Document:

EX-10.8

 Exhibit 10.8 
  

			
	Valeritas Holdings, Inc. 2016 Incentive Compensation Plan	  	

	Stock Option Agreement

  
 RECITALS

 A. The Board has adopted the Plan for the purpose of retaining the services of selected Employees, non-employee members of the Board (or the board
of directors of any Parent or Subsidiary) and consultants and other independent advisors who provide services to the Corporation (or any Parent or Subsidiary). 

B. Optionee is to render valuable services to the Corporation (or a Parent or Subsidiary), and this Agreement is executed pursuant to, and is intended to
carry out the purposes of, the Plan in connection with the Corporation’s grant of an option to Optionee. 
 C. All capitalized terms in this Agreement,
to the extent not defined herein or in the attached Appendix, shall have the meaning assigned to them in the Plan. 
 NOW, THEREFORE, it is hereby
agreed as follows: 
 1. Grant of Option. The Corporation hereby grants to Optionee, as of the Grant Date, an option to
purchase up to the number of Option Shares specified in the Grant Notice, subject to the terms and conditions of this Agreement and the Plan. The Option Shares shall be purchasable from time to time during the option term specified in Paragraph
2 at the Exercise Price. 
 2. Option Term. This option shall have a maximum term of ten (10) years measured from the
Grant Date and shall accordingly expire at the close of business on the Expiration Date, unless sooner terminated in accordance with Paragraph 5 or 6. 

3. Transferability. The transferability of this option shall be governed by the requirements of Article Two, Section I.F. of
the Plan. 
 4. Dates of Exercise. This option shall become vested and exercisable for the Option Shares in one or more
installments in accordance with the Exercise Schedule set forth in the Grant Notice. As the option becomes vested and exercisable for such installments, those installments shall accumulate, and the option shall remain vested and exercisable for
the accumulated installments until the Expiration Date or sooner termination of the option term under Paragraph 5 or 6. 
 5. Cessation
of Service. The option term specified in Paragraph 2 shall terminate (and this option shall cease to be outstanding) prior to the Expiration Date should any of the following provisions become applicable: 

(a) Should Optionee cease to remain in Service for any reason (other than death, Involuntary Termination, Retirement, Permanent Disability or
Misconduct) while this option is outstanding, then Optionee (or any person or persons to whom this option is transferred pursuant to a permitted transfer under Paragraph 3) shall have a period of three (3) months (commencing with the first date
following such cessation of Service) during which to exercise this option, but in no event shall this option be exercisable at any time after the Expiration Date. 

(b) Should Optionee die while this option is outstanding, then this option may be exercised by (i) the personal representative of
Optionee’s estate or (ii) the person or persons to whom the option is transferred pursuant to Optionee’s will or the laws of inheritance following Optionee’s death or to whom the option is transferred during Optionee’s lifetime
pursuant to a permitted transfer under Paragraph 3, as the case may be. However, if Optionee dies while holding this option and has an effective beneficiary designation in effect for this option at the time of his or her death, then the designated
beneficiary or beneficiaries shall have the exclusive right to exercise this option following Optionee’s death. Any such right to exercise this option shall lapse, and this option shall cease to be outstanding, upon the earlier of (i) the
expiration of the twelve (12)-month period following the date of Optionee’s death or (ii) the Expiration Date. 
 (c) Should Optionee
cease Service by reason of Involuntary Termination, Retirement or Permanent Disability while this option is outstanding, then Optionee (or any person or persons to whom this option is transferred pursuant to a permitted transfer under Paragraph 3)
shall have a period of twelve (12) months (commencing with the first date following such cessation of Service) during which to exercise this option. In no event shall this option be exercisable at any time after the Expiration Date. 

Note: If this option is designated as an Incentive Option in the Grant Notice, exercise of this option on a date later than three (3)
months following cessation of Service due to Involuntary Termination or Retirement will result in the loss of Incentive Option tax treatment. In the event Incentive Option tax treatment is not available, this option will be taxed as a
Non-Statutory Option upon exercise. 

 (d) During the limited period of post-Service exercisability, this option may not be exercised in
the aggregate for more than the number of Option Shares for which this option is, at the time of Optionee’s cessation of Service, vested and exercisable pursuant to the Exercise Schedule specified in the Grant Notice. This option shall not vest
or become exercisable for any additional Option Shares, whether pursuant to the normal Exercise Schedule specified in the Grant Notice, following the Optionee’s cessation of Service, except to the extent (if any) specifically authorized by the
Plan Administrator pursuant to an express written agreement with the Optionee. Upon the expiration of such limited exercise period or (if earlier) upon the Expiration Date, this option shall terminate and cease to be outstanding for any exercisable
Option Shares for which the option has not otherwise been exercised. 
 (e) Should Optionee’s Service be terminated for Misconduct or
should Optionee otherwise engage in any Misconduct while this option is outstanding, then this option shall terminate immediately and cease to remain outstanding. 

6. Change in Control. Except as may be provided in the Grant Notice, the provisions of the Plan applicable to a Change in
Control shall apply to the option, and, in the event of a Change in Control, the Board may take such actions as it deems appropriate pursuant to the Plan. 

7. Adjustment in Option Shares. Should any change be made to the Common Stock by reason of any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares, spin-off transaction, merger, reorganization, consolidation, reclassification or change in par value, or any other unusual or infrequently occurring event affecting the outstanding Common
Stock as a class without the Corporation’s receipt of consideration, then equitable adjustments shall be made by the Plan Administrator to (i) the total number and/or class of securities subject to this option and (ii) the Exercise Price, in
order to reflect such change and thereby preclude a dilution or enlargement of benefits hereunder. 
 8. Manner of Exercising
Option. 
 (a) In order to exercise this option with respect to all or any part of the Option Shares for which this option is at the
time exercisable, Optionee (or any other person or persons exercising the option) must take the following actions: 
  

	 	(i)	Execute and deliver to the Corporation a Notice of Exercise for the Option Shares for which the option is exercised, or comply with such other procedures as the Corporation may establish from time to time.

  

	 	(ii)	Pay the aggregate Exercise Price for the purchased shares in one or more of the following forms: 

  

	 	(A)	cash or check made payable to the Corporation; 

 Should the Common Stock be registered under
Section 12 of the 1934 Act at the time the option is exercised, then the Exercise Price may also be paid as follows: 
  

	 	(B)	in shares of Common Stock held by Optionee (or any other person or persons exercising the option) for the requisite period necessary to avoid a charge to the Corporation’s earnings for financial reporting purposes
and valued at Fair Market Value on the Exercise Date; 

  

	 	(C)	shares of Common Stock otherwise issuable under the option but withheld by the Corporation in satisfaction of the exercise price, with such withheld shares to be valued at Fair Market Value on the Exercise Date, or

  

	 	(D)	through a special sale and remittance procedure pursuant to which Optionee (or any other person or persons exercising the option) shall concurrently provide irrevocable instructions (i) to a brokerage firm (reasonably
satisfactory to the Corporation for purposes of administering such procedure in accordance with the Corporation’s pre-clearance/pre-notification policies) to effect the immediate sale of the purchased shares and remit to the Corporation, out of
the sale proceeds available on the settlement date, sufficient funds to cover the aggregate Exercise Price payable for the purchased shares plus all applicable income and employment taxes required to be withheld by the Corporation by reason of such
exercise and (ii) to the Corporation to deliver the certificates for the purchased shares directly to such brokerage firm on such settlement date in order to complete the sale. 

Except to the extent the sale and remittance procedure is utilized in connection with the option exercise, payment of the Exercise Price must
accompany the Notice of Exercise delivered to the Corporation in connection with the option exercise. 

  
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	 	(iii)	Furnish to the Corporation appropriate documentation that the person or persons exercising the option (if other than Optionee) have the right to exercise this option. 

 

	 	(iv)	Execute and deliver to the Corporation such written representations as may be requested by the Corporation in order for it to comply with the applicable requirements of applicable securities laws. 

 

	 	(v)	Make appropriate arrangements with the Corporation (or Parent or Subsidiary employing or retaining Optionee) for the satisfaction of all applicable income and employment tax withholding requirements applicable to the
option exercise. 

 (b) As soon as practical after the Exercise Date, the Corporation shall issue to or on behalf of Optionee
(or any other person or persons exercising this option) a certificate for the purchased Option Shares, with the appropriate legends affixed thereto. 

(c) In no event may this option be exercised for any fractional shares. 

 

	9.	Compliance with Laws and Regulations. 

 (a) The exercise of this option and the
issuance of the Option Shares upon such exercise shall be subject to compliance by the Corporation and Optionee with all applicable requirements of law relating thereto and with all applicable regulations of any stock exchange (or the Nasdaq
National Market, if applicable) on which the Common Stock may be listed for trading at the time of such exercise and issuance. 
 (b) The
inability of the Corporation to obtain approval from any regulatory body having authority deemed by the Corporation to be necessary to the lawful issuance and sale of any Common Stock pursuant to this option shall relieve the Corporation of any
liability with respect to the non-issuance or sale of the Common Stock as to which such approval shall not have been obtained. The Corporation, however, shall use its best efforts to obtain all such approvals. 

 

	10.	Successors and Assigns. Except to the extent otherwise provided in Paragraph 3 or the Plan, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Corporation and its
successors and assigns and Optionee, Optionee’s assigns, the legal representatives, heirs and legatees of Optionee’s estate and any beneficiaries of this option designated by Optionee. 

 

	11.	Notices. Any notice required to be given or delivered to the Corporation under the terms of this Agreement shall be in writing and addressed to the Corporation at its principal corporate offices. Any
notice required to be given or delivered to Optionee shall be in writing and addressed to Optionee at the address indicated below Optionee’s signature line on the Grant Notice. All notices shall be deemed effective upon personal delivery or
upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified. 

  

	12.	Grant Subject to Plan Provisions. This option is granted pursuant to the Plan, the terms of which are incorporated herein by reference, and in all respects shall be interpreted in accordance with the
Plan. The grant and exercise of this option are subject to interpretations, regulations and determinations concerning the Plan established from time to time by the Plan Administrator in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (a) rights and obligations with respect to Withholding Taxes, (b) the registration, qualification or listing of the Common Stock, (c) changes in capitalization of the Corporation and (d) other requirements of
applicable law. The Plan Administrator shall have the authority to interpret and construe the option pursuant to the terms of the Plan, and its decisions shall be conclusive as to any questions arising hereunder. 

 

	13.	Additional Terms Applicable to an Incentive Option. In the event this option is designated an Incentive Option in the Grant Notice, the following terms and conditions shall also apply to the grant:

 (a) This option shall cease to qualify for favorable tax treatment as an Incentive Option if (and to the extent) this option
is exercised for one or more Option Shares: (A) more than three (3) months after the date Optionee ceases to be an Employee for any reason other than death or Permanent Disability or (B) more than twelve (12) months after the date Optionee ceases to
be an Employee by reason of Permanent Disability. 
 (b) No installment under this option shall qualify for favorable tax treatment as an
Incentive Option if (and to the extent) the aggregate Fair Market Value (determined at the Grant Date) of the Common Stock for which such installment first becomes exercisable hereunder would, when added to the aggregate value (determined as of the
respective date or dates of grant) of the Common Stock or other securities for which this option or any other Incentive Options granted to Optionee prior to the Grant Date (whether under the Plan or any other option plan of the Corporation or any
Parent or Subsidiary) first become exercisable during the same calendar year, exceed One Hundred Thousand Dollars ($100,000) in the aggregate. Should such One Hundred Thousand Dollar ($100,000) limitation be exceeded in any calendar year, this
option shall nevertheless become exercisable for the excess shares in such calendar year as a Non-Statutory Option. 

  
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 (c) Should the exercisability of this option be accelerated by the Plan Administrator or as may
be provided in the Grant Notice, then this option shall qualify for favorable tax treatment as an Incentive Option only to the extent the aggregate Fair Market Value (determined at the Grant Date) of the Common Stock for which this option first
becomes exercisable in the calendar year in which such acceleration occurs does not, when added to the aggregate value (determined as of the respective date or dates of grant) of the Common Stock or other securities for which this option or one or
more other Incentive Options granted to Optionee prior to the Grant Date (whether under the Plan or any other option plan of the Corporation or any Parent or Subsidiary) first become exercisable during the same calendar year, exceed One Hundred
Thousand Dollars ($100,000) in the aggregate. Should the applicable One Hundred Thousand Dollar ($100,000) limitation be exceeded in the calendar year of such acceleration, the option may nevertheless be exercised for the excess shares in such
calendar year as a Non-Statutory Option. 
 (d) Should Optionee hold, in addition to this option, one or more other options to purchase
Common Stock which become exercisable for the first time in the same calendar year as this option, then the foregoing limitations on the exercisability of such options as Incentive Options shall be applied on the basis of the order in which such
options are granted. 
 14. Optionee Undertaking. Optionee hereby agrees to take whatever additional action and execute whatever
additional documents the Corporation may deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on either Optionee or the Option Shares pursuant to the provisions of this Agreement. 

15. Recoupment. This Option shall be subject to any clawback, recoupment or other similar policy adopted by the Board as in effect
from time to time, and this Option and any cash, shares of common stock or other property or amounts due, paid or issued to the Optionee shall be subject to the terms of such policy, as in effect from time to time. 

  
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 APPENDIX 

The following definitions shall be in effect under the Agreement: 

A. Agreement shall mean this Stock Option Agreement. 

B. Exercise Price shall mean the exercise price per Option Share as specified in the Grant Notice. 

C. Exercise Schedule shall mean the schedule set forth in the Grant Notice pursuant to which the option is to become exercisable for the Option
Shares in one or more installments over the Optionee’s period of Service. 
 D. Expiration Date shall mean the date on which the option
expires as specified in the Grant Notice. 
 E. Grant Date shall mean the date of grant of the option as specified in the Grant
Notice. 
 F. Grant Notice shall mean the Notice of Grant of Stock Option accompanying the Agreement, pursuant to which Optionee has been
informed of the basic terms of the option evidenced hereby. 
 G. Involuntary Termination shall mean the termination of the Service of
Optionee which occurs by reason of: 
 (i) Optionee’s involuntary dismissal or discharge by the Corporation (or any Parent or
Subsidiary) for reasons other than Misconduct, or 
 (ii) Optionee’s voluntary resignation following (A) a change in his or her
position with the Corporation (or any Parent or Subsidiary) which materially reduces his or her duties and responsibilities or the level of management to which he or she reports, (B) a reduction in his or her level of compensation (including base
salary, fringe benefits and target bonus under any corporate-performance based bonus or incentive programs) by more than fifteen percent (15%) or (C) a relocation of such individual’s place of employment by more than fifty (50) miles, provided
and only if such change, reduction or relocation is effected by the Corporation (or any Parent or Subsidiary) without Optionee’s consent. 
 H.
Misconduct shall have the meaning assigned to such term or substantially similar term (e.g. a definition of a termination for “cause”) set forth in any employment agreement between Optionee and the Corporation. To the extent
not otherwise defined in any employment agreement between Optionee and the Corporation, the term Misconduct shall mean the commission of any act of fraud, embezzlement or dishonesty by Optionee, any unauthorized use or disclosure by Optionee of
confidential information or trade secrets of the Corporation (or any Parent or Subsidiary), or any other intentional misconduct by Optionee adversely affecting the business or affairs of the Corporation (or any Parent or Subsidiary) in a material
manner. The foregoing definition shall not in any way preclude or restrict the right of the Corporation (or any Parent or Subsidiary) to discharge or dismiss Optionee or any other person in the Service of the Corporation (or any Parent or
Subsidiary) for any other acts or omissions, but such other acts or omissions shall not be deemed, for purposes of the Plan or this Agreement, to constitute grounds for termination for Misconduct. 

I. Notice of Exercise shall mean the notice of option exercise in the form prescribed by the Corporation. 

J. Option Shares shall mean the number of shares of Common Stock subject to the option as specified in the Grant Notice. 

K. Optionee shall mean the person to whom the option is granted as specified in the Grant Notice.EX-10.13

 Exhibit 10.13 

Execution Version 

LIMITED FORBEARANCE AGREEMENT 

This LIMITED FORBEARANCE AGREEMENT (this “Agreement”) is made as of May 18, 2015 by and among VALERITAS, INC., a
Delaware corporation (the “Borrower”), VALERITAS HOLDINGS, LLC, a Delaware limited liability company (“Parent”), as a Guarantor (as such term is defined in the Credit Agreement), each of the other Guarantors party
hereto, and the undersigned Lenders. 
 RECITALS 

A. The Borrower, Parent, the other Guarantors, the Control Agent and the other Lenders signatory thereto have entered into that certain
Amended and Restated Term Loan Agreement dated as of August 5, 2014 (as amended from time to time, the “Credit Agreement”). All capitalized terms used herein and not otherwise defined shall have the meanings assigned to such
terms in the Credit Agreement. 
 B. As of the date hereof, the Events of Default identified on Exhibit A hereto have occurred and
are continuing (collectively, the “Designated Defaults”). 
 C. Notwithstanding the existence of the Designated Defaults,
the Borrower and the Guarantors requested that the Control Agent and the other Lenders, during the Forbearance Period (defined below), temporarily forbear from exercising certain rights or remedies under the Credit Agreement, the other Loan
Documents and applicable law with respect to such Designated Defaults (and only with respect thereto). 
 D. Subject to the terms and
conditions set forth herein, the Control Agent and the other Lenders have agreed to forbear from exercising certain of their default-related rights and remedies against the Borrower and the Guarantors with respect to the Designated Defaults (and
only with respect thereto). 
 E. This Agreement shall constitute a Loan Document, and these Recitals shall be construed as part of this
Agreement. 
 NOW, THEREFORE, for valuable consideration, the receipt and adequacy of which is hereby acknowledged, and in consideration of
the premises and the mutual covenants contained herein, subject to the satisfaction of the conditions described in Section 5, the parties hereto hereby agree as follows: 

SECTION 1. Definitions. 
 Certain
Defined Terms. As used herein, the following terms have the following respective meanings: 

“Agreement” has the meaning set forth in the introduction hereto. 

“Borrower” has the meaning set forth in the introduction hereto. 

“Bridge Equity Financing” has the meaning set forth in Section 4(n) hereof. 

 “Budgeted Cash Flow” has the meaning set forth in
Section 4(b)(i) hereof. 
 “Collateral” has the meaning set forth in the Security
Agreement. 
 “Control Accounts” shall mean, collectively (i) Account No. DE3550 that is subject to that
certain Account Control Agreement, dated as of May 27, 2013, by and among the Borrower, Capital Advisors Group, Inc., as Investment Manager, Capital Royalty Partners II, L.P., as Lender, and State Street Bank and Trust Company, as Securities
Intermediary; (ii) Account Nos. 3300994367 and 3300994371 that are subject to that certain Deposit Account Control Agreement, dated as of August15, 2013, by and among Borrower, Capital Royalty Partners II, L.P. and Silicon Valley Bank and
(iii) Account No. DE 3551 that is subject to that certain Account Control Agreement, dated as of April 2015, by and among Valeritas Security Corporation, as Borrower, Capital Advisors Group, Inc., as Investment Manager, Capital Royalty Partners
II L.P., as Lender, and State Street Bank and Trust Company, as Securities Intermediary. 
 “Control
Agent” has the meaning set forth in the Security Agreement. 
 “Cost Reduction
Plan” has the meaning set forth in Section 4(o) hereof. 
 “Credit
Agreement” has the meaning set forth in the Recitals hereof. 
 “Credit Parties” means the
Borrower and each Guarantor. 
 “CRII” means Capital Royalty Partners II L.P., a Delaware limited
partnership. 
 “CRII Parallel” means Capital Royalty Partners II – Parallel Fund “A”
L.P., a Delaware limited partnership. 
 “Designated Defaults” has the meaning set forth in the Recitals hereof.

 “Final Plan” has the meaning set forth in Section 4(m) hereof. 

“Financial Reports” has the meaning set forth in Section 4(c) hereof. 

“Forbearance Period” has the meaning set forth in Section 3(a) hereof. 

“Lenders’ Costs” has the meaning set forth in Section 4(b)(iii) hereof. 

“Parallel Investment” means Parallel Investment Opportunities Partners II L.P., a Delaware limited
partnership. 
 “Permitted Expenditures” has the meaning set forth in Section 4(b)(iii)
hereof. 
 “Plan” has the meaning set forth in Section 4(m) hereof. 

“Qualified Equity Financing” has the meaning set forth in Section (p) hereof. 

“Released Party” has the meaning set forth in Section 7(a) hereof. 

  
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 “Reserve Account” has the meaning set forth in Section 11(c)
hereof. 
 “Sale Transaction” has the meaning set forth in Section (p) hereof. 

“Secured Party” has the meaning set forth in the Security Agreement. 

“Security Agreement” means that certain Security Agreement, dated as of May 24, 2013, among
Borrower, each of the other Grantors party thereto, CRII, CRII Parallel, Parallel Investment and the other Secured Parties from time to time party thereto, as amended from time to time, and including the Valeritas Guarantee Assumption, the Valeritas
Joinder and the instruments and documents executed in connection therewith. 
 “Senior Debt” has the
meaning set forth in the Subordination Agreement. 
 “Side Letter Agreement” means that certain Side Letter
Agreement, dated of even date herewith, by and among the parties hereto. 
 “Subordinated Debt” has
the meaning set forth in the Subordination Agreement. 
 “Subordination Agreement” means that certain
Subordination Agreement, dated as of May 24, 2013, among CRII, CRII Parallel, Parallel Investment (and their successors and assigns), and WCAS (as to be amended by the terms of the Amended and Restated Subordination Agreement). 

“Unencumbered Assets” has the meaning set forth in Section 4(e) hereof. 

“Valeritas Guarantee Assumption” means the Guarantee Assumption Agreement, dated as of April 16, 2015, by
Valeritas in favor of the Lenders. 
 “Valeritas Joinder” means the Joinder Agreement, dated as of April 16,
2015, by Valeritas, the Control Agent and the other Lenders. 
 “Valeritas Security” means Valeritas Security
Corporation, a Delaware corporation. 
 “Valeritas Security Control Account” means the Control Account No. DE 3551
that is subject to that certain Account Control Agreement, dated as of April 2015, by and among Valeritas, as Borrower, Capital Advisors Group, Inc., as Investment Manager, Capital Royalty Partners II L.P., as Lender, and State Street Bank and Trust
Company, as Securities Intermediary. 
 “WCAS” means WCAS Capital Partners IV, L.P., a Delaware limited partnership.

 “Waiver Agreement” means that certain Consent, Waiver, and Amendment Agreement dated as of June 19, 2014,
among the Borrower and the Lenders party thereto. 
 SECTION 2. Acknowledgment. 

(a) Acknowledgment of Obligations. Each Credit Party hereby acknowledges, confirms and agrees that as of April 3
2015, the Credit Parties are indebted to the Lenders in respect of the Loans in an aggregate amount no less than the amounts set-forth in the notice attached in Exhibit C hereto. 

  
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 The foregoing amounts and all other Obligations under or in connection with the Loans, together with interest
accrued and accruing thereon, and fees, costs, expenses and other charges now or hereafter payable by the Borrower or any Guarantor to the Control Agent and the other Lenders (including, without limitation, the Prepayment Premium, which each Credit
Party acknowledges, confirms and agrees is immediately due and payable in accordance with Section 11.02 of the Credit Agreement and otherwise pursuant to the Loan Documents), are unconditionally and immediately due and payable by the
Borrower and the Guarantors to the Control Agent and the other Lenders, without offset, recoupment, defense or counterclaim of any kind, nature or description whatsoever, all of which (if any exist, and which the Credit Parties hereby acknowledge do
not exist) are hereby waived by the Credit Parties. 
 (b) Acknowledgment of Security Interest. Borrower and each other Grantor under
the Security Agreement each hereby acknowledges, confirms and agrees that the Control Agent and the Secured Parties have, as of the date hereof, and shall continue to have a valid, enforceable and perfected first-priority lien upon and security
interest in the Collateral granted to the Control Agent and the other Lenders pursuant to the Security Agreement and the other Loan Documents. 

(c) Acknowledgment of Default. Each Credit Party hereby acknowledges and agrees that the Designated Defaults have occurred and are
continuing as of the date hereof, each of which constitutes an Event of Default, and, as a result of the Designated Defaults, as well as any other Defaults or Events of Default that may exist, the Control Agent and the other Lenders are entitled to
exercise any and all default-related rights and remedies under the Credit Agreement, the other Loan Documents, and/or applicable law, including without limitation, to accelerate the Obligations (and have done so as set forth in
Section 2(d) herein) or to exercise rights against Collateral and that no Credit Party has any valid defense to the enforcement of such default-related rights and remedies. Each Credit Party hereby acknowledges and agrees that the first
to occur of the Designated Defaults occurred no later than January 1, 2015 and have continued to date. 
 (d) Acknowledgment of
Exercise of Remedies. Each Credit Party hereby acknowledges, confirms, and agrees that (i) on April 3, 2015, the Control Agent and the other Lenders duly provided notice to the Borrower that various defaults and Events of Default
(including, without limitation, the Designated Defaults) have occurred and are continuing, declared all of the Obligations of the Borrower under the Credit Agreement and all other Loan Documents to be then immediately due and payable, and terminated
the Commitments as of January 1, 2015, and any other obligations to extend any further credit under any of the Loan Documents; (ii) such actions by the Control Agent and the other Lenders were a proper exercise of their rights and
remedies, and were made in accordance with the provisions of the Credit Agreement, the other Loan Documents, and applicable law; and (iii) payment in full in cash of the Obligations (in the case of the Loans, at the Redemption Price) is
immediately due and payable. 

  
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 SECTION 3. Forbearance. 

(a) As used herein, the term “Forbearance Period” shall mean the period commencing on the date hereof and ending on the
earlier to occur of (i) September 29, 2015 (5:00 p.m. Central time) and (ii) the occurrence of any one or more of the following events: 

(A) the occurrence of any default or Event of Default under the Credit Agreement or the other Loan Documents (including, for
the avoidance of doubt, the Waiver Agreement), other than the Designated Defaults, or any Designated Default either is repeated or worsens; 

(B) any failure by any Credit Party to timely comply with any other term, condition or provision contained in this Agreement,
whether or not notice is given of such failure, after giving effect to any notice, lapse of time or both; 
 (C) any
representation made by any Credit Party in this Agreement or the other Loan Documents proves to be incorrect or misleading (or more incorrect or misleading) in any material respect as of the date when made; and 

(D) any Material Adverse Effect (other than any Designated Default, except to the extent that any Designated Default either is
repeated or worsens) shall occur as determined by Control Agent (after giving effect to the financial condition of the Borrower and the other Credit Parties as of the date hereof); 

(E) Any failure by any Credit Party to timely comply with any term, condition or provision contained in the documents
evidencing the Bridge Equity Financing, whether or not notice is given of such failure, after giving effect to an notice, lapse of time or both. 

The occurrence of any of the events set forth in clauses (A) through (E) above shall constitute an immediate Event of Default under
the Credit Agreement and the other Loan Documents. 
 (b) Forbearance. Subject to and conditioned upon the timely satisfaction of the
conditions precedent set forth in Section 5 hereof and subject to the right to payment from the Reserve Account set forth in Section 11(c) hereof, during the Forbearance Period, neither the Control Agent nor any other Lender
will take action, on account of the Designated Defaults only, to enforce payment of the Obligations of the Credit Parties under the Loan Documents by creditor default remedies. Automatically and without any notice or action by the Control Agent or
the other Lenders, upon termination or expiration of the Forbearance Period, the Control Agent and the other Lenders shall be entitled (but not required) to exercise any of the rights and remedies with respect to the Designated Defaults (or
otherwise) available to them under the Loan Documents or applicable law. For the avoidance of doubt, the rights and remedies of the Control Agent and the other Lenders shall not be limited, adversely affected, or otherwise subject to forbearance or
restraint on account of any Default, Event of Default, repeated or worsened Designated Default, or other reason other than a Designated Default during the Forbearance Period. 

  
 5 

 SECTION 4. Supplementary Loan Document Provisions. 

Each party hereto hereby agrees to comply with the following terms, conditions and covenants during the Forbearance Period (and, as to any
Credit Party’s Obligations, thereafter so long as any Event of Default continues) to the extent applicable to it, in each case notwithstanding any provision to the contrary set forth in this Agreement, the Credit Agreement or any other Loan
Document. 
 (a) Default Interest. The interest payable pursuant to Section 3.02 of the Credit Agreement shall accrue
during the Forbearance Period and be deemed to have accrued at the Post-Default Rate from and after January 1, 2015. 
 (b)
Permitted Expenditures. 
 (i) Attached hereto as Exhibit B is a draft 13-week detailed expense statement containing a
projection of cash receipts and disbursements for the period reflected thereon, a final version of which shall be delivered to the Control Agent and the other Lenders on or before May 20, 2015 (as set forth thereon or as modified in accordance
with the terms of this Agreement, the “Budgeted Cash Flow”). The Borrower represents and warrants that such Budgeted Cash Flow (and each modification thereof) was prepared in good faith in accordance with GAAP consistently applied
(using reasonable and conservative assumptions and estimates) and contains only those expenditures that are necessary to avoid immediate or irreparable harm to the Collateral and as are necessary and reasonable for the Borrower to preserve the
going-concern value of the Borrower’s business during the Forbearance Period. The Borrower may modify the Budgeted Cash Flow upon the prior written consent of the Control Agent and the Majority Lenders so long as the Borrower’s total
expenditures do not exceed the aggregate funds approved in the Budgeted Cash Flow. 
 (ii) Subject to the terms and conditions contained
herein, during the Forbearance Period the Borrower shall be authorized to use cash for Permitted Expenditures only or pursuant to separate, advance approval by the Control Agent. 

(iii) “Permitted Expenditures” shall consist of cash disbursements consistent with and pursuant to the line items of expenses
set forth in the Budgeted Cash Flow that has most recently been approved by the Control Agent and the other Lenders. The Borrower’s actual expenditures for any specific expense line item in the Budgeted Cash Flow (other than the Lenders’
Costs (as defined below) may vary by no more than 10% of the amount set forth in the applicable Budgeted Cash Flow without prior written consent of the Control Agent; provided, however, that the total amount of cash used by the Borrower shall not
exceed on a cumulative basis the amounts shown on the then-current Budgeted Cash Flow through the end of each weekly period (other than the Lenders’ Costs). The Budgeted Cash Flow shall also include a line item for the reimbursement of the
reasonable fees, costs and out-of-pocket expenses (the “Lenders’ Costs”) incurred by the Control Agent and the other Lenders in connection with the preparation, execution, delivery, administration and enforcement of this
Agreement, including, without limitation, any costs and out-of-pocket expenses incurred in connection with the Bridge Equity Financing, which Lenders’ Costs shall not be capped and shall be paid out of the Reserve Account in accordance with
Section 11(c) hereof. 

  
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 (c) Financial Reporting. In addition to the reporting requirements set forth in the Credit
Agreement, the Borrower shall provide to the Control Agent and the other Lenders such financial and operating reports (the “Financial Reports”). The Financial Reports shall include, but are not necessarily limited to, the following,
in each case to be delivered to the Control Agent and the other Lenders on Tuesday of each week during the Forbearance Period: 
 (i) a
weekly update of the Budgeted Cash Flow, which shall identify all changes and modification from the immediately preceding Budgeted Cash Flow (subject to the provisions set forth in Section 4(b) hereof); 

(ii) a report detailing the following: 

(A) the amount of cash and Permitted Cash Equivalent Investments held by the Credit Parties and their Subsidiaries as of the
immediately preceding Friday; 
 (B) all of the Credit Parties and their Subsidiaries’ cash receipts and disbursements
through Friday of the prior week; 
 (C) for each category of expense contained in the Budgeted Cash Flow, the total amount
of cash used by the Credit Parties and their Subsidiaries since the last such Financial Report was delivered pursuant to the terms hereof and identifying any variance thereof from the Budgeted Cash Flow; 

(D) all of revenues received by the Credit Parties and their Subsidiaries through Friday of the prior week; 

(E) for each category of revenue contained in the Budgeted Cash Flow, the total amount of revenue received by the Credit
Parties and their Subsidiaries since the last such Financial Report was delivered pursuant to the terms hereof and identifying any variance thereof from the Budgeted Cash Flow; 

(F) all inventory of the Credit Parties and their Subsidiaries as of Friday of the prior week; 

(G) all accounts receivable as of Friday of the prior week, including the name of each account debtor, the amount of each
receivable, and the date each such receivable is or was due; and 
 (H) all communications between the Credit Parties and
their vendors or other suppliers during the prior week concerning any outstanding payments or any action that such vendors or other suppliers have taken or threatened to take on account thereof; 

Each Financial Report shall be prepared in accordance with GAAP consistently applied, in reasonable detail in a form satisfactory to the Control Agent, and
shall be delivered together with a certificate of a Responsible Officer of Borrower stating that such Financial Report is true and accurate as at such date and has been prepared in accordance with GAAP consistently applied, subject to normal
year-end adjustments. 

  
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 (d) Access to Books and Records. Notwithstanding any limitations on the Lenders’
inspection rights set forth in Section 8.06 of the Credit Agreement, each Credit Party will, and will cause each of its Subsidiaries to, permit any representatives designated by the Control Agent or the other Lenders, upon reasonable
prior notice, to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at reasonable times and as frequently
as the Control Agent or any other Lender deems necessary or appropriate in its discretion; provided that such representative shall use its commercially reasonable efforts to minimize disruptions to the business and affairs of the Borrower as a
result of any such visit, inspection, examination or discussion. In addition, the Credit Parties hereby agree that the Control Agent and the other Lenders, or representatives designated by any of them, may communicate directly with the Credit
Parties’ vendors or other suppliers concerning the Credit Parties’ business affairs, and the Credit Parties hereby agree to take reasonable efforts to facilitate such communications, including by making introductions or providing relevant
contact information to the Control Agent and the other Lenders upon request. 
 (e) Use of Valeritas Security Cash. The Credit
Parties shall (A) take reasonable steps to ensure that Valeritas Security shall not, directly or indirectly, receive the proceeds of any accounts receivable or other income, revenue, or other cash or cash equivalents of the Borrower or the
other Guarantors, and (B) if applicable, pay (or cause to be paid) or otherwise transfer the proceeds of any accounts receivable or other income, revenue, or other cash or cash equivalents to or for the benefit of the Borrower to the Control
Accounts other than the Valeritas Security Control Account for the purpose of making cash disbursements in accordance with the Budgeted Cash Flow. If and to the extent that Valeritas Security receives any such proceeds, revenue or other cash or cash
equivalents notwithstanding the foregoing clause (A) or proceeds or other income, revenue or other cash or cash equivalents are paid to or for the benefit of the Borrower to the Valeritas Security Control Account notwithstanding the foregoing
clause (B), then the Credit Parties agree that the same shall be, and shall be deemed to be, held in trust at all times for the benefit of the Borrower and shall promptly cause the same to be contributed or otherwise transferred to or for the
benefit of the Borrower for the purpose of making cash disbursements in accordance with the Budgeted Cash Flow (or if in excess of such budgeted disbursements, to be paid to the Control Agent for application to the Obligations). 

(f) Indebtedness. Notwithstanding Section 9.01 of the Credit Agreement, the Credit Parties shall not, and shall not permit
their respective Subsidiaries to, create, incur, assume or permit to exist, whether directly or indirectly, any Indebtedness constituting the following without the prior written consent of the Majority Lenders: 

(i) Indebtedness of the kind specified in subsections (c), (f), (g), (h), (i), (j), (k),
(m), or (o) (to the extent related to the Indebtedness prohibited hereby) of Section 9.01 of the Credit Agreement; or 

(ii) Permitted Refinancings of the Indebtedness set forth on Schedule 7.13(a) of the Credit Agreement. 

  
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 (g) Liens. Notwithstanding Section 9.02 of the Credit Agreement, the Credit
Parties shall not, and shall not permit their respective Subsidiaries to, create, incur, assume or permit to exist, whether directly or indirectly, any Liens constituting the following on any property or asset now owned by it without the prior
written consent of the Majority Lenders: 
 (i) Liens securing Indebtedness of the kind prohibited by this Agreement; 

(ii) Liens of the kind specified in subsections (c), (h), (n), or (q) of Section 9.02 of the
Credit Agreement. 
 (iii) This provision will not apply to any Liens created, incurred or assumed before April 1, 2015 and then
permitted by the Credit Agreement. 
 (h) Fundamental Changes and Acquisitions. Notwithstanding Section 9.03 of the
Credit Agreement, the Credit Parties shall not, and shall not permit their respective Subsidiaries to, whether directly or indirectly, engage in any transactions of the kind specified in subsections (b) or (e) thereof.

 (i) Investments. Notwithstanding Section 9.05 of the Credit Agreement, the Credit Parties shall not, and shall not
permit their respective Subsidiaries to, make, or permit to remain outstanding, whether directly or indirectly, any Investments constituting the following without the prior written consent of the Majority Lenders: 

(i) Investments of the kind specified in subsections (e) or (h) of Section 9.05 of the Credit Agreement; 

(ii) Investments constituting Permitted Indebtedness otherwise prohibited by Section 4(f) of this Agreement; or 

(iii) Investments permitted under Section 9.03 of the Credit Agreement otherwise prohibited by Section 4(h) of this
Agreement. 
 (j) Restricted Payments. Notwithstanding Section 9.06 of the Credit Agreement, the Credit Parties shall
not, and shall not permit any of their Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment constituting the following without the prior written consent of the Majority Lenders: 

(i) Restricted Payments of the kind specified in subsections (a), (b), (d), (e), or (g) of
Section 9.06 of the Credit Agreement. 
 (k) Actions Prohibited Due to Event of Default. For the avoidance of doubt,
during the Forbearance Period the Credit Parties shall not exercise any rights or perform any acts prohibited by the Credit Agreement as the result of the occurrence or continuation of an Event of Default unless expressly permitted by this
Agreement. 

  
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 (l) Assignments by Lenders. The parties hereto agree that Section 12.05(b) of
the Credit Agreement shall be amended and restated in its entirety as follows: 
 Any of the Lenders may at any time assign to one or more
transferees in their discretion all or a portion of their rights and obligations under this Agreement (including all or a portion of the Commitment and the Loans at the time owing to it) following written notice to the Borrower. Subject to the
recording thereof by the Lenders pursuant to Sections 12.05(c) and 12.05(d), from and after the effective date specified in each Assignment and Acceptance, the assignee thereunder shall be a party to this Agreement and, to the extent
of the interest assigned by such Assignment and Acceptance, have the rights and obligations of the Lenders under this Agreement, and correspondingly the assigning Lender shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of a Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall
continue to be entitled to the benefits of Section 5 and Section 12.03. 
 (m) Operating Plan. The Borrower
shall prepare, with the assistance of the Borrower’s restructuring advisor, and provide to the Control Agent and the other Lenders an operating plan (the “Operating Plan”) demonstrating how the Borrower and its subsidiaries
will operate during the Forbearance Period and how it will budget for such operations. As a condition to the effectiveness of this Agreement, the Borrower shall have delivered to the Control Agent and the other Lenders a copy of the Operating Plan
which shall be in form and substance acceptable to the Control Agent and the other Lenders on or before the date of execution of this Agreement. 

(n) Bridge Equity Financing. By no later than May 18, 2015, the Borrower shall consummate a transaction for equity financing of no
less than $15 million, inclusive of any amounts invested or advanced by the Lenders, (the “Bridge Equity Financing”), pursuant to documentation in form and substance acceptable to the Majority Lenders. For the avoidance of doubt,
during the Forbearance Period, no Credit Party shall make any Restricted Payment on account of such equity, whether directly or indirectly. 

(o) Cost Reduction Plan. The Borrower shall consult with the Control Agent and the other Lenders to develop a definitive plan (the
“Cost Reduction Plan”), pursuant to documentation acceptable to the Majority Lenders in their sole discretion, by which the Borrower will undertake to significantly reduce its operating expenditures in a manner approved by the other
Credit Parties. Toward that end, as a condition to the effectiveness of this Agreement, the Borrower shall have delivered to the Control Agent and the other Lenders a final copy of the Cost Reduction Plan in form and substance acceptable to the
Control Agent and the other Lenders on or before the date of execution of this Agreement. The terms of the Cost Reduction Plan shall be incorporated into this Agreement as though set forth herein in full, and the failure to comply with the terms
thereof shall constitute a default under this Agreement and an Event of Default under the Credit Agreement and the other Loan Documents. Any reduction in operating expenditures under the Cost Reduction Plan shall be reflected in an amended Budgeted
Cash Flow in form and substance acceptable to the Majority Lenders in accordance with the Section 4(b) hereof. The Credit Parties acknowledge that the Cost Reduction Plan is necessary to salvage the value of the Borrower’s business
and its assets and, absent such a Cost Reduction Plan, the Credit Parties would be unable to provide the Control Agent and the other Lenders with adequate protection of the Collateral. 

  
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 (p) Sale Transaction/Qualified Equity Financing. Borrower has informed the Control Agent
and other Lenders that will seek to undertake to sell all or substantially all of its assets (a “Sale Transaction”), or, in the alternative, seek to complete an equity financing (a “Qualified Equity Financing”), in
each case seeking not less than $75 million in gross proceeds, which the Credit Parties represent and warrant to the Lenders constitutes to the best of their knowledge, at this time, the best means of maximizing the value of the Borrower, the
Guarantors and their assets under the current circumstances. The Credit Parties hereby agree that (i) they shall provide to the Control Agent and the other Lenders all drafts of any term sheets and other documentation pursuant to which a Sale
Transaction or Qualified Equity Financing is proposed contemporaneously with delivery of any such draft term sheets and other documentation to Borrower’s board of directors and (ii) such Sale Transaction or Qualified Equity Financing shall
be subject to written approval by the Majority Lenders prior to execution of the documents evidencing the Sale Transaction or the Qualified Equity Financing, as applicable. The failure to comply with the terms of this Section 4(p) shall
constitute a default under this Agreement and an immediate Event of Default under the Credit Agreement and the other Loan Documents. 
 (q)
Waiver of Default. Subject to the consummation, in accordance with Section 4(p) hereof, of a Qualified Equity Financing by the Borrower by September 29, 2015, the Lenders concurrent with the closing of a Qualified Equity
Financing will waive the Designated Defaults. Such waiver shall only apply to the Designated Defaults. Upon closing a Qualified Equity Financing, the Lenders agree to reinstate the Loans upon the terms set forth in the Credit Agreement and the Loan
Documents, provided, however, that (i) the Credit Parties agree and acknowledge that the Loans will accrue interest from January 1, 2015 through and including the date a Qualified Equity Financing is closed at the
Post-Default Rate, and that such accrued interest shall be capitalized as an additional PIK Loan under the Credit Agreement and be evidenced by a separate promissory note bearing interest at a rate per annum equal to 11.00% from the date a Qualified
Equity Financing is closed and be payable upon the Maturity Date and (ii) in the event the Loans are reinstated pursuant to this subsection, Valeritas Security shall, notwithstanding such reinstatement, remain a Subsidiary Guarantor under the
Credit Agreement and other Loan Documents. 
 SECTION 5. Conditions to Effectiveness. 

The effectiveness of Section 3 of this Agreement is expressly conditioned upon the satisfaction and delivery of each of the
applicable conditions set forth below: 
 (a) Documentary Deliveries. The Lenders shall have received the following documents, each of
which shall be in form and substance acceptable to the Lenders: 
 (i) this Agreement duly executed and delivered by the Borrower and each of
the other parties hereto; 
 (ii) a copy of a fully executed agreement providing for the engagement of Greenhill & Co., Inc., as
investment banker (or such other investment banker as the Control Agent and the other Lenders shall approve; 

  
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 (iii) a draft Budgeted Cash Flow in accordance with Section 4(b)(i) hereof and a
draft Operating Plan in accordance with Section 4(m) hereof, provided, however that, as a condition to the continued forbearance hereunder through the Forbearance Period, Borrower shall deliver to the Control Agent and the
other Lenders a final Budgeted Cash Flow and a final Operating Plan satisfactory to the Lenders’ in their sole discretion not later than May 20, 2015; 

(iv) a final Cost Reduction Plan in accordance with Section 4(o) hereof; 

(v) documentation evidencing Valeritas Security Corporation as a Subsidiary Guarantor under the Credit Agreement and other Loan Documents;

 (vi) documentation evidencing the closing, in toto, of the Bridge Equity Financing in accordance with Section 4(n)
hereof; and 
 (vii) funding of the Reserve Account in accordance with Section 11(c) hereof and the Side Letter Agreement. 

(b) No Default. The representations and warranties contained herein shall be true and correct in all material respects as of the date
hereof, and no Default or Event of Default, other than the Designated Defaults, shall exist on the date hereof. 
 (c) Forbearance
Agreement; Consent. The Control Agent shall have received duly executed copies of (i) this Agreement from the Borrower, Parent, each other Credit Party, the Control Agent and the other Lenders, (ii) the Consent and Affirmation by WCAS
attached hereto, and (iii) a fully executed Amended and Restated Subordination Agreement between the Lenders and WCAS in form and substance acceptable to the Lenders in their sole discretion. 

(d) Expense Reimbursement. The Control Agent and the other Lenders shall have received reimbursement for all expenses for which
invoices have been presented (including reasonable fees, disbursements and other charges of counsel to the Control Agent and the other Lenders) in accordance with Section 12.03(a) of the Credit Agreement and the Reserve Account shall
have been created and fully funded. 
 (e) Other Further Assurances. The Control Agent shall have received such other certificates,
documents and agreements as the Control Agent may reasonably request. 
 SECTION 6. Reservation of Rights. 

(a) Neither the Control Agent nor any other Lender has waived, is not by this Agreement waiving, and has no intention of waiving under this
Agreement or any Loan Document, any Defaults, Events of Default, or other noncompliance which may be continuing on the date hereof or any Defaults, Events of Default, or other noncompliance that may occur after the date hereof (whether the same or
similar to the Designated Defaults or otherwise), and neither the Control Agent nor any other Lender has agreed to forbear with respect to any of its rights or remedies concerning any Defaults, Events of Default, or other noncompliance (other than,
during the Forbearance Period, the Designated Defaults to the extent expressly set forth herein), which may have occurred or are continuing as of the date hereof or which may occur after the date hereof. 

  
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 (b) Neither any “day-by-day” discretionary extensions of credit or releases or
permitted uses of cash constituting Collateral or proceeds thereof by the Control Agent or the other Lenders, nor anything in this Agreement or in any ongoing discussions or negotiations between the Control Agent and/or any one or more of the other
Lenders, on the one hand, and the Borrower and other Credit Parties and Credit Parties’ Affiliates, on the other hand, nor any delay on the part of the Control Agent or the other Lenders in exercising any of their respective rights and remedies
under the Credit Agreement, the other Loan Documents and/or applicable law, shall directly or indirectly: (i) create any obligation to forbear or otherwise refrain from taking any enforcement action, exercising any right or remedy or asserting
any defense, or to make any further extensions of credit or releases or permitted uses of cash constituting Collateral or proceeds thereof (other than during the Forbearance Period, with respect to the Designated Defaults to the extent expressly set
forth herein), (ii) constitute a consent to or waiver of any past, present or future Default or Event of Default or other violation of any provisions of the Credit Agreement or any other Loan Document, (iii) amend, modify or operate as a
waiver of any provision of the Credit Agreement or any other Loan Document or any right, defense, power, privilege or remedy of the Control Agent or any one or more of the other Lenders thereunder or under applicable law or constitute an agreement
to forbear or otherwise refrain (other than during the Forbearance Period, with respect to the Designated Defaults to the extent expressly set forth herein) or to restructure or modify any of the Obligations in any respect or otherwise modify the
capital structure or Collateral of any or all of the Credit Parties, or (iv) constitute a course of dealing or other basis for altering any rights, defenses, remedies or obligations of Control Agent or the other Lenders under the Loan Documents
or any Obligations of the Borrower or any other Credit Party under the Credit Agreement, other Loan Documents or any other contract or instrument. Nothing contained in this Agreement shall confer on Borrower or any other Credit Party or Person any
right to notice or cure periods with respect to any Event of Default or other defaults or matters. 
 (c) The Control Agent and the other
Lenders have not waived the Designated Defaults and (subject to the express provisions of Sections 3 and 4 above) each of Control Agent and the other Lenders expressly reserves all of its rights, defenses, powers, privileges and
remedies under the Credit Agreement, other Loan Documents and/or applicable law, including, without limitation, subject to Section 3(b) above solely with respect to the Designated Defaults, its right at any time, as applicable,
(i) to determine not to make further Loans under the Credit Agreement or releases or permitted uses of cash constituting Collateral or proceeds thereof as a result of the Designated Defaults, (ii) to charge the Post-Default Rate of
interest in respect of the Obligations (as of any date from and after the date on which the first Designated Default first occurred), (iii) to commence any legal or other action to collect or enforce any or all of the Obligations from any or
all of the Borrower, the other Credit Parties, and any other Person liable therefor and/or any Collateral, (iv) to foreclose or otherwise realize, collect, or recover on any or all of the Collateral and/or as appropriate, set-off, recoup or
apply to the payment of any or all of the Obligations, any or all of the Collateral, (v) to take any other enforcement action or otherwise exercise any or all rights and remedies provided for by any or all of the Credit Agreement, other Loan
Documents or applicable law, and (vi) to reject any forbearance, financial restructuring or other proposal made by or on behalf of Borrower, any other Credit Party or any creditor or equity holder. Subject to Section 3(b) above
solely with respect to the Designated Defaults, each of Control Agent and the other Lenders may exercise their respective rights, defenses, powers, privileges and remedies, including those set forth in (i) through (vi) above at any time in
its sole 

  
 13 

 
and absolute discretion without further notice. No oral representations or course of dealing on the part of Control Agent, any other Lender or any of its officers, employees or agents, and no
failure or delay by Control Agent or any other Lender with respect to the exercise of any right, defense, power, privilege or remedy under any of the Credit Agreement, other Loan Documents or applicable law shall operate as a waiver thereof, and the
single or partial exercise of any such right, defense, power, privilege or remedy shall not preclude any later exercise of any other right, defense, power, privilege or remedy. 

SECTION 7. Release; Covenant Not to Sue; Acknowledgement. 

(a) Each Credit Party and its Affiliates hereby absolutely and unconditionally releases and forever discharges the Control Agent and each other
Lender, and any and all participants, parent corporations, subsidiary corporations, affiliated corporations, insurers, indemnitors, successors and assigns thereof, together with all of the present and former directors, officers, agents, attorneys,
consultants, representatives and employees of any of the foregoing (each a “Released Party”), from any and all claims, demands, defenses or causes of action of any kind, nature or description relating to or arising out of or in
connection with or as a result of any of the Obligations, the Credit Agreement, any other Loan Documents or any agreement related to any of the foregoing, whether arising in law or equity or upon contract or tort or under any state or federal law or
otherwise, which any Credit Party has had, now has or has made claim to have against any such person for or by reason of any act, omission, matter, cause or thing whatsoever arising from the beginning of time to and including the date of this
Agreement, whether such claims, demands, defenses, and causes of action are matured or unmatured, known or unknown, contingent, liquidated, or otherwise. It is the intention of each Credit Party and each of its Affiliates in providing this release
that the same shall be effective as a bar to each and every claim, demand and cause of action specified. Each Credit Party and its Affiliates acknowledges that it may hereafter discover facts different from or in addition to those now known or
believed to be true with respect to such claims, demands, defenses, or causes of action and agree that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Each Credit Party and its
Affiliates understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted,
prosecuted or attempted in breach of the provisions of such release. 
 (b) Each Credit Party and its Affiliates, on behalf of itself and
its successors, assigns, and other legal representatives, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Released Party above that it will not sue (at law, in equity, in any regulatory proceeding
or otherwise) any Released Party on the basis of any claim released, remised and discharged by any Credit Party pursuant to the above release. If any Credit Party, any of its Affiliates or any of their successors, assigns or other legal
representations violates the foregoing covenant, each Credit Party and its Affiliates, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Released Party may sustain as a result
of such violation, all reasonable attorneys’ fees and costs incurred by such Released Party as a result of such violation. 

  
 14 

 (c) Each Credit Party hereby acknowledges its status as a Credit Party and affirms its
obligations under the Credit Agreement and the other Loan Documents and represents and warrants that, to its knowledge, there are no liabilities, claims, suits, debts, liens, losses, causes of action, demands, rights, damages or costs, or expenses
of any kind, character or nature whatsoever, known or unknown, fixed or contingent, which any Credit Party may have or claim to have against any Released Party arising with respect to the Obligations, the Credit Agreement or any other Loan
Documents. 
 (d) In connection with the releases granted herein, to the extent applicable, the Credit Parties expressly waive any and all
rights conferred upon them by the provisions of Section 1542 of the Civil Code of California and/or any other federal or state statute or common law principle of similar effect. Section 1542 of the Civil Code of California reads as
follows: 
 A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time
of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor. 
 The Credit Parties understand
and acknowledge the significance and consequence of their waiver of Section 1542 of the California Civil Code, as well as any other federal or state statute or common law principle of similar effect. 

SECTION 8. Representations, Warranties and Covenants of Credit Parties. 

In order to induce the Control Agent and the other Lenders to enter into this Agreement, each Credit Party hereby jointly and severally
represents, warrants and covenants to the Control Agent and the other Lenders, as of the date hereof and any other date on which representations and warranties are otherwise remade or deemed remade under the Credit Agreement that: 

(a) Representations, Warranties and Covenants. (i) After giving effect to this Agreement, no representation or warranty of any
Credit Party contained in the Credit Agreement or any of the Loan Documents, including this Agreement, shall be untrue or incorrect in any material respect as of the date hereof, except to the extent that such representation or warranty expressly
relates to an earlier date, and (ii) no Default or Event of Default (other than the Designated Defaults) has occurred or is continuing, or would result after giving effect hereto. 

(b) Authorization, Etc. Each Credit Party has the power and authority to execute, deliver and perform this Agreement. Each Credit Party
has taken all necessary action (including, without limitation, obtaining approval of its stockholders, if necessary) to authorize its execution, delivery and performance of this Agreement. No consent, approval or authorization of, or declaration or
filing with, any Governmental Authority, and no consent of any other Person, is required in connection with any Credit Party’s execution, delivery and performance of this Agreement, except for those already duly obtained. This Agreement has
been duly executed and delivered by each Credit Party and constitutes the legal, valid and binding obligation of each Credit Party, enforceable against it in accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditor rights generally or by equitable principles relating to enforceability. No Credit Party’s execution, delivery or performance of this Agreement (i) contravenes
the terms of any of such Credit Party’s organization documents; (ii) conflicts with or constitutes a violation or breach of, 

  
 15 

 
or constitutes a default under, or results in the creation or imposition of any Lien (other than pursuant to the Security Documents) upon the property of any Credit Party by reason of the terms
of any material obligation under any Contract to which such Credit Party is a party (including without limitation obligations arising from agreements relating to any such Contract to which any Credit Party is a party or which is binding upon it); or
(iii) violates any Requirement of Law in any material respect. 
 (c) Security. The Secured Parties’ security interests in
the Collateral continue to be perfected, valid, binding and enforceable first-priority security interests which secure the Obligations (subject only to the Permitted Liens) and no tax or judgment liens are currently of record against Borrower or any
other Credit Party. Neither the Borrower nor any Guarantor holds or controls, or will hold or control during the Forbearance Period, cash or cash equivalents that is unencumbered and the Borrower and the Guarantors have granted to the Control Agent
and the other Lenders enforceable first-priority security interests on all of the Borrower’s and the Guarantors’ cash and cash equivalents. 

SECTION 9. Reference to and Effect on Loan Documents. 

(a) Ratification. Except as specifically provided in this Agreement, the Credit Agreement and the other Loan Documents shall remain in
full force and effect and each Credit Party hereby ratifies and reaffirms each term and condition set forth in the Credit Agreement and in the other Loan Documents, effective as of the date hereof. 

(b) No Waiver. This Agreement is only applicable and shall only be effective in the specific instances and for the specific purposes
for which made or given. Except as specifically provided in this Agreement, the execution, delivery and effectiveness of this Agreement shall not operate as a waiver or forbearance of any right, power or remedy of the Control Agent or any other
Lender under the Credit Agreement or any of the Loan Documents, or constitute a consent, waiver or modification with respect to any provision of the Credit Agreement or any of the Loan Documents which shall remain in full force and effect. Upon the
effectiveness of this Agreement each reference in (i) the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” or words of similar import and (ii) any Loan Document to “the Agreement” shall,
in each case and except as otherwise specifically stated therein, mean and be a reference to the Credit Agreement as modified hereby. 
 SECTION 10.
Affirmation of Guarantors. 
 (a) Each Guarantor hereby acknowledges that it has reviewed the terms and provisions of this Agreement and
consents to any modification of the Loan Documents effected pursuant to this Agreement. Each Guarantor hereby confirms to the Control Agent and the other Secured Parties that, after giving effect to this Agreement, the Guarantee of such Guarantor
and each other Loan Document to which such Guarantor is a party continues in full force and effect and is the legal, valid and binding obligation of such Guarantor, enforceable against such Guarantor in accordance with its terms except as
enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability. Each Guarantor further acknowledges, confirms
and agrees that Control Agent and the other Lenders have and shall continue to have a 

  
 16 

 
valid, enforceable and perfected first-priority lien (subject only to Permitted Liens) upon and security interest in the Collateral granted to Control Agent and the other Lenders pursuant to the
Loan Documents or otherwise granted to or held by Control Agent and the other Lenders. 
 (b) Each Guarantor acknowledges and agrees that
(i) notwithstanding the conditions to effectiveness set forth in this Agreement, such Guarantor is not required by the terms of the Credit Agreement or any other Loan Document to consent to the waivers or modifications to the Credit Agreement
effected pursuant to this Agreement and (ii) nothing in the Credit Agreement, this Agreement or any other Loan Document shall be deemed to require the consent of such Guarantor to any future waivers or modifications to the Credit Agreement.

 SECTION 11. Miscellaneous. 
 (a)
Successors and Assigns. This Agreement shall be binding on and shall inure to the benefit of the Credit Parties, the Control Agent and the other Lenders and their respective successors and assigns, except as otherwise provided herein (none of
which include WCAS, who is not a party or a third-party beneficiary of this Agreement). No Credit Party may assign, delegate, transfer, hypothecate or otherwise convey any of its rights, benefits, obligations or duties hereunder without the prior
written consent of the Control Agent and the other Lenders. The terms and provisions of this Agreement are for the purpose of defining the relative rights and obligations of the Credit Parties, the Control Agent and the other Lenders with respect to
the transactions contemplated hereby and there shall be no third party beneficiaries (other than the Released Parties) of any of the terms and provisions of this Agreement. The consent by WCAS included in the signature pages hereto shall not be
deemed a part of this Agreement and shall not, directly or indirectly, create any obligation or duty of the Control Agent or the other Lenders to WCAS or any rights, interests, or defenses of WCAS against the Control Agent or the other Lenders. 

(b) Entire Agreement. This Agreement, including all schedules and other documents attached hereto or incorporated by reference herein or
delivered in connection herewith (excluding the consent of WCAS and the Amended and Restated Subordination Agreement), together with the Side Letter Agreement, constitutes the entire agreement of the signing parties with respect to the subject
matter hereof and supersedes all other understandings, oral or written, with respect to the subject matter hereof. There are no oral or implied obligations of the Control Agent or the other Lenders to WCAS or any third party in connection with this
Agreement. 
 (c) Fees and Expenses. As provided in Section 12.03(a) of the Credit Agreement, the Borrower agrees to pay
on demand all Lenders’ Costs. In furtherance thereof, on the date this Agreement is executed, in accordance with the terms and conditions of this subsection and the Side Letter Agreement, the Borrower shall fund into a reserve account held with
the Control Agent (the “Reserve Account”) an amount equal to $500,000 to pay Lenders’ Costs. At any time that the balance in the Reserve Account falls below $75,000, the Borrower shall immediately transfer to the Control Agent
for deposit into the Reserve Account additional amounts sufficient to bring the balance of the Reserve Account to $500,000. The Control Agent shall (i) periodically (whether daily, weekly or monthly, in Control Agent’s sole discretion)
transfer amounts from the Reserve Account to the Lenders for reimbursement of the Lenders’ Costs and (ii) send copies of documentation (appropriately redacted if such documentation constitutes

  
 17 

 
attorneys’ invoices) to the Borrower of the Lenders’ Costs being reimbursed at such time, though the Control Agent’s failure to send such documentation shall not be deemed a
default hereunder nor affect the Control Agent’s right to reimbursement the Lenders’ Costs from the Reserve Account. 
 (d)
Headings. Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. 

(e) Severability. Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and
valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement. 
 (f) Conflict of Terms. Except as otherwise provided in this
Agreement, if any provision contained in this Agreement is in conflict with, or inconsistent with, any provision in any of the Loan Documents, the provision contained in this Agreement shall govern and control. 

(g) Time of the Essence. With regard to all dates and time periods set forth or referred to in this Agreement, time is of the essence.

 (h) Counterparts. This Agreement may be executed in any number of separate counterparts, each of which shall collectively and
separately constitute one agreement. Delivery of an executed signature page to this Agreement by facsimile or electronic transmission shall be effective as delivery of a manually executed signature page to this Agreement. 

(i) Incorporation of Credit Agreement. The provisions contained in Sections 12.09 (Governing Law), 12.10 (Jurisdiction,
Service of Process and Venue), 12.11 (Waiver of Jury Trial) and 12.12 (Waiver of Immunity) of the Credit Agreement are incorporated herein by reference to the same extent as if reproduced herein in their entirety, except with reference
to this Agreement rather than the Credit Agreement. 
 (j) Reviewed by Attorneys. Each Credit Party represents and warrants to the
Control Agent and the other Lenders that it (i) understands fully the terms of this Agreement and the consequences of the execution and delivery of this Agreement, (ii) has been afforded an opportunity to have this Agreement reviewed by,
and to discuss this Agreement and the documents executed in connection herewith, with such attorneys and other persons and advisors as such Credit Party may wish, and (iii) has entered into this Agreement and executed and delivered all
documents in connection herewith of its own free will and accord and without threat, duress or other coercion of any kind by any Person. The parties hereto acknowledge and agree that neither this Agreement nor any of the other documents executed
pursuant hereto shall be construed more favorably in favor of one party over the other based upon which party drafted the same, it being acknowledged that all parties hereto contributed substantially to the negotiation and preparation of this
Agreement and the other documents executed pursuant hereto or in connection herewith. 

  
 18 

 (k) Further Assurances. Borrower and each other Credit Party agrees to, and to cause any
other Credit Party to, take all further actions and execute all further documents as Control Agent may from time to time reasonably request to carry out the transactions contemplated by this Agreement and all other agreements executed and delivered
in connection herewith. 
 [signature pages follow] 

  
 19 

 IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Agreement to be
duly executed and delivered as of the date first above written. 
  

			
	BORROWER:
	
	VALERITAS, INC.
		
	By: 	 	/s/ Kristine Peterson
		 	Name: Kristine Peterson
		 	Title: Chief Executive Officer

  

			
	GUARANTORS:
	
	VALERITAS HOLDINGS, LLC.
		
	By: 	 	/s/ Kristine Peterson
		 	Name: Kristine Peterson
		 	Title: President

  

			
	VALERITAS SECURITY CORPORATION
		
	By: 	 	/s/ Kristine Peterson
		 	Name: Kristine Peterson
		 	Title: Chief Executive Officer

  
 [Signature Page to
Forbearance Agreement] 

 
	
	 LENDERS:
  

	CAPITAL ROYALTY PARTNERS II L.P.
	 By CAPITAL ROYALTY PARTNERS II GP

L.P., its General Partner

	     By CAPITAL ROYALTY PARTNERS II

    GP LLC, its General Partner

 
			
		
	By: 	 	/s/ Charles Tate
		 	Name: Charles Tate
		 	Title: Sole Member

  

	
	PARALLEL INVESTMENT OPPORTUNITIES PARTNERS II L.P.
	     By PARALLEL INVESTMENT

    OPPORTUNITIES PARTNERS II GP L.P., its

    General Partner

	         By PARALLEL INVESTMENT

        OPPORTUNITIES PARTNERS II GP LLC,

        its General Partner

 
			
		
	By: 	 	/s/ Charles Tate
		 	Name: Charles Tate
		 	Title: Sole Member

  

	
	CAPITAL ROYALTY PARTNERS II-PARALLEL FUND “A” L.P.
	     By CAPITAL ROYALTY PARTNERS II-

    PARALLEL FUND “A” GP L.P., its

    General Partner

	         By CAPITAL ROYALTY PARTNERS II-

        PARALLEL FUND “A” GP LLC, its

        General Partner

 
			
		
	By: 	 	/s/ Charles Tate
		 	Name: Charles Tate
		 	Title: Sole Member

  
 [Signature Page to
Forbearance Agreement] 

 
	
	 CAPITAL ROYALTY PARTNERS II
 (CAYMAN)
L.P.

	    By CAPITAL ROYALTY PARTNERS II
    (CAYMAN) GP L.P., its General Partner
	        By CAPITAL ROYALTY PARTNERS II
        (CAYMAN) GP LLC, its General Partner

  

			
	By: 	 	/s/ Charles Tate
		 	Name: Charles Tate
		 	Title: Sole Member
		
		 	WITNESS: /s/ Nicole Nesson
		 	Name: Nicole Nesson

  

	
	 CAPITAL ROYALTY PARTNERS II -

PARALLEL FUND “B” (CAYMAN) L.P.

	     By CAPITAL ROYALTY PARTNERS II

    (CAYMAN) GP L.P., its General Partner

	         By CAPITAL ROYALTY PARTNERS II

        (CAYMAN) GP LLC, its General Partner

  

			
	By: 	 	/s/ Charles Tate
		 	Name: Charles Tate
		 	Title: Sole Member
		
		 	WITNESS: /s/ Nicole Nesson
		 	Name: Nicole Nesson

  
 [Signature Page to
Forbearance Agreement] 

 CONSENT AND AFFIRMATION OF FORBEARANCE BY WCAS 

As an accommodation to the Borrower and without directly or indirectly creating any obligations or duties of the Control Agent or any other
Lender to WCAS or any rights or defenses by WCAS against the Control Agent or any other Lender, WCAS hereby acknowledges and consents to any modification of the Loan Documents effected pursuant to the Limited Forbearance Agreement (the
“Forbearance Agreement”) dated as of May 18, 2015 by and among Valeritas, Inc., a Delaware corporation, Valeritas Holdings, LLC, a Delaware limited liability company, each of the other Guarantors party thereto and the Lenders
party thereto. Capitalized terms used herein and not otherwise defined herein shall have the same meanings assigned thereto in the Forbearance Agreement. Notwithstanding anything herein to the contrary, nothing in the Forbearance Agreement shall be
deemed to violate, breach, modify, adversely affect, or otherwise infringe the terms of the Subordination Agreement, and WCAS hereby confirms to the Control Agent and the other Lenders that, after giving effect to the Forbearance Agreement, the
Subordination Agreement continues in full force and effect and is the legal, valid and binding obligation of WCAS, enforceable against WCAS in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency,
or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability. WCAS further acknowledges, confirms and agrees that (i) the Subordinated Debt (to the extent it remains
outstanding Indebtedness) is and shall remain subordinate in right and time of payment to payment in full of the Senior, and (ii) WCAS has not and shall not obtain any security interests in the Collateral to secure the Subordinated Debt, in
each case in accordance with and on the terms and conditions set forth in the Subordination Agreement. For the avoidance of doubt, no party should rely in any way upon this Consent and Affirmation, as a consent, acknowledgement or undertaking of any
kind by WCAS to participate in the equity financing contemplated by Section 4(n) of the Forbearance Agreement. 
  

			
	SUBORDINATED CREDITOR:
	
	WCAS CAPITAL PARTNERS IV, L.P.
		
	By: 	 	/s/ Sean M. Traynor
		 	Name: Sean M. Traynor
		 	Title:

 EXHIBIT A 

DESIGNATED DEFAULTS 
 1.
The occurrence of a Material Adverse Change in violation of Section 11.01(l) of the Credit Agreement, including without limitation by reason of (a) the failure of the Borrower to conduct an initial public offering as anticipated,
without providing any adequate and feasible alternative source of equity or other liquidity; (b) the failure of the Borrower to maintain reasonably adequate operating cash and working capital, including without limitation by reason of notice
that the Lenders received from the Borrower’s investment bankers that the Borrower has only approximately $9 million in cash remaining and that the Borrower is chronically operating at a negative cash-flow basis and is spending net operating
cash at a rate of approximately $4 million per month; (c) the failure of the Borrower to raise additional capital from its existing shareholders and notice that the Lenders received that the Borrower’s existing shareholders do not intend
to invest further in or otherwise finance the Borrower; and (d) the Borrower’s inability to be able to provide adequate assurance of its making its interest payment due on March 31, 2015. 

2. The failure of the Borrower to timely pay interest due on March 31, 2015, in violation of Section 11.01(b) of the Credit
Agreement. 
 3. The failure of the Borrower to provide adequate assurances that it will continue to maintain a minimum daily balance of
cash and Permitted Cash Equivalent Investments of at least the amounts required under Section 10.02 of the Credit Agreement. 

4. The failure of the Borrower to provide adequate assurances that it is or will remain solvent and will not violate
Section 11.01(h) of the Credit Agreement. 
 5. The failure of the Borrower to comply with Section 7 of the Waiver
Agreement, including without limitation by reason of the Borrower’s failure (a) to timely conduct an initial public offering, (b) to timely complete a private financing in the amounts required in Section 7(ii) of the
Waiver Agreement, and (c) to timely complete a strategic investment by a publicly listed company in the Borrower in the amount required in Section 7(iii) of the Waiver Agreement. 

6. The failure of the Borrower to comply with Section 10.01(a)(ii) of the Credit Agreement, in violation of
Section 11.01(d) of the Credit Agreement, by reason of the Borrower’s failure, during the twelve-month period beginning on January 1, 2014, to have at least $25 million in Revenue (which failure is not deemed to have been
waived due to the failure of the Borrower to satisfy the condition described in paragraph 5 above). 
 Notwithstanding the foregoing,
the Designated Defaults identified above constitute “Designated Defaults” under this Agreement solely at the level, amount, or degree of such factors constituting defaults as of March 31, 2015, and any repeat or worsening of such
Designated Defaults shall constitute new Events of Default under the Credit Agreement and the other Loan Documents and shall not constitute “Designated Defaults” hereunder. 

  
 Ex. A - 1 

 EXHIBIT B 

INITIAL BUDGET 
 (See
attached) 

  
 Ex. B - 1 

 Cash Forecast - Inflows & Outflows 

 

																																																					
	 	  	Actuals	 	 	2	 	 	3	 	  	4	 	 	5	 	 	6	 	 	7	 	 	8	 	 	9	 	 	10	 	 	11	 	 	12	 	 	13	 
	 Week Ended 

	  	5/2/15	 	 	5/9/15	 	 	5/16/15	 	  	5/23/15	 	 	5/30/15	 	 	6/6/15	 	 	6/13/15	 	 	6/20/15	 	 	6/27/15	 	 	7/4/15	 	 	7/11/15	 	 	7/18/15	 	 	7/25/15	 
	 Sources
	  				 				 				  				 				 				 				 				 				 				 				 				 			
	 Gross Receipts
	  	 	401	 	 	 	475	 	 	 	641	  	  	 	593	  	 	 	475	  	 	 	713	  	 	 	543	 	 	 	613	  	 	 	475	  	 	 	658	  	 	 	618	  	 	 	358	  	 	 	618	 
	 Uses
	  				 				 				  				 				 				 				 				 				 				 				 				 			
	 GTN Costs
	  	 	376	 	 	 	300	 	 	 	100	  	  	 	150	  	 	 	80	  	 	 	225	  	 	 	100	 	 	 	280	  	 	 	200	  	 	 	225	  	 	 	—  	 	 	 	170	  	 	 	—  	 
	 Inventory Purchases/COS
	  	 	342	 	 	 	447	 	 	 	100	  	  	 	600	  	 	 	—  	 	 	 	600	  	 	 	180	 	 	 	170	  	 	 	800	  	 	 	280	  	 	 	400	  	 	 	250	  	 	 	200	 
	 Consol Spend:
	  				 				 				  				 				 				 				 				 				 				 				 				 			
	 Payroll & Benefits, EE and Contract costs
	  	 	6	 	 	 	700	 	 	 	—  	 	  	 	1,350	  	 	 	—  	 	 	 	895	  	 	 	—  	 	 	 	700	  	 	 	—  	 	 	 	740	  	 	 	—  	 	 	 	700	  	 	 	—  	 
	 Qtrly Bonus Payout
	  				 	 	—  	 	 	 	—  	 	  	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	650	  	 	 	—  	 
	 T&E
	  	 	75	 	 	 	40	 	 	 	40	  	  	 	40	  	 	 	40	  	 	 	40	  	 	 	90	 	 	 	140	  	 	 	90	  	 	 	115	  	 	 	140	  	 	 	140	  	 	 	140	 
	 Rents/Facility Costs
	  	 	122	 	 	 	—  	 	 	 	—  	 	  	 	—  	 	 	 	160	  	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	—  	 	 	 	160	  	 				 				 			
	 Professional Services
	  	 	15	 	 	 	—  	 	 	 	100	  	  	 	—  	 	 	 	100	  	 	 	—  	 	 	 	100	 	 	 	—  	 	 	 	50	  	 	 	—  	 	 	 	50	  	 				 	 	50	  
	 Other SG&A
	  	 	115	 	 	 	200	 	 	 	200	  	  	 	100	  	 	 	175	  	 	 	5	  	 	 	100	 	 	 	200	  	 	 	100	  	 	 	135	  	 	 	100	  	 	 	150	  	 	 	100	  
		  	 	1,051	 	 	 	1,687	 	 	 	540	  	  	 	2,240	  	 	 	555	  	 	 	1,765	  	 	 	570	 	 	 	1,490	  	 	 	1,240	  	 	 	1,655	  	 	 	690	  	 	 	2,060	  	 	 	490	 
		  	  
	  
	 	 	  
	  
	 	 	  
	  
	 	  	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 
	 Est Cash Outflow
	  	 	(650	) 	 	 	(1,212	) 	 	 	101	 	  	 	(1,647	) 	 	 	(80	) 	 	 	(1,052	) 	 	 	(27	) 	 	 	(877	) 	 	 	(765	) 	 	 	(997	) 	 	 	(72	) 	 	 	(1,702	) 	 	 	128	 
	 Ending Cash Balance
	  	$	3,819	  	 	$	2,607	  	 	$	2,708	  	  	$	1,061	  	 	$	981	  	 	$	(71	) 	 	$	(98	) 	 	$	(975	) 	 	$	(1,740	) 	 	$	(2,737	) 	 	$	(2,809	) 	 	$	(4,511	) 	 	$	(4,383	) 
		  	  
	  
	 	 	  
	  
	 	 	  
	  
	 	  	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 

 Income Statement Forecast 

																																																					
	 	  	Actuals	 	 	2	 	 	3	 	 	4	 	 	5	 	 	6	 	 	7	 	 	8	 	 	9	 	 	10	 	 	11	 	 	12	 	 	13	 
	Week Ended 

	  	5/2/15	 	 	5/9/15	 	 	5/16/15	 	 	5/23/15	 	 	5/30/15	 	 	6/6/15	 	 	6/13/15	 	 	6/20/15	 	 	6/27/15	 	 	7/4/15	 	 	7/11/15	 	 	7/18/15	 	 	7/25/15	 
	 Sales/AR Volume (Kits)
	  	 	2,736	  	 	 	2,143	  	 	 	2,143	  	 	 	2,143	  	 	 	2,143	  	 	 	1,892	  	 	 	1,892	  	 	 	1,892	  	 	 	1,892	  	 	 	1,892	  	 	 	2,508	  	 	 	2,508	  	 	 	2,508	  
	 Revenue Volume (Kits)
	  	 	2,376	  	 	 	2,143	  	 	 	2,143	  	 	 	2,143	  	 	 	2,143	  	 	 	1,892	  	 	 	1,892	  	 	 	1,892	  	 	 	1,892	  	 	 	1,892	  	 	 	2,508	  	 	 	2,508	  	 	 	2,508	  
	 Gross Sales (net of PP discount)
	  	$	705	  	 	$	552	  	 	$	552	  	 	$	552	  	 	$	552	  	 	$	488	  	 	$	488	  	 	$	488	  	 	$	488	  	 	$	488	  	 	$	646	  	 	$	646	  	 	$	646	  
	 Net Price
	  	$	5.33	  	 	$	5.35	  	 	$	5.35	  	 	$	5.35	  	 	$	5.35	  	 	$	5.33	  	 	$	5.33	  	 	$	5.33	  	 	$	5.33	  	 	$	5.33	  	 	$	5.29	  	 	$	5.29	  	 	$	5.29	  
	 Net Revenue
	  	$	380	  	 	$	344	  	 	$	344	  	 	$	344	  	 	$	344	  	 	$	303	  	 	$	303	  	 	$	303	  	 	$	303	  	 	$	303	  	 	$	398	  	 	$	398	  	 	$	398	  
	 GTN Costs
	  	$	325	  	 	$	208	  	 	$	208	  	 	$	208	  	 	$	208	  	 	$	185	  	 	$	185	  	 	$	185	  	 	$	185	  	 	$	185	  	 	$	248	  	 	$	248	  	 	$	248	  
	 Inventory Purchases/COS
	  	$	147	  	 	$	133	  	 	$	133	  	 	$	133	  	 	$	133	  	 	$	117	  	 	$	117	  	 	$	117	  	 	$	117	  	 	$	117	  	 	$	156	  	 	$	156	  	 	$	156	  
	 Production slow-down costs (Providence)
	  				 				 				 				 				 	$	19	  	 	$	19	  	 	$	19	  	 	$	19	  	 	$	19	  	 	$	28	  	 	$	28	  	 	$	28	  
	 Consol Spend:
	  				 				 				 				 				 				 				 				 				 				 				 				 			
	 Salaries & Benefits
	  	$	383	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  	 	$	401	  
	 Stock Comp
	  	$	79	  	 	$	80	  	 	$	80	  	 	$	80	  	 	$	80	  	 	$	63	  	 	$	63	  	 	$	63	  	 	$	63	  	 	$	63	  	 	$	80	  	 	$	80	  	 	$	80	  
	 Contract Labor
	  	$	17	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  	 	$	11	  
	 Bonus and Commissions Accruals
	  	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  	 	$	110	  
	 Auto Expense
	  	$	0	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  	 	$	23	  
	 T&E
	  	$	41	  	 	$	70	  	 	$	70	  	 	$	70	  	 	$	70	  	 	$	50	  	 	$	50	  	 	$	50	  	 	$	50	  	 	$	50	  	 	$	88	  	 	$	88	  	 	$	88	  
	 Equipment Expense
	  	$	0	  	 	$	3	  	 	$	3	  	 	$	3	  	 	$	3	  	 	$	2	  	 	$	2	  	 	$	2	  	 	$	2	  	 	$	2	  	 	$	3	  	 	$	3	  	 	$	3	  
	 Supplies & Freight
	  	$	13	  	 	$	24	  	 	$	24	  	 	$	24	  	 	$	24	  	 	$	17	  	 	$	17	  	 	$	17	  	 	$	17	  	 	$	17	  	 	$	14	  	 	$	14	  	 	$	14	  
	 Sterilization and Cold Soak
	  	$	2	  	 	$	12	  	 	$	12	  	 	$	12	  	 	$	12	  	 	$	4	  	 	$	4	  	 	$	4	  	 	$	4	  	 	$	4	  	 	$	9	  	 	$	9	  	 	$	9	  
	 Non-revenue V-Go/EZ Fills
	  	$	10	  	 	$	52	  	 	$	52	  	 	$	52	  	 	$	52	  	 	$	19	  	 	$	19	  	 	$	19	  	 	$	19	  	 	$	19	  	 	$	59	  	 	$	59	  	 	$	59	  
	 External Services
	  	$	388	  	 	$	532	  	 	$	532	  	 	$	532	  	 	$	532	  	 	$	374	  	 	$	374	  	 	$	374	  	 	$	374	  	 	$	374	  	 	$	437	  	 	$	437	  	 	$	437	  
	 Facilities
	  	$	37	  	 	$	38	  	 	$	38	  	 	$	38	  	 	$	38	  	 	$	29	  	 	$	29	  	 	$	29	  	 	$	29	  	 	$	29	  	 	$	37	  	 	$	37	  	 	$	37	  
	 Depreciation
	  	$	45	  	 	$	50	  	 	$	50	  	 	$	50	  	 	$	50	  	 	$	42	  	 	$	42	  	 	$	42	  	 	$	42	  	 	$	42	  	 	$	53	  	 	$	53	  	 	$	53	  
	 Administration
	  	$	37	  	 	$	31	  	 	$	31	  	 	$	31	  	 	$	31	  	 	$	26	  	 	$	26	  	 	$	26	  	 	$	26	  	 	$	26	  	 	$	34	  	 	$	34	  	 	$	34	  
		  	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 
		  	$	1,160	  	 	$	1,435	  	 	$	1,435	  	 	$	1,435	  	 	$	1,435	  	 	$	1,172	  	 	$	1,172	  	 	$	1,172	  	 	$	1,172	  	 	$	1,172	  	 	$	1,357	  	 	$	1,357	  	 	$	1,357	  
	 Other (Income)/Expense
	  	$	146	  	 	$	146	  	 	$	146	  	 	$	146	  	 	$	146	  	 	$	117	  	 	$	117	  	 	$	117	  	 	$	117	  	 	$	117	  	 	$	149	  	 	$	149	  	 	$	149	  
		  	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 	 	  
	  
	 
	 Net Income
	  	($	1,073	) 	 	($	1,370	) 	 	($	1,370	) 	 	($	1,370	) 	 	($	1,370	) 	 	($	1,122	) 	 	($	1,122	) 	 	($	1,122	) 	 	($	1,122	) 	 	($	1,122	) 	 	($	1,291	) 	 	($	1,291	) 	 	($	1,291	) 
	 Cumulative Net Income
	  	($	5,122	) 	 	($	6,492	) 	 	($	7,862	) 	 	($	9,232	) 	 	($	10,602	) 	 	($	11,725	) 	 	($	12,847	) 	 	($	13,970	) 	 	($	15,092	) 	 	($	16,214	) 	 	($	17,505	) 	 	($	18,796	) 	 	($	20,087	) 

 Exhibit C 

(See attached) 

  
 Ex. C-1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00260-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00260-of-00352.parquet"}]]