of each Loan Party Obligor set forth on Section 1(b) of the Perfection Certificate is its correct
and complete legal name as of the date hereof, and no Loan Party Obligor has used any other name at any time in the past five
years, or at any time will use any other name, in any tax filing made in any jurisdiction. Listed in Section 1(b) of the Perfection
Certificate are all prior names used by each Loan Party Obligor at any time in the past five years and all of the present and
prior trade names used by any Loan Party Obligor at any time in the past five years. Borrower Representative shall give Agent
at least thirty days' prior written notice (and will deliver an updated Section 1(b) of the Perfection Certificate to reflect
the same) before it or any other Loan Party Obligor changes its legal name or does business under any other name.

 

7.3.        Title to Collateral;
Third Party Locations; Permitted Liens. Each Loan Party Obligor has, and at all times will continue to have, good and marketable
title to all of the Collateral. The Collateral now is, and at all times will remain, free and clear of any and all Liens, except
for Permitted Liens. Agent now has, and will at all times continue to have, a first-priority perfected and enforceable security
interest in all of the ABL Priority Collateral, subject only to the Permitted Liens, and each Loan Party Obligor will at all times
defend Agent and the ABL Priority Collateral against all claims of others. Agent now has, and will at all times continue to have,
a second-priority perfected and enforceable security interest in all of the Collateral not constituting ABL Priority Collateral,
subject only to the Permitted Liens, and each Loan Party Obligor will at all times defend Agent and such Collateral against all
claims of others. Except for leases or subleases as to which Borrowers have delivered to Agent a landlord's waiver in form and
substance reasonably satisfactory to Agent (unless waived by Agent in its sole discretion; provided, that such waiver
may be conditioned upon Agent establishing a rent or other similar Reserve satisfactory to Agent in its sole discretion), no Loan
Party Obligor is or will be a lessee or sublessee under any real property lease or sublease. Except for warehouses as to which
Borrowers have delivered to Agent a warehouseman's waiver in form and substance reasonably satisfactory to Agent (unless waived
by Agent in its sole discretion; provided, that such waiver may be conditioned upon Agent establishing a rent or
other similar Reserve satisfactory to Agent in its sole discretion), no Loan Party Obligor is or will at any time be a bailor
of any Goods at any warehouse or otherwise. Except as provided in Section 6.7(b), prior to causing or permitting any Collateral
to at any time be located upon premises in which any third party (including any landlord, warehouseman, or otherwise) has an interest,
Borrower Representative shall notify Agent and the applicable Loan Party Obligor shall cause each such third party to execute
and deliver to Agent, in form and substance reasonably acceptable to Agent, such waivers, collateral access agreements, and subordinations
as Agent shall specify, so as to, among other things, ensure that Agent's rights in the Collateral are, and will at all times
continue to be, superior to the rights of any such third party and that Agent has access to such Collateral. Each applicable Loan
Party Obligor will keep at all times in full force and effect, and will comply at all times with all the terms of, any lease of
real property where any of the Collateral now or in the future may be located.

 

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7.4.        Accounts and
Chattel Paper. As of each date reported by Borrowers, all Accounts which any Borrower has then reported to Agent as then being
Eligible Accounts comply in all respects with the criteria for eligibility set forth in the definition of Eligible Accounts. All
such Accounts, and all Chattel Paper owned by any Loan Party Obligor, are genuine and in all respects what they purport to be,
arise out of a completed, bona fide and unconditional and non-contingent sale and delivery of goods or rendition of services by
a Borrower in the Ordinary Course of Business and in accordance with the terms and conditions of all purchase orders, contracts
or other documents relating thereto, each Account Debtor thereunder had the capacity to contract at the time any contract or other
document giving rise to such Accounts and Chattel Paper were executed, and the transactions giving rise to such Accounts and Chattel
Paper comply with all applicable laws and governmental rules and regulations.

 

7.5.        Electronic
Chattel Paper. To the extent that any Loan Party Obligor obtains or maintains any Electronic Chattel Paper, such Loan Party
Obligor shall at all times create, store and assign the record or records comprising the Electronic Chattel Paper in such a manner
that (a) a single authoritative copy of the record or records exists which is unique, identifiable and except as otherwise provided
below, unalterable, (b) the authoritative copy identifies Agent as the assignee of the record or records, (c) the authoritative
copy is communicated to and maintained by Agent or its designated custodian, (d) copies or revisions that add or change an identified
assignee of the authoritative copy can only be made with the participation of Agent, (e) each copy of the authoritative copy and
any copy of a copy is readily identifiable as a copy that is not the authoritative copy and (f) any revision of the authoritative
copy is readily identifiable as an authorized or unauthorized revision.

 

7.6.       Capitalization;
Investment Property.

 

(a)        No
Loan Party, directly or indirectly, owns, or shall at any time own, any capital stock or other equity interests of any other Person
except as set forth in Sections 1(f) and 1(g) of the Perfection Certificate, which Sections list all Investment Property owned
by each Loan Party Obligor.

 

(b)        None
of the Pledged Equity has been issued or otherwise transferred in violation of the Securities Act, or other applicable laws of
any jurisdiction to which such issuance or transfer may be subject. The Pledged Equity pledged by each Loan Party Obligor hereunder
constitutes all of the issued and outstanding equity interests of each Issuer owned by such Loan Party Obligor, other than to the
extent such Pledged Equity is a controlled foreign corporation in which case such Pledged Equity constitutes 65% of the issued
and outstanding equity interests of such Issuer.

 

(c)        All
of the Pledged Equity has been duly and validly issued and is fully paid and non-assessable, and the holders thereof are not entitled
to any preemptive, first refusal or other similar rights. There are no outstanding options, warrants or similar agreements, documents,
or instruments with respect to any of the Pledged Equity except in favor of the Term Loan Agent.

 

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(d)        Each
Loan Party Obligor has caused each Issuer to amend or otherwise modify its Governing Documents, books, records, and related agreements,
documents and instruments, as applicable, to reflect the rights and interests of the Term Loan Agent, and to the extent required
to enable and empower Term Loan Agent to exercise and enforce its rights and remedies hereunder in respect of the Pledged Equity
and other Investment Property.

 

(e)        Each
Loan Party Obligor will take any and all actions required or requested by Agent, from time to time, to (i) cause Agent to obtain
exclusive control of any Investment Property that is ABL Priority Collateral in a manner reasonably acceptable to Agent and (ii)
obtain from any Issuers and such other Persons as Agent shall specify, for the benefit of Agent, written confirmation of Agent's
exclusive control over such Investment Property that is ABL Priority Collateral and take such other actions as Agent may request
to perfect Agent's security interest in any Investment Property that is ABL Priority Collateral. For purposes of this Section 7.6,
Term Loan Agent shall have exclusive control of Investment Property if (A) pursuant to Section 5.2, such Investment Property consists
of certificated securities and the applicable Loan Party Obligor delivers such certificated securities to Term Loan Agent (with
all appropriate endorsements), (B) such Investment Property consists of uncertificated securities and either (x) the applicable
Loan Party Obligor delivers such uncertificated securities to Term Loan Agent or (y) the Issuer thereof agrees, pursuant to documentation
in form and substance reasonably satisfactory to Term Loan Agent, that it will comply with instructions originated by Term Loan
Agent without further consent by the applicable Loan Party Obligor and (C) such Investment Property consists of security entitlements
and either (x) Term Loan Agent becomes the entitlement holder thereof or (y) the appropriate securities intermediary agrees, pursuant
to documentation in form and substance reasonably satisfactory to Term Loan Agent, that it will comply with entitlement orders
originated by Term Loan Agent without further consent by the applicable Loan Party Obligor. Each Loan Party Obligor that is a limited
liability company or a partnership hereby represents and warrants that it has not elected, and at no time will, elect pursuant
to the provisions of Section 8-103 of the UCC to provide that its equity interests are securities governed by Article 8 of the
UCC or make a similar election under the laws of any other jurisdiction.

 

(f)        No Loan Party owns,
or has any present intention of acquiring, any "margin security" or any "margin stock"
within the meaning of Regulations T, U or X of the Board of Governors of the Federal Reserve System (herein called "margin
security" and "margin stock"). None of the proceeds of the Loans will be used, directly or
indirectly, for the purpose of purchasing or carrying, or for the purpose of reducing or retiring any Indebtedness which was originally
incurred to purchase or carry, any margin security or margin stock or for any other purpose which might constitute the transactions
contemplated hereby a "purpose credit" within the meaning of said Regulations T, U or X, or cause this
Agreement to violate any other regulation of the Board of Governors of the Federal Reserve System or the Exchange Act, or any
rules or regulations promulgated under such statutes.

 

(g)        No
Loan Party Obligor shall vote to enable, or take any other action to cause or to permit, any Issuer to issue any equity interests
of any nature, or to issue any other securities or interests convertible into or granting the right to purchase or exchange for
any equity interests of any nature of any Issuer.

 

(h)        No
Loan Party Obligor shall take, or fail to take, any action that would in any manner impair the value or the enforceability of Term
Loan Agent's Lien on any of the Investment Property, or any of Term Loan Agent's rights or remedies under this Term Loan Documents
with respect to any of the Investment Property.

 

(i)        In
the case of any Loan Party Obligor which is an Issuer, such Issuer agrees that the terms of Section 11.3(g)(iii) shall apply to
such Loan Party Obligor with respect to all actions that may be required of it pursuant to such Section
11.3(g)(iii) regarding the Investment Property issued by it.

 

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(j)        Each
Loan Party Obligor has made all capital contributions heretofore required to be made to the respective Issuer in respect of any
Investment Property constituting limited liability company interests and no additional capital contributions are required to be
made in respect of the respective limited liability company interests.

 

7.7.        Commercial
Tort Claims. No Loan Party Obligor has any Commercial Tort Claims in excess of $100,000 pending other than those listed in
Section 2 of the Perfection Certificate, and each Loan Party Obligor shall promptly (but in any case, no later than five Business
Days thereafter) notify Agent in writing upon incurring or otherwise obtaining a Commercial Tort Claim after the date hereof against
any third party. Such notice shall constitute such Loan Party Obligor's authorization to amend such Section 2 to add such Commercial
Tort Claim and shall automatically be deemed to amend such Section 2 to include such Commercial Tort Claim.

 

7.8.        Jurisdiction
of Organization; Location of Collateral. Sections 1(c) and 1(d) of the Perfection Certificate set forth (a) each place of
business of each Loan Party Obligor (including its chief executive office), (b) all locations where all Inventory, Equipment,
and other Collateral owned by each Loan Party Obligor is kept and (c) whether each such Collateral location and place of business
(including each Loan Party Obligor's chief executive office) is owned by a Loan Party or leased (and if leased, specifies the
complete name and notice address of each lessor). Except as permitted by Section 6.7(b), no Collateral is located outside the
United States or Canada or in the possession of any lessor, bailee, warehouseman or consignee, except as expressly indicated in
Sections 1(c) and 1(d) of the Perfection Certificate. Each Loan Party Obligor will give Agent at least thirty (30) days' prior
written notice before changing its jurisdiction of organization, opening any additional place of business, changing its chief
executive office or the location of its books and records, or, subject to Section 6.7(b) moving any of the Collateral to a location
other than one of the locations set forth in Sections 1(c) and 1(d) of the Perfection Certificate, and will execute and deliver
all Financing Statements, landlord waivers, collateral access agreements, mortgages, and all other agreements, instruments and
documents which Agent shall require in connection therewith prior to making such change, all in form and substance reasonably
satisfactory to Agent. Without the prior written consent of Agent, no Loan Party Obligor will at any time (i) change its jurisdiction
of organization or (ii) allow any Collateral to be located outside of the continental United States of America or Canada.

 

7.9.        Financial
Statements and Reports; Solvency.

 

(a)        All
financial statements delivered to Agent and Lenders by or on behalf of any Loan Party have been, and at all times will be, prepared
in conformity with GAAP and completely and fairly reflect the financial condition of each Loan Party covered thereby, at the times
and for the periods therein stated.

 

(b)       As
of the date hereof (after giving effect to the Loans to be made on the date hereof, and the consummation of the transactions contemplated
hereby), and as of each other day that any Loan is made (after giving effect thereof), (i) the fair saleable value of all of the
assets and properties of each Loan Party, individually, exceeds the aggregate liabilities and Indebtedness of each such Loan Party
(including contingent liabilities), (ii) each Loan Party, individually, is solvent and able to pay its debts as they come due,
(iii) each Loan Party, individually, has sufficient capital to carry on its business as now conducted and as proposed to be conducted,
(iv) no Loan Party is contemplating either the liquidation of all or any substantial portion of its assets or property, or the
filing of any petition under any state, federal, or other bankruptcy or insolvency law and (v) no Loan Party has knowledge of any
Person contemplating the filing of any such petition against any Loan Party.

 

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7.10.        Tax Returns
and Payments; Pension Contributions. Each Loan Party has filed all Canadian and U.S. federal, provincial, state and material
local and foreign tax returns and other reports that it is required by law to file, and has paid, or made provision for the payment
of, all Taxes upon it, its income and its Properties that are due and payable, except to the extent being Properly Contested.
The provision for Taxes on the books of each Obligor and Subsidiary is adequate for all years not closed by applicable statutes,
and for its current Fiscal Year. Each Plan is in compliance in all material respects with the applicable provisions of ERISA,
the Code and other applicable laws. Each Plan that is intended to be a qualified plan under Section 401(a) of the Code has received
a favorable determination letter or opinion letter from the Internal Revenue Service to the effect that the form of such Plan
is qualified under Section 401(a) of the Code and the trust related thereto has been determined by the Internal Revenue Service
to be exempt from federal income tax under Section 501(a) of the Code, or an application for such a letter is currently being
processed by the Internal Revenue Service. To the best knowledge of each Loan Party, nothing has occurred that would prevent or
cause the loss of such tax-qualified status. There are no pending or, to the best knowledge of any Loan Party, threatened claims,
actions or lawsuits, or action by any Governmental Authority, with respect to any Plan that could reasonably be expected to result
in liabilities individually or in the aggregate in excess of $250,000 of any Loan Party. There has been no prohibited transaction
or violation of the fiduciary responsibility rules with respect to any Plan that has resulted or could reasonably be expected
to result in liabilities individually or in the aggregate of any Loan Party in excess of $250,000. No ERISA Event has occurred,
and no Loan Party is aware of any fact, event or circumstance that could reasonably be expected to constitute or result in an
ERISA Event with respect to any Pension Plan, in each case that could reasonably be expected to result in liabilities individually
or in the aggregate in excess of $250,000. Each Loan Party and each ERISA Affiliate has met all applicable requirements under
the Pension Funding Rules in respect of each Pension Plan, and no waiver of the minimum funding standards under the Pension Funding
Rules has been applied for or obtained, in each case except as could not reasonably be expected to result in liabilities individually
or in the aggregate to the Loan Parties in excess of $250,000. As of the most recent valuation date for any Pension Plan, the
funding target attainment percentage (as defined in Section 430(d)(2) of the Code) is sixty (60%) or higher and no Loan Party
knows of any facts or circumstances that could reasonably be expected to cause the funding target attainment percentage for any
such plan to drop below sixty (60%) as of the most recent valuation date. No Loan Party or any ERISA Affiliate has incurred any
liability to the PBGC other than for the payment of premiums, and there are no premium payments which have become due that are
unpaid, except as could not reasonably be expected to result in liabilities individually or in the aggregate to the Loan Parties
in excess of $250,000. No Loan Party or any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069
or Section 4212(c) of ERISA except as could not reasonably be expected to result in liabilities individually or in the aggregate
to the Loan Parties in excess of $250,000. No Pension Plan has been terminated by the plan administrator thereof or by the PBGC,
and no event or circumstance has occurred or exists that could reasonably be expected to cause the PBGC to institute proceedings
under Title IV of ERISA to terminate any Pension Plan, except as could not reasonably be expected to result in liabilities individually
or in the aggregate to the Loan Parties in excess of $250,000.

 

7.11.       Compliance
with Laws; Intellectual Property; Licenses.

 

(a)        Each
Loan Party has complied, and will continue at all times to comply (a) in all material respects with applicable laws and regulations
governing the payment and withholding of Taxes, ERISA, safety and environmental matters, and (b) with other applicable laws and
regulations relating to the ownership of real or personal property, the conduct and licensing of each Loan Party's business and
other employee matters except where noncompliance could not reasonably be expected to have a Material Adverse Effect.

 

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(b)        No
Loan Party has received written notice of default or violation, or is in default or violation, with respect to any material judgment,
order, writ, injunction, decree, demand or assessment issued by any court or any federal, state, local, municipal or other Governmental
Authority relating to any aspect of any Loan Party's business, affairs, properties or assets. No Loan Party has received written
notice of or been charged with, or is, to the knowledge of any Loan Party, under investigation with respect to, any violation of
any material and applicable law.

 

(c)        To
the Loan Parties’ knowledge, each Loan Party owns or has the lawful right to use all Intellectual Property necessary for
the conduct of its business, without conflict with any rights of others. There is no pending or, to any Loan Party’s knowledge,
threatened Intellectual Property Claim with respect to any Obligor, any Subsidiary or any of its Property (including any Intellectual
Property). Except as disclosed on Section 4 of the Perfection Certificate, no Loan Party pays or owes any Royalty or other compensation
to any Person with respect to any material Intellectual Property. All Intellectual Property that is licensed by or is subject to
a pending application or current registration that is owned by any Obligor or Subsidiary is shown on Section 4 of the Perfection
Certificate. To any Loan Party’s knowledge, there is no third party Intellectual Property licensed to a Loan Party that is
necessary for, or critical to, the manufacture, sale or distribution of any products or services of any Obligor, and no licensed
third party Intellectual Property is necessary for Agent to exercise its rights to enforce Agent’s Liens with respect to
the ABL Priority Collateral, including the right to dispose of it, in the event of an Event of Default.

 

(d)        Each
Loan Party has and will continue at all times to have, all federal, state, provincial, local and other licenses and permits required
to be maintained in connection with such Loan Party's business operations, and all such licenses and permits are valid and in full
force and effect. Each Loan Party has, and will continue at all times to have, complied with the requirements of such licenses
and permits in all material respects, except where the failure to comply could not reasonably be expected to have a Material Adverse
Effect, and as of the Closing Date has received no written notice of any pending or threatened proceedings for the suspension,
termination, revocation or limitation thereof. No Loan Party is aware of any facts or conditions that could reasonably be expected
to cause or permit any of such licenses or permits to be voided, revoked or withdrawn.

 

7.12.        Litigation.
Section 1(e) of the Perfection Certificate discloses all claims, proceedings, litigation or investigations pending or (to the
best of each Loan Party Obligor's knowledge) threatened against any Loan Party as of the Closing Date. There is no claim, suit,
litigation, proceeding or investigation pending or (to the best of each Loan Party Obligor's knowledge) threatened by or against
or affecting any Loan Party in any court or before any Governmental Authority (or any basis therefor known to any Loan Party Obligor)
which may result, either separately or in the aggregate, in liability in excess of $500,000 (to the extent not covered by insurance)
for the Loan Parties, in any Material Adverse Effect, or in any material impairment in the ability of any Loan Party to carry
on its business in substantially the same manner as it is now being conducted.

 

7.13.        Use of Proceeds.
All proceeds of all Loans shall be used by Borrowers solely (a) with respect to Loans made on the Closing Date, to repay in full
its indebtedness owing to Bank of America, NA pursuant to the Existing ABL Agreement, (b) to pay the fees, costs, and expenses
incurred in connection with this Agreement, the other Loan Documents and the transactions contemplated hereby and thereby, (c)
for Borrowers’ working capital purposes and (d) for such other purposes as specifically permitted pursuant to the terms
of this Agreement. All proceeds of all Loans will be used solely for lawful business purposes.

 

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7.14.
         Insurance.

 

(a)        Each
Loan Party will at all times carry property, liability and other insurance, with insurers reasonably acceptable to Agent, in such
form and amounts, and with such deductibles and other provisions, as Agent shall reasonably require, but in any event, in such
amounts and against such risks as is usually carried by companies engaged in similar business and owning similar properties in
the same general areas in which such Loan Party operates, and each Borrower will provide Agent with evidence reasonably satisfactory
to Agent that such insurance is, at all times, in full force and effect. A true and complete listing of such insurance as of the
Closing Date, including issuers, coverages and deductibles, is set forth in Section 5 of the Perfection Certificate. Each property
insurance policy shall name Agent as lender loss payee and mortgagee, if applicable, and shall contain a lender's loss payable
endorsement, and a mortgage endorsement, if applicable, and each liability insurance policy shall name Agent as an additional insured,
and each business interruption insurance policy shall be collaterally assigned to Agent, all in form and substance reasonably satisfactory
to Agent. All policies of insurance shall provide that they may not be cancelled or changed without at least thirty (30) days'
(or, with respect to nonpayment of premiums, ten (10) days’) prior written notice to Agent, and shall otherwise be in form
and substance reasonably satisfactory to Agent. Borrower Representative shall advise Agent promptly of any policy cancellation,
non-renewal, reduction, or material amendment with respect to any insurance policies maintained by any Loan Party or any receipt
by any Loan Party of any notice from any insurance carrier regarding any intended or threatened cancellation, non-renewal, reduction
or material amendment of any of such policies, and Borrower Representative shall promptly deliver to Agent copies of all notices
and related documentation received by any Loan Party in connection with the same.

 

(b)        Borrower
Representative shall deliver to Agent no later than fifteen (15) days prior to the expiration of any then current insurance policies,
insurance certificates evidencing renewal of all such insurance policies required by this Section 7.14. Borrower Representative
shall deliver to Agent, upon Agent 's request, certificates evidencing such insurance coverage in such form as Agent shall specify.

 

(c)        IF ANY LOAN PARTY
AT ANY TIME OR TIMES HEREAFTER SHALL FAIL TO OBTAIN OR MAINTAIN ANY OF THE POLICIES OF INSURANCE REQUIRED ABOVE (AND PROVIDE EVIDENCE
THEREOF TO AGENT) OR TO PAY ANY PREMIUM RELATING THERETO, THEN AGENT, WITHOUT WAIVING OR RELEASING ANY OBLIGATION OR DEFAULT BY
ANY BORROWER HEREUNDER, MAY (BUT SHALL BE UNDER NO OBLIGATION TO) OBTAIN AND MAINTAIN SUCH POLICIES OF INSURANCE AND PAY SUCH
PREMIUMS AND TAKE SUCH OTHER ACTIONS WITH RESPECT THERETO AS AGENT DEEMS ADVISABLE UPON NOTICE TO BORROWER REPRESENTATIVE. SUCH
INSURANCE, IF OBTAINED BY AGENT, MAY, BUT NEED NOT, PROTECT ANY LOAN PARTY'S INTERESTS OR PAY ANY CLAIM MADE BY OR AGAINST ANY
LOAN PARTY WITH RESPECT TO THE COLLATERAL. SUCH INSURANCE MAY BE MORE EXPENSIVE THAN THE COST OF INSURANCE ANY LOAN PARTY MAY
BE ABLE TO OBTAIN ON ITS OWN AND MAY BE CANCELLED ONLY UPON THE APPLICABLE LOAN PARTY PROVIDING EVIDENCE THAT IT HAS OBTAINED
THE INSURANCE AS REQUIRED ABOVE. ALL SUMS DISBURSED BY AGENT IN CONNECTION WITH ANY SUCH ACTIONS, INCLUDING COURT COSTS, EXPENSES,
OTHER CHARGES RELATING THERETO AND REASONABLE INTERNAL AND EXTERNAL ATTORNEY COSTS, SHALL CONSTITUTE LOANS HEREUNDER, SHALL BE
PAYABLE ON DEMAND BY BORROWERS TO AGENT AND, UNTIL PAID, SHALL BEAR INTEREST AT THE HIGHEST RATE THEN APPLICABLE TO LOANS HEREUNDER.

 

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7.15.        Financial,
Collateral and Other Reporting / Notices. Each Loan Party has kept, and will at all times keep, adequate records and books
of account with respect to its business activities and the Collateral in which proper entries are made in accordance with GAAP
reflecting all its financial transactions. The information provided in the Perfection Certificate is correct and complete in all
respects. Each Loan Party Obligor will cause to be prepared and furnished to Agent, in each case in a form and in such detail
as is acceptable to Agent the following items (the items to be provided under this Section 7.15 shall be delivered to Agent by
posting on ABLSoft or, if requested by Agent, by another form of Approved Electronic Communication or in writing):

 

(a)        Annual Financial
Statements. Not later than one hundred twenty (120) days after the close of each Fiscal Year, unqualified, audited consolidated
financial statements of the Loan Parties as of the end of such Fiscal Year, including balance sheet, income statement, and statement
of cash flow for such Fiscal Year, in each case on a consolidated and consolidating basis, certified by a firm of independent
certified public accountants of recognized standing selected by Borrowers but acceptable to Agent, together with a copy of any
management letter issued in connection therewith. Concurrently with the delivery of such financial statements, Borrower Representative
shall deliver to Agent a Compliance Certificate, indicating whether (i) Borrowers are in compliance with each of the covenants
specified in Section 9, and setting forth a detailed calculation of such covenants and (ii) any Default or Event of Default is
then in existence;

 

(b)        Interim Financial
Statements. Not later than thirty (30) days after the end of each month hereafter, but within 45 days after the last month
of each Fiscal Year, unaudited consolidated and consolidating financial statements of the Loan Parties as of the end of such month
and of the portion of such Fiscal Year then elapsed, including balance sheet, income statement, statement of cash flow, and results
of their respective operations during such month and the then- elapsed portion of the Fiscal Year, together with comparative figures
for the same periods in the immediately preceding Fiscal Year and the corresponding figures from the budget for the Fiscal Year
covered by such financial statements, in each case on a consolidated and consolidating basis, certified by the principal financial
officer of Borrower Representative as prepared in accordance with GAAP and fairly presenting the consolidated financial position
and results of operations (including management discussion and analysis of such results) of each Loan Party for such month and
period subject only to changes from ordinary course year-end audit adjustments and except that such statements need not contain
footnotes. Concurrently with the delivery of such financial statements, Borrower Representative shall deliver to Agent a Compliance
Certificate, indicating whether (i) Borrowers are in compliance with each of the covenants specified in Section 9, and setting
forth a detailed calculation of such covenants, and (ii) any Default or Event of Default is then in existence;

 

(c)        Borrowing Base
/ Collateral Reports / Insurance Certificates / Perfection Certificates / Other Items. The items described on Annex II hereto
by the respective dates set forth therein.

 

(d)        Projections,
Etc. Not later than thirty (30) days after the end of each Fiscal Year, monthly business projections for the following Fiscal
Year for the Loan Parties on a consolidated and consolidating basis, which projections shall include for each such period Borrowing
Base projections, profit and loss projections, balance sheet projections, income statement projections and cash flow projections;

 

(e)        Shareholder Reports,
Etc. Promptly after the sending or filing thereof, as the case may be, copies of any proxy statements, financial statements
or reports which each Loan Party has made available to its shareholders and copies of any regular, periodic and special reports
or registration statements which any Loan Party files with the Securities and Exchange Commission or any Governmental Authority
which may be substituted therefor, or any national securities exchange;

 

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(f)        ERISA Reports.
Copies of any annual report to be filed pursuant to the requirements of ERISA in connection with each plan subject thereto promptly
upon request by Agent and in addition, each Loan Party shall promptly notify Agent upon having knowledge of any ERISA Event; and

 

(g)        Tax Returns.
Each federal, state and provincial income tax return filed by any Loan Party or Other Obligor promptly (but in no event later
than ten days following the filing of such return), together with such supporting documentation as is supplied to the applicable
tax authority with such return and proof of payment of any amounts owing with respect to such return.

 

(h)        Notification
of Certain Changes. Promptly (and in no case later than the earlier of (i) three Business Days after a Loan Party obtaining
knowledge the occurrence of any of the following and (ii) such other date that such information is required to be delivered pursuant
to this Agreement or any other Loan Document) notification to Agent in writing of (A) the occurrence of any Default or Event of
Default, (B) the occurrence of any event that has had, or may have, a Material Adverse Effect, (C) any change in any Loan Party's
officers or directors, (D) any investigation, action, suit, proceeding or claim (or any material development with respect to any
existing investigation, action, suit, proceeding or claim) relating to any Loan Party, any officer or director of a Loan Party,
the Collateral or which may result in a Material Adverse Effect, (E) any material loss or damage to the Collateral, (F) any event
or the existence of any circumstance that has resulted in, or could reasonably be expected to result in, a Material Adverse Effect,
any Default, or any Event of Default, or which would make any representation or warranty previously made by any Loan Party to
Agent untrue in any material respect or constitute a material breach if such representation or warranty was then being made, (G)
any actual or alleged breaches of any Material Contract or termination or threat to terminate any Material Contract or any material
amendment to or modification of a Material Contract, or the execution of any new Material Contract by any Loan Party and (H) any
change in any Loan Party's certified independent accountant. In the event of each such notice under this Section 7.15(h), Borrower
Representative shall give notice to Agent of the action or actions that each Loan Party has taken, is taking, or proposes to take
with respect to the event or events giving rise to such notice obligation.

 

(i)        Other Information.
Promptly upon request, such other data and information (financial and otherwise) as Agent, from time to time, may reasonably request,
bearing upon or related to the Collateral or each Loan Party's and each Other Obligor's business or financial condition or results
of operations.

 

(j)        Notices Under
Material Contracts. Promptly upon any delivery to Loan Party or any of their Subsidiaries of any material notices under any
Material Contract, a written statement describing such event, with copies of such amendments, notices or new contracts, delivered
to Agent, and a description of any actions being taken pursuant thereto.

 

(k)        Notices Relating
to Term Loan Facility. Promptly after any Loan Party Obligor knows or has reason to know that any Default or Event of Default
has occurred and is continuing, any “Default” or “Event of Default” under and as defined in any Term Loan
Documents has occurred and is continuing occurred, but in any event not later than five (5) Business Days after any Loan Party
Obligor becomes aware thereof, a notice from the Borrower Representative of such Default, Event of Default, “Default”,
 “Event of Default” describing the same in reasonable detail and a description of the action that the Loan Party Obligors
have taken and propose to take with respect thereto.

 

7.16.        Litigation
Cooperation. Should any third-party suit, regulatory action, or any other judicial, administrative, or similar proceeding
be instituted by or against Agent or any Lender with respect to any Collateral or in any manner relating to any Loan Party, this
Agreement, any other Loan Document or the transactions contemplated hereby, each Loan Party Obligor shall, without expense to
Agent or any Lender, make available each Loan Party, such Loan Party's officers, employees and agents, and any Loan Party's books
and records, without charge, to the extent that Agent or such Lender may deem them reasonably necessary in order to prosecute
or defend any such suit or proceeding.

 

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7.17.        Maintenance
of Collateral, Etc. Each Loan Party Obligor will maintain all of the Collateral in good working condition, ordinary wear and
tear excepted, and no Loan Party Obligor will use the Collateral for any unlawful purpose.

 

7.18.        Material
Contracts. No Loan Party is a party to a Material Contract except as set forth on Schedule 7.18. The Material Contracts listed
on Schedule 7.18 are in full force and effect and there are no events of thereunder or, to the knowledge of the Loan Parties,
any event which with notice or passage of time, or both, would constitute and event of default thereunder.

 

7.19.        No Default.
No Default or Event of Default has occurred and is continuing.

 

7.20.        No Material
Adverse Change. Since December 31, 2018 there has been no material adverse change in the financial condition, business, operations,
or properties of any Loan Party or any Other Obligor.

 

7.21.        Full Disclosure.
Excluding projections and other forward-looking information, pro forma financial information and information of a general economic
or industry nature, no report, notice, certificate, information or other statement delivered or made (including, in electronic
form) by or on behalf of any Loan Party, any Other Obligor or any of their respective Affiliates to Agent or Lender in connection
with this Agreement or any other Loan Document contains or will at any time contain any untrue statement of a material fact, or
omits or will at any time omit to state any material fact necessary to make any statements contained herein or therein not misleading.
Except for matters of a general economic or political nature which do not affect any Loan Party or any Other Obligor uniquely,
there is no fact presently known to any Loan Party Obligor which has not been disclosed to Agent, which has had or could reasonably
be expected to have, individually or in the aggregate, a Material Adverse Effect. Any projections and other forward-looking information
and pro forma financial information contained in such materials were prepared in good faith based upon assumptions that were believed
by such Loan Party to be reasonable at the time prepared and at the time furnished in light of conditions and facts then known
(it being recognized that such projections and other forward-looking information and pro forma financial information are not to
be viewed as facts and that actual results during the period or periods covered by any such projections or information may differ
from the projected results, and such differences may be material).

 

7.22.        Sensitive
Payments. No Loan Party (a) has made or will at any time make any contributions, payments or gifts to or for the private use
of any governmental official, employee or agent where either the payment or the purpose of such contribution, payment or gift
is illegal under the applicable laws of the United States or the jurisdiction in which made or any other applicable jurisdiction,
(b) has established or maintained or will at any time establish or maintain any unrecorded fund or asset for any purpose or made
any false or artificial entries on its books, (c) has made or will at any time make any payments to any Person with the intention
that any part of such payment was to be used for any purpose other than that described in the documents supporting the payment
or (d) has engaged in or will at any time engage in any "trading with the enemy" or other transactions
violating any rules or regulations of the Office of Foreign Assets Control or any similar applicable laws, rules or regulations.

 

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7.23.        Holdings.
Holdings shall not: (a) engage in any activities other than acting as a holding company and transactions incidental thereto, maintaining
its corporate existence, and entering into and performing its obligations under the Loan Documents, the Term Loan Documents and
the HHG Note; (b) hold any assets other than (i) all of the issued and outstanding equity interests of any Borrower, (ii) contractual
rights pursuant to the Loan Documents, Term Loan Documents, and (iii) cash in an amount not to exceed the amount required for
the purpose of promptly paying general operating expenses (including audit fees, reasonable and customary director and officer
compensation and indemnification obligations pursuant to its Governing Documents); and (c) incur any liabilities other than under
the Loan Documents, under the Term Loan Documents and obligations incurred in the Ordinary Course of Business related to its existence,
including Taxes, franchise or other entity existence taxes and fees payable to its state of incorporation or organization, payment
of reasonable and customary director fees and expenses, and indemnification obligations pursuant to its Governing Documents.

 

7.24.        Term Loan
Facility.

 

(a)        Borrower
Representative has furnished Agent a true, correct and complete copy of each of the Term Loan Documents. No statement or representation
made in any of the Term Loan Documents by any Loan Party Obligor or, to any Borrower Representative 's knowledge, any other Person,
contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary
in order to make the statements made therein, in light of the circumstances under which they are made, not misleading in any material
respect as of the time that such statement or representation is made.

 

(b)        As
of the Closing Date, neither Ultimate Parent, Investment Corp. nor any of their respective direct or indirect Subsidiaries other
than the Loan Party Obligors (i) are borrowers or guarantors of the Term Loan Facility or (ii) have granted any Liens to the Term
Loan Agent on any or their assets. Loan Party Obligors agree that, if after the Closing Date, Ultimate Parent, Investment Corp.
or any of their respective direct or indirect Subsidiaries other than the Loan Party Obligors (i) become borrowers or guarantors
in respect of the Term Loan Facility or (ii) grant any Liens to the Term Loan Agent, such Persons shall promptly agree to become
Loan Party Obligors under this Agreement and grant Liens to the Lenders and the Agent in such assets of such Persons in which the
Term Loan Agent are so granted a Lien (such assets, the “New Collateral”), in each case, subject to the lien priorities
described below, on the same terms as such Persons become borrowers or guarantors and grant Liens in respect of the Term Loan Facility
and in a manner consistent with the terms of the Intercreditor Agreement; provided, that, for the avoidance of doubt, the obligations
of the Loan Party Obligors under this sentence shall be deemed satisfied if (x) the Liens granted to the Agent and the Lenders
in all such New Collateral are subordinated to the Liens granted to the Term Loan Agent in respect of such New Collateral in a
manner consistent with the Intercreditor Agreement and (y) the priority of the Liens granted to the Term Loan Agent, the Agent
and the Lenders in such New Collateral are consistent with the lien priorities set forth in the Intercreditor Agreement as though
all such New Collateral were deemed “Term Loan Priority Collateral” under the Intercreditor Agreement.

 

(c)        For all purposes
of the Loan Agreement, the other Loan Documents and the Intercreditor Agreement (including, without limitation, Section 10.1(l)
of the Loan Agreement), Agent and the Lenders hereby (i) acknowledge the entry by the Obligors, the Term Loan Agent, Ultimate
Parent and Investment Corp. into that certain Side Letter Agreement, dated as of March 15, 2019 (the “Term Loan Side
Letter Agreement”), (ii) acknowledge the potential consummation of each of the transactions contemplated by the
Term Loan Side Letter Agreement at a future date, and (iii) acknowledge that the Obligors shall not be required to comply with
the provisions of Section 7.24(b) of this Agreement in connection with any of the matters or transactions described in the Term
Loan Side Letter Agreement until, if ever, such transactions are consummated, and if so, in a manner consistent with the last
sentence of Section 7.24(b) and the Intercreditor Agreement.

 

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(d)        The
provisions of the Intercreditor Agreement are enforceable against the Term Loan Agent each holder of the Term Loan Obligations.
Each Loan Party Obligor acknowledges that Agent is entering into this Agreement and extending credit and making the Loans in reliance
upon the Intercreditor Agreement and this Section 7.24.

 

7.25.         Subordinated
Debt; HHG Note.

 

(a)        Borrower
Representative has furnished Agent a true, correct and complete copy of each of the Subordinated Debt Documents and the HHG Note.
No statement or representation made in any of the Subordinated Debt Documents by any Borrower or any other Loan Party or, to any
Borrower Representative 's knowledge, any other Person, contains any untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances
under which they are made, not misleading in any material respect as of the time that such statement or representation is made.
Each of the representations and warranties of the Loan Parties set forth in each of the Subordinated Debt Documents and the HHG
Note are true and correct in all respects. No portion of the Subordinated Debt is, or at any time shall be, (i) secured by any
assets of any of the Loan Parties or any other Person or any equity issued by any of the Loan Parties or any other Person or (ii)
guaranteed by any Person (except to the extent expressly permitted by the applicable Subordinated Debt Subordination Agreement).

 

(b)        The
provisions of the applicable Subordinated Debt Subordination Agreement and the HHG Subordination Agreement are enforceable against
each holder of the applicable Subordinated Debt and the HHG Note. Each Borrower and each other Loan Party Obligor acknowledges
that Agent is entering into this Agreement and extending credit and making the Loans in reliance upon the Subordinated Debt Subordination
Agreement, the HHG Note Subordination Agreement and this Section 7.25. All Obligations constitute senior Indebtedness entitled
to the benefits of the subordination provisions contained in the applicable Subordinated Debt Documents and the HHG Note Subordination
Agreement and the applicable Subordinated Debt Subordination Agreement and the HHG Subordination Agreement.

 

7.26.        Access to
Collateral, Books and Records/Retention of Conway MacKenzie. At reasonable times, Agent and its representatives or agents
shall have the right to inspect the Collateral and to examine and copy each Loan Party's books and records. Each Loan Party Obligor
agrees to give Agent access to any or all of such Loan Party Obligor's, and each of its Subsidiaries', premises to enable Agent
to conduct such inspections and examinations. Such inspections and examinations shall be at Borrowers’ expense and the charge
therefor shall be $1200 per person per day (or such higher amount as shall represent Agent's then current standard charge), plus
out-of-pocket expenses. Agent may, at Borrowers’ expense, use each Loan Party's personnel, computer and other equipment,
programs, printed output and computer readable media, supplies and premises for the collection, sale or other disposition of Collateral
to the extent Agent, in its sole discretion, deems appropriate. Each Loan Party Obligor hereby irrevocably authorizes all accountants
and third parties to disclose and deliver to Agent, at Borrowers’ expense, all financial information, books and records,
work papers, management reports and other information in their possession regarding the Loan Parties. The foregoing notwithstanding,
so long as no Event of Default has occurred and is continuing, the Loan Parties’ obligation to reimburse Agent for any such
visit, inspection and/or examination shall be limited to two such occurrences in any four consecutive fiscal quarter period. Loan
Party Obligors shall continue to engage the consulting firm of Conway MacKenzie through the earlier of (i) the end of third quarter
of Fiscal Year 2019 or (ii) the date Agent specifies that certain U.S. inventory and accounts receivable aging reporting issues
have been resolved to Agent’s satisfaction in its Permitted Discretion.

 

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7.27.        Appraisals.
Each Loan Party Obligor will permit Agent and each of its representatives or agents to conduct appraisals and valuations of the
ABL Priority Collateral at such times and intervals as Agent may designate (including any appraisals that may be required to comply
with FIRREA). Such appraisals and valuations shall be at Borrowers’ expense, provided, however, so long as no Event of Default
has occurred and is continuing, the Loan Parties’ obligation to reimburse Agent for any such appraisal\valuation shall be
limited to three appraisals\valuations in any four consecutive fiscal quarter period.

 

7.28.        Lender Meetings.
Upon the request of any Agent or the Required Lenders (which request, so long as no Event of Default shall have occurred and be
continuing, shall not be made more than once during each fiscal quarter), participate in a telephonic meeting with the Agents
and the Lenders at such time as may be agreed to by Borrower Representative and such Agent or the Required Lenders.

 

7.29.        Interrelated
Businesses. Loan Parties make up a related organization of various entities constituting a single economic and business enterprise
so that Loan Parties share an identity of interests such that any benefit received by any one of them benefits the others. From
time to time each of the Loan Parties may render services to or for the benefit of the other Loan Parties, purchase or sell and
supply goods to or from or for the benefit of the others, make loans, advances and provide other financial accommodations to or
for the benefit of the other Loan Parties (including inter alia, the payment by such Loan Parties of creditors of the other Loan
Parties and guarantees by such Loan Parties of indebtedness of the other Loan Parties and provides administrative, marketing,
payroll and management services to or for the benefit of the other Loan Parties). Loan Parties have the same centralized accounting
and legal services, certain common officers and directors and generally do not provide stand-alone consolidating financial statements
to creditors.

 

7.30.        Canadian
Benefit Plans. Except where the failure to perform any obligation or make any withholding, collection or payment, as applicable,
could not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect: (a) all obligations
of the Loan Parties (including fiduciary, funding, investment, administration and reporting obligations) required to be performed
by them in connection with the Canadian Benefit Plans and the funding agreements therefor have been performed, (b) all contributions
or premiums required to be made or paid by the Loan Parties to the Canadian Benefit Plans have been made or paid in a timely fashion
in accordance with the terms of such plans and all applicable laws, and (c) all employee contributions to the Canadian Benefit
Plans by way of authorized payroll deduction or otherwise have been properly withheld or collected by the Loan Parties and have
been fully paid into those plans in compliance with the plans and applicable laws. There have been no improper withdrawals or
applications of the assets of the Canadian Benefit Plans. There is no proceeding, action, suit or claim (other than routine claims
for benefits) pending or threatened involving the Canadian Benefit Plans, and no facts exist which could reasonably be expected
to give rise to that type of proceeding, action, suit or claim, except where the outcome thereof could not reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect. No promises of benefit improvements under the Canadian
Benefit Plans by the Loan Parties have been made except where improvement could not have a Material Adverse Effect. The Loan Parties
shall perform all obligations (including fiduciary, funding, investment and administration obligations) required to be performed
in connection with each Canadian Benefit Plan and the funding media therefor; make all contributions and pay all premiums required
to be made or paid by it or them in accordance with the terms of the plan and all applicable laws; and withhold by way of authorized
payroll deductions or otherwise collect and pay into the plan all employee contributions required to be withheld or collected
in accordance with the terms of the plan and all applicable laws.

 

    	 	60	 

     

    

 

7.31.        Canadian
Pension Plans. None of the Loan Parties has any Canadian Pension Plans and none of the Loan Parties shall establish or maintain
a Canadian Pension Plan without the prior written consent of the Agent.

 

7.32.        Post-Closing
Matters. Loan Party Obligors shall satisfy the requirements set forth in Schedule 7.32 on or before the dates specified therein
or such later date to be determined by Agent, at its sole option, each of which shall be completed or provided in form and substance
reasonably satisfactory to Agent. The failure to satisfy any such requirement on or before the date when due (or within such longer
period as Agent may agree at its sole option) shall be an Event of Default, except as otherwise agreed to by Agent at its sole
option.

 

8.        NEGATIVE COVENANTS.
Until the Termination Date, no Loan Party Obligor shall, and no Loan Party Obligor shall permit any other Loan Party to:

 

(a)        Merge,
Divide, or consolidate with another Person, form any new Subsidiary, including by any Division thereof, acquire any interest in
any Person, or wind-up its business operations or cease substantially all or any material portion of its normal business operations,
dissolve or liquidate, except after prior written notice to the Agent, for a merger, amalgamation, combination, consolidation,
liquidation, or dissolution of a Borrower into another Borrower (other than a Borrower that is a U.S. Obligor into a Canadian Obligor
or vice versa), a wholly-owned Subsidiary of a Borrower into another wholly owned Subsidiary of such Borrower (provided that if
any such Person is an Obligor, the Obligor shall be the surviving or continuing entity);

 

(b)        acquire all or a
material portion of the assets or the business of any Person; (c) acquire any assets except in the Ordinary Course of Business
and as otherwise expressly permitted by this Agreement;

 

(d)        substantially
change the nature of the business in which it is presently engaged or enter into any transaction outside the Ordinary Course of
Business that is not expressly permitted by this Agreement;

 

(e)        permit
an Asset Disposition, sell, lease, assign, transfer, return, liquidate, or dispose of any Collateral or other assets with an aggregate
book value in excess of $500,000 in any fiscal year, except that each Loan Party may make a Permitted Asset Disposition;

 

(f)        make any loans to,
or investments in, any Affiliate or other Person in the form of money or other assets; provided, that

 

(i) Borrowers may
make loans and investments in its wholly-owned Subsidiaries that are Loan Party Obligors;

 

(ii) Holdings may make investments in Borrowers;

 

(iii) Loan Party Obligors may make Permitted Intercompany
Loans;

 

(iv) Loan
Party Obligors may make investments consisting of securities of account debtors received pursuant to a plan of reorganization of
such account debtor or in connection with the settlement of such accounts;

 

(v) Loan
Party Obligors may make advances to an officer or employee for salary, travel expenses, commissions and similar items in the Ordinary
Course of Business;

 

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(vi) Loan
Party Obligors may pay prepaid expenses and make extensions of trade credit made in the Ordinary Course of Business;

 

(vii) Loan
Party Obligors may make investments consisting of contributions of capital or asset transfers to Borrowers or Guarantors, so long
as no Change of Control occurs as a result thereof, provided that no Loan Party Obligor that is a U.S. Obligor may make contributions
of capital or asset transfers to Borrowers or Guarantors that are Canadian Obligors except as otherwise provided herein;

 

(viii)
Loan Party Obligors may make investments consisting of securities or instruments received pursuant to a disposition of assets permitted
hereby; and

 

(ix) Loan
Party Obligors may make deposits with financial institutions permitted hereunder;

 

(g)        incur any Indebtedness other than:

 

(i) the
Obligations;

 

(ii) Permitted Indebtedness; and

 

(iii) Indebtedness
of a Loan Party Obligor consisting of obligations under deferred compensation or other similar arrangements for employees entered
into in the Ordinary Course of Business.

 

(h)        create,
incur, assume or suffer to exist any Lien or other encumbrance of any nature whatsoever or authorize under the UCC or PPSA of any
jurisdiction a Financing Statement naming the Loan Party as debtor, or execute any Security Agreement authorizing any secured party
thereunder to file such Financing Statement, other than in favor of Agent to secure the Obligations, on any of its assets whether
now or hereafter owned, and Permitted Liens;

 

(i)        authorize,
enter into, or execute any agreement giving a Secured Party control of a (i) Deposit Account as contemplated by Section 9-104 of
the UCC or (ii) Securities Accounts as contemplated by Section 9-106 of the UCC, in each case other than in favor of Lender to
secure the Obligations (or in the case of Canadian Borrowers, the PPSA, as applicable to either (i) or (ii));

 

(j)        enter
into any covenant or other agreement that restricts or is intended to restrict it from pledging or granting a security interest
in, mortgaging, assigning, encumbering or otherwise creating a Lien on any of its property, whether, real or personal, tangible
or intangible, existing or hereafter acquired, in favor of Lender except for:

 

(i) any
agreements governing any Indebtedness permitted under clause (b) or (c) of the definition of Permitted Indebtedness, but only to
the extent any such restriction is limited to the assets that are the subject of such agreements;

 

(ii) (a)
customary provisions contained in an agreement restricting assignment of such agreement entered into in the Ordinary Course of
Business including the Excluded Property; (b) customary provisions (including customary net worth provisions) in leases, subleases,
licenses and sublicenses that restrict the transfer thereof or the transfer of the assets subject thereto by the lessee, sublessee,
licensee or sublicensee; and (c) customary restrictions on customer deposits imposed by customers under contracts entered into
in the Ordinary Course of Business; and

 

    	 	62	 

     

    

 

(iii)
customary restrictions that arise in connection with any disposition permitted under Section 8(e) solely to the assets subject
to such disposition;

 

(k)        guaranty
or otherwise become liable with respect to the obligations (other than the Obligations) of another party or entity except as permitted
herein;

 

(l)        make a Restricted
Payment unless the Distribution Payment Conditions have been satisfied; provided, that notwithstanding the foregoing:

 

(i) Loan
Party Obligors may declare and accrue any distribution or dividend for shareholders; and

 

(ii) Loan Party Obligors may make Permitted Tax
Distributions;

 

(m)        redeem,
retire, purchase or otherwise acquire, directly or indirectly, any of Loan Party Obligor's capital stock or other equity interests;

 

(n)        dissolve
or elect to dissolve except as permitted in Section 8(a);

 

(o)        engage, directly
or indirectly, in a business other than the business which is being conducted on the date hereof, wind up its business operations
or cease substantially all, or any material portion, of its normal business operations, or suffer any material disruption, interruption
or discontinuance of a material portion of its normal business operations except as permitted in Section 8(a);

 

(p)        pay
or make any payments (whether voluntary or mandatory, or a prepayment, distribution, redemption, retirement, defeasance or acquisition)
with respect to any Indebtedness that is contractually subordinated to Agent, including the Subordinated Debt, in violation of
the applicable subordination or intercreditor agreement;

 

(q)        pay
or make any payments with respect to the HHG Note unless permitted by the terms and conditions of the HHG Subordination Agreement;

 

(r)        pay
or make any payments (whether voluntary or mandatory, or a prepayment, distribution, redemption, retirement, defeasance or acquisition)
with respect to the Term Loan Facility other than (i) regularly scheduled payments of principal and interest and mandatory prepayments
permitted by the Intercreditor Agreement, and (ii) voluntary prepayments pursuant to the Term Loan Side Letter Agreement but only
to the extent funded by capital contributions made by Ultimate Parent and Investment Corp. to Holdings;

 

(s)        enter
into any transaction involving an amount greater than $100,000 with an Affiliate or any employee of any Loan Party Obligor or Affiliate
other than (i) on arms-length terms, (ii) payment of reasonable compensation to officers and employees for services actually rendered,
and payment of customary directors’ fees and indemnities, (iii) intercompany purchases and sales, and (iv) as otherwise disclosed
to Agent in writing prior to the date hereof;

 

(t)        change its jurisdiction
of organization or enter into any transaction which has the effect of changing its jurisdiction of organization except as provided
for in Section 7.8 and Section 8.1(a);

 

(u)       agree,
consent, permit or otherwise undertake to amend or otherwise modify any of the terms or provisions of any Loan Party's Governing
Documents, except for such amendments or other modifications required
by applicable law or that are not materially adverse to Agent and Lenders, and then, only to the extent such amendments or other
modifications are fully disclosed in writing to Agent no less than five Business Days prior to being effectuated;

 

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(v)        enter
into or assume any agreement prohibiting the creation or assumption of any Lien to secure the Obligations upon its properties or
assets, whether now owned or hereafter acquired, except in connection with any document or instrument governing Liens permitted
pursuant to clause (a) of the definition of Permitted Liens provided that any such restriction contained therein relates only to
the asset or assets subject to such Permitted Lien and with respect to Excluded Property;

 

(w)        create
or otherwise cause or suffer to exist or become effective any encumbrance or restriction (other than any Loan Documents or Term
Loan Documents, as permitted by the Intercreditor Agreement) of any kind on the ability of any such Person to pay or make any dividends
or distributions to any Borrower, to pay any of the Obligations, to make loans or advances or to transfer any of its property or
assets to any Borrower;

 

(x)        agree,
consent, permit or otherwise undertake to amend, waive or otherwise modify any of the terms or provisions of any Subordinated Debt
Document in violation of the Subordinated Debt Subordination Agreement;

 

(y)        agree,
consent, permit or otherwise undertake to amend, waive or otherwise modify any of the terms or provisions of any HHG Note in violation
of the HHG Note Subordination Agreement;

 

(z)        become
party to any Multiemployer Plan, Canadian Multi-Employer Plan, Foreign Plan or Canadian Defined Benefit Pension Plan, other than
any in existence on the Closing Date or maintain, contribute or have any liability in respect of, or acquire any Person that maintains,
contributes or has any liability in respect of, a Canadian Pension Plan or Canadian Multi-Employer Plan or a Canadian Defined Benefit
Pension Plan during the term of this Agreement;

 

(aa)      amend,
modify, change, waive, or obtain any consent, waiver or forbearance with respect to, any of the terms or provisions of any agreement,
instrument, document, indenture, or other writing evidencing or concerning the Term Loan Obligations (including the Term Loan Documents)
except to the extent permitted by the Intercreditor Agreement; or

 

(bb)      sell
inventory or product to the cannabis/marijuana industry, advertise to the cannabis/marijuana industry (including any direct cannabis
trade or social media advertising); provided that nothing in this Section 8(z) shall restrict (i) Borrowers’ selling or advertising
to the hemp industry or (ii) Borrowers’ employees attending and participating in cannabis/marijuana industry conferences/events
in a manner that does not include selling or advertising.

 

(cc)      pay
or make any payments (whether voluntary or mandatory, or a prepayment, distribution, redemption, retirement, defeasance or acquisition)
with respect to the Asset Acquisition Earnout Obligations.

 

9.        FINANCIAL COVENANTS.
Each Loan Party Obligor shall at all times comply with the following Financial Covenants:

 

9.1.
Fixed Charge Coverage Ratio/ Minimum Excess Availability. Borrowers shall not permit Excess Availability
at any time following the Availability Block Release Date to be less than the Minimum Excess Availability Amount, unless as of
the last day of the most recent month for which the monthly financial statements of Borrowers and the related Compliance Certificate
are required to have been delivered to Agent pursuant to Section 7.15, the Fixed Charge Coverage Ratio for the applicable FCCR
Measurement Period then ended is greater than 1:05 to 1:00.

 

    	 	64	 

     

    

 

9.1.        Reserved..

 

9.2.        Capital Expenditure
Limitation. The Loan Parties shall not make any Capital Expenditures if, after giving effect to such Capital Expenditures,
the aggregate cost of all Capital Expenditures of the Loan Parties would exceed $500,000 during Fiscal Year 2019 and $750,000
annually during any subsequent Fiscal Year.

  

10.       RELEASE,
LIMITATION OF LIABILITY AND INDEMNITY.

 

10.1.       Release.
Each Borrower and each other Loan Party Obligor on behalf of itself and its successors, assigns, heirs and other legal representatives,
hereby absolutely, unconditionally and irrevocably releases, remises and forever discharges Agent and each Lender and any and
all Participants and Affiliates, and their respective successors and assigns, and their respective directors, members, managers,
officers, employees, attorneys and agents, including each Agent-Related Person, and any other Person affiliated with or representing
Agent or any Lender (collectively, the "Released Parties") of and from any and all liability, including
all actual or potential claims, demands or causes of action of any kind, nature or description whatsoever, whether arising in
law or equity or under contract or tort or under any state, provincial or federal law or otherwise, which any Borrower or any
Loan Party or any of their successors, assigns or other legal representatives has had, now has or has made claim to have against
any of the Released Parties for or by reason of any act, omission, matter, cause or thing whatsoever, including any liability
arising from acts or omissions pertaining to the transactions contemplated by this Agreement and the other Loan Documents, whether
based on errors of judgment or mistake of law or fact, from the beginning of time to and including the Closing Date, whether such
claims, demands and causes of action are matured or known or unknown. Notwithstanding any provision in this Agreement to the contrary,
this Section 10.1 shall remain operative even after the Termination Date and shall survive the payment in full of all of the Loans.
Such release is made on the date hereof and remade upon each request for a Loan by any Borrower or Borrower Representative.

 

10.2.        Limitation
of Liability. In no circumstance will any of the Released Parties be liable for lost profits or other special, punitive, or
consequential damages. Notwithstanding any provision in this Agreement to the contrary, this Section 10.2 shall remain operative
even after the Termination Date and shall survive the payment in full of all of the Loans.

 

10.3.       Indemnity.

 

(a)        Each
Loan Party Obligor hereby agrees to indemnify the Released Parties and hold them harmless from and against any and all claims,
debts, liabilities, demands, obligations, actions, causes of action, penalties, costs and expenses (including internal and external
attorneys' fees), of every nature, character and description, which the Released Parties may sustain or incur based upon or arising
out of any of the transactions contemplated by this Agreement or any other Loan Documents or any of the Obligations, any Collateral
relating thereto, any drafts thereunder and any errors or omissions relating thereto, or any other matter, cause or thing whatsoever
occurred, done, omitted or suffered to be done by Agent or any Lender relating to any Loan Party or the Obligations (except any
such amounts sustained or incurred solely as the result of the gross negligence or willful misconduct of such Released Parties,
as finally determined by a court of competent jurisdiction and except for disputes among the Released Parties). Notwithstanding
any provision in this Agreement to the contrary, this Section 10.3 shall remain operative
even after the Termination Date and shall survive the payment in full of all of the Loans.

 

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(b)        To
the extent that any Loan Party Obligor fails to pay any amount required to be paid by it to Agent (or any Released Party of Agent)
under paragraph (a) above, each Lender severally agrees to pay to Agent (or such Released Party), such Lender's Pro Rata Share
(determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount (it being
understood that any such payment by the Lenders shall not relieve any Loan Party of any default in the payment thereof); provided
that the unreimbursed expense or indemnified loss, claim, damage, penalty, liability or related expense, as the case may be, was
incurred by or asserted against Agent in its capacity as such.

 

11.        
EVENTS OF DEFAULT AND REMEDIES.

 

11.1.         Events
of Default. The occurrence of any of the following events shall constitute an "Event of Default":

 

(a)        Payment.
If any Loan Party Obligor or any Other Obligor fails to pay to Agent, when due, any principal or interest payment or any other
monetary Obligation required under this Agreement or any other Loan Document;

 

(b)        Breaches of Representations
and Warranties. If any warranty, representation, statement, report or certificate made or delivered to Agent or any Lender
by or on behalf of any Loan Party or any Other Obligor is untrue or misleading in any material respect on the date made or deemed
made (except where such warranty or representation is already qualified by Material Adverse Effect, materiality, dollar thresholds
or similar qualifications, in which case such warranty or representation shall be accurate in all respects);

 

(c)        Breaches of Covenants.

 

(i) If any Loan Party
or any Other Obligor defaults in the due observance or performance of any covenant, condition or agreement contained in Section
5.2, 6.1, 6.6, 6.7, 7.2 (limited to the last sentence of Section 7.2), 7.3, 7.7, 7.8, 7.11(c), 7.13, 7.14, 7.15, 7.23, 7.25, 7.26,
7.27, 7.30, 7.31, 7.32, 8 or 9; or

 

(ii)
If any Loan Party or any Other Obligor defaults in the due observance or performance of any covenant, condition or agreement contained
in any provision of this Agreement or any other Loan Document and not addressed in clauses Sections 11.1(a), (b) or (c)(i), and
such default is not cured within 30 days after a senior officer of such Obligor has knowledge thereof or receives notice thereof
from Agent, whichever is sooner; provided, however, that such notice and opportunity to cure shall not apply if the breach or failure
to perform is not capable of being cured within such period or is a willful breach by an Obligor;

 

(d)        Judgment.
If one or more judgments aggregating in excess of $500,000 which is not covered by insurance is obtained against any Loan Party
or any Other Obligor which remains unstayed for more than thirty (30) days or is enforced;

 

(e)        Cross-Default.
If any default occurs with respect to any Indebtedness in the amount of $500,000 or more (other than the Obligations, the Term
Loan Facility, the HHG Note or the Subordinated Debt) of any Loan Party or any Other Obligor if (i) such default shall consist
of the failure to pay such Indebtedness when due, whether by acceleration or otherwise or (ii) the effect of such default is to
permit the holder, with or without notice or lapse of time or both, to accelerate the maturity of any such Indebtedness or to
cause such Indebtedness to become due prior to the stated maturity thereof (without regard to the existence of any subordination
or intercreditor agreements);

 

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(f)        Dissolution.
The dissolution, termination of existence, insolvency or business failure or suspension or cessation of business as usual of any
Loan Party or any Other Obligor (or of any general partner of any Loan Party or any Other Obligor if it is a partnership), except
as permitted pursuant to the terms hereof;

 

(g)        Voluntary Bankruptcy
or Similar Proceedings. If any Loan Party or any Other Obligor shall apply for or consent to the appointment of a receiver,
trustee, custodian or liquidator of it or any of its properties, admit in writing its inability to pay its debts as they mature,
make a general assignment for the benefit of creditors, be adjudicated a bankrupt or insolvent or be the subject of an order for
relief under the Bankruptcy Code or under any bankruptcy or insolvency law of a foreign jurisdiction, or file a voluntary petition
in bankruptcy, or a petition or an answer seeking reorganization or an arrangement with creditors or to take advantage of any
bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or liquidation law or statute, or an answer admitting
the material allegations of a petition filed against it in any proceeding under any such law, or take or permit to be taken any
action in furtherance of or for the purpose of effecting any of the foregoing;

 

(h)        Involuntary Bankruptcy
or Similar Proceedings. The commencement of an involuntary case or other proceeding against any Loan Party or any Other Obligor
seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other
similar applicable law or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it
or any substantial part of its property, or if an order for relief is entered against any Loan Party or any Other Obligor under
any bankruptcy, insolvency or other similar applicable law as now or hereafter in effect; provided, that if such
commencement of proceedings is involuntary, such action shall not constitute an Event of Default unless such proceedings are not
dismissed within sixty (60) days after the commencement of such proceedings, though Agent and Lenders shall have no obligation
to make Loans during such sixty-day period or, if earlier, until such proceedings are dismissed;

 

(i)        Revocation or
Termination of Guaranty or Security Documents. The actual or attempted revocation or termination of, or limitation or denial
of liability under, any guaranty of any of the Obligations, or any security document securing any of the Obligations, by any Loan
Party or Other Obligor;

 

(j)        Subordinated
Indebtedness. If any Loan Party or Other Obligor makes any payment on account of the Subordinated Debt, the HHG Note or any
Indebtedness or obligation which has been contractually subordinated to the Obligations other than payments which are not prohibited
by the applicable subordination provisions pertaining thereto, or if any Person who has subordinated such Indebtedness or obligations
attempts to limit or terminate any applicable subordination provisions pertaining thereto, in each case, including the Subordinated
Debt Subordination Agreement and the HHG Note Subordination Agreement;

 

(k)        Term Loan Facility.
A Default or Event of Default (as such terms are defined in the Term Loan Documents) occurs with respect to the Term Loan Facility
or the occurrence of any condition or event that results in the Term Loan Obligations becoming due prior to its scheduled maturity
as of the Closing Date or permits any holder or holders of the Term Loan Obligations or any trustee or agent on its or their behalf
to cause the Term Loan Obligations to become due, or require the prepayment, repurchase, redemption of defeasance thereof, prior
to its scheduled maturity as of the Closing Date.

 

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(l)        Criminal Indictment
or Proceedings. If there is any indictment of any Loan Party, any Loan Party's officers, any Other Obligor or any Other Obligor's
officers under any criminal statute or commencement of criminal proceedings against any such Person relating to the business affairs
of the Loan Parties;

 

(m)        Change of Control.
If (i) the Sponsor Group shall cease to directly or indirectly own and control, beneficially and of record, Equity Interests of
Ultimate Parent representing at least 50.1% of the voting power and at least 50.1% of the economic interest represented by the
outstanding equity interests of Ultimate Parent Inc. held by the Sponsor Group as of March 15, 2019; (ii) the Control Group shall
cease, for any reason, to have, collectively, the right or ability by voting power, contract or otherwise to, directly or indirectly,
elect or designate for election a majority (in number and in voting power) of the members of the board of directors, board of
managers or similar governing body of Ultimate Parent, (iii) Ultimate Parent becomes a direct or indirect Subsidiary of any Person,
(iv) Ultimate Parent ceases to, directly or indirectly, own and control all of the outstanding equity interests of Investment
Corp. and Holdings on a fully diluted basis, (v) Holdings ceases to, directly or indirectly, own and control all of the outstanding
equity interests of each other Loan Party Obligor on a fully diluted basis, or (vi) any “change of control” (or similar
term) under the Term Loan Facility, the Term Loan Documents or any Subordinated Debt, while outstanding, shall have occurred;

 

(n)        Change of Management.
If Bill Toler ceases to be employed as, and actively perform the duties of, the chief executive officer of each Loan Party, unless
a successor is appointed within ninety (90) days after the termination of such individual's employment and such successor is reasonably
satisfactory to Agent;

 

(o)        Invalid Liens.
If any Lien purported to be created by any Loan Document shall cease to be a valid perfected first priority Lien (subject only
to any priority accorded by law to Permitted Liens) on any material portion of the Collateral, or any Loan Party or any other
Obligor shall assert in writing that any Lien purported to be created by any Loan Document is not a valid perfected first-priority
lien (subject only to any priority accorded by law to Permitted Liens) on the assets or properties purported to be covered thereby;

 

(p)        Termination of
Loan Documents. If any of the Loan Documents shall cease to be in full force and effect (other than as a result of the discharge
thereof in accordance with the terms thereof or by written agreement of all parties thereto);

 

(q)        Liquidation Sales.
The determination by any Loan Party to employ an agent or other third party or otherwise engage any Person or solicit proposals
for the engagement of any Person (i) in connection with the proposed liquidation of all or a material portion of its assets, or
(ii) to conduct any so-called closing, liquidation or “GoingOutOfBusiness” sales;

 

(r)        Loss of Collateral.
The (i) uninsured loss, theft, damage or destruction of any of the Collateral, (ii) the uninsured loss, theft, damage or destruction
of any of the ABL Priority Collateral in an amount in excess of $250,000 in the aggregate for all such events during any Fiscal
Year, or (iii) except as permitted hereby, the sale, lease or furnishing under a contract of service of, any of the ABL Priority
Collateral.

 

(s)        Plans. (i)
An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which has resulted or could reasonably be expected
to result in liability of any Loan Party or any Subsidiary under Title IV of ERISA to the Pension Plan, Multiemployer Plan or
the PBGC in an aggregate amount in excess of $250,000, (ii) the existence of any Lien under Section 430(k) or Section 6321 of
the Code or Section 303(k) or Section 4068 of ERISA on any assets of a Loan Party, or (iii) a Loan Party or any ERISA Affiliate
fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of $250,000.

 

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11.2.        Remedies
with Respect to Lending Commitments/Acceleration, Etc. Upon the occurrence of an Event of Default, Agent may (in its sole
discretion), or at the direction of Required Lenders, shall, (a) terminate all or any portion of its commitment to lend to or
extend credit to Borrowers under this Agreement and/or any other Loan Document, without prior notice to any Loan Party and/or
(b) demand payment in full of all or any portion of the Obligations (whether or not payable on demand prior to such Event of Default),
together with the Early Payment/Termination Premium in the amount specified in Section 3.2(e) and/or (c) take any and all other
and further actions and avail itself of any and all rights and remedies available to Agent under this Agreement, any other Loan
Document, under law or in equity. Notwithstanding the foregoing sentence, upon the occurrence of any Event of Default described
in Section 11.1(g) or Section 11.1(h), without notice, demand or other action by Agent all of the Obligations (including the Early
Payment/Termination Premium in the amount specified in Section 3.2(e)) shall immediately become due and payable whether or not
payable on demand prior to such Event of Default.

 

11.3.        Remedies
with Respect to Collateral. Without limiting any rights or remedies Agent or any Lender may have pursuant to this Agreement,
the other Loan Documents, under applicable law or otherwise, upon the occurrence and during the continuation of an Event of Default:

 

(a)        Any and All Remedies.
Agent may take any and all actions and avail itself of any and all rights and remedies available to Agent under this Agreement,
any other Loan Document, under law or in equity, and the rights and remedies herein and therein provided shall be cumulative and
not exclusive of any rights or remedies provided by applicable law or otherwise.

 

(b)        Collections;
Modifications of Terms. Agent may, but shall be under no obligation to: (i) notify all appropriate parties that the Collateral,
or any part thereof, has been assigned to, or is subject to a security interest in favor of, Agent; (ii) demand, sue for, collect
and give receipts for and take all necessary or desirable steps to collect any Collateral or Proceeds in its or any Loan Party
Obligor's name, and apply any such collections against the Obligations as Agent may elect; (iii) take control of any Collateral
and any cash and non-cash Proceeds of any Collateral; (iv) enforce, compromise, extend, renew settle or discharge any rights or
benefits of each Loan Party Obligor with respect to or in and to any Collateral, or deal with the Collateral as Agent may deem
advisable; and (v) make any compromises, exchanges, substitutions or surrenders of Collateral Agent deems necessary or proper
in its reasonable discretion, including extending the time of payment, permitting payment in installments, or otherwise modifying
the terms or rights relating to any of the Collateral, all of which may be effected without notice to, consent of, or any other
action of any Loan Party and without otherwise discharging or affecting the Obligations, the Collateral or the security interests
granted to Agent under this Agreement or any other Loan Document.

 

(c)        Insurance.
Agent may file proofs of loss and claim with respect to any of the Collateral with the appropriate insurer and may endorse in
its own and each Loan Party Obligor's name any checks or drafts constituting Proceeds of insurance. Any Proceeds of insurance
received by Agent may be applied by Agent against payment of all or any portion of the Obligations as Agent may elect in its reasonable
discretion.

 

(d)        Possession and
Assembly of Collateral. Agent may take possession of the Collateral. Upon Agent's request, each Loan Party Obligor shall assemble
the Collateral and make it available to Agent at one or more places designated by Agent.

 

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(e)        Set-off.
Agent may and, without any notice to, consent of or any other action by any Loan Party (such notice, consent or other action being
expressly waived), set-off or apply (i) any and all deposits (general or special, time or demand, provisional or final) at any
time held by or for the account of Agent or any Affiliate of Agent and (ii) any Indebtedness at any time owing by Agent or any
Affiliate of Agent or any Participant in the Loans to or for the credit or the account of any Loan Party Obligor to the repayment
of the Obligations, irrespective of whether any demand for payment of the Obligations has been made.

 

(f)        Disposition of
Collateral.

 

(i)        Sale, Lease,
etc. of Collateral. Agent may, without demand, advertising or notice, all of which each Loan Party Obligor hereby waives
(except as the same may be required by the UCC, PPSA, or other applicable law and is not waivable under the UCC, PPSA or such
other applicable law), at any time or times in one or more public or private sales or other dispositions, for cash, on credit
or otherwise, at such prices and upon such terms as determined by Agent (provided such price and terms are commercially reasonable
within the meaning of the UCC or PPSA, as applicable, to the extent such sale or other disposition is subject to the UCC or PPSA
requirements that such sale or other disposition must be commercially reasonable), (A) sell, lease, license or otherwise dispose
of any and all Collateral and/or (B) deliver and grant options to a third party to purchase, lease, license or otherwise dispose
of any and all Collateral. Agent may sell, lease, license or otherwise dispose of any Collateral in its then-present condition
or following any preparation or processing deemed necessary by Agent in its reasonable discretion. Agent may be the purchaser
at any such public or private sale or other disposition of Collateral, and in such case, Agent may make payment of all or any
portion of the purchase price therefor by the application of all or any portion of the Obligations due to Agent to the purchase
price payable in connection with such sale or disposition. Agent may, if it deems it reasonable, postpone or adjourn any sale
or other disposition of any Collateral from time to time by an announcement at the time and place of the sale or disposition to
be so postponed or adjourned without being required to give a new notice of sale or disposition; provided, that Agent shall provide
the applicable Loan Party Obligor with written notice of the time and place of such postponed or adjourned sale or disposition.
Each Loan Party Obligor hereby acknowledges and agrees that Agent's compliance with any requirements of applicable law in connection
with a sale, lease, license or other disposition of Collateral will not be considered to adversely affect the commercial reasonableness
of any sale, lease, license or other disposition of such Collateral.

 

(ii)        Deficiency.
Each Loan Party Obligor shall remain liable for all amounts of the Obligations remaining unpaid as a result of any deficiency
of the Proceeds of the sale, lease, license or other disposition of Collateral after such Proceeds are applied to the Obligations
as provided in this Agreement.

 

(iii)        Warranties;
Sales on Credit. Agent may sell, lease, license or otherwise dispose of the Collateral without giving any warranties and
may specifically disclaim any and all warranties, including but not limited to warranties of title, possession, merchantability
and fitness. Each Loan Party Obligor hereby acknowledges and agrees that Agent's disclaimer of any and all warranties in connection
with a sale, lease, license or other disposition of Collateral will not be considered to adversely affect the commercial reasonableness
of any such disposition of the Collateral. If Agent sells, leases, licenses or otherwise disposes of any of the Collateral on
credit, Borrowers will be credited only with payments actually made in cash by the recipient of such Collateral and received by
Agent and applied to the Obligations. If any Person fails to pay for Collateral acquired pursuant this Section 11.3(f) on credit,
Agent may re-offer the Collateral for sale, lease, license or other disposition.

 

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(g)        Investment
Property; Voting and Other Rights; Irrevocable Proxy.

 

(i)        All
rights of each Loan Party Obligor to exercise any of the voting and other consensual rights which it would otherwise be entitled
to exercise in accordance with the terms hereof with respect to any Investment Property, and to receive any dividends, payments,
and other distributions which it would otherwise be authorized to receive and retain in accordance with the terms hereof with respect
to any Investment Property, shall immediately, at the election of Control Agent (without requiring any notice) cease, and all such
rights shall thereupon become vested solely in Control Agent, and Control Agent (personally or through an agent) shall thereupon
be solely authorized and empowered, without notice, to (A) transfer and register in its name, or in the name of its nominee, the
whole or any part of the Investment Property, it being acknowledged by each Loan Party Obligor that any such transfer and registration
may be effected by Control Agent through its irrevocable appointment as attorney-in-fact pursuant to Section 11.3(g)(ii) and Section
6.4, (B) exchange certificates or instruments representing or evidencing Investment Property for certificates or instruments of
smaller or larger denominations, (C) exercise the voting and all other rights as a holder with respect to all or any portion of
the Investment Property (including all economic rights, all control rights, authority and powers, and all status rights of each
Loan Party Obligor as a member or as a shareholder (as applicable) of the Issuer), (D) collect and receive all dividends and other
payments and distributions made thereon, (E) notify the parties obligated on any Investment Property to make payment to Control
Agent of any amounts due or to become due thereunder, (F) endorse instruments in the name of each Loan Party Obligor to allow collection
of any Investment Property, (G) enforce collection of any of the Investment Property by suit or otherwise, and surrender, release,
or exchange all or any part thereof, or compromise or renew for any period (whether or not longer than the original period) any
liabilities of any nature of any Person with respect thereto, (H) consummate any sales of Investment Property or exercise any other
rights as set forth in Section 11.3(f), (I) otherwise act with respect to the Investment Property as though Control Agent was the
outright owner thereof and (J) exercise any other rights or remedies Control Agent may have under the UCC, PPSA, other applicable
law or otherwise.

 

(ii)        EACH LOAN
PARTY OBLIGOR HEREBY IRREVOCABLY CONSTITUTES AND APPOINTS CONTROL AGENT AS ITS PROXY AND ATTORNEY-IN- FACT FOR SUCH LOAN
PARTY OBLIGOR WITH RESPECT TO ALL OF EACH SUCH LOAN PARTY OBLIGOR'S INVESTMENT PROPERTY WITH THE RIGHT, DURING THE
CONTINUANCE OF AN EVENT OF DEFAULT, WITHOUT NOTICE, TO TAKE ANY OF THE FOLLOWING ACTIONS: (A) TRANSFER AND REGISTER IN
AGENT'S NAME, OR IN THE NAME OF ITS NOMINEE, THE WHOLE OR ANY PART OF THE INVESTMENT PROPERTY, (B) VOTE THE PLEDGED EQUITY,
WITH FULL POWER OF SUBSTITUTION TO DO SO, (C) RECEIVE AND COLLECT ANY DIVIDEND OR ANY OTHER PAYMENT OR DISTRIBUTION IN
RESPECT OF, OR IN EXCHANGE FOR, THE INVESTMENT PROPERTY OR ANY PORTION THEREOF, TO GIVE FULL DISCHARGE FOR THE SAME AND TO
INDORSE ANY INSTRUMENT MADE PAYABLE TO ANY LOAN PARTY OBLIGOR FOR THE SAME, (D) EXERCISE ALL OTHER RIGHTS, POWERS,
PRIVILEGES, AND REMEDIES (INCLUDING ALL ECONOMIC RIGHTS, ALL CONTROL RIGHTS, AUTHORITY AND POWERS, AND ALL STATUS RIGHTS OF
EACH LOAN PARTY OBLIGOR AS A MEMBER OR AS A SHAREHOLDER (AS APPLICABLE) OF THE ISSUER) TO WHICH A HOLDER OF THE PLEDGED
COLLATERAL WOULD BE ENTITLED (INCLUDING, WITH RESPECT TO THE PLEDGED EQUITY, GIVING OR WITHHOLDING WRITTEN CONSENTS OF
MEMBERS OR SHAREHOLDERS, CALLING SPECIAL MEETINGS OF MEMBERS OR SHAREHOLDERS, AND VOTING AT SUCH MEETINGS), AND (E) TAKE ANY
ACTION AND TO EXECUTE ANY INSTRUMENT WHICH AGENT MAY DEEM NECESSARY OR ADVISABLE TO ACCOMPLISH THE PURPOSES OF THIS
AGREEMENT. THE APPOINTMENT OF CONTROL AGENT AS PROXY AND ATTORNEY-IN-FACT IS COUPLED WITH AN INTEREST AND SHALL BE VALID AND IRREVOCABLE
UNTIL (x) ALL OF THE OBLIGATIONS HAVE BEEN INDEFEASIBLY PAID IN FULL IN CASH IN ACCORDANCE WITH THE PROVISIONS OF THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS, (y) CONTROL AGENT AND THE LENDERS HAVE NO FURTHER OBLIGATIONS UNDER THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, AND (z) THE COMMITMENTS UNDER THIS AGREEMENT HAVE EXPIRED OR HAVE BEEN TERMINATED (IT BEING UNDERSTOOD AND AGREED THAT
SUCH OBLIGATIONS WILL BE AUTOMATICALLY REINSTATED IF AT ANY TIME PAYMENT, IN WHOLE OR IN PART, OF ANY OF THE OBLIGATIONS IS RESCINDED
OR MUST OTHERWISE BE RESTORED OR RETURNED BY CONTROL AGENT OR ANY LENDER FOR ANY REASON WHATSOEVER, INCLUDING AS A PREFERENCE,
FRAUDULENT CONVEYANCE, OR OTHERWISE UNDER ANY BANKRUPTCY, INSOLVENCY, OR SIMILAR LAW, ALL AS THOUGH SUCH PAYMENT HAD NOT BEEN MADE;
IT BEING FURTHER UNDERSTOOD THAT IN THE EVENT PAYMENT OF ALL OR ANY PART OF THE OBLIGATIONS IS RESCINDED OR MUST BE RESTORED OR
RETURNED, ALL REASONABLE OUT-OF-POCKET COSTS AND EXPENSES (INCLUDING ALL REASONABLE INTERNAL AND EXTERNAL ATTORNEYS' FEES AND DISBURSEMENTS)
INCURRED BY CONTROL AGENT AND THE LENDERS IN DEFENDING AND ENFORCING SUCH REINSTATEMENT SHALL HEREBY BE DEEMED TO BE INCLUDED AS
A PART OF THE OBLIGATIONS). SUCH APPOINTMENT OF CONTROL AGENT AS PROXY AND AS ATTORNEY-IN-FACT SHALL BE VALID AND IRREVOCABLE AS
PROVIDED HEREIN NOTWITHSTANDING ANY LIMITATIONS TO THE CONTRARY SET FORTH IN ANY GOVERNING DOCUMENTS OF ANY LOAN PARTY OBLIGOR,
ANY ISSUER, OR OTHERWISE.

 

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(iii)       
In order to further effect the foregoing transfer of rights in favor of Control Agent, during the continuance of an Event of Default,
each Loan Party Obligor hereby authorizes and instructs each Issuer of Investment Property pledged by such Loan Party Obligor to
comply with any instruction received by such Issuer from Control Agent without any other or further instruction from such Loan
Party Obligor, and each Loan Party Obligor acknowledges and agrees that each Issuer shall be fully protected in so complying, and
to pay any dividends, distributions, or other payments with respect to any of the Investment Property directly to Control Agent.

 

(iv)        Upon
exercise of the proxy set forth herein, all prior proxies given by any Loan Party Obligor with respect to any of the Pledged Equity
or other Investment Property, other than to Control Agent, are hereby revoked, and no subsequent proxies, other than to Control
Agent will be given with respect to any of the Pledged Equity or any of the other Investment Property unless Control Agent otherwise
subsequently agrees in writing. Control Agent, as proxy, will be empowered and may exercise the irrevocable proxy to vote the Pledged
Equity and the other Investment Property at any and all times during the existence of an Event of Default, including, at any meeting
of shareholders or members, as the case may be, however called, and at any adjournment thereof, or in any action by written consent,
and may waive any notice otherwise required in connection therewith. To the fullest extent permitted by applicable law, Control
Agent shall have no agency, fiduciary or other implied duties to any Loan Party Obligor, any Issuer, any Loan Party or any other
Person when acting in its capacity as such proxy or attorney-in-fact. Each Loan Party Obligor hereby waives and releases any claims
that it may otherwise have against Control Agent with respect to any breach, or alleged breach, of any such agency, fiduciary or
other duty.

 

(v)        Any
transfer to Control Agent or its nominee, or registration in the name of Agent or its nominee, of the whole or any part of the
Investment Property shall be made solely for purposes of effectuating voting or other consensual rights with respect to the Investment
Property in accordance with the terms of this Agreement and is not intended to effectuate any transfer of ownership of any of the
Investment Property. Notwithstanding the delivery by Control Agent of any instruction to any Issuer
or any exercise by Control Agent of an irrevocable proxy or otherwise, Control Agent shall not be deemed the owner of, or assume
any obligations or any liabilities whatsoever of the owner or holder of, any Investment Property unless and until Agent expressly
accepts such obligations in a duly authorized and executed writing and agrees in writing to become bound by the applicable Governing
Documents or otherwise becomes the owner thereof under applicable law (including through a sale as described in Section 11.3(f)).
The execution and delivery of this Agreement shall not subject Control Agent to, or transfer or pass to Control Agent, or in any
way affect or modify, the liability of any Loan Party Obligor under the Governing Documents of any Issuer or any related agreements,
documents, or instruments or otherwise. In no event shall the execution and delivery of this Agreement by Control Agent, or the
exercise by Control Agent of any rights hereunder or assigned hereby, constitute an assumption of any liability or obligation whatsoever
of any Loan Party Obligor to, under, or in connection with any of the Governing Documents of any Issuer or any related agreements,
documents, or instruments or otherwise.

 

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(vi)        Compliance
with the Securities Act as now in effect or as hereafter amended, or any similar statute hereafter adopted with similar purpose
or effect, as well as any applicable "Blue Sky" or other state securities laws, if applicable to the Collateral or the
portion thereof being sold, may require strict limitations as to the manner in which the Control Agent or any subsequent transferee
may dispose of the Collateral. With respect to any disposition as to which the Securities Act or analogous state securities laws
is applicable, each Loan Party Obligor hereby waives any objection to sale in a compliant manner, and agrees that the Control Agent
has no obligation to obtain the maximum possible price for the Collateral so long as the Agent proceeds in a commercially reasonable
manner. Without limiting the generality of the foregoing, each Loan Party Obligor agrees that in conducting a disposition of the
Collateral as to which the Securities Act or analogous state securities laws applies, Control Agent may seek to sell the Collateral
by private placement, and may restrict bidders and prospective purchasers to those who are willing to represent that they are purchasing
for investment only and not for distribution and who otherwise satisfy qualifications designed to ensure compliance with the Securities
Act and analogous state securities laws and those that may be established in the Issuer’s Governing Documents. Each Loan
Party Obligor acknowledges that in order to protect Control Agent’s interest, it may be necessary to sell the Collateral
at a price less than the maximum price attainable if a sale were delayed or were made in another manner, including a public offering
under the Securities Act. In order to address these potential compliance requirements, Control Agent may solicit offers to purchase
the Collateral from a limited number of bidders reasonably believed by Control Agent to be institutional investors or accredited
investors. If Agent solicits offers in a commercially reasonable manner, then acceptance by Control Agent of one or more of the
offers shall be deemed to be a commercially reasonable method of disposition of the Collateral and Control Agent will not be responsible
or liable for selling all or any portion of the Collateral at a price that Control Agent deems in good faith to be reasonable.
Control Agent is under no obligation to delay a disposition of any portion of the Collateral that are securities under the Securities
Act or applicable “Blue Sky” or other state securities law for the period of time necessary to permit any Loan Party
Obligor or the Issuer to register the securities for public sale under the Securities Act or under applicable “Blue Sky”
or other state securities laws, even if a Loan Party Obligor or the Issuer agrees to do so. In addition, to the extent not prohibited
by applicable law, each Loan Party Obligor waives any right to prior notice (except to the extent expressly provided in this Agreement)
or judicial hearing in connection with the taking possession or the disposition of any of the Collateral, including any right which
Loan Party Obligor otherwise would have.

 

(vii)       
To the extent permitted under applicable law, Control Agent is not required to conduct any foreclosure sale of the Investment Property
or any portion thereof.

 

(viii)       
Control Agent, at its option, may obtain the appointment of a receiver to take possession of the Investment Property and, at the
option of Control Agent, a receiver may be empowered (i) to collect,
receive and enforce all distributions, (ii) to exercise the rights of Control Agent as provided in this Agreement, (iii) to collect
all other amounts owed to any Loan Party Obligor in respect of the Investment Property as and when due to any Loan Party Obligor,
(iv) to otherwise collect, sell or dispose of the Investment Property, (v) to exercise all rights in and under the Investment Property;
and (vi) to turn over all net proceeds to Control Agent. Each Loan Party Obligor irrevocably and unconditionally agrees that a
receiver may be appointed by a court to take the actions listed above without regard to the adequacy of the security for the Obligations,
and the actions of the receiver may be taken in the name of the receiver, any Loan Party Obligor or Control Agent.

 

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(ix)        Control
Agent may elect to conduct a sale of an economic interest in any Investment Property constituting limited liability company interests
that does not result in the purchaser being admitted as a substitute limited liability company member in the Issuer, and that any
sale or dispositions made in good faith will be considered commercially reasonable, notwithstanding the possibility that a substantially
higher price might be realized if the purchaser were able to be admitted as a substitute limited liability company member rather
than the holder of only an economic interest in the Issuer.

 

(x)        Control
Agent may disclose to prospective purchasers all of the information relating to the Investment Property (and the applicable Issuer)
that is in the Agent's possession or otherwise available to the Control Agent.

 

(xi)        Each
Loan Party Obligor hereby authorizes and instructs their respective Issuer to comply with any instruction received by it from Control
Agent in writing that (i) states that an Event of Default has occurred and is continuing and (ii) is otherwise in accordance with
the terms of the provisions of the this Agreement, the Loan documents or Term Loan Documents as to Investment Property, without
any other or further instructions from the respective Loan Party Obligor, and such Loan Party Obligor agrees that Issuer be fully
protected in so complying.

 

(h)        Election of
Remedies. Agent shall have the right in Agent's sole discretion to determine which rights, security, Liens or remedies Agent
may at any time pursue, foreclose upon, relinquish, subordinate, modify or take any other action with respect to, without in any
way impairing, modifying or affecting any of Agent's other rights, security, Liens or remedies with respect to any Collateral
or any of Agent's rights or remedies under this Agreement or any other Loan Document.

 

(i)        Agent's Obligations.
Each Loan Party Obligor agrees that Agent shall not have any obligation to preserve rights to any Collateral against prior
parties or to marshal any Collateral of any kind for the benefit of any other creditor of any Loan Party Obligor or any other
Person. Agent shall not be responsible to any Loan Party Obligor or any other Person for loss or damage resulting from Agent's
failure to enforce its Liens or collect any Collateral or Proceeds or any monies due or to become due under the Obligations or
any other liability or obligation of any Loan Party Obligor to Agent.

 

(j)        Waiver of Rights
by Loan Party Obligors. Except as otherwise expressly provided for in this Agreement or by non-waivable applicable law, each
Loan Party waives (i) presentment, demand and protest and notice of presentment, dishonor, notice of intent to accelerate, notice
of acceleration, protest, default, nonpayment, maturity, release, compromise, settlement, extension or renewal of any or all commercial
paper, accounts, contract rights, documents, instruments, chattel paper and guaranties at any time held by Agent on which any
Loan Party Obligor may in any way be liable, and hereby ratifies and confirms whatever Agent may do in this regard, (ii) all rights
to notice and a hearing prior to Agent's taking possession or control of, or to Agent's replevy, attachment or levy upon, the
Collateral or any bond or security which might be required by any court prior to allowing Agent to exercise any of its remedies
and (iii) the benefit of all valuation, appraisal, marshaling and exemption laws. If any notice of a proposed sale or other disposition
of any part of the Collateral is required under applicable law, each Loan Party Obligor agrees that ten (10) calendar days prior
notice of the time and place of any public sale and of the time after which any private sale or other disposition is to be made
is commercially reasonable.

 

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12.         LOAN
GUARANTY.

 

12.1.        Guaranty.
Each Loan Party Obligor hereby agrees that it is jointly and severally liable for, and absolutely and unconditionally guaranties
to Agent, for the ratable benefit of the Lenders, the prompt payment when due, whether at stated maturity, upon acceleration or
otherwise, and at all times thereafter, all of the Obligations and all costs and expenses, including all court costs and attorneys'
and paralegals' fees (including internal and external counsel and paralegals) and expenses of Agent or any Lender in endeavoring
to collect all or any part of the Obligations from, or in prosecuting any action against, any Borrower, any Loan Party Obligor
or any Other Obligor of all or any part of the Obligations (and such costs and expenses paid or incurred shall be deemed to be
included in the Obligations). Each Loan Party Obligor further agrees that the Obligations may be extended or renewed in whole
or in part without notice to or further assent from it, and that it remains bound upon its guaranty notwithstanding any such extension
or renewal. All terms of this Loan Guaranty apply to and may be enforced by or on behalf of any branch or Affiliate of Agent that
extended any portion of the Obligations.

 

12.2.        Guaranty
of Payment. This Loan Guaranty is a guaranty of payment and not of collection. Each Loan Party Obligor waives any right to
require Agent to sue or otherwise take action against any Borrower, any other Loan Party Obligor, any Other Obligor, or any other
Person obligated for all or any part of the Obligations, or otherwise to enforce its payment against any Collateral securing all
or any part of the Obligations.

 

12.3.        No Discharge
or Diminishment of Loan Guaranty.

 

(a)        Except
as otherwise expressly provided for herein, the obligations of each Loan Party Obligor hereunder are unconditional and absolute
and not subject to any reduction, limitation, impairment or termination for any reason (other than the indefeasible payment in
full in cash of all of the Obligations), including: (i) any claim of waiver, release, extension, renewal, settlement, surrender,
alteration, or compromise of any of the Obligations, by operation of law or otherwise; (ii) any change in the corporate existence,
structure or ownership of any Borrower or any Obligor; (iii) any insolvency, bankruptcy, reorganization or other similar proceeding
affecting any Borrower or any Obligor or their respective assets or any resulting release or discharge of any obligation of any
Borrower or any Obligor; or (iv) the existence of any claim, setoff or other rights which any Loan Party Obligor may have at any
time against any Borrower, any Obligor, Agent, or any other Person, whether in connection herewith or in any unrelated transactions.

 

(b)        The
obligations of each Loan Party Obligor hereunder are not subject to any defense or setoff, counterclaim, recoupment, or termination
whatsoever by reason of the invalidity, illegality or unenforceability of any of the Obligations or otherwise, or any provision
of applicable law or regulation purporting to prohibit payment by any Borrower or any Obligor of the Obligations or any part thereof.

 

(c)        Further,
the obligations of any Loan Party Obligor hereunder shall not be discharged or impaired or otherwise affected by: (i) the failure
of Agent to assert any claim or demand or to enforce any remedy with respect to all or any part of the Obligations; (ii) any waiver
or modification of or supplement to any provision of any agreement relating to the Obligations; (iii) any release, non-perfection
or invalidity of any indirect or direct security for all or any part of the Obligations or all or any
part of any obligations of any Obligor; (iv) any action or failure to act by Agent with respect to any Collateral; or (v) any default,
failure or delay, willful or otherwise, in the payment or performance of any of the Obligations, or any other circumstance, act,
omission or delay that might in any manner or to any extent vary the risk of such Loan Party Obligor or that would otherwise operate
as a discharge of any Loan Party Obligor as a matter of law or equity (other than the indefeasible payment in full in cash of all
of the Obligations).

 

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12.4.        Defenses
Waived. To the fullest extent permitted by applicable law, each Loan Party Obligor hereby waives any defense based on or arising
out of any defense of any Loan Party Obligor or the unenforceability of all or any part of the Obligations from any cause, or
the cessation from any cause of the liability of any Loan Party Obligor, other than the indefeasible payment in full in cash of
all of the Obligations. Without limiting the generality of the foregoing, each Loan Party Obligor irrevocably waives acceptance
hereof, presentment, demand, protest and, to the fullest extent permitted by law, any notice not provided for herein, as well
as any requirement that at any time any action be taken by any Person against any Borrower, any Obligor, or any other Person.
Each Loan Party Obligor confirms that it is not a surety under any state law and shall not raise any such law as a defense to
its obligations hereunder. Agent may, at its election, foreclose on any Collateral held by it by one or more judicial or nonjudicial
sales, accept an assignment of any such Collateral in lieu of foreclosure or otherwise act or fail to act with respect to any
Collateral, compromise or adjust any part of the Obligations, make any other accommodation with any Borrower or any Obligor or
exercise any other right or remedy available to it against any Borrower or any Obligor, without affecting or impairing in any
way the liability of any Loan Party Obligor under this Loan Guaranty except to the extent the Obligations have been fully and
indefeasibly paid in cash. To the fullest extent permitted by applicable law, each Loan Party Obligor waives any defense arising
out of any such election even though that election may operate, pursuant to applicable law, to impair or extinguish any right
of reimbursement or subrogation or other right or remedy of any Loan Party Obligor against any Borrower or any Obligor or any
security.

 

12.5.        Rights of
Subrogation. No Loan Party Obligor will assert any right, claim or cause of action, including a claim of subrogation, contribution
or indemnification that it has against any Borrower or any Obligor, or any Collateral, until the Termination Date.

 

12.6.        Reinstatement;
Stay of Acceleration. If at any time any payment of any portion of the Obligations is rescinded or must otherwise be restored
or returned upon the insolvency, bankruptcy or reorganization of any Borrower or any other Person, or otherwise, each Loan Party
Obligor's obligations under this Loan Guaranty with respect to that payment shall be reinstated at such time as though the payment
had not been made and whether or not Agent is in possession of this Loan Guaranty. If acceleration of the time for payment of
any of the Obligations is stayed upon the insolvency, bankruptcy or reorganization of any Borrower, all such amounts otherwise
subject to acceleration under the terms of any agreement relating to the Obligations shall nonetheless be payable by the Loan
Party Obligors forthwith on demand by Agent. This Section 12.6 shall remain operative even after the Termination Date and shall
survive the payment in full of all of the Loans.

 

12.7.        Information.
Each Loan Party Obligor assumes all responsibility for being and keeping itself informed of each Borrower's financial condition
and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope and extent
of the risks that each Loan Party Obligor assumes and incurs under this Loan Guaranty, and agrees that Agent shall not have any
duty to advise any Loan Party Obligor of information known to it regarding those circumstances or risks.

 

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12.8.        Termination.
To the maximum extent permitted by law, each Loan Party Obligor hereby waives any right to revoke this Loan Guaranty as to future
Obligations. If such a revocation is effective notwithstanding the foregoing waiver, each Loan Party Obligor acknowledges and
agrees that (a) no such revocation shall be effective until written notice thereof has been received by Agent, (b) no such revocation
shall apply to any Obligations in existence on the date of receipt by Agent of such written notice (including any subsequent continuation,
extension, or renewal thereof, or change in the interest rate, payment terms or other terms and conditions thereof), (c) no such
revocation shall apply to any Obligations made or created after such date to the extent made or created pursuant to a legally
binding commitment of Agent, (d) no payment by any Borrower, any other Loan Party Obligor, or from any other source, prior to
the date of Agent's receipt of written notice of such revocation shall reduce the maximum obligation of any Loan Party Obligor
hereunder and (e) any payment, by any Borrower or from any source other than a Loan Party Obligor which has made such a revocation,
made subsequent to the date of such revocation, shall first be applied to that portion of the Obligations as to which the revocation
is effective and which are not, therefore, guarantied hereunder, and to the extent so applied shall not reduce the maximum obligation
of any Loan Party Obligor hereunder.

 

12.9.        Maximum Liability.
The provisions of this Loan Guaranty are severable, and in any action or proceeding involving any state corporate law, or any
state, federal or foreign bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if
the obligations of any Loan Party Obligor under this Loan Guaranty would otherwise be held or determined to be avoidable, invalid
or unenforceable on account of the amount of such Loan Party Obligor's liability under this Loan Guaranty, then, notwithstanding
any other provision of this Loan Guaranty to the contrary, the amount of such liability shall, without any further action by the
Loan Party Obligors, Agent or any Lender, be automatically limited and reduced to the highest amount that is valid and enforceable
as determined in such action or proceeding (such highest amount determined hereunder being the relevant Loan Party Obligor's "Maximum
Liability"). This Section 12.9 with respect to the Maximum Liability of each Loan Party Obligor is intended solely
to preserve the rights of Agent and the Lenders to the maximum extent not subject to avoidance under applicable law, and no Loan
Party Obligor or any other Person shall have any right or claim under this Section with respect to such Maximum Liability, except
to the extent necessary so that the obligations of any Loan Party Obligor hereunder shall not be rendered voidable under applicable
law. Each Loan Party Obligor agrees that the Obligations may at any time and from time to time exceed the Maximum Liability of
each Loan Party Obligor without impairing this Loan Guaranty or affecting the rights and remedies of Agent hereunder; provided,
that nothing in this sentence shall be construed to increase any Loan Party Obligor's obligations hereunder beyond its Maximum
Liability.

 

12.10.      Contribution.
In the event any Loan Party Obligor shall make any payment or payments under this Loan Guaranty or shall suffer any loss as a
result of any realization upon any collateral granted by it to secure its obligations under this Loan Guaranty (such Loan Party
Obligor a "Paying Guarantor"), each other Loan Party Obligor (each a "Non-Paying Guarantor")
shall contribute to such Paying Guarantor an amount equal to such Non-Paying Guarantor's "Applicable Percentage"
of such payment or payments made, or losses suffered, by such Paying Guarantor. For purposes of this Section 12.10, each Non-Paying
Guarantor's "Applicable Percentage" with respect to any such payment or loss by a Paying Guarantor shall
be determined as of the date on which such payment or loss was made by reference to the ratio of (x) such Non-Paying Guarantor's
Maximum Liability as of such date (without giving effect to any right to receive, or obligation to make, any contribution hereunder)
or, if such Non-Paying Guarantor's Maximum Liability has not been determined, the aggregate amount of all monies received by such
Non-Paying Guarantor from any Borrower after the date hereof (whether by loan, capital infusion or by other means) to (y) the
aggregate Maximum Liability of all Loan Party Obligors hereunder (including such Paying Guarantor) as of such date (without giving
effect to any right to receive, or obligation to make, any contribution hereunder), or to the extent that a Maximum Liability
has not been determined for any Loan Party Obligor, the aggregate amount of all monies received by such Loan Party Obligors from
any Borrower after the date hereof (whether by loan, capital infusion or by other means). Nothing in this provision shall affect
any Loan Party Obligor's several liability for the entire amount of the Obligations (up to such Loan Party Obligor's Maximum Liability).
Each of the Loan Party Obligors covenants and agrees that its right to receive any contribution under this Loan Guaranty from
a Non-Paying Guarantor shall be subordinate and junior in right of payment to the payment in full in cash of all of the Obligations.
This provision is for the benefit of Agent and the Lenders and the Loan Party Obligors and may be enforced by any one, or more,
or all of them, in accordance with the terms hereof.

 

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12.11.        Liability
Cumulative. The liability of each Loan Party Obligor under this Section 12 is in addition to and shall be cumulative with
all liabilities of each Loan Party Obligor to Agent and the Lenders under this Agreement and the other Loan Documents to which
such Loan Party Obligor is a party or in respect of any obligations or liabilities of the other Loan Parties, without any limitation
as to amount, unless the instrument or agreement evidencing or creating such other liability specifically provides to the contrary.

 

12.12.        Miscellaneous.
Each of the Loan Party Obligors hereby acknowledges and affirms that it understands that to the extent the Obligations are secured
by Real Property located in California, Loan Party Obligors shall be liable for the full amount of the liability hereunder notwithstanding
the foreclosure on such Real Property by trustee sale or any other reason impairing such Guarantor's right to proceed against
any Loan Party. In accordance with Section 2856 of the California Civil Code or any similar laws of any other applicable jurisdiction,
each of the Loan Party Obligors hereby waives until such time as the Obligations have been paid in full:

 

(1)
all rights of subrogation, reimbursement, indemnification, and contribution and any other rights and defenses that are or may become
available to the Loan Party Obligors by reason of Sections 2787 to 2855, inclusive, 2899, and 3433 of the California Civil Code
or any similar laws of any other applicable jurisdiction;

 

(2)
all rights and defenses that the Loan Party Obligors may have because the Obligations are secured by Real Property located in California,
meaning, among other things, that: (A) Agent and the other Lenders may collect from the Loan Party Obligors without first foreclosing
on any real or personal property collateral pledged by any Borrower or any other Grantor, and (B) if Agent, on behalf of the Lenders,
forecloses on any Real Property collateral pledged by any Borrower or any other Grantor, (1) the amount of the Obligations may
be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than
the sale price, and (2) the Agent and Lenders may collect from the Loan Party Obligors even if, by foreclosing on the Real Property
collateral, Agent or the other Lenders have destroyed or impaired any right the Loan Party Obligors may have to collect from any
other Grantor, it being understood that this is an unconditional and irrevocable waiver of any rights and defenses the Loan Party
Obligors may have because the Obligations are secured by Real Property (including, without limitation, any rights or defenses based
upon Sections 580a, 580d, or 726 of the California Code of Civil Procedure or any similar laws of any other applicable jurisdiction);
and

 

(3)
all rights and defenses arising out of an election of remedies by Agent or the other Lenders, even though that election of remedies,
such as a non-judicial foreclosure with respect to security for the Obligations, has destroyed Loan Party Obligors' rights of subrogation
and reimbursement against any Grantor by the operation of Section 580d of the California Code of Civil Procedure or any similar
laws of any other applicable jurisdiction or otherwise.

 

The
provisions in this Section 12.12 which refer to certain sections of the California Civil Code or the California Code of Civil
Procedure are included in this Guaranty solely out of an abundance of caution and shall not be construed to mean that any of the
above-referenced provisions of California law are in any way applicable to this Guaranty.

 

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13.        PAYMENTS FREE
OF TAXES; OBLIGATION TO WITHHOLD; PAYMENTS ON ACCOUNT OF TAXES.

 

(a)        Any
and all payments by or on account of any obligation of the Loan Party Obligors hereunder or under any other Loan Document shall
to the extent permitted by applicable laws be made free and clear of and without reduction or withholding for any Taxes. If, however,
applicable laws require the Loan Party Obligors to withhold or deduct any Tax, such Tax shall be withheld or deducted in accordance
with such laws as the case may be, upon the basis of the information and documentation to be delivered pursuant to subsection (e)
below.

 

(b)        If
any Loan Party Obligor shall be required by applicable law to withhold or deduct any Taxes from any payment, then (i) such Loan
Party Obligor shall withhold or make such deductions as are required based upon the information and documentation it has received
pursuant to subsection (e) below, (ii) such Loan Party Obligor shall timely pay the full amount withheld or deducted to the relevant
Governmental Authority in accordance with the applicable law and (iii) to the extent that the withholding or deduction is made
on account of Indemnified Taxes, the sum payable by the Loan Party Obligors shall be increased as necessary so that after any required
withholding or the making of all required deductions (including deductions applicable to additional sums payable under this Section)
the Recipient receives an amount equal to the sum it would have received had no such withholding or deduction been made. Upon request
by Agent or other Recipient, Borrower Representative shall deliver to Agent or such other Recipient, as the case may be, the original
or a certified copy of a receipt issued by such Governmental Authority evidencing such payment of Indemnified Taxes, a copy of
any return required by applicable law to report such payment or other evidence of such payment reasonably satisfactory to Agent
or such other Recipient, as the case may be.

 

(c)        Without
limiting the provisions of subsections (a) and (b) above, the Loan Party Obligors shall timely pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

 

(d)        Without
limiting the provisions of subsections (a) through (c) above, each Loan Party Obligor shall, and does hereby, on a joint and several
basis, indemnify Agent, each Lender and each other Recipient (and their respective directors, officers, employees, affiliates and
agents) and shall make payment in respect thereof within ten days after demand therefor, for the full amount of any Indemnified
Taxes and Other Taxes (including Indemnified Taxes and Other Taxes imposed or asserted on or attributable to amounts payable under
this Section) paid or incurred by Agent, any Lender or any other Recipient on account of, or in connection with any Loan Document
or a breach by a Loan Party Obligor thereof, and any penalties, interest and related expenses and losses arising therefrom or with
respect thereto (including the fees, charges and disbursements of any internal or external counsel or other tax advisor for Agent,
any Lender or any other Recipient (or their respective directors, officers, employees, affiliates, and agents)), whether or not
such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate
as to the amount of any such payment or liability delivered to Borrower Representative shall be conclusive absent manifest error.
Notwithstanding any provision in this Agreement to the contrary, this Section 13 shall remain operative even after the Termination
Date and shall survive the payment in full of all of the Loans.

  

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(e)        Each Lender shall
deliver to Borrower Representative and each Lender and each Participant shall deliver to Agent, at the time or times prescribed
by applicable laws, such properly completed and executed documentation prescribed by applicable laws or by the taxing authorities
of any jurisdiction and such other reasonably requested information as will permit Borrower Representative or Agent, as the case
may be, to determine (x) whether or not payments made hereunder or under any other Loan Document are subject to Taxes, (y) if
applicable, the required rate of withholding or deduction and (z) such Lender's or Participant's entitlement to any available
exemption from, or reduction of, applicable Taxes in respect of all payments to be made to such Recipient by the Loan Party Obligors
pursuant to this Agreement or otherwise to establish such Recipient's status for withholding tax purposes in the applicable jurisdiction;
provided, that each Recipient shall only be required to deliver such documentation as it may legally provide. Without
limiting the generality of the foregoing, if a Borrower is resident for tax purposes in the United States:

 

(i)        each Lender (or
Participant) that is a "United States person" within the meaning of Section 7701(a)(30) of the Code shall
deliver to Borrower Representative and Agent (or any Lender granting a participation as applicable) an executed original of Internal
Revenue Service Form W-9 or such other documentation or information prescribed by applicable law or reasonably requested by Borrower
Representative or Agent (or Lender granting a participation) as will enable Borrower Representative or Agent (or Lender granting
a participation) as the case may be, to determine whether or not such Lender (or Participant) is subject to backup withholding
or information reporting requirements under the Code;

 

(ii)        each Lender (or
Participant) that is not a "United States person" within the meaning of Section 7701(a)(30) of the Code
(a "Non-U.S. Recipient") shall deliver to Borrower Representative and Agent (or any Lender granting a
participation in case the Non-U.S. Recipient is a Participant) on or prior to the date on which such Non-U.S. Person becomes a
party to this Agreement or a Participant (and from time to time thereafter upon the reasonable request of Borrower Representative
or Agent but only if such Non-U.S. Recipient is legally entitled to do so), whichever of the following is applicable: (A) executed
originals of Internal Revenue Service Form W-8BEN claiming eligibility for benefits of an income tax treaty to which the United
States is a party; (B) executed originals of Internal Revenue Service Form W-8ECI; (C) executed originals of Internal Revenue
Service Form W-8IMY and all required supporting documentation; (D) each Non-U.S. Recipient claiming the benefits of the exemption
for portfolio interest under section 881(c) of the Code, shall provide (x) a certificate to the effect that such Non-U.S. Recipient
is not (1) a "bank" within the meaning of section 881(c)(3)(A) of the Code, (2) a "10 percent
shareholder" of Borrowers within the meaning of section 881(c)(3)(B) of the Code, or (3) a "controlled
foreign corporation" described in section 881(c)(3)(C) of the Code and (y) executed originals of Internal Revenue
Service Form W- 8BEN; and/or (E) executed originals of any other form prescribed by applicable law (including FATCA) as a basis
for claiming exemption from or a reduction in United States Federal withholding tax together with such supplementary documentation
as may be prescribed by applicable law to permit Borrower Representative or Agent to determine the withholding or deduction required
to be made. Each Non-U.S. Recipient shall promptly notify Borrower Representative and Agent (or any Lender granting a participation
if the Non-U.S. Recipient is a Participant) of any change in circumstances which would modify or render invalid any claimed exemption
or reduction.

  

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14.        AGENT

 

14.1.        Appointment.
Each of the Lenders hereby irrevocably appoints Agent as its agent and authorizes Agent to take such actions on its behalf, including
execution of the other Loan Documents, and to exercise such powers as are delegated to Agent by the terms of the Loan Documents,
together with such actions and powers as are reasonably incidental thereto. Without limiting the generality of the foregoing,
Agent shall have the sole and exclusive authority to (a) act as the disbursing and collecting agent for Lenders with respect to
all payments and collections arising in connection with the Loan Documents; (b) execute and deliver as Agent, each Loan Document,
including any intercreditor or subordination agreement, and accept delivery of each Loan Document; (c) make Loans, for itself
or on behalf of Lenders, as provided in the Loan Documents, (d) act as collateral agent for Lenders for purposes of perfecting
and administering Liens under the Loan Documents, and for all other purposes stated therein and execute or file any and all financing
or similar statements or notices, amendments, renewals, supplements, documents, instruments, proofs of claim, notices and other
written agreements with respect to the Loan Documents; (e) manage, supervise or otherwise deal with Collateral; (f) exclusively
receive, apply, and distribute payments and proceeds of the Collateral as provided in the Loan Documents, (g) open and maintain
such bank accounts and cash management arrangements as Agent deems necessary and appropriate in accordance with the Loan Documents,
(h) take any Enforcement Action or otherwise exercise any rights or remedies with respect to any Collateral or under any Loan
Documents, applicable law or otherwise, including the determination of eligibility of Accounts and Inventory, the necessity and
amount of Reserves and all other determinations and decisions relating to ordinary course administration of the credit facilities
contemplated hereunder; and (i) incur and pay such expenses as Agent may deem necessary or appropriate for the performance and
fulfillment of its functions and powers pursuant to the Loan Documents, whether or not any Loan Party is obligated to reimburse
Agent or Lenders for such expenses pursuant to the Loan Documents or otherwise. The provisions of this Article are solely for
the benefit of Agent and the Lenders, and the Loan Parties shall not have rights as a third-party beneficiary of any of such provisions.
It is understood and agreed that the use of the term "agent" as used herein or in any other Loan Documents (or any similar
term) with reference to Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is used as a matter of market custom, and is intended to create or reflect
only an administrative relationship between independent contracting parties.

 

14.2.        Rights as
a Lender. The Person serving as Agent hereunder, if it is a Lender, shall have the same rights and powers in its capacity
as a Lender as any other Lender and may exercise the same as though it were not Agent, and such Person and its Affiliates may
accept deposits from, lend money to and generally engage in any kind of business with any Loan Party or any Subsidiary or any
Affiliate thereof as if it were not Agent hereunder without notice to or consent of the other Lenders.

 

14.3.        Duties and
Obligations. Agent shall not have any duties or obligations except those expressly set forth in the Loan Documents. Without
limiting the generality of the foregoing, (a) Agent shall not be subject to any fiduciary or other implied duties, regardless
of whether a Default has occurred and is continuing, (b) Agent shall not have any duty to take any discretionary action or exercise
any discretionary powers, except discretionary rights and powers expressly contemplated by the Loan Documents that Agent is required
to exercise as directed in writing by the Required Lenders, and, (c) except as expressly set forth in the Loan Documents, Agent
shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any Loan
Party or any Subsidiary that is communicated to or obtained by the Person serving as Agent or any of its Affiliates in any capacity.
Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders or
in the absence of its own gross negligence or willful misconduct as determined by a final nonappealable judgment of a court of
competent jurisdiction. Agent shall be deemed not to have knowledge of any Default unless and until written notice thereof is
given to Agent by a Borrower or a Lender, and Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate,
report or other document delivered hereunder or in connection with any Loan Document, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth in any Loan Document, (iv) the validity, enforceability, effectiveness
or genuineness of any Loan Document or any other agreement, instrument or document, (v) the creation, perfection or priority of
Liens on the ABL Priority Collateral or the existence of the ABL Priority Collateral, or (vi) the satisfaction of any condition
set forth in Article IV or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to bedelivered
to Agent. Agent shall be under no 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 other Loan Document, or to inspect the books and records
or properties of any Loan Party.

 

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14.4.        Reliance.
Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person.
Agent also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and
shall not incur any liability for relying thereon. Agent may consult with and employ Agent Professionals, and shall be entitled
to act upon, and shall be fully protected in any action taken in good faith reliance upon, any advice given by an Agent Professional
(who may be counsel for any Borrower), independent accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts. Agent shall be fully
justified in failing or refusing to take any action under this Agreement or any other Loan Document, unless Agent shall first
receive such advice or concurrence of the Lenders as it deems appropriate and until such instructions are received, Agent shall
act, or refrain from acting, as it deems advisable. If Agent so requests, it shall first be indemnified to its reasonable satisfaction
by the Lenders against any and all liability and expense that may be incurred by it by reason of taking or continuing to take
any such action. Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or
any other Loan Document in accordance with a request or consent of the Required Lenders and such request and any action taken
or failure to act pursuant thereto shall be binding upon all of the Lenders.

 

14.5.        Actions through
Sub-Agents. Agent may perform any and all of its duties and exercise its rights and powers by or through any one or more sub-agents
appointed by Agent. Agent may also perform its duties through employees and other Agent-Related Persons. Agent shall not be responsible
for the negligence or misconduct of any sub-agent, employee or Agent Professional that it selects as long as such selection was
made without gross negligence or willful misconduct. Agent and any such sub-agent may perform any and all of its duties and exercise
its rights and powers through their respective Affiliates and other related parties. The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the related parties of Agent and any such sub- agent, and shall apply to their
respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as
Agent.

 

14.6.        Resignation.
Subject to the appointment and acceptance of a successor Agent as provided in this paragraph, Agent may resign at any time by
notifying the Lenders and Borrower Representative. Upon any such resignation, the Required Lenders shall have the right, in consultation
with Borrower Representative, to appoint a successor. If no successor shall have been so appointed by the Required Lenders and
shall have accepted such appointment within thirty (30) days after the retiring Agent gives notice of its resignation, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent. Upon the acceptance of its appointment as Agent hereunder
by its successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and obligations hereunder and under the other Loan
Documents. The fees payable by Borrowers to a successor Agent shall be the same as those payable to its predecessor, unless otherwise
agreed by Borrower Representative and such successor. Notwithstanding the foregoing, in the event no successor Agent shall have
been so appointed and shall have accepted such appointment within thirty (30) days after the retiring Agent gives notice of its
intent to resign, the retiring Agent may give notice of the effectiveness of its resignation to the Lenders and Borrower Representative,
whereupon, on the date of effectiveness of such resignation stated in such notice, (a) the retiring Agent shall be discharged
from its duties and obligations hereunder and under the other Loan Documents, provided that, solely for purposes of maintaining
any security interest granted to the Agent under any Loan Document for the benefit of the Lenders, the retiring Agent shall continue
to be vested with such security interest as collateral agent for the benefit of the Lenders and, in the case of any Collateral
in the possession of Agent, shall continue to hold such Collateral, in each case until such time as a successor Agent is appointed
and accepts such appointment in accordance with this paragraph (it being understood and agreed that the retiring Agent shall have
no duly or obligation to take any further action under any Loan Document, including any action required to maintain the perfection
of any such security interest), and (b) the Required Lenders shall succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent, provided that (i) all payments required to be made hereunder or under any other Loan Document
to the Agent for the account of any Person other than Agent shall be made directly to such Person and (ii) all notices and other
communications required or contemplated to be given or made to Agent shall also directly be given or made to each Lender. Following
the effectiveness of the Agent's resignation from its capacity as such, the provisions of this Article, as well as any exculpatory,
reimbursement and indemnification provisions set forth in any other Loan Document, shall continue in effect for the benefit of
such retiring Agent, its sub-agents and their respective related parties in respect of any actions taken or omitted to be taken
by any of them while it was acting as Agent and in respect of the matters referred to in the proviso under clause (a) above.

 

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14.7.       Non-Reliance.

 

(a)        Each
Lender acknowledges and agrees that none of the Agent-Related Persons has made any representation or warranty to it, and that no
act by Agent hereinafter taken, including any review of the affairs of Borrowers and their respective Subsidiaries or Affiliates,
shall be deemed to constitute any representation or warranty by any Agent-Related Person to any Lender. Each Lender further acknowledges
the extensions of credit made hereunder are commercial loans and not investments in a business enterprise or securities. Each Lender
further represents that it is engaged in making, acquiring or holding commercial loans in the ordinary course of its business and
has, independently and without reliance upon any Agent-Related Person, any arranger of this credit facility or any amendment thereto
or any other Lender and based on such due diligence, documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of
any Borrower or any other Person party to a Loan Document, and all applicable laws relating to the transactions contemplated hereby,
and made its own credit analysis and decision to enter into this Agreement as a Lender, and to make, acquire or hold Loans hereunder.
Each Lender shall, independently and without reliance upon any Agent-Related Person, any arranger of this credit facility or any
amendment thereto or any other Lender and based on such documents and information (which may contain material, non- public information
within the meaning of the United States securities laws concerning any Borrower and its Affiliates) as it shall from time to time
deem appropriate, continue to make its own credit analysis and decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document, any related agreement or any document furnished hereunder or thereunder , and to make such
investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other
condition and creditworthiness of any Borrower or any other Person party to a Loan Document and in deciding whether or to the extent
to which it will continue as a Lender or assign or otherwise transfer its rights, interests and obligations hereunder. Except for
notices, reports, and other documents expressly herein required to be furnished to the Lenders by Agent, Agent shall not have any
duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of any Borrower or any other Person party to a Loan Document that may
come into the possession of any of the Agent-Related Persons. Each Lender acknowledges that Agent does not have any duty or responsibility,
either initially or on a continuing to provide such Lender with any credit or other information with respect to any Borrower, its
Affiliates or any of their respective business, legal, financial or other affairs, and irrespective of whether such information
came into Agent's or its Affiliates’
or representatives’ possession before or after the date on which such Lender became a party to this Agreement.

 

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(b)        Each
Lender hereby agrees that (i) it has requested a copy of each appraisal, audit or field examination report prepared by or on behalf
of Agent; (ii) Agent (A) makes no representation or warranty, express or implied, as to the completeness or accuracy of any such
report or any of the information contained therein or any inaccuracy or omission contained in or relating to any such report and
(B) shall not be liable for any information contained in any such report; (iii) such reports are not comprehensive audits or examinations,
and that any Person performing any field examination will inspect only specific information regarding the Loan Parties and will
rely significantly upon the Loan Parties' books and records, as well as on representations of the Loan Parties' personnel and that
Agent undertakes no obligation to update, correct or supplement such reports; (iv) it will keep all such reports confidential and
strictly for its internal use, not share any such report with any Loan Party or any other Person except as otherwise permitted
pursuant to this Agreement; and (v) without limiting the generality of any other indemnification provision contained in this Agreement,
(A) it will hold Agent and any such other Person preparing any such report harmless from any action the indemnifying Lender may
take or conclusion the indemnifying Lender may reach or draw from any such report in connection with any extension of credit that
the indemnifying Lender has made or may make to any Borrower, or the indemnifying Lender's participation in, or the indemnifying
Lender's purchase of, a Loan or Loans; and (B) it will pay and protect, and indemnify, defend, and hold Agent and any such other
Person preparing any such report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other
amounts (including reasonable attorneys' fees of both internal and external counsel) of Agent or any such other Person as the direct
or indirect result of any third parties who might obtain all or part of any such report through the indemnifying Lender.

 

14.8.        Not Partners
or Co-Venturers; Agent as Representative of the Secured Parties.

 

(a)        The Lenders are not partners or co-venturers, and no
Lender shall be liable for the acts or omissions of, or (except as otherwise set forth herein in the case of Agent) authorized
to act for, any other Lender. Agent shall have the exclusive right on behalf of the Lenders to enforce the payment of the principal
of and interest on any Loan after the date such principal or interest has become due and payable pursuant to the terms of this
Agreement.

 

(b)        In
its capacity, Agent is a "representative" of the Lenders within the meaning of the term "secured party" as
defined in the UCC or a “person who holds a security interest for the benefit” of the Lenders within the meaning of
the term “secured party” as defined in the PPSA. Each Lender authorizes Agent to enter into each of the Loan Documents
to which it is a party and to take all action contemplated by such documents. Each Lender agrees that no Lender (other than Agent)
shall have the right individually to seek to realize upon the security granted by any Loan Document, it being understood and agreed
that such rights and remedies may be exercised solely by Agent for the benefit of the Lenders upon the terms of the Loan Documents.
In the event that any Collateral is hereafter pledged by any Person as collateral security for the Obligations, Agent is hereby
authorized, and hereby granted a power of attorney, to execute and deliver on behalf of the Lenders any Loan Documents necessary
or appropriate to grant and perfect a Lien on such Collateral in favor of Agent on behalf of the Lenders.

 

(c)        Agent hereby appoints
each other Lender as its agent (and each Lender hereby accepts such appointment) for the purpose of perfecting Agent’s Liens
in assets which can be perfected by possession or control in accordance with Article 8 or Article 9, as applicable, of the UCC
or the equivalent provisions of the applicable PPSA. Should any Lender obtain possession or control of any such Collateral, such
Lender shall notify Agent thereof, and, promptly upon Agent’s request therefor shall deliver possession or control of such
Collateral to Agent or in accordance with Agent’s instructions. Agent shall have no obligation whatsoever to any of the
Lenders (i) to verify or assure that the Collateral exists or is owned by any Borrower or its Subsidiaries or is cared for, protected,
or insured or has been encumbered, (ii) to verify or assure that Agent’s Liens have been properly or sufficiently or lawfully
created, perfected, protected, or enforced or are entitled to any particular priority, (iii) to verify or assure that any particular
items of Collateral meet the eligibility criteria applicable in respect thereof, (iv) to impose, maintain, increase, reduce, implement
or eliminate any particular reserve hereunder or to determine whether the amount of any reserve is appropriate or not, or (v)
to exercise at all or in any particular manner or under any duty of care, disclosure or fidelity, or to continue exercising, any
of the rights, authorities and powers granted or available to Agent pursuant to any of the Loan Documents, it being understood
and agreed that in respect of the Collateral, or any act, omission, or event related thereto, subject to the terms and conditions
contained herein. 

 

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14.9.        Credit Bidding.
The Loan Parties and the Lenders hereby irrevocably authorize Agent, based upon the instruction of the Required Lenders, to Credit
Bid and purchase (either directly or through one or more acquisition vehicles) all or any portion of the Collateral (and the Loan
Parties shall approve Agent as a qualified bidder and such Credit Bid as qualified bid) at any sale thereof conducted by Agent,
based upon the instruction of the Required Lenders, under any provisions of the UCC or PPSA, as part of any sale or investor solicitation
process conducted by any Loan Party, any interim receiver, receiver, receiver and manager, administrative receiver, trustee, agent
or other Person pursuant or under any insolvency laws; provided, however, that (i) the Required Lenders may not direct
Agent in any manner that does not treat each of the Lenders equally, without preference or discrimination, in respect of consideration
received as a result of the Credit Bid, (ii) the acquisition documents shall be commercially reasonable and contain customary
protections for minority holders such as among other things, anti-dilution and tag-along rights, (iii) the exchanged debt or equity
securities must be freely transferable, without restriction (subject to applicable securities laws) and (iv) reasonable efforts
shall be made to structure the acquisition in a manner that causes the governance documents pertaining thereto to not impose any
obligations or liabilities upon the Lenders individually (such as indemnification obligations). Agent, based upon the instruction
of the Required Lenders, may accept non-cash consideration, including debt and equity securities issued by any entities used to
consummate such Credit Bid or purchase and in connection therewith Agent may reduce the Obligations owed to the Lenders (ratably
based upon the proportion of their Obligations credit bid in relation to the aggregate amount of Obligations so credit bid) based
upon the value of such non-cash consideration. For purposes of the preceding sentence, the term "Credit Bid" shall mean,
an offer submitted by Agent (on behalf of the Lender group), based upon the instruction of the Required Lenders, to acquire the
property of any Loan Party or any portion thereof in exchange for and in full and final satisfaction of all or a portion (as determined
by Agent, based upon the instruction of the Required Lenders) of the claims and Obligations under this Agreement and other Loan
Documents.

 

14.10.        Certain
Collateral Matters. The Lenders irrevocably authorize Agent, at its option and in its discretion, (a) to release any Lien
granted to or held by Agent under any Loan Document (i) upon termination of the Commitments and payment in full of all Loans and
all other obligations of Borrowers hereunder; (ii) constituting property sold or to be sold or disposed of as part of or in connection
with any disposition permitted hereunder (including the release of any guarantor); or (iii) subject to Section 15.5 if approved,
authorized or ratified in writing by the Required Lenders; or (ii) to subordinate its interest in any Collateral to any holder
of a Lien on such Collateral which is permitted by clause (a) of the definition of Permitted Liens (it being understood that Agent
may conclusively rely on a certificate from Borrower Representative in determining whether the Indebtedness secured by any such
Lien is permitted hereunder). Upon request by Agent at any time, the Lenders will confirm in writing Agent's authority to release,
or subordinate its interest in, particular types or items of Collateral pursuant to this Section 14.10. Agent may, and at the
direction of Required Lenders shall, give blockage notices in connection with any Subordinated Debt and each Lender hereby authorizes
Agent to give such notices. Each Lender further agrees that it will not act unilaterally to deliver such notices.

 

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14.11.        Restriction
on Actions by Lenders. Each Lender agrees that it shall not, without the express written consent of Agent, and shall, upon
the written request of Agent (to the extent it is lawfully entitled to do so), set off against the Obligations, any amounts owing
by such Lender to a Loan Party or any deposit accounts of any Loan Party now or hereafter maintained with such Lender. Each of
the Lenders further agrees that it shall not, unless specifically requested to do so in writing by Agent, take or cause to be
taken, any action, including the commencement of any legal or equitable proceedings to foreclose any loan or otherwise enforce
any security interest in any of the Collateral or to enforce all or any part of this Agreement or the other Loan Documents. All
Enforcement Actions under this Agreement and the other Loan Documents against the Loan Parties or any third party with respect
to the Obligations or the Collateral may only be taken by Agent (at the direction of the Required Lenders or as otherwise permitted
in this Agreement) or by its agents at the direction of Agent.

 

14.12.        Expenses.
Agent is authorized and directed to deduct and retain sufficient amounts from payments or proceeds of the Collateral received
by Agent to reimburse Agent for such out-of- pocket costs and expenses prior to the distribution of any amounts to Lenders. In
the event Agent is not reimbursed for such costs and expenses by a Loan Party, each Lender hereby agrees that it is and shall
be obligated to pay to Agent such Lender’s ratable share thereof. Without limitation of the foregoing, each Lender shall
reimburse Agent upon demand for such Lender’s ratable share of any costs or out of pocket expenses (including Agent Professional
fees and expenses) incurred by Agent in connection with the preparation, execution, delivery, administration, modification, amendment,
or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities
under, this Agreement or any other Loan Document to the extent that Agent is not reimbursed for such expenses by or on behalf
of Borrowers. The undertaking in this Section shall survive the payment of all Obligations hereunder and the resignation or replacement
of Agent.

 

14.13.        Notice of
Default or Event of Default. Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event
of Default, except with respect to defaults in the payment of principal, interest, fees, and expenses required to be paid to Agent
for the account of the Lenders and, except with respect to Events of Default of which Agent has actual knowledge, unless Agent
shall have received written notice from a Lender or Borrower referring to this Agreement, describing such Default or Event of
Default, and stating that such notice is a "notice of default." Agent will promptly notify the Lenders of its receipt
of any such notice or of any Event of Default of which Agent has actual knowledge. If any Lender obtains actual knowledge of any
Event of Default, such Lender promptly shall notify the other Lenders and Agent of such Event of Default. Agent shall take such
action with respect to such Default or Event of Default as may be requested by the Required Lenders in accordance with this Agreement;
provided, that unless and until Agent has received any such request, 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.

 

14.14.        Liability
of Agent. None of the Agent-Related Persons shall (a) be liable for any action taken or omitted to be taken by any of them
under or in connection with this Agreement or any other Loan Document or the transactions contemplated hereby (except for its
own gross negligence or willful misconduct), or (b) be responsible in any manner to any of the Lenders for any recital, statement,
representation or warranty made by any Borrower or any of their respective Subsidiaries or Affiliates, or any officer or director
thereof, contained in this Agreement or in any other Loan Document, 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 other Loan Document, or
the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or for any
failure of any Borrower, or any of their respective Subsidiaries or any other party to any Loan Document to perform its obligations
hereunder or thereunder. No Agent-Related Person shall be under any obligation to any Lenders 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 other Loan Document,
or to inspect the books and records or properties of any Borrower or their respective Subsidiaries.

 

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15.        GENERAL PROVISIONS.

 

15.1.       
Notices.

 

(a)        Notice by Approved
Electronic Communications. Agent and each of its Affiliates is authorized to transmit, post or otherwise make or communicate,
in its sole discretion (but shall not be required to do so), by Approved Electronic Communications in connection with this Agreement
or any other Loan Document and the transactions contemplated therein. Agent is hereby authorized to establish procedures to provide
access to and to make available or deliver, or to accept, notices, documents and similar items by posting to ABLSoft. All uses
of ABLSoft and other Approved Electronic Communications shall be governed by and subject to, in addition to the terms of this
Agreement, the separate terms, conditions and privacy policy posted or referenced in such system (or such terms, conditions and
privacy policy as may be updated from time to time, including on such system) and any related contractual obligations executed
by Agent and Loan Parties in connection with the use of such system. Each of the Loan Parties, the Lenders and Agent hereby acknowledges
and agrees that the use of ABLSoft and other Approved Electronic Communications is not necessarily secure and that there are risks
associated with such use, including risks of interception, disclosure and abuse and each indicates it assumes and accepts such
risks by hereby authorizing Agent and each of its Affiliates to transmit Approved Electronic Communications. ABLSoft and all Approved
Electronic Communications shall be provided "as is" and "as available". None of
Agent or any of its Affiliates or related persons warrants the accuracy, adequacy or completeness of ABLSoft or any other electronic
platform or electronic transmission and disclaims all liability for errors or omissions therein. No warranty of any kind is made
by Agent or any of its Affiliates or related persons in connection with ABLSoft or any other electronic platform or electronic
transmission, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights
or freedom from viruses or other code defects. Each Borrower and each other Loan Party executing this Agreement agrees that Agent
has no responsibility for maintaining or providing any equipment, software, services or any testing required in connection with
ABLSoft, any Approved Electronic Communication or otherwise required for ABLSoft or any Approved Electronic Communication. Prior
to the Closing Date, Borrower Representative shall deliver to Agent a complete and executed Client User Form regarding Borrowers’
use of ABLSoft in the form of Exhibit C annexed hereto. No Approved Electronic Communications shall be denied legal effect merely
because it is made electronically. Approved Electronic Communications that are not readily capable of bearing either a signature
or a reproduction of a signature may be signed, and shall be deemed signed, by attaching to, or logically associating with such
Approved Electronic Communication, an E-Signature, upon which Agent and the Loan Parties may rely and assume the authenticity
thereof. Each Approved Electronic Communication containing a signature, a reproduction of a signature or an E-Signature shall,
for all intents and purposes, have the same effect and weight as a signed paper original. Each E-Signature shall be deemed sufficient
to satisfy any requirement for a "signature" and each Approved Electronic Communication shall be deemed
sufficient to satisfy any requirement for a "writing", in each case including pursuant to this Agreement,
any other Loan Document, the UCC, PPSA, the Federal Uniform Electronic Transactions Act, the Electronic Signatures in Global and
National Commerce Act and any similar Canadian laws governing the electronic execution and delivery of agreements, documents,
and instruments and any substantive or procedural law governing such subject matter. Each party or beneficiary hereto agrees not
to contest the validity or enforceability of an Approved Electronic Communication or E-Signature under the provisions of any applicable
law requiring certain documents to be in writing or signed; provided, that nothing herein shall limit such party's
or beneficiary's right to contest whether an Approved Electronic Communication or E-Signature has been altered after transmission.

 

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(b)        All Other Notices.
All notices, requests, demands and other communications under or in respect of this Agreement or any transactions hereunder, other
than those approved for or required to be delivered by Approved Electronic Communications (including via ABLSoft or otherwise
pursuant to Section 15.1(a)), shall be in writing and shall be personally delivered or mailed (by prepaid registered or certified
mail, return receipt requested), sent by prepaid recognized overnight courier service, or by email to the applicable party at
its address or email address indicated below,

 

If
to Agent:

 

ENCINA
BUSINESS CREDIT, LLC, 

   as Agent

123
N Wacker Suite 2400

Chicago,
IL 60606

Attention:
Thomas SullivanTracy
Salyers

Email:
tsullivantsalyers@encinabc.com

  

If
to Borrower Representative, any Borrower or any other Loan Party:

 

Hydrofarm,
LLC

2249
S. McDowell Boulevard

Petaluma,
CA 94954

Attention:
Jeff Peterson, CFO Email: jeffp@hydrofarm.com

 

with
a copy to:

 

Perkins
Coie LLP

131
S. Dearborn Street Suite 1700

Chicago,
IL 60603-5559

Attention:
Teri Lindquist

Email:
tlindquist@perkinscoie.com

 

or,
as to each party, at such other address as shall be designated by such party in a written notice to the other party delivered
as aforesaid. All such notices, requests, demands and other communications shall be deemed given (i) when personally delivered,
(ii) three Business Days after being deposited in the mails with postage prepaid (by registered or certified mail, return receipt
requested), (iii) one Business Day after being delivered to the overnight courier service, if prepaid and sent overnight delivery,
addressed as aforesaid and with all charges prepaid or billed to the account of the sender or (iv) when sent by email transmission
to an email address designated by such addressee and the sender receives a confirmation of transmission.

 

15.2.        Severability.
If any provision of this Agreement or any other Loan Document is held invalid or unenforceable, either in its entirety or by virtue
of its scope or application to given circumstances, such provision shall thereupon be deemed modified only to the extent necessary
to render same valid, or not applicable to given circumstances, or excised from this Agreement or such other Loan Document, as
the situation may require, and this Agreement and the other Loan Documents shall be construed and enforced as if such provision
had been included herein as so modified in scope or application, or had not been included herein or therein, as the case may be.

 

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15.3.        Integration.
This Agreement and the other Loan Documents represent the final, entire and complete agreement between each Loan Party that is
a party hereto and thereto and Agent and supersede all prior and contemporaneous negotiations, oral representations and agreements,
all of which are merged and integrated into this Agreement. THERE ARE NO ORAL UNDERSTANDINGS, REPRESENTATIONS OR AGREEMENTS BETWEEN
THE PARTIES THAT ARE NOT SET FORTH IN THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.

 

15.4.        Waivers.
The failure of Agent and the Lenders at any time or times to require any Loan Party to strictly comply with any of the provisions
of this Agreement or any other Loan Documents shall not waive or diminish any right of Agent later to demand and receive strict
compliance therewith. Any waiver of any default shall not waive or affect any other default, whether prior or subsequent, and
whether or not similar. None of the provisions of this Agreement or any other Loan Document shall be deemed to have been waived
by any act or knowledge of Agent or its agents or employees, but only by a specific written waiver signed by an authorized officer
of Agent and any necessary Lenders and delivered to Borrowers. Once an Event of Default shall have occurred, it shall be deemed
to continue to exist and not be cured or waived unless specifically waived in writing by an authorized officer of Agent and Required
Lenders and delivered to Borrowers. Each Loan Party Obligor waives demand, protest, notice of protest and notice of default or
dishonor, notice of payment and nonpayment, release, compromise, settlement, extension or renewal of any commercial paper, Instrument,
Account, General Intangible, Document, Chattel Paper, Investment Property or guaranty at any time held by Agent on which such
Loan Party Obligor is or may in any way be liable, and notice of any action taken by Agent, unless expressly required by this
Agreement, and notice of acceptance hereof.

 

15.5.        Amendments.

 

(a)        No
amendment, modification or waiver of, or consent with respect to, any provision of this Agreement or the other Loan Documents shall
in any event be effective unless the same shall be in writing and acknowledged by the Required Lenders, and then any such amendment,
modification, waiver or consent shall be effective only in the specific instance and for the specific purpose for which given;
provided, that, except to the extent set forth in Section 14.9 hereof, no amendment, modification, waiver or consent shall
(i) extend or increase the Commitment of any Lender without the written consent of such Lender, (ii) extend the date scheduled
for payment of any principal (excluding mandatory prepayments) of or interest on the Loans or any fees payable hereunder without
the written consent of each Lender directly affected thereby,, (iii) reduce the principal amount of any Loan, the rate of interest
thereon or any fees payable hereunder, without the consent of each Lender directly affected thereby; (iv) amend or modify the definitions
of Borrowing Base, Eligible Accounts or Eligible Inventory, or any components thereof (including any advance rates), without the
written consent of each Lender; or (v) release any guarantor from its obligations under any Guaranty, other than as part of or
in connection with any disposition permitted hereunder, or release or subordinate its liens on all or any substantial part of the
Collateral granted under any of the other Loan Documents (except as permitted by Section 14.10), change the definition of Required
Lenders, any provision of Section 6.2, any provision of this Section 15.4, the provisions of Section 14.9 or reduce the aggregate
Pro Rata Share required to effect an amendment, modification, waiver or consent, without, in each case set forth in this clause
(v), the written consent of all Lenders. No provision of Section 14 or other provision of this Agreement affecting Agent in its
capacity as such shall be amended, modified or waived without the consent of Agent.

 

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(b)        If, in connection
with any proposed amendment, modification, waiver or termination requiring the consent of all Lenders, the consent of the Required
Lenders is obtained, but the consent of other Lenders whose consent is required is not obtained (any such Lender whose consent
is not obtained being referred to as a "Non-Consenting Lender"), then, so long as Agent is not a Non-
Consenting Lender, Agent and/or a Person or Persons reasonably acceptable to Agent shall have the right to purchase from such
Non-Consenting Lenders, and such Non-Consenting Lenders agree that they shall, upon Agent's request, sell and assign to Agent
and/or such Person or Persons, all of the Loans and Commitments of such Non-Consenting Lenders for an amount equal to the principal
balance of all such Loans and Commitments held by such Non-Consenting Lenders and all accrued interest, fees, expenses and other
amounts then due with respect thereto through the date of sale, such purchase and sale to be consummated pursuant to an executed
Assignment and Assumption.

 

15.6.        Time
of Essence. Time is of the essence in the performance by each Loan Party Obligor of each and every obligation under this Agreement
and the other Loan Documents.

 

15.7.        Expenses,
Fee and Costs Reimbursement. Each Borrower hereby agrees to promptly pay (a) all out of pocket costs and expenses of Agent
(including the reasonable out of pocket fees, costs and expenses of internal and external legal counsel to, and appraisers, accountants,
consultants and other professionals and advisors retained by or on behalf of, Agent) in connection with (i) all loan proposals
and commitments pertaining to the transactions contemplated hereby (whether or not such transactions are consummated), (ii) the
examination, review, due diligence investigation, documentation, negotiation, and closing of the transactions contemplated by
the Loan Documents (whether or not such transactions are consummated), (iii) the creation, perfection and maintenance of Liens
pursuant to the Loan Documents, (iv) the performance or enforcement by Agent of its rights and remedies under the Loan Documents
(or determining whether or how to perform or enforce such rights and remedies), (v) the administration of the Loans (including
usual and customary fees for wire transfers and other transfers or payments received by Agent on account of any of the Obligations)
and Loan Documents, (vi) any amendments, modifications, consents and waivers to and/or under any and all Loan Documents (whether
or not such amendments, modifications, consents or waivers are consummated), (vii) any periodic public record searches conducted
by or at the request of Agent (including, title investigations and public records searches), pending litigation and tax lien searches
and searches of applicable corporate, limited liability company, partnership and related records concerning the continued existence,
organization and good standing of certain Persons), (viii) protecting, storing, insuring, handling, maintaining, auditing, examining,
valuing or selling any Collateral, (ix) any litigation, dispute, suit or proceeding relating to any Loan Document (other than
disputes among Lenders or among Lenders and Agent) and (x) any workout, collection, bankruptcy, insolvency and other enforcement
proceedings under any and all of the Loan Documents (it being agreed that (A) such costs and expenses may include the costs and
expenses of workout consultants, investment bankers, financial consultants, appraisers, valuation firms and other professionals
and advisors retained by or on behalf of Agent (B) each Lender shall also be entitled to reimbursement for all out of pocket costs
and expense of the type described in this clause (x), provided that, to the extent of an actual or reasonably perceived
conflict of interest, such reimbursement shall be limited to one additional counsel for the Lenders as a whole), and (b) without
limiting the preceding clause (a), all out of pocket costs and expenses of Agent in connection with Agent's reservation of funds
in anticipation of the funding of the initial Loans to be made hereunder. Any fees, costs and expenses owing by any Borrower or
other Loan Party Obligor hereunder shall be due and payable within three days after written demand therefor.

 

    	 	90	 

     

    

 

15.8.        Benefit of
Agreement; Assignability. The provisions of this Agreement shall be binding upon and inure to the benefit of the respective
successors, assigns, heirs, beneficiaries and representatives of each Borrower, each other Loan Party Obligor party hereto, Agent
and each Lender; provided, that neither each Borrower nor any other Loan Party Obligor may assign or transfer any of its rights
under this Agreement without the prior written consent of Agent and each Lender, and any prohibited assignment shall be void.
No consent by Agent or any Lender to any assignment shall release any Loan Party Obligor from its liability for any of the Obligations.
Each Lender shall have the right to assign all or any of its rights and obligations under the Loan Documents to one or more other
Persons in accordance with Section 15.9, and each Loan Party Obligor agrees to execute all agreements, instruments, and documents
requested by any Lender in connection with such assignment. Notwithstanding any provision of this Agreement or any other Loan
Document to the contrary, a Lender may at any time pledge or grant a security interest in all or any portion of its rights under
this Agreement and the other Loan Documents to secure any obligations of such Lender, including any pledge or grant to secure
obligations to a Federal Reserve Bank.

 

15.9.        Assignments.

 

(a)        Any Lender may at
any time assign to one or more Persons (any such Person, an "Assignee") all or any portion of such Lender's
Loans and Commitments, with the prior written consent of Agent and, so long as no Event of Default exists, Borrower Representative
(which consents shall not be unreasonably withheld or delayed and shall not be required for an assignment by a Lender to a Lender
(other than a Defaulting Lender) or an Affiliate of a Lender (other than an Affiliate of a Defaulting Lender) or an Approved Fund
(other than an Approved Fund of a Defaulting Lender)). Except as Agent may otherwise agree, any such assignment shall be in a
minimum aggregate amount equal to $5,000,000 or, if less, the remaining Commitment and Loans held by the assigning Lender (provided,
that an assignment to a Lender, an Affiliate of a Lender or an Approved Fund shall not be subject to the foregoing minimum assignment
limitations). The Loan Parties and Agent shall be entitled to continue to deal solely and directly with such Lender in connection
with the interests so assigned to an Assignee until Agent shall have received and accepted an effective Assignment and Assumption
executed, delivered and fully completed by the applicable parties thereto and a processing fee of $3,500. Notwithstanding anything
herein to the contrary, no assignment may be made to any equity holder of a Loan Party, any Affiliate of any equity holder of
a Loan Party, any Loan Party, any holder of Subordinated Debt of a Loan Party, any holder of any debt that is secured by liens
or security interests that have been contractually subordinated to the liens and security interests securing the Obligations,
or any Affiliate of any of the foregoing Persons without the prior written consent of Agent, which consent may be withheld in
Agent's sole discretion and, in any event, if granted, may be conditioned on such terms and conditions as Agent shall require
in its sole discretion, including a limitation on the aggregate amount of Loans and Commitments which may be held by such Person
and/or its Affiliates and/or limitations on such Person's and/or its Affiliates' voting and consent rights and/or rights to attend
Lender meetings or obtain information provided to other Lenders. Any attempted assignment not made in accordance with this Section
15.10 shall be null and void. Each Borrower shall be deemed to have granted its consent to any assignment requiring its consent
hereunder unless Borrower Representative has expressly objected to such assignment within five (5) Business Days after notice
thereof.

 

(b)        From
and after the date on which the conditions described in Section 15.10(a) above have been met, (i) such Assignee shall be deemed
automatically to have become a party hereto and, to the extent that rights and obligations hereunder have been assigned to such
Assignee pursuant to the applicable Assignment and Assumption, shall have the rights and obligations of a Lender hereunder and
(ii) the assigning Lender, to the extent that rights and obligations hereunder have been assigned by it pursuant to the applicable
Assignment and Assumption, shall be released from its rights (other than its indemnification rights) and obligations hereunder.
Upon the request of the Assignee (and, as applicable, the assigning Lender) pursuant to an effective Assignment and Assumption,
Borrowers shall execute and deliver to Agent for delivery to the Assignee (and, as applicable, the assigning Lender) a promissory
note in the principal amount of the Assignee's Pro Rata Share of the aggregate Revolving Loan Commitment (and, as applicable, a
promissory note in the principal amount of the Pro Rata Share of
the aggregate Revolving Commitment retained by the assigning Lender). Upon receipt by Agent of such promissory note(s), the assigning
Lender shall return to Borrowers any prior promissory note held by it.

 

    	 	91	 

     

    

 

(c)        Agent shall, as
a non-fiduciary agent of Borrowers, maintain a copy of each Assignment and Assumption delivered and accepted by it and register
(the "Register") for the recordation of names and addresses of the Lenders and the Commitment of each
Lender and principal and stated interest of each Loan owing to each Lender from time to time and whether such Lender is the original
Lender or the Assignee. No assignment shall be effective unless and until the Assignment and Assumption is accepted and registered
in the Register. All records of transfer of a Lender's interest in the Register shall be conclusive, absent manifest error, as
to the ownership of the interests in the Loans. Agent shall not incur any liability of any kind with respect to any Lender with
respect to the maintenance of the Register. Each Lender granting a participation shall, as a non-fiduciary agent of the Borrowers,
maintain a register containing information similar to that of the Register in a manner such that the loans hereunder are in "registered
form" for the purposes of the Code. This Section and Section 19.1.2 shall be construed so that the Loans are at all
times maintained in "registered form" for the purpose of the Code and any related regulations (and any successor provisions).

 

15.10.        Participations.
Anything in this Agreement or any other Loan Document to the contrary notwithstanding, any Lender may, at any time and from time
to time, without in any manner affecting or impairing the validity of any Obligations, sell to one or more Persons participating
interests in its Loans, commitments or other interests hereunder or under any other Loan Document (any such Person, a "Participant").
In the event of a sale by a Lender of a participating interest to a Participant, (a) such Lender's obligations hereunder and under
the other Loan Documents shall remain unchanged for all purposes, (b) Borrowers and such Lender shall continue to deal solely
and directly with each other in connection with such Lender's rights and obligations hereunder and under the other Loan Documents
and (c) all amounts payable by Borrowers shall be determined as if such Lender had not sold such participation and shall be paid
directly to such Lender; provided, that a Participant shall be entitled to the benefits of Section 13 as if it were
a Lender if Borrower Representative is notified of the Participation and the Participant complies with Section 13. Each Borrower
agrees that if amounts outstanding under this Agreement or any other Loan Document are due and payable (as a result of acceleration
or otherwise), each Participant shall be deemed to have the right of set-off in respect of its participating interest in amounts
owing under this Agreement and the other Loan Documents to the same extent as if the amount of its participating interest were
owing directly to it as a Lender under this Agreement; provided, that such right of set-off shall not be exercised
without the prior written consent of such Lender and shall be subject to the obligation of each Participant to share with such
Lender its share thereof. Each Borrower also agrees that each Participant shall be entitled to the benefits of Section 15.9 as
if it were a Lender. Notwithstanding the granting of any such participating interests, (i) Borrowers shall look solely to the
applicable Lender for all purposes of this Agreement, the Loan Documents and the transactions contemplated hereby, (ii) Borrowers
shall at all times have the right to rely upon any amendments, waivers or consents signed by the applicable Lender as being binding
upon all of the Participants and (iii) all communications in respect of this Agreement and such transactions shall remain solely
between Borrowers and the applicable Lender (exclusive of Participants) hereunder. If a Lender grants a participation hereunder,
such Lender shall maintain, as a non-fiduciary agent of Borrowers, a register as to the participations granted and transferred
under this Section containing the same information specified in Section 15.9 on the Register as if each Participant were a Lender
to the extent required to cause the Loans to be in registered form for the purposes of Sections 163(F), 165(J), 871, 881, and
4701 of the Code.

 

15.11.        Headings;
Construction. Section and subsection headings are used in this Agreement only for convenience and do not affect the meanings
of the provisions that they precede.

 

    	 	92	 

     

    

 

15.12.        USA PATRIOT
Act Notification. Agent hereby notifies the Loan Parties that pursuant to the requirements of the USA PATRIOT Act, it may
be required to obtain, verify and record certain information and documentation that identifies such Person, which information
may include the name and address of each such Person and such other information that will allow Agent to identify such Persons
in accordance with the USA PATRIOT Act.

 

15.13.        Counterparts;
Fax/Email Signatures. This Agreement may be executed in any number of counterparts, all of which shall constitute one and
the same agreement. This Agreement may be executed by signatures delivered by facsimile or electronic mail, each of which shall
be fully binding on the signing party.

 

15.14.        GOVERNING
LAW. THIS AGREEMENT, ALONG WITH ALL OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED OTHERWISE IN SUCH OTHER LOAN DOCUMENT)
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED THEREIN WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. FURTHER, THE LAW OF THE STATE OF NEW YORK SHALL APPLY TO ALL DISPUTES
OR CONTROVERSIES ARISING OUT OF OR CONNECTED TO OR WITH THIS AGREEMENT AND ALL SUCH OTHER LOAN DOCUMENTS WITHOUT REGARD TO CONFLICT
OF LAW PRINCIPLES.

 

15.15.        CONSENT
TO JURISDICTION; WAIVER OF JURY TRIAL; CONSENT TO SERVICE OF PROCESS. ANY LEGAL ACTION, SUIT OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE BROUGHT EXCLUSIVELY IN THE COURTS OF THE STATE OF ILLINOIS IN THE COUNTY OF
COOK OR IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS OR IN ANY OTHER COURT (IN ANY JURISDICTION)
SELECTED BY THE AGENT IN ITS SOLE DISCRETION, AND EACH BORROWER AND EACH OTHER LOAN PARTY OBLIGOR HEREBY ACCEPTS FOR ITSELF AND
IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFOREMENTIONED COURTS. EACH BORROWER AND EACH
OTHER LOAN PARTY OBLIGOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, OR BASED ON 28 U.S.C. § 1404,
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING AND ADJUDICATION OF ANY SUCH ACTION, SUIT OR PROCEEDING IN ANY OF THE AFOREMENTIONED
COURTS AND AMENDMENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT. EACH BORROWER AND
EACH OTHER LOAN PARTY OBLIGOR HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM CONCERNING
ANY RIGHTS UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR UNDER ANY AMENDMENT, WAIVER, AMENDMENT, INSTRUMENT, DOCUMENT OR
OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN CONNECTION HEREWITH OR THEREWITH, OR ARISING FROM ANY FINANCING
RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE OTHER TRANSACTION DOCUMENTS, AND AGREES
THAT ANY SUCH ACTION, PROCEEDING OR COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH BORROWER AND EACH OTHER
LOAN PARTY OBLIGOR HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON ANY BORROWER OR ANY OTHER LOAN PARTY OBLIGOR AND
CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY CERTIFIED MAIL (RETURN RECEIPT REQUESTED) DIRECTED TO BORROWER'S’
NOTICE ADDRESS (ON BEHALF OF BORROWERS OR SUCH LOAN PARTY OBLIGOR) SET FORTH IN SECTION 15.1 AND SERVICE SO MADE SHALL BE DEEMED
TO BE COMPLETED FIVE DAYS AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED IN THE MAIL, OR, AT THE AGENT'S OPTION, BY SERVICE UPON
ANY BORROWER OR ANY OTHER LOAN PARTY OBLIGOR IN ANY OTHER MANNER PROVIDED UNDER THE RULES OF ANY SUCH COURTS.

 

    	 	93	 

     

    

 

15.16.        Publication.
Each Borrower and each other Loan Party Obligor consents to the publication by Agent of a tombstone, press releases or similar
advertising material relating to the financing transactions contemplated by this Agreement, and Agent reserves the right to provide
to industry trade organizations information necessary and customary for inclusion in league table measurements.

 

15.17.        Confidentiality.
Agent and each Lender agree to use commercially reasonable efforts not to disclose Confidential Information to any Person without
the prior consent of Borrower Representative; provided, that nothing herein contained shall limit any disclosure
of the tax structure of the transactions contemplated hereby, or the disclosure of any information (a) to the extent required
by applicable law, statute, rule, regulation or judicial process or in connection with the exercise of any right or remedy under
any Loan Document, or as may be required in connection with the examination, audit or similar investigation of Agent or any of
its Affiliates, (b) to examiners, auditors, accountants or any regulatory authority, (c) to the officers, partners, managers,
directors, employees, agents and advisors (including independent auditors, lawyers and counsel) of Agent and each Lender or any
of their respective Affiliates, (d) in connection with any litigation or dispute which relates to this Agreement or any other
Loan Document to which Agent or any Lender is a party or is otherwise subject, (e) to a subsidiary or Affiliate of Agent or any
Lender, (f) to any assignee or participant (or prospective assignee or participant) which agrees to be bound by this Section 15.17
and (g) to any lender or other funding source of Agent or any Lender (each reference to Agent and Lender in the foregoing clauses
shall be deemed to include (i) the actual and prospective assignees and participants referred to in clause (f) and the lenders
and other funding sources referred to in clause (g), as applicable for purposes of this Section 15.17), and further provided,
that in no event shall Agent or any Lender be obligated or required to return any materials furnished by or on behalf of any Borrower
or any other Loan Party or Obligor. The obligations of Agent and Lenders under this Section 15.17 shall supersede and replace
the obligations of Agent and Lenders under any confidentiality letter or provision in respect of this financing or any other financing
previously signed and delivered by Agent or any Lender to any Borrower or any of its Affiliates.

 

15.18.        INTERCREDITOR
AGREEMENT.

 

EACH LENDER
PARTY HERETO (I) UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT IT (AND EACH OF ITS SUCCESSORS AND ASSIGNS) AND EACH OTHER LENDER (AND
EACH OF THEIR SUCCESSORS AND ASSIGNS) SHALL BE BOUND BY THE INTERCREDITOR AGREEMENT, (II) AUTHORIZES AND DIRECTS THE AGENT TO ENTER
INTO THE INTERCREDITOR AGREEMENT ON ITS BEHALF, AND (III) AGREES THAT ANY ACTION TAKEN BY THE AGENT PURSUANT TO THE INTERCREDITOR
AGREEMENT SHALL BE BINDING UPON SUCH LENDER.

 

THE PROVISIONS
OF THIS SECTION 15.19 ARE NOT INTENDED TO SUMMARIZE OR FULLY DESCRIBE THE PROVISIONS OF THE INTERCREDITOR AGREEMENT. REFERENCE
MUST BE MADE TO THE INTERCREDITOR AGREEMENT ITSELF TO UNDERSTAND ALL TERMS AND CONDITIONS THEREOF. EACH LENDER IS RESPONSIBLE FOR
MAKING ITS OWN ANALYSIS AND REVIEW OF THE INTERCREDITOR AGREEMENT AND THE TERMS AND PROVISIONS THEREOF, AND
NEITHER THE AGENT NOR ANY OF ITS AFFILIATES MAKES ANY REPRESENTATION TO ANY LENDER AS TO THE SUFFICIENCY OR ADVISABILITY OF THE
PROVISIONS CONTAINED IN THE INTERCREDITOR AGREEMENT. A COPY OF THE INTERCREDITOR AGREEMENT MAY BE OBTAINED FROM THE AGENT.

 

    	 	94	 

     

    

 

THE INTERCREDITOR
AGREEMENT IS AN AGREEMENT SOLELY AMONGST THE SECURED PARTIES (AS DEFINED IN THE INTERCREDITOR AGREEMENT) AND THEIR RESPECTIVE AGENTS
(INCLUDING THEIR SUCCESSORS AND ASSIGNS) AND IS ACKNOWLEDGED AND AGREED TO BY THE LOAN PARTIES. AS MORE FULLY PROVIDED THEREIN,
THE INTERCREDITOR AGREEMENT CAN ONLY BE AMENDED BY THE PARTIES THERETO IN ACCORDANCE WITH THE PROVISIONS THEREOF.

 

IN
THE EVENT OF ANY CONFLICT BETWEEN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND THE INTERCREDITOR AGREEMENT, THE INTERCREDITOR
AGREEMENT SHALL GOVERN.

  

[Signature page follows]

 

    	 	95	 

     

    

 

IN WITNESS WHEREOF, each
Borrower, each other Loan Party Obligor party hereto, Agent and each Lender have signed this Agreement as of the date first set
forth above.

 

 

	 	Agent:
	 	 
	 	ENCINA BUSINESS CREDIT, LLC
	 	 	 
	 	By: 	/s/ Tracy Salyers
	 	 	 
	 	Name: 	Tracy Salyers
	 	 	 
	 	Its:	Authorized Signatory

 

 

	 	Lenders:
	 	 
		ENCINA
BUSINESS CREDIT SPV, LLC
	 	 	 
	 	By:	/s/ Tracy Salyers
	 	 	 
	 	Name:	Tracy Salyers
	 	 	 
	 	Its:	Authorized Signatory

  

    	 	1	 

     

    

 

	 	Borrowers:
	 	 	 
	 	HYDROFARM, LLC
	 	 	 
	 	By:	/s/
    Jeff Peterson
	 	 	 
	 	Name:	
    Jeff Peterson
	 	 	 
	 	Its:	CFO
	 	 	 
	 	 	 
	 	SUNBLASTER, LLC
	 	 	 
	 	By:	/s/
    Jeff Peterson
	 	 	 
	 	Name:	Jeff Peterson
	 	 	 
	 	Its:	CFO
	 	 	 
	 	 	 
	 	SUNBLASTER HOLDINGS, LLC
	 	 	 
	 	By:	/s/
    Jeff Peterson
	 	 	 
	 	Name:	Jeff Peterson
	 	 	 
	 	Its:	CFO
	 	 	 
	 	 	 
	 	EDDI’S WHOLESALE GARDEN SUPPLIES LTD.
	 	 	 
	 	By:	/s/
    Jeff Peterson
	 	 	 
	 	Name:	Jeff Peterson
	 	 	 
	 	Its:	CFO
	 	 	 
	 	 	 
	 	HYDROFARM CANADA, LLC
	 	 	 
	 	By:	/s/
    Jeff Peterson
	 	 	 
	 	Name:	Jeff Peterson
	 	 	 
	 	Its:	CFO

  

    	 	2	 

     

    

 

	 	Loan Party Obligors:
	 	 	 
	 	 	 
	 	EHH HOLDINGS, LLC
	 	 	 
	 	By:	/s/ Jeff Peterson
	 	 	 
	 	Name:	Jeff Peterson
	 	 	 
	 	Its:	CFO
	 	 	 
	 	 	 
	 	HYDROFARM HOLDINGS, LLC
	 	 	 
	 	By:	/s/ Jeff Peterson
	 	 	 
	 	Name:	Jeff Peterson
	 	 	 
	 	Its:	CFO

  

    	 	3	 

     

    

 

Perfection Certificate

 

    	 	1	 

     

    

 

Annex I

 

Description of
Certain Terms

 

    	 	1	 

     

    

 

Annex II

 

    	 	1	 

     

    
 

ANNEX
III

 

Revolving
Loan Commitments

 

	Encina Business Credit SPV, LLC	$45,000,000
	 	 
	Total	$45,000,000

 

    	 	1	 

     

    

 

ANNEX IV

 

    	 	1	 

     

    

 

ANNEX V

 

Disqualified Institutions

 

    4

     

    

 

Exhibit A

 

FORM OF NOTICE OF
BORROWING

 

[letterhead of Borrower
Representative]

 

ENCINA
BUSINESS CREDIT, LLC, as Agent

____________

____________

Attention:
[______________]

 

Ladies
and Gentlemen:

 

Please
refer to the Loan and Security Agreement dated as of [__________] (as amended, restated or otherwise modified from time to time,
the "Loan Agreement") among the undersigned, as Borrower Representative, the Borrowers (as defined therein)
the Loan Party Obligors (as defined therein) party thereto, the Lenders party thereto and ENCINA BUSINESS CREDIT, LLC, as Agent
for the Lenders. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Loan
Agreement. This notice is given pursuant to Section 2.3 of the Loan Agreement and constitutes a representation by Borrower Representative,
for itself and on behalf of each Borrower, that the conditions specified in Section 4 of the Loan Agreement have been satisfied.
Without limiting the foregoing, (i) each of the representations and warranties set forth in the Loan Agreement and in the other
Loan Documents is true and correct in all respects as of the date hereof (or to the extent any representations or warranties are
expressly made solely as of an earlier date, such representations and warranties shall be true and correct as of such earlier
date), both before and after giving effect to the Loans requested hereby, and (ii) no Default or Event of Default is in existence,
both before and after giving effect to the Loans requested hereby.

 

Borrower
Representative hereby requests a borrowing, on behalf of each Borrower, under the Loan Agreement as follows:

 

The
aggregate amount of the proposed borrowing is $[______________]. The requested borrowing date for the proposed borrowing (which
is a Business Day) is [____________], [____].

 

Borrower Representative has
caused this Notice of Borrowing to be executed and delivered by its officer thereunto duly authorized on [_____________].

  

 

	 	[Borrower Representative], as Borrower Representative
	 	 	 
	 	By: 	                                  
	 	Title:   	  

 

 

    5

     

    

 

Exhibit
B

 

CLOSING
CHECKLIST

 

    	 	1	 

     

    

 

Exhibit C

 

CLIENT
USER FORM

 

ENCINA
BUSINESS CREDIT, LLC

ABLSoft – Client
User Form

 

Borrowers
Names: [Borrowers]

 

Borrower
Number:                    

 

Loan
and Security Agreement Date:                       ,
20    

 

 

I,
being an authorized signer of the above borrower, as Borrower Representative (the "Borrower"), refer to
the above Loan and Security Agreement (as amended, restated or otherwise modified from time to time, the "Loan Agreement")
between the Borrowers named above, the Lenders party thereto and ENCINA BUSINESS CREDIT, LLC, as Agent. This is the Client User
Form, used to determined client access to ABLSoft. Terms defined in the Loan Agreement have the same meaning when used in this
Client User Form.

 

Being
duly authorized by Borrower Representative, on behalf of Borrowers, I confirm that the following individuals have been authorized
by Borrower to have access to ABLSoft:

 

	 First
                                         Name
	 Last
                                         Name
	 Email
                                         Address
	 Phone
                                         Number

	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

 

 

	[Borrower Representative], as Borrower Representative
	 	 	 
	By: 	    	 
	Name:	 	 
	Title: 	  	 
	Date:	 	 

  

 

    	 	1	 

     

    

 

Exhibit
D

 

AUTHORIZED
ACCOUNTS FORM

 

ENCINA BUSINESS
CREDIT, LLC

 Authorized
Accounts Form

 

Borrowers
Names: [Borrowers]

 

Borrower
Number:                         

 

Loan
and Security Agreement Date:                       ,
20    

 

  

I,
being an authorized signer of , as Borrower Representative, refer to the above Loan and Security Agreement (as amended, restated
or otherwise modified from time to time, the "Loan Agreement") between the Borrower named above, the Lenders
party thereto and ENCINA BUSINESS CREDIT, LLC, as agent ("Agent"). This is the Authorized Accounts Form,
referring to authorized operating bank accounts of Borrower. Terms defined in the Loan Agreement have the same meaning when used
in this Authorized Accounts Form.

 

Being
duly authorized by Borrower Representative, I confirm that the following operating bank accounts of Borrowers are the accounts
into which the proceeds of any Loan may be paid:

 

	Bank
	Routing
        Number
	Account
        number
	Account
        name

	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

 

 

	[Borrower Representative], as Borrower Representative
	 	 	 
	By: 	    	 
	 	Authorized Signer	 
	 	 	 
	Name:	 	 
	Title: 	  	 
	Date:	 	 

  

    	 	1	 

     

    

 

Exhibit E

 

FORM OF ACCOUNT
DEBTOR NOTIFICATION

 

[Date]

 

 

VIA
CERTIFIED MAIL, RETURN RECEIPT REQUESTED

[Account
Debtor]

[Address]

 

	Re:	Loan Transaction
                                         with ENCINA BUSINESS CREDIT, LLC

 

Ladies
and Gentlemen:

 

Please
be advised that we have entered into certain financing arrangements (along with any other financing agreements that we may enter
into with Agent in the future, the "Financing Arrangements") with ENCINA BUSINESS CREDIT, LLC ("Agent"),
as Agent for certain Lenders, pursuant to which we have granted to Agent a security interest in, among other things, any and all
Accounts and Chattel Paper (as those terms are defined in the Uniform Commercial Code) owing by you to us, whether now existing
or hereafter arising.

 

You are
authorized and directed to respond to any inquiries that Agent may direct to you from time to time pertaining to the validity,
amount and other matters relating to such Accounts and Chattel Paper. In the event that Agent requests that payment for any Accounts
and/or Chattel Paper be made directly to Agent, you are hereby authorized and directed to comply with such instructions, without
further authorization or instruction from us.

 

This authorization
and directive shall be continuing and irrevocable until Agent advises you, in writing, that this authorization is no longer in
force.

 

 

 

	 	Very truly yours,
	 	 
	 	[BORROWER]
	 	 	 
	 	By: 	 
	 	Name: 	 
	 	Its:	            

  

	cc: 	ENCINA BUSINESS CREDIT, LLC
	 	as Agent	 	 
	 	 	 	 
	 	 	 	 
	 	Attention:  	 	 	 

 

    	 	1	 

     

    

 

Exhibit F

 

FORM OF COMPLIANCE
CERTIFICATE

 

[letterhead of Borrower
Representative]

 

 

	To: 	ENCINA BUSINESS CREDIT, LLC
	 	as Agent	 	 
	 	 	 	 
	 	 	 	 
	 	Attention:   	 	 	 

 

		Re:	Compliance Certificate
                                         dated                        

 

Ladies
and Gentlemen:

 

Reference
is made to that certain Loan and Security Agreement dated as of                       ,
20   (as amended, restated or otherwise modified from time to time, the "Loan Agreement")
by and among ENCINA BUSINESS CREDIT, LLC ("Agent"), the Lenders party thereto, [                     
], a [                                   ]
and [                     ], a
[                                   ]
(each a "Borrower" and collectively, the “Borrowers”) and each of the Loan Party
Obligors (as defined therein) party thereto. Capitalized terms used in this Compliance Certificate have the meanings set forth
in the Loan Agreement unless specifically defined herein.

 

Pursuant
to Section 7.15 of the Loan Agreement, the undersigned Chief Financial Officer of Borrower Representative hereby certifies on
behalf of each Borrower (solely in his capacity as an officer or Borrower Representative and not in his individual capacity) that:

 

1.
The financial statements of Borrowers for the      -month period ending                            
attached hereto have been prepared in accordance with GAAP and fairly present the financial condition of Borrowers for the
periods and as of the dates specified therein.

 

2. As of the date hereof,
there does not exist any Default or Event of Default.

 

3. Borrowers are in compliance
with the applicable financial covenants contained in Section 9 of the Loan Agreement for the periods covered by this Compliance
Certificate. Attached hereto are statements of all relevant facts and computations in reasonable detail sufficient to evidence
Borrowers’ compliance with such financial covenants, which computations were made in accordance with GAAP.

 

  

 

IN
WITNESS WHEREOF, this Compliance Certificate is executed by the undersigned this      day of                                ,         
.

  

	 	[Borrower Representative], as Borrower Representative
	 	 	 	 
	 	By: 	    	 
	 	Name:	 	 
	 	Title: 	Chief Financial Officer	 

  

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Exhibit G

 

FORM OF ASSIGNMENT
AND ASSUMPTION

 

Dated [                            
       , 201_]

 

Reference
is made to the Loan and Security Agreement dated as of [___________], 201[_] among [_______], a [________] and [_______], a [________]
(each a "Borrower" and collectively the “Borrowers” ) , the other Loan Party
Obligors party thereto, the lenders party thereto as "Lenders" and Encina Business Credit, LLC, as agent ("Agent")
for the Lenders (as amended, restated, supplemented or otherwise modified from time to time, the "Loan Agreement").
Terms defined in the Loan Agreement are used herein as therein defined.

 

[____________],
solely in its capacity as a Lender under the Loan Agreement (the "Assignor"), and [__________] (the "Assignee")
agree as follows:

 

2.        The
Assignor hereby sells and assigns to the Assignee, without recourse, representation or warranty (except as expressly set forth
elsewhere herein), and the Assignee hereby purchases and assumes from the Assignor, on the Effective Date (as defined below),
an interest as set forth in Exhibit A attached hereto (the "Assigned Interest") in and to (i) all
of the Assignor's right, title and interest with respect to the Loans set forth in Exhibit A, (ii) all of the Assignor's
right, title and interest with respect to the [Revolving Loan Commitment] of Assignor as set forth in Exhibit A
and (iii) to the extent related thereto, all of the Assignor's rights and obligations, solely as a Lender, under the Loan Agreement
and any other Loan Document (including, without limitation, (A) the outstanding principal amount of the Loans made by the Assignor
and assigned to Assignee hereunder, and (B) the Assignor's pro rata share of the obligations owing by each Loan Party under the
Loan Agreement and the Loan Documents). The Assigned Interest (expressed as a percentage) in the Loans and the [Revolving Loan
Commitment] is set forth in Exhibit A.

 

3.         The
Assignor (i) represents and warrants as of the date hereof that [its Revolving Loan Commitment, or if its Revolving Loan Commitment
shall have been terminated, the outstanding principal amount of its Revolving Loans], is set forth in Exhibit A (without
giving effect to assignments thereof which have not yet become effective); (ii) represents and warrants that it is the legal and
beneficial owner of the interest it is assigning hereunder; (iii) makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made by or in connection with the Loan Agreement or any other Loan
Document or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Agreement or any
other Loan Document, or any other instrument or document furnished pursuant thereto; and (iv) makes no representation or warranty
and assumes no responsibility with respect to the financial condition of any Loan Party or the performance or observance by any
Loan Party of any of its obligations under the Loan Agreement, any other Loan Document or any other instrument or document furnished
pursuant thereto.

 

4.         The
Assignee represents and warrants that it has become a party hereto solely in reliance upon its own independent investigation of
the financial and other circumstances surrounding the Loan Parties, the Collateral, the Loans, the Revolving Loan Commitments and
all aspects of the transactions evidenced by or referred to in the Loan Documents, or has otherwise satisfied itself thereto, and
that it is not relying upon any representation, warranty or statement (except any such representation, warranty or statement expressly
set forth in this Assignment and Assumption) of the Assignor in connection with the assignment made under this Assignment and Assumption.
The Assignee further acknowledges that the Assignee will, independently and without reliance upon Agent, the Assignor or any other
Lender and based upon the Assignee's review of such documents and information
as the Assignee deems appropriate at the time, make and continue to make its own credit decisions in entering into this Assignment
and Assumption and taking or not taking action under the Loan Documents. The Assignor shall have no duty or responsibility either
initially or on a continuing basis to make any such investigation or any such appraisal on behalf of the Assignee or to provide
the Assignee with any credit or other information with respect thereto, whether coming into its possession before the making of
the initial extension of credit under the Loan Agreement or at any time or times thereafter.

 

    	 	1	 

     

    

 

5.         The
Assignee represents and warrants to the Assignor that it has experience and expertise in the making of loans such as the Loans
or with respect to the other types of credit which may be extended under the Loan Agreement; that it has acquired its Assigned
Interest for its own account and not with any intention of selling all or any portion of such interest; and that it has received,
reviewed and approved copies of all Loan Documents.

 

6.         The
Assignor shall not be responsible to the Assignee for the execution, effectiveness, accuracy, completeness, legal effect, genuineness,
validity, enforceability, collectibility or sufficiency of any of the Loan Documents or for any representations, warranties, recitals
or statements made therein or in any written or oral statement or in any financial or other statements, instruments, reports, certificates
or any other documents made or furnished or made available by the Assignor to the Assignee or by or on behalf of the Loan Parties
to the Assignor or the Assignee in connection with the Loan Documents and the transactions contemplated thereby or for the financial
condition or business affairs of the Loan Parties or any other Person liable for the payment of any Loans or payment of amounts
owed in connection with other extensions of credit under the Loan Agreement or the value of the Collateral or any other matter.
The Assignor shall not be required to ascertain or inquire as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreements contained in any of the Loan Documents or as to the use of the proceeds of the Loans or other
extensions of credit under the Loan Agreement or as to the existence or possible existence of any Event of Default.

 

7.         Each
party to this Assignment and Assumption represents and warrants to the other party to this Assignment and Assumption that it has
full power and authority to enter into this Assignment and Assumption and to perform its obligations under this Assignment and
Assumption in accordance with the provisions set forth herein, that this Assignment and Assumption has been duly authorized, executed
and delivered by such party and that this Assignment and Assumption constitutes a legal, valid and binding obligation of such party,
enforceable in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, moratorium or other
similar laws affecting creditors' rights generally and by general equitable principles.

 

8.         Each
party to this Assignment and Assumption represents and warrants that the making and performance by it of this Assignment and Assumption
do not and will not violate any law or regulation of the jurisdiction of its organization or any other law or regulation applicable
to it.

 

9.         Each
party to this Assignment and Assumption represents and warrants that all consents, licenses, approvals, authorizations, exemptions,
registrations, filings, opinions and declarations from or with any agency, department, administrative authority, statutory corporation
or judicial entity necessary for the validity or enforceability of its obligations under this Assignment and Assumption have been
obtained, and no governmental authorizations other than any already obtained are required in connection with its execution, delivery
and performance of this Assignment and Assumption.

 

    	 	2	 

     

    

 

10.         The
Assignor represents and warrants that it is the legal and beneficial owner of the interest being assigned and that such interest
is free and clear of any lien, security interest or other encumbrance.

 

11.         The
Assignor makes no representation or warranty and assumes no responsibility with respect to the operations, condition (financial
or otherwise), business or assets of the Loan Parties or the performance or observance by the Loan Parties of any of their obligations
under the Loan Agreement or any other Loan Document.

 

12.         The
Assignee appoints and authorizes Agent to take such action as agent on its behalf and to exercise such powers under the Loan Documents
as are delegated to Agent by the terms thereof, together with such powers as are reasonably incidental thereto.

 

13.         The
Assignee agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Loan Agreement
and the other Loan Documents are required to be performed by it as a Lender.

 

14.         The
Assignee confirms that it has received all documents and information it has deemed appropriate to make its own credit analysis
and decision to enter into this Assignment and Assumption.

 

15.         The
Assignee specifies as its address for notices the office set forth beneath its name on the signature pages hereof.

 

16.
        The effective date for this Assignment and Assumption (the "Effective Date") shall be the date that is
the latest of (a) the execution of this Assignment and Assumption, (b) the delivery of this Assignment and Assumption to Agent
for acceptance, and (c) the date on which the Assignor has received the payment, in immediately available funds, by the Assignee
of $[_____________], which amount represents the purchase price for the Assigned Interest.

 

17.         Upon
acceptance of this Assignment and Assumption by Agent, as of the Effective Date (i) the Assignee shall, in addition to the rights
and obligations under the Loan Agreement and the other Loan Documents held by it immediately prior to the Effective Date, have
the rights and obligations under the Loan Agreement and the other Loan Documents that have been assigned to it pursuant to this
Assignment and Assumption, and (ii) the Assignor shall, to the extent provided in this Assignment and Assumption, relinquish its
rights and be released from its obligations under the Loan Agreement and the other Loan Documents that have been assigned by the
Assignor to the Assignee pursuant to this Assignment and Assumption.

 

18.         Upon
acceptance of this Assignment and Assumption by Agent, from and after the Effective Date, Agent shall make all payments under the
Loan Agreement in respect of the rights assigned hereby (including, without limitation, all payments of principal, interest and
fees with respect thereto) to the Assignee. If the Assignor receives or collects any payment of interest or fees attributable to
the interests assigned to Assignee by this Assignment and Assumption which has accrued after the Effective Date, the Assignor shall
distribute to the Assignee such payment. If the Assignee receives or collects any payment of interest or fees which is not attributable
to the interests assigned to the Assignee by this Assignment and Assumption or which has accrued on or prior to the Effective Date,
the Assignee shall distribute to the Assignor such payment.

 

 

    	 	3	 

     

    

 

19.
        This Assignment and Assumption shall be delivered and accepted in and shall be deemed to be a contract made under and governed
by the internal laws of the State of [Illinois] (but giving effect to federal laws applicable to national banks) applicable
to contracts made and to be performed entirely within such state, without regard to conflict of laws principles.

 

[rest of page intentionally
left blank; signature page follows]

 

    	 	4	 

     

    

 

IN WITNESS WHEREOF, the parties
hereto have caused their duly authorized officers to execute this Assignment and Assumption as of the Effective Date.

 

 

	 	[ASSIGNOR]
	 	 	 
	 	By	                 
	 	Name	       
	 	Title	  
	 	 	 
	 	NOTICE ADDRESS AN PAYMENT INSTRUCTIONS FOR ASSIGNOR
	 	        	              
	 	 	 
	 	    	       

	 	Telephone No.	(___) ___ - ____
	 	Telecopy No.	(___) ___ - ____

 

 

	 	[ASSIGNEE]
	 	 	 
	 	By	                           
	 	Name 	        
	 	Title	          
	 	 	 
	 	NOTICE ADDRESS AN PAYMENT INSTRUCTIONS FOR ASSIGNEE
	 	 	   
	 	 	 
	 	 	 

	 	Telephone No.	(___) ___ - ____
	 	Telecopy No.	(___) ___ - ____

  

    	 	5	 

     

    

  

	ACCEPTED this ____ day
	of ___________, 201__
	 	 	 
	ENCINA BUSINESS CREDIT, LLC,
	as Agent	 
	 	 	 
	 	 	 
	By: 	                   	 
	Name:	 	 
	Title: 	 	 ]

 

    	 	6	 

     

    

 

	Consented to this ____ day of ___________,
    201__
	 	 	 
	[BORROWER]
	 	 	 
	 	 	 
	By: 	                   	 
	Name:	 	 
	Title: 	 	 

  

    	 	7	 

     

    

 

EXHIBIT A

  

Borrowers:
[                        ]

 

Description
of Loan Agreement: Loan and Security Agreement, dated as of [                         ],
201[_] among Borrowers, the other Loan Party Obligors party thereto, the lenders party thereto as "Lenders" and Encina
Business Credit, LLC as agent ("Agent") for the Lenders (as amended, restated, supplemented or otherwise
modified from time to time).

 

Assigned
Interests:

 

	 Assignor's
        Interest Prior to

        Assignment
	Assigned

        Interests
	Assignor's

        Remaining
        Interest

        After
        Assignment
	Assignee's
        Pro

        Rata Shares

	
        Revolving Loans and Revolving

        Loan Commitments
	 	 	 

  

    8

     

    

 

Schedule 7.30

 

Post-Closing Matters

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