Document:

Form of 10% Senior Secured Note Due 2014

 Exhibit 4.2 
 [FORM OF FACE OF NOTE] 
 [Applicable Restricted Securities Legend] 
 [Depository Legend, if applicable] 

			
	No. [    ]	 	 Principal Amount
$[                    ]
 as revised by the
Schedule of Increases
 and Decreases in the Global Security attached hereto

		
		 	CUSIP NO.             

 SMITHFIELD FOODS, INC. 
 10% Senior Secured Note, due 2014 
 Smithfield Foods, Inc., a Virginia corporation,
promises to pay to [                    ], or registered assigns, the principal sum of
[                                ] Dollars, as revised by the Schedule of Increases and
Decreases in the Global Security attached hereto, on July 15, 2014. 
 Interest Payment Dates: January 15 and July 15.

 Record Dates: January 1 and July 1. 
 Additional provisions of this Security are set forth on the other side of this Security. 
  

			
	SMITHFIELD FOODS, INC.
		
	By:	 	  

		
	By:	 	  

  

							
	 TRUSTEE’S CERTIFICATE OF AUTHENTICATION
	 		 	
			
	U.S. BANK NATIONAL ASSOCIATION	 		 	
			
	as Trustee, certifies that this is one of the Securities referred to in the Indenture.	 		 	
				
	By	 	  
	 		 	
		 	Authorized Signatory	 	Date:	 	

  

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 [FORM OF REVERSE SIDE OF NOTE] 
 10% Senior Secured Note, due 2014 
  

	1.	Interest 

 Smithfield Foods, Inc., a Virginia
corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest on the principal amount of this Security at the rate per annum shown
above. 
 The Company will pay interest semiannually on January 15 and July 15 of each year, with the first interest payment to be
made on January 15, 2010. Interest on the Securities will accrue from the most recent date to which interest has been paid on the Securities or, if no interest has been paid, from July 2, 2009. The Company shall pay interest on overdue
principal or premium, if any (plus interest on such interest to the extent lawful), at the rate borne by the Securities to the extent lawful. Interest will be computed on the basis of a 360-day year of twelve 30-day months. 
  

	2.	Method of Payment 

 By no later than 10:00 a.m. (New
York City time) on the date on which any principal of, premium, if any, or interest on any Security is due and payable, the Company shall irrevocably deposit with the Trustee or the Paying Agent money sufficient to pay such principal, premium, if
any, and/or interest. The Company will pay interest (except Defaulted Interest) to the Persons who are registered Holders of Securities at the close of business on the January 1 and July 1 next preceding the interest payment date even if
Securities are cancelled, repurchased or redeemed after the record date and on or before the interest payment date. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company will pay principal, premium, if any,
and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. Payments in respect of Securities represented by a Global Security (including principal, premium, if any, and interest)
will be made by the transfer of immediately available funds to the accounts specified by the Depositary. The Company will make all payments in respect of a Definitive Security (including principal, premium, if any, and interest) by mailing a check
to the registered address of each Holder thereof; provided, however, that payments on the Securities may also be made, in the case of a Holder of at least $1,000,000 aggregate principal amount of Securities, by wire transfer to a U.S.
dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days
immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion). 
  

	3.	Paying Agent and Registrar 

 Initially, U.S. Bank
National Association, a national banking association duly organized and existing under the laws of the United States of America and having a corporate trust office in Atlanta, Georgia (“Trustee”), will act as Paying Agent and Registrar.
The Company may appoint and change any Paying Agent, Registrar or co-registrar without notice to any Holder. The Company or any of its domestically incorporated Wholly-Owned Subsidiaries may act as Paying Agent, Registrar or co-registrar.

  

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	4.	Indenture 

 The Company issued the Securities under
an Indenture dated as of July 2, 2009 (as it may be amended or supplemented from time to time in accordance with the terms thereof, the “Indenture”), among the Company, the Subsidiary Guarantors and the Trustee. The terms of the
Securities include those stated in the Indenture. Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture. The Securities are subject to all such terms, and Holders are referred to the Indenture and
the Act for a statement of those terms. 
 The Securities are senior secured obligations of the Company. The aggregate principal amount of
Securities which may be authenticated and delivered under the Indenture is unlimited, provided that to the extent not applied to refinance Indebtedness, the Net Cash Proceeds from any issuance of Additional Notes are invested in Additional
Assets in accordance with the Indenture. This Security is one of the 10% Senior Secured Notes due 2014 referred to in the Indenture. The Securities include (i) $625,000,000 aggregate principal amount of the Company’s 10% Senior Secured
Notes due 2014 issued under the Indenture on July 2, 2009 (herein called “Initial Notes”) and (ii) (x) $225,000,000 aggregate principal amount of the Company’s 10% Senior Secured Notes due 2014 issued under the
Indenture on August 14, 2009 and (y) if and when issued, additional 10% Senior Secured Notes due 2014 of the Company that may be issued from time to time under the Indenture subsequent to July 2, 2009 (together, herein called
“Additional Notes”). The Initial Notes and Additional Notes are treated as a single class of securities under the Indenture and shall be secured by first and second priority Liens and security interests, subject to Permitted Liens, in the
Collateral. The Indenture imposes certain limitations on the Incurrence of Indebtedness by the Company and its Subsidiaries, the payment of dividends and other distributions on the Capital Stock of the Company and its Subsidiaries, the purchase or
redemption of Capital Stock of the Company and Capital Stock of such Subsidiaries, certain purchases or redemptions of Junior Lien Collateral Indebtedness, Senior Unsecured Pari Passu Indebtedness, Subordinated Indebtedness or Guarantor Subordinated
Indebtedness, the sale or transfer of assets and Capital Stock of Subsidiaries, certain Sale/Leaseback Transactions involving the Company or any Restricted Subsidiary, the issuance or sale of Capital Stock of Restricted Subsidiaries, the incurrence
of certain Liens, future Subsidiary Guarantors, the business activities and investments of the Company and its Subsidiaries and transactions with Affiliates, provided, however, certain of such limitations will no longer be in effect if the
Securities receive a rating of “BBB-” or higher from Standard & Poor’s Rating Services (or its successors) and “Baa3” or higher from Moody’s Investors Service, Inc. (or its successors). In addition, the
Indenture limits the ability of the Company and its Subsidiaries to enter into agreements that restrict distributions and dividends from Subsidiaries. The Indenture also imposes requirements with respect to the provision of financial information.

 To guarantee the due and punctual payment of the principal, premium, if any, and interest (including post-filing or post-petition
interest) on the Securities and all other amounts payable by the Company under the Indenture, the Securities, the Collateral Documents and the Intercreditor Agreements when and as the same shall be due and payable, whether at maturity, by
acceleration or 

  

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otherwise, according to the terms of the Securities and the Indenture, the Subsidiary Guarantors have unconditionally guaranteed (and future guarantors,
together with the Subsidiary Guarantors, will unconditionally Guarantee), jointly and severally, such obligations on a senior, secured basis pursuant to the terms of the Indenture. 
  

	5.	Redemption 

 Prior to July 15, 2012, the
Company may, upon not less than 30 nor more than 60 days’ notice, on any one or more occasions redeem up to 35% of the original principal amount of the Securities with the Net Cash Proceeds of one or more Public Equity Offerings at a redemption
price of 110% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date);
provided that: 
 (i) at least 65% of the original principal amount of the Securities (exclusive of Additional Notes) remains outstanding
after each such redemption; and 
 (ii) the redemption occurs within 60 days after the closing of such Public Equity Offering. 
 If the optional redemption date is on or after an interest record date and on or before the related interest payment date, the accrued and unpaid
interest, if any, will be paid to the person in whose name the Security is registered at the close of business on such record date, and no additional interest will be payable to Holders whose Securities will be subject to redemption by the Company.

 At any time prior to the Maturity Date of the Securities, the Securities may be redeemed or purchased by the Company, in whole or in part,
at the Company’s option, at a price (the “Redemption Price”) equal to 100% of the principal amount thereof plus the Applicable Premium as of, and accrued but unpaid interest, if any, to, the date of such redemption or purchase (the
“Redemption Date”) (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date). Such redemption or purchase may be made upon notice mailed by first-class mail to
each Holder’s registered address, not less than 30 nor more than 60 days prior to the Redemption Date. The Company may provide in such notice that payment of the Redemption Price and performance of the Company’s obligations with respect to
such redemption or purchase may be performed by another Person. Any such redemption, purchase or notice may, at the Company’s discretion, be subject to the satisfaction or one or more conditions precedent, including but not limited to the
occurrence of a Change of Control. 
 In the case of any partial redemption, selection of the Securities for redemption will be made by the
Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Securities are listed or, if the Securities are not listed, then on a pro rata basis, by lot or by such other method as the Trustee in
its sole discretion shall deem to be fair and appropriate, although no Securities of $1,000 in original principal amount or less will be redeemed in part. If any Security is to be redeemed in part only, the notice of redemption relating to such
Security shall state the portion of the principal amount thereof to be 

  

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redeemed. A new Security in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of
the original Security. On and after the redemption date, interest will cease to accrue on Securities or portions thereof called for redemption as long as the Company has deposited with the Paying Agent funds in satisfaction of the applicable
redemption price pursuant to the Indenture. 
  

	6.	Put Provisions 

 Upon the occurrence of a Change of
Control, any Holder of Securities will have the right to offer to cause the Company to repurchase all or any part of the Securities of such Holder at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid
interest, if any, to the date of repurchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date) as provided in, and subject to the terms of, the Indenture. 

In the event of an Asset Disposition that requires the purchase of Securities pursuant to Section 3.7(a) or Section 3.7(b) of
the Indenture, the Company will be required to apply such Excess Collateral Proceeds or Excess Proceeds, as applicable, to the repayment of the Securities, the Rabobank Term Loan and, in the case of Excess Proceeds, any Pari Passu Indebtedness in
accordance with the procedures set forth in Section 3.7 of the Indenture. 
  

	7.	Denominations; Transfer; Exchange 

 The Securities
are in registered form without coupons in denominations of principal amount of $2,000 and whole multiples of $1,000 in excess thereof. A Holder may transfer or exchange Securities in accordance with the Indenture. The Registrar may require a Holder,
among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not register the transfer of or exchange any Securities for a period
beginning 15 Business Days before an interest payment date and ending on such interest payment date. 
  

	8.	Persons Deemed Owners 

 The registered Holder of
this Security may be treated as the owner of it for all purposes. 
  

	9.	Unclaimed Money 

 If money for the payment of the
principal of or premium, if any, or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at its request unless an abandoned property law designates another person. After any such payment,
Holders entitled to the money must look only to the Company and not to the Trustee for payment. 
  

	10.	Defeasance 

 Subject to certain conditions set forth
in the Indenture, the Company at any time may terminate some or all of its obligations under the Securities and the Indenture if the Company deposits with the Trustee money or U.S. Government Obligations for the payment of principal and interest on
the Securities to maturity. 
  

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	11.	Amendment, Waiver 

 Subject to certain exceptions
set forth in the Indenture, (i) the Indenture, the Securities, the Collateral Documents or the Intercreditor Agreements may be amended with the written consent of the Holders of at least a majority in principal amount of the then outstanding
Securities and (ii) any default (other than (x) with respect to nonpayment or (y) in respect of a provision that cannot be amended without the written consent of each Holder affected or (z) with respect to
Section 11.6(a)(vi) of the Indenture) or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount of the then outstanding Securities. Subject to certain exceptions set forth in the
Indenture, without the consent of any Holder, the Company, the Subsidiary Guarantors and the Trustee may amend the Indenture, the Securities, the Collateral Documents or the Intercreditor Agreements to cure any ambiguity, omission, defect or
inconsistency, or to comply with Article IV or Article X of the Indenture in respect of the assumption by a Successor Company of an obligation of the Company under the Indenture, or to provide for uncertificated Securities in addition to or in place
of certificated Securities, or to add guarantees with respect to the Securities or to secure the Securities, or to release a Subsidiary Guarantor upon its designation as an Unrestricted Subsidiary or otherwise in accordance with the Indenture, to
release Liens in favor of the Collateral Agent in the Collateral as provided under the collateral release provisions, or to add additional covenants or surrender rights and powers conferred on the Company, or to make any change that does not
adversely affect the rights of any Holder. 
  

	12.	Defaults and Remedies 

 Under the Indenture, Events
of Default include: (i) default for 30 days in payment of interest when due on the Securities; (ii) default in payment of the principal of or premium, if any, on the Securities at Stated Maturity, upon required repurchase, upon declaration
or otherwise; (iii) failure by the Company or any Significant Subsidiary to comply with certain other provisions or agreements in the Indenture, the Securities, the Collateral Documents and the Intercreditor Agreements, in certain cases subject
to notice and lapse of time; (iv) certain accelerations (including failure to pay within any grace period after final maturity) of other Indebtedness of the Company or any Significant Subsidiary if the amount accelerated (or so unpaid) exceeds
$25.0 million (v) certain events of bankruptcy or insolvency with respect to the Company or any Significant Subsidiary; (vi) certain final judgments or decrees for the payment of money in excess of $25.0 million; (vii) failure by any
Subsidiary Guarantor that is a Significant Subsidiary to comply with its obligations under its Subsidiary Guarantee or Collateral Documents or Intercreditor Agreement; (viii) the failure of any Subsidiary Guarantee or Collateral Document
entered into by a Subsidiary Guarantor which is a Significant Subsidiary to be in full force and effect (except as contemplated thereby) or any denial or disaffirmation thereof and (ix) with respect to Collateral with a fair market value in
excess of $25.0 million, a declaration or assertion of invalidity or unenforceability or the failure to be in full force and effect (except as contemplated hereby), subject to any applicable grace periods as set forth in the Indenture. 

 

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 If an Event of Default occurs and is continuing, the Trustee or Holders of at least 25% in aggregate
principal amount of the outstanding Securities then outstanding may declare all the Securities to be due and payable immediately. Certain events of bankruptcy or insolvency are Events of Default which will result in the Securities being due and
payable immediately upon the occurrence of such Events of Default. 
 Holders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee and the Collateral Agent may refuse to enforce the Indenture or the Securities unless it receives reasonable indemnity or security. Subject to certain limitations, Holders of a majority in principal amount of
the Securities may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a Default or Event of Default in payment of principal or interest) if it
determines that withholding notice is in their interest. 
  

	13.	Trustee Dealings with the Company 

 Subject to
certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or
its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. 
  

	14.	No Recourse Against Others 

 A director, officer,
employee or stockholder, as such, of the Company or any Subsidiary Guarantor shall not have any liability for any obligations of the Company or any Subsidiary Guarantor under the Securities, the Indenture, the Collateral Documents, the Intercreditor
Agreements or the Subsidiary Guarantees or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Security, each Holder waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities. 
  

	15.	Authentication 

 This Security shall not be valid
until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication on the other side of this Security. 
  

	16.	Abbreviations 

 Customary abbreviations may be used
in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to
Minors Act). 
  

 A-8 

	17.	CUSIP Numbers 

 Pursuant to a recommendation
promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP numbers to be printed on the Securities. No representation is made as to the accuracy of such numbers as printed on the Securities and reliance
may be placed only on the other identification numbers placed thereon. 
  

	18.	Governing Law 

 This Security shall be governed by,
and construed in accordance with, the laws of the State of New York. 
 The Company will furnish to any Holder upon written request and
without charge to the Holder a copy of the Indenture which has in it the text of this Security in larger type. Requests may be made to: 
 Smithfield Foods, Inc. 
 200 Commerce Street 
 Smithfield, VA 23430 
 Attention: Chief Financial Officer 
  

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 ASSIGNMENT FORM 
 To assign this Security, fill in the form below: 
 I or we assign and transfer this Security to 
  

									
		 	  
	  	
		 	(Print or type assignee’s name, address and zip code)	  	

  

									
		 		 	  
	 		 	
		 	(Insert assignee’s soc. sec. or tax I.D. No.)	 	

 and irrevocably appoint
                     agent to transfer this Security on the books of the Company. The agent may substitute another to act for him. 
  
  
  

											
	Date:	 	  
	  		 	Your Signature:	 	  
	 	
		 		  		 		 		 	

  

													
	Signature Guarantee:	 	  
	 		 		 		 	
		 	(Signature must be guaranteed)	 		 		 		 	

  
  
 Sign exactly as your name appears on the other side of this Security. 
 The
signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15.

 The undersigned hereby certifies that it  ̈ is /  ̈ is not an Affiliate of the Company
and that, to its knowledge, the proposed transferee  ̈ is /  ̈ is not an Affiliate of the Company. 
 In connection with any transfer or exchange of any of the Securities evidenced by this certificate occurring prior to the date that is one year after the later of the date of original issuance of such Securities and
the last date, if any, on which such Securities were owned by the Company or any Affiliate of the Company, the undersigned confirms that such Securities are being: 
 CHECK ONE BOX BELOW: 
  

					
	1	  	 ̈	  	acquired for the undersigned’s own account, without transfer; or
			
	2	  	 ̈	  	transferred to the Company or any Subsidiary thereof; or
			
	3	  	 ̈	  	transferred pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”); or
			
	4	  	 ̈	  	transferred pursuant to and in compliance with Regulation S under the Securities Act; or

  

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	5	  	 ̈	  	transferred to an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act), that has furnished to the Trustee a signed
letter containing certain representations and agreements (the form of which letter appears as Section 2.7 of the Indenture); or
			
	6	  	 ̈	  	transferred pursuant to another available exemption from the registration requirements of the Securities Act of 1933.

 Unless one of the boxes is checked, the Trustee will refuse to register any of the Securities evidenced by this
certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (4), (5) or (6) is checked, the Trustee or the Company may require, prior to registering any such transfer of the
Securities, in their sole discretion, such legal opinions, certifications and other information as the Trustee or the Company may reasonably request to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act of 1933, such as the exemption provided by Rule 144 under such Act. 
  

					
		 		 	  

		 		 	Signature
			
	Signature Guarantee:	 		 	
			
	  
	 		 	  

	(Signature must be guaranteed)	 		 	Signature

  
  
 The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an
approved signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15. 
 TO BE COMPLETED BY PURCHASER IF (1) OR (3) ABOVE IS CHECKED.

 The undersigned represents and warrants that it is purchasing this Security for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act of 1933, as amended, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is
relying upon the undersigned’s foregoing representations in order to claim the exemption from registration provided by Rule 144A. 
  

			
	Dated:	 	NOTICE: To be executed by an executive officer

  

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 [TO BE ATTACHED TO GLOBAL SECURITIES] 
 SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY 
 The following increases or
decreases in this Global Security have been made: 
  

									
	 Date of
 Exchange
	  	 Amount of decrease in Principal
 Amount of this Global Security
	  	 Amount of increase in Principal
 Amount of this Global Security
	  	 Principal Amount of this Global
 Security following such
 decrease or
increase
	  	 Signature of authorized
 signatory of Trustee or
 Securities
Custodian

		  		  		  		  	
		  		  		  		  	
		  		  		  		  	
		  		  		  		  	

  

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 OPTION OF HOLDER TO ELECT PURCHASE 
 If you want to elect to have this Security purchased by the Company pursuant to Section 3.7 or 3.9 of the Indenture, check the box:

  ̈       ̈ 
  3.7    3.9  
 If you want to elect to have only part of this Security purchased by the Company pursuant to Section 3.7 or 3.9 of the Indenture, state the amount in principal amount (must be in denominations of $2,000 or an integral
multiple of $1,000 in excess thereof): $                     
  

									
	Date:	 	  
	 		 	Your Signature:	 	  

		 		 		 	(Sign exactly as your name appears on the other side of the Security)

  

					
	 Signature Guarantee:
	 	  
	 	
		 	 (Signature must be guaranteed)
	 	

 The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan
associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15. 
  

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 SUBSIDIARY GUARANTEE 
 Pursuant to the Indenture (the “Indenture”) dated as of July 2, 2009 among Smithfield Foods, Inc., the Subsidiary Guarantors party thereto (each a “Subsidiary Guarantor” and collectively the
“Subsidiary Guarantors”) and U.S. Bank National Association, as trustee (the “Trustee”), each Subsidiary Guarantor, subject to the provisions of Article X of the Indenture, hereby fully, unconditionally and irrevocably
guarantees, as primary obligor and not merely as surety, jointly and severally with each other Subsidiary Guarantor, to each Holder of the Securities, to the extent lawful, and the Trustee the full and punctual payment when due, whether at maturity,
by acceleration, by redemption or otherwise, of the principal of, premium, if any, and interest on the Securities and all other obligations and liabilities of the Company under the Indenture (including without limitation interest accruing after the
filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Company or any Subsidiary Guarantor whether or not a claim for post-filing or post-petition interest is allowed in such
proceeding and the obligations under Section 7.6 of the Indenture), the Collateral Documents and the Intercreditor Agreements (all the foregoing being hereinafter collectively called the “Obligations”). Each Subsidiary Guarantor
agrees that the Obligations will rank equally in right of payment with other Indebtedness of such Subsidiary Guarantor, except to the extent such other Indebtedness is subordinate to the Obligations. Each Subsidiary Guarantor further agrees (to the
extent lawful) that the Obligations may be extended or renewed, in whole or in part, without notice or further assent from it, and that it will remain bound under this Subsidiary Guarantee notwithstanding any extension or renewal of any Obligation.

 Each Subsidiary Guarantor waives (to the extent lawful) presentation to, demand of payment from and protest to the Company of any of the
Obligations and also waives (to the extent lawful) notice of protest for nonpayment. Each Subsidiary Guarantor waives notice of any default under the Securities or the Obligations. 
 Each Subsidiary Guarantor further agrees that its Subsidiary Guarantee herein constitutes a Guarantee of payment when due (and not a Guarantee of
collection) and waives any right to require that any resort be had by any Holder to any security held for payment of the Obligations. 
 Except as set forth in Section 4.2, Section 10.2 and Article VIII of the Indenture, the obligations of each Subsidiary Guarantor hereunder shall not be subject to any reduction, limitation, impairment or
termination for any reason (other than payment of the Obligations in full), including any claim of waiver, release, surrender, alteration or compromise, and shall not (to the extent lawful) be subject to any defense of setoff, counterclaim,
recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Obligations or otherwise. Without limiting the generality of the foregoing, the obligations of each Subsidiary Guarantor herein shall not (to
the extent lawful) be discharged or impaired or otherwise affected by (a) the failure of any Holder to assert any claim or demand or to enforce any right or remedy against the Company or any other person under the Indenture, the Securities or
any other agreement or otherwise; (b) any extension or renewal of any thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of the Indenture, the Securities or any other agreement; (d) the
release of any security held by any Holder or the Collateral Agent for the Obligations or any of them; (e) the failure of any Holder to exercise 

  

 A-14 

 
any right or remedy against any other Subsidiary Guarantor; (f) any change in the ownership of the Company; (g) any default, failure or delay,
willful or otherwise, in the performance of the Obligations, or (h) any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of any Subsidiary Guarantor or would
otherwise operate as a discharge of such Subsidiary Guarantor as a matter of law or equity. 
 Each Subsidiary Guarantor agrees that its
Subsidiary Guarantee herein shall remain in full force and effect until payment in full of all the Obligations or such Subsidiary Guarantor is released from its Subsidiary Guarantee upon the merger or the sale of all the Capital Stock or assets of
the Subsidiary Guarantor or otherwise in compliance with Section 4.2, Section 10.2 and Article VIII of the Indenture. Each Subsidiary Guarantor further agrees that its Subsidiary Guarantee herein shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal of, premium, if any, or interest on any of the Obligations is rescinded or must otherwise be restored by any Holder upon the bankruptcy or
reorganization of the Company or otherwise. 
 In furtherance of the foregoing and not in limitation of any other right which any Holder has
at law or in equity against any Subsidiary Guarantor by virtue hereof, upon the failure of the Company to pay any of the Obligations when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, each
Subsidiary Guarantor hereby promises to and will, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Trustee or the Trustee on behalf of the Holders an amount equal to the sum of (i) the unpaid
amount of such Obligations then due and owing and (ii) accrued and unpaid interest on such Obligations then due and owing (but only to the extent not prohibited by law). 
 Each Subsidiary Guarantor further agrees that, as between such Subsidiary Guarantor, on the one hand, and the Holders, on the other hand, (x) the
maturity of the Obligations guaranteed hereby may be accelerated as provided in the Indenture for the purposes of its Subsidiary Guarantee herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of
the Obligations guaranteed hereby and (y) in the event of any such declaration of acceleration of such Obligations, such Obligations (whether or not due and payable) shall forthwith become due and payable by the Subsidiary Guarantor for the
purposes of this Subsidiary Guarantee. 
 Each Subsidiary Guarantor also agrees to pay any and all reasonable costs and expenses (including
reasonable attorneys’ fees) incurred by the Trustee or the Holders in enforcing any rights under this Subsidiary Guarantee. 
  

 A-15 

					
	 Brown’s Realty Partnership,
     a North Carolina general partnership
 Carroll’s Realty Partnership,
     a North Carolina general partnership
 Smithfield-Carroll’s Farms,
     a Virginia general partnership,
         as Subsidary Guarantors

		
	By:	 	 Murphy-Brown, LLC,
 as a general partner
of each

			
		 	By:	 	  

		 	Name:	 	Carey J. Dubois
		 	Title:	 	Vice President

  

 A-16 

			
	 814 Americas, Inc.,
     a Delaware corporation
 Armour-Eckrich Meats LLC,
     a Delaware limited liability company
 Farmland Distribution Inc.,
     a Delaware corporation
 Farmland Foods,
Inc.,
     a Delaware corporation
 Gwaltney
Transportation Co., Inc.,
     a Delaware corporation
 John Morrell & Co.,
     a Delaware corporation
 LPC Transport, Inc.,
     a Delaware corporation
 Murphy Farms of Texhoma, Inc.,
     an Oklahoma
corporation
 Murphy-Brown LLC,
     a
Delaware limited liability company
 North Side Foods Corp.,
     a Delaware corporation
 Patrick Cudahy Incorporated,
     a Delaware corporation
 PC Express, Inc.,
     a Delaware corporation
 Premium Standard Farms, LLC,

     a Delaware limited liability company
 RMH Foods, Inc.,
     a Delaware corporation
 The Smithfield Packing Company, Incorporated,
     a Delaware corporation
 Smithfield Purchase Corporation,
     a North Carolina
corporation
 Smithfield Transportation Co., Inc.,
     a Delaware corporation
 Stefano Foods, Inc.,
     a North Carolina corporation
 Valleydale Transportation Company, Inc.,
     a Delaware corporation,
         as Subsidary Guarantors

		
	By:	 	  

	Name:	 	Carey J. Dubois
	Title:	 	Vice President

  

 A-17 

			
	 Jonmor Investments, Inc.,
     a Delaware corporation
 Patcud Investments, Inc.,
     a Delaware corporation
 SFFC, Inc.,
     a Delaware corporation
 SF Investments, Inc.,
     a Delaware corporation,
         as Subsidary Guarantors

		
	By:	 	  

	Name:	 	Charles McCarrick
	Title:	 	 President/Assistant Secretary/
 Assistant Treasurer

  

 A-18Amended and Restated Letter Agreement

 Exhibit 10.1 
 June 30, 2009 
 Dreams, Inc. 
 2
S. University Drive, Suite 325 
 Plantation, FL 33324 
 Re: Amended and Restated Letter Agreement 
 Ladies and Gentlemen: 
 This letter (“Agreement”) constitutes an agreement by and between COMERICA BANK, (herein called “Bank”), and (i) Dreams, Inc., a Utah corporation, registered in Florida as a foreign
corporation under the name Dreams of Utah, Inc. and dba Dreams, Inc. (individually “Dreams”, and as authorized agent for each of the other Borrowers “Authorized Agent”), (ii) Dreams Franchise Corporation, a California corporation
(“Franchise”), (iii) Dreams Entertainment, Inc., a Utah corporation (“Entertainment”), (iv) Dreams Products, Inc., a Utah corporation, Inc. (“Products”), (v) Dreams Retail Corporation, a Florida corporation
(“Retail”), (vi) Dreams/Pro Sports, Inc., a Florida corporation (“Pro Sports”), (vii) Fansedge Incorporated, a Delaware corporation (“Fansedge”), (viii) The Greene Organization, Inc., a Florida
corporation (“Greene”), (ix) The Sports Collectibles & Auction Company, Inc., a Florida corporation (“Collectibles”), (x) Dreams Unique, Inc., a Florida corporation (“Unique”), (xi) StarsLive365,
LLC, a Nevada limited liability corporation (“StarsLive”), (xii) 365 Las Vegas, L.P., a Nevada limited partnership (“Las Vegas”) and (xiii) BKJ Consulting Corp., an Illinois corporation (“BKJ” and collectively
with Dreams, Franchise, Entertainment, Products, Retail, Pro Sports, Fansedge, Greene, Collectibles, Unique, StarsLive and Las Vegas referred to herein as the “Borrowers” and individually, a “Borrower”), pertaining to certain
loans and other credit which Bank has made and/or may from time to time hereafter make available to Borrowers, or any of them. 
 This
Agreement amends, restates and replaces that certain letter agreement dated May 15, 2007, among Borrowers and Bank, as amended (the “Prior Agreement”). 
 In consideration of all present and future loans, advances and other credit from time to time made available by Bank to or in favor of any of the Borrowers, and in consideration of all present and future Liabilities
of any of the Borrowers to Bank, each Borrower represents, warrants, covenants and agrees as follows: 
 1. (a) As used in this
Agreement, the following terms shall have the following respective meanings: 
 “Affiliate” shall mean, when used with respect to
any Person, any other Person, or group acting in concert in respect of such Person, that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with such Person. For purposes of this
definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person or group of persons, shall mean the possession, directly or
indirectly, of 

 
the power to direct or cause the direction of management and policies of such Person, whether through the ownership of voting securities, by contract or
otherwise. 
 “Agreement” shall mean this letter agreement, as the same may be amended from time to time. 
 “Business Day” shall mean any day, other than a Saturday, Sunday or holiday, on which Bank is open for all or substantially all of its domestic
and international business (including dealings in foreign exchange) in Detroit, Michigan and Fort Lauderdale, Florida. 
 “Capital
Expenditure” shall mean, without duplication, with respect to any Person, any payment made directly or indirectly for the purpose of acquiring or constructing fixed assets, real property or equipment which in accordance with GAAP would be added
as a debit to the fixed asset account of such Person, including, without limitation, amounts paid or payable under any conditional sale or other title retention agreement or under any lease or other periodic payment arrangement which is of such a
nature that payment obligations of such Person thereunder would be required by generally accepted accounting principles to be capitalized and shown as liabilities on the balance sheet of such Person. 
 “Consolidated” and “Consolidating” shall mean when used with reference to any financial term in this Agreement, the aggregate for two
or more Persons of the amounts signified by such term for all such Persons determined on a consolidated basis in accordance with GAAP. 
 “Debt” shall mean with respect to any Person as of any date of determination all items of indebtedness, obligation or liability of that Person, whether matured or unmatured, liquidated or unliquidated direct or indirect, absolute
or contingent, joint or several, that should be classified as liabilities in accordance with GAAP. 
 “Default” shall mean any
condition or event which, with the giving of notice or the passage of time, or both, would constitute an Event of Default. 
 “EBITDA” shall mean, for any period, net income (loss) of Dreams and its Consolidated Subsidiaries before interest expense, income tax expense and depreciation and amortization expense for such period, all as determined on a
Consolidated basis in accordance with GAAP. 
 “Environmental Laws” shall mean all laws, codes, ordinances, rules, regulations,
orders, decrees and directives issued by any federal, state, local, foreign or other governmental or quasi-governmental authority or body (or any agency, instrumentality or political subdivision thereof) pertaining to hazardous or toxic materials,
including, without limitation, any hazardous materials or wastes, toxic substances, flammable, explosive or radioactive materials, asbestos, and/or other similar materials; any so-called “superfund” or “superlien” law pertaining
to hazardous or toxic materials on or about any property at any time owned, leased or otherwise used by any Borrower, or any portion thereof, including, without limitation, those relating to soil, surface, subsurface groundwater conditions and the
condition of the ambient air; and any other federal, state, foreign or local statute, law, ordinance, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning, any hazardous, toxic,
radioactive, flammable or dangerous waste, substance or material, as now or at any time hereafter in effect. 
  

 2 

 “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended, or any
successor act or code. 
 “Event of Default” shall mean the occurrence or existence of any of the conditions or events set forth in
Section 8 of this Agreement. 
 “GAAP” shall mean generally accepted accounting principles consistently applied. 

“Guaranty” shall mean a guaranty in form and substance satisfactory to Bank pursuant to which a Guarantor guaranties payment of all or any
portion of the Liabilities. 
 “Hazardous Materials” shall mean all of the following: any asbestos, petroleum, petroleum
by-products, flammable explosives, radioactive materials, and any hazardous or toxic materials, as defined in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections 9601 et seq.), or in any
other Environmental Law. 
 “Liabilities” shall mean all present and future liabilities, obligations and indebtedness of Borrowers,
or any of them, to Bank, howsoever created, existing, evidenced or arising, whether direct or indirect, absolute or contingent, joint or several, now or hereafter existing or arising, whether due or to become due, and all amendments, restatements,
extensions and/or renewals thereof. 
 “Licensing Agreements” shall mean the Licensing Agreements described in Schedule 1
annexed hereto. 
 “Loan Documents” shall mean this Agreement and any and all notes, instruments, documents, guarantees, security
agreements and written agreements at any time evidencing, governing, securing or supporting any of the Liabilities. 
 “Material Adverse
Effect” shall mean any material adverse change in or effect upon (i) the business, operations, condition (financial or otherwise), performance or properties of any Borrower(s), or (ii) the ability of any. Borrower(s) to pay and
perform their obligations under this Agreement or otherwise in respect of any of the Liabilities, or (iii) the enforceability of this Agreement or any of the other Loan Documents. 
 “PBGC” shall mean the Pension Benefit Guaranty Corporation, or any successor thereto. 
 “Permitted Acquisition” shall mean the acquisition of (i) all outstanding equity interests of an entity pursuant to which such entity
becomes a wholly-owned subsidiary of the Borrower (and, if required by Bank, such Subsidiary shall have duly executed a guaranty of payment of the Liabilities and/or agreements granting Bank a security interest in all present and future assets of
such Subsidiary as collateral security for the Liabilities) or (ii) substantially all assets of an entity by the Borrower or one of the Borrower’s subsidiaries free and clear of liens and encumbrances other than Permitted Encumbrances; so
long as in each case, the Bank has given its prior written consent to such acquisition. 
 “Permitted Encumbrances” is defined in
Section 7(c) of this Agreement. 
  

 3 

 “Person” or “person” shall mean any individual, corporation, partnership, limited
liability company, trust, incorporated or unincorporated organization, joint venture, joint stock company, a government, or any agency or political subdivision thereof, or any other entity of any kind. 
 “Revolving Credit Amount” shall mean from the date hereof through August 31, 2009, $19,500,000, (ii) from September 1, 2009
through December 30, 2009, $20,000,000, (iii) on December 31, 2009, $13,000,000, (iv) from January 1, 2010 through February 28, 2010, $15,000,000, and.(v) from March 1,2010 and thereafter $19,500,000.

 “Revolving Credit Maturity Date” shall mean the “Maturity Date” as set forth in the Revolving Note. 
 “Revolving Note” shall mean that certain Master Revolving Note dated June 30, 2009 made by in the original principal amount of $20,000,000
by Borrowers payable to Bank, as may be amended, restated, supplemented or replaced from time to time. 
 “Subsidiary(ies)” shall
mean, in respect of any Person, any corporation, association, joint stock company, limited liability company, partnership (whether general, limited or both), or business trust (in any case, whether now existing or hereafter organized or acquired),
of which more than fifty percent (50%) of the outstanding voting stock or other ownership interest is owned either directly or indirectly by such Person and/or one or more of its Subsidiaries, or the management of which is otherwise controlled
either directly or indirectly by such Person and/or one or more of its Subsidiaries. Unless otherwise specified to the contrary herein or the context otherwise expressly requires, the term Subsidiary(ies) shall refer to the Subsidiary(ies) Dreams.

 “Tangible Net Worth” shall mean, as of any date of determination (i) the net book value of the assets of Dreams and its
Consolidated Subsidiaries as of such date (excluding all amounts owing to Dreams and/or its Consolidated Subsidiaries by officers, directors, shareholders and other Affiliates and all patents, patent rights, trademarks, trade names, franchises,
copyrights, licenses, goodwill and all other intangible assets of Dreams and/or its Consolidated Subsidiaries), after all appropriate deductions in accordance with GAAP (including, without limitation, reserves for doubtful receivables, obsolescence,
depreciation and amortization) minus (ii) the total Debt of Dreams and its Consolidated Subsidiaries as of such date, all as determined in accordance with GAAP. 
 (b) Unless expressly provided to the contrary, all accounting and financial terms and calculations hereunder or pursuant hereto shall be defined and
determined in accordance with GAAP. 
 2. Each loan, advance or other extension of credit made by Bank to or otherwise in favor of Borrowers,
or any of them, shall be evidenced by and subject to a promissory note or other agreement or evidence of indebtedness acceptable to Bank, in each case, executed and delivered by Borrowers unto Bank. The funding and disbursement of any loan or
advance, and the extension of any other credit, to or in favor of Borrowers shall be subject to the execution and/or delivery unto Bank of such Loan Documents as Bank may reasonably require, and shall be further subject to the satisfaction of such
other conditions and requirements as Bank, and its counsel, may from time to time require. 
  

 4 

 3.(a) Borrowers agree to pay Bank a non-refundable, unused fee on the average daily balance of the unused
portion of the Revolving Credit Amount at the rate per annum equal to one quarter of one percent (0.25%) of the Revolving Credit Amount for the average number of days elapsed using a year of 360 days. The commitment fee shall be payable quarterly in
arrears on the first Business Day of each March, June, September and December, commencing September 1, 2009, and on the Revolving Credit Maturity Date. 
 (b) Borrowers also agree to pay Bank a non-refundable, annual credit facility fee of $50,000. $37,500 of the credit facility fee for 2009 was paid by Borrower prior to the date hereof. The $12,500 balance of the 2009
credit facility fee shall be paid by Borrower upon execution of this Agreement. $25,000 of the credit facility fee for 2010 shall be paid by Borrower to Bank on January 4, 2010. In the event the Revolving Credit Maturity Date is extended to any
date beyond June 3, 2010, the $25,000 balance of the 2010 credit facility fee shall be paid by Borrower to Bank on July 1, 2010. In the event the Revolving Credit Maturity Date is not extended beyond June 30, 2010, the second $25,000
installment of the 2010 credit facility fee shall be deemed waived by Bank. 
 (c) Borrowers shall pay Bank a non-refundable restructuring
fee of $270,000, which fee shall be deemed fully earned upon execution of the Agreement by Borrowers and Bank. Payment of the restructuring fee be made by Borrowers on or before the earlier to occur of: (i) January 4, 2010, or
(ii) the first occurrence of an Event of Default. 
 4. The proceeds of advances of the revolving line of credit evidenced by the
Revolving Note shall be used for working capital purposes. 
 5. Each Borrower hereby represents and warrants, and such representations and
warranties shall be deemed to be continuing representations and warranties during the entire life of this Agreement, and thereafter, so long as any Liabilities remain unpaid and outstanding: 
  

	 	(a)	It and each of its Subsidiaries is duly organized, validly existing and in good standing under the laws of the State of its organization, is duly qualified and authorized to do
business in each jurisdiction where the character of its assets or the nature of its activities makes such qualification necessary and where the failure to so qualify could have a Material Adverse Effect, and it has the legal power and authority to
own its properties and assets and to carry out its business as now being conducted in each such jurisdiction wherein such qualification is necessary; execution, delivery and performance of this Agreement, and any and all other Loan Documents to
which such Borrower or any of its Subsidiaries is a party or by which it is otherwise bound, are within its powers and authorities, have been duly authorized by all requisite corporate or other necessary or appropriate action, and are not in
contravention or violation of law or the terms of its organizational or other governing documents, and do not require the consent or approval of any governmental body, agency or authority; and this Agreement, and any other Loan Documents
contemplated hereby, when executed, issued and/or delivered, will be valid and binding and legally enforceable in accordance with their terms. 

  

 5 

	 	(b)	Each Borrower, and any other business or organization to which such Borrower became the successor by merger, consolidation, acquisition or change in form, conducts business and
operates under its exact legal name set forth on the signature page below. 

  

	 	(c)	The execution, delivery and performance of this Agreement, and any other Loan Documents required under or contemplated by this Agreement to which such Borrower or any of its
Subsidiaries is a party or by which it is otherwise bound, and the issuance of this Agreement and any such other Loan Documents, and the borrowings and other transactions contemplated hereby and thereby, are not in contravention or violation of the
unwaived terms of any indenture, agreement or undertaking to which such Borrower or any of its Subsidiaries is a party or by which it or any of its property or assets is bound, and will not result in the creation or imposition of any lien or
encumbrance of any nature whatsoever upon any of the property or assets of Borrowers or any of their Subsidiaries, except to or in favor of Bank. 

  

	 	(d)	No litigation or other proceeding before any court or administrative agency is pending, or, to the knowledge of such Borrower or any of its officers, is threatened against such
Borrower or any of its Subsidiaries, the outcome of which could result in a Material Adverse Effect. 

  

	 	(e)	There are no security interests in, or liens, mortgages, or other encumbrances on, any of such Borrower’s or any of its Subsidiaries’ property or assets, except Permitted
Encumbrances. 

  

	 	(f)	As of the date of this Agreement and after giving effect to the waiver set forth in paragraph 18 below, there exists no Default or Event of Default under any of the Liabilities.

  

	 	(g)	The most recent financial statements with respect to Dreams and its Consolidated Subsidiaries delivered to Bank fairly present the financial condition of Dreams and its Consolidated
Subsidiaries as of the date thereof and for the period(s) covered thereby in accordance with GAAP, and since December 31, 2008, there has been no Material Adverse Effect. 

  

	 	(h)	 Neither such Borrower nor any Subsidiary has used Hazardous Materials on, in, under or otherwise affecting any real or personal property now or at any time owned,
occupied or operated by such Borrower or any Subsidiary or upon which such Borrower or any Subsidiary has a place of business (collectively and severally the “Property”) in any manner which violates any Environmental Law(s), to the extent
that any such violation could result in a Material Adverse Effect; and that, to the best of such Borrower’s knowledge, no prior owner, occupant or operator of any of the Property, or any current or prior owner, occupant or operator thereof, has
used any Hazardous Materials on or affecting the Property in any manner which violates any Environmental Law(s), to the extent that any such violation could result in a Material Adverse Effect. 

  

 6 

	 	 
To the best of its knowledge neither such Borrower nor any Subsidiary has ever received any notice of any violation of any Environmental Law(s), and to the
best of such Borrower’s knowledge, there have been no actions commenced or threatened by any party against such Borrower or any Subsidiary or any of the Property for non-compliance with any Environmental Law(s), which, in any case, could result
in a Material Adverse Effect. 

  

	 	(i)	As of the date of this Agreement, Schedule 5(i) is a true and complete list of all of the Subsidiaries of Dreams, and each such Subsidiary’s address, place of
incorporation or organization and percentage of ownership of such Borrower in each such Subsidiary. 

  

	 	(j)	As of the date of this Agreement, all current real estate rental obligations of Borrowers are have been paid in full and no payments are overdue. 

 6. So long as Bank shall have any commitment or obligation, if any, to make any loans or extend credit to or in favor of Borrowers, or any of them, and
so long as any Liabilities remain unpaid and outstanding, each Borrower covenants and agrees that it shall and it shall cause each of its Subsidiaries to: 
  

	 	(a)	Furnish to Bank, or cause to be furnished to Bank, in each case, in form and detail and on a reporting basis satisfactory to Bank, the following: 

  

	 	(i)	as soon as available, and in any event not later than ninety (90) days after and as of the end of each fiscal year of Dreams, beginning with the fiscal year ending
December 31, 2009, (A) Dreams’ 10K as of such date and (B) the financial statement of Dreams and its Consolidated Subsidiaries for and as of the end of each such fiscal year, containing the balance sheets of Dreams and its
Consolidated Subsidiaries as of the close of each such fiscal year, statements of income and retained earnings and a statement of cash flows for each such fiscal year, and such other comments and financial details as are usually included in similar
reports. Such financial statements shall be prepared on a consolidated and consolidating basis in accordance with GAAP, shall be in such detail as Bank may reasonably require, and shall be audited by independent certified public accountants of
recognized standing selected by Dreams and acceptable to Bank (Bank acknowledges that as of the date hereof, Freidman, Cohen, Taubman & Co., LLC is acceptable to Bank); 

  

	 	(ii)	 as soon as available, and in any event not later than forty five (45) days after and as of the end of each fiscal quarter of Dreams,
(A) Dreams’ 10-Q for such fiscal quarter and (B) the financial
statement for Dreams and its Consolidated Subsidiaries, containing the balance sheet of Dreams and its Consolidated Subsidiaries as of the end of each such quarter, statements of income and retained earning and a statement of cash flows for Dreams
and its Consolidated Subsidiaries for such quarter and for the portion of the fiscal year of Dreams and its Consolidated Subsidiaries through the end of the fiscal quarter then ending. Such financial statements shall be prepared by 

  

 7 

	 	 
Dreams on a consolidated and consolidating basis in accordance with GAAP, and shall be certified as to accuracy and fairness by the chief executive or chief
financial officer of Dreams; 

  

	 	(iii)	as soon as available, and in any event not later than forty five (45) days after and as of the end of each month, the financial statements for the Borrowers, containing the
balance sheets of the Borrowers as of the end of each such month, statements of income and retained earning and a statement of cash flows for the Borrowers for such month and for the portion of the fiscal year of the Borrowers through the end of the
month then ending, and such other comments and financial details as are usually included in similar reports. Such financial statements shall be in the form previously furnished to Bank, shall be prepared by Borrowers in accordance with GAAP, and
shall be certified as to accuracy and fairness by the chief executive or chief financial officer of Borrowers; 

  

	 	(iv)	simultaneous with the delivery to Bank of the respective financial statements required in sub-sections (i) and (iii) above, a compliance certificate in form annexed hereto
as Exhibit “B”, certified by the chief executive or chief financial officer of Dreams, for itself and as Authorized Agent for all of the other Borrowers; 

  

	 	(v)	as soon as available, and in any event within fifteen (15) days after and as of the end of each month, agings of each Borrower’s accounts receivable, agings of each
Borrower’s account payable and an inventory report of each Borrower, each in form and substance satisfactory to Bank, certified by a duly authorized officer of Dreams; 

  

	 	(vi)	by the close of business on Wednesday of each week, and as of the immediately preceding Sunday, a borrowing base report for the 7-day period week ending on such Sunday, in form
satisfactory to Bank, certified by a duly authorized officer of Dreams; 

  

	 	(vii)	on or before January 31 of each year, commencing January 31, 2010, EBITDA projections for such year on a quarter-by-quarter basis, which projections shall be reasonable in
all material respects taking into account all facts and information known or reasonably available to Borrowers; and 

  

	 	(viii)	as soon as possible, and in any event within four (4) Business Days after becoming aware of the occurrence or existence of any Default or Event of Default, or of any other
condition or occurrence which has had or could reasonably be expected to have a Material Adverse Effect, a written statement of the chief executive or chief financial officer of such Dreams, for itself and as Authorized Agent for all of the other
Borrowers setting forth the details of such Default or Event of Default, or such other condition or occurrence, and the action which Dreams or such Borrower has taken or caused to be taken, or proposes to take or cause to be taken, with respect
thereto; and 

  

 8 

	 	(ix)	promptly, at such times US Bank may reasonably require, in form and detail satisfactory to Bank, such other information and reports as may be required under the terms of any Loan
Documents or as Bank may reasonably request from time to time. 

  

	 	(b)	Keep proper books of record and account in which full and correct entries shall be made of all of its financial transactions and its assets and businesses so as to permit the
presentation of financial statements (including, without limitation, those financial statements to be delivered to Bank pursuant to Section 6(a) above) prepared in accordance with GAAP; permit Bank, or its representatives, at reasonable times
and intervals, to visit all of such Borrower’s and its Subsidiaries’ offices and to make inquiries as to such Borrower’s and its Subsidiaries’ financial matters with their respective directors, officers, employees, and
independent certified public accountants; and permit Bank, through Bank’s authorized attorneys, accountants and representatives, to inspect, audit, appraise and examine such Borrower’s and its Subsidiaries’ books, accounts, records,
ledgers and assets and properties of every kind and description, wherever located, at all reasonable times during normal business hours. Such Borrower shall reimburse Bank for all reasonable costs and expenses incurred by Bank in connection with
such inspections, examinations and audits, and to pay to Bank such fees as Bank may reasonably charge in respect of such inspections, examinations and audits, or as otherwise mutually agreed upon by such Borrower and Bank; provided, however,
so long as no Default or Event of Default shall have occurred and be continuing, Borrowers shall not be required to reimburse Bank for more than three (3) such inspections, examinations and audits per Borrower per year. In addition, Bank shall
have the right to conduct or obtain an appraisal of each of the Borrowers’ inventory from time to time; provided, that so long as no Default or Event of Default shall have occurred and be continuing, Borrowers shall not be required to reimburse
Bank for more than one (1) such inventory appraisal per Borrower, per year. Notwithstanding the foregoing, Borrowers shall be required to reimburse Bank for a limited scope appraisal (the scope of such appraisal to be determined by Bank) of the
Borrowers’ inventory which shall be completed on or before August 31, 2009 and the next full appraisal of the Borrowers’ inventory shall be completed by January 31, 2010. 

  

	 	(c)	Keep its insurable properties (including, without limitation, any collateral at any time securing all or any part of the Liabilities) adequately insured and maintain
(i) insurance against fire and other risks customarily insured against under an “all- risk” policy and such additional risks customarily insured against by companies engaged in the same or a similar business to that of such Borrower
and its Subsidiaries, (ii) necessary workers’ compensation insurance, (iii) public liability and product liability insurance, and (iv) such other insurance as may be required by law or as may be reasonably required in writing by
Bank, all of which insurance shall be in such amounts, contain such terms, be in such form, be for such 

  

 9 

	 	    	purposes, prepaid for periods of not less than six (6) months, and written by such companies as may be satisfactory to Bank. All such policies shall contain a provision whereby
they may not be canceled or materially amended except upon thirty (30) days’ prior written notice to Bank. Such Borrower will promptly deliver to Bank, at Bank’s request, evidence satisfactory to Bank that such insurance has been so
procured and, with respect to casualty insurance, made payable to Bank. If such Borrower or any Subsidiary fails to maintain satisfactory insurance as herein provided, Bank shall have the option (but not the obligation) to do so, and such Borrower
agrees to repay Bank, upon demand, with interest at the highest rate of interest applicable to any of the Liabilities, all amounts so expended by Bank. Such Borrower hereby appoints Bank, or any employee or agent of Bank, as such Borrower’s
attorney-in-fact, which appointment is coupled with an interest and irrevocable, and authorizes Bank, or any employee or agent of Bank, on behalf of such Borrower; to do either of the following after an Event of Default and during the continuance
thereof, (i) adjust and compromise any loss under said insurance and (ii) to endorse any check or draft payable to such Borrower in connection with returned or unearned premiums on said insurance or the proceeds of said insurance, and any
amount so collected may be applied toward satisfaction of the Liabilities; provided, however, that Bank shall not be required hereunder so to act. 

  

	 	(d)	Pay promptly and within the time that they can be paid without late charge, penalty or interest, all taxes, assessments and similar imposts and charges of every kind and nature
lawfully levied, assessed or imposed upon such Borrower, any Subsidiary and/or any of their respective property, except to the extent being contested in good faith and, if requested by Bank, bonded in an amount and manner satisfactory to Bank
(“Contested Taxes”), If such Borrower or any Subsidiary fails to pay such taxes and assessments (excluding Contested Taxes) within the time they can be paid without penalty, late charge or interest, Bank shall have the option (but not the
obligation) to do so, and such Borrower agrees to repay Bank, upon demand, with interest at the highest rate of interest applicable to any of the Liabilities, all amounts so expended by Bank. 

  

	 	(e)	Do or cause to be done all things necessary to preserve and keep in full force and effect such Borrower’s and each Subsidiary’s existence, rights and franchises and comply
with all applicable laws; continue to conduct and operate its business substantially as conducted and operated during the present and preceding calendar year; at all times maintain, preserve and protect all franchises and trade names and preserve
all the remainder of its property and keep the same in good repair, working order and condition; and from time to time make, or cause to be made, all needed and proper repairs, renewals, replacements, betterments and improvements thereto so that the
business carried on in connection therewith may be properly and advantageously conducted at all times; provided, (however, upon not less than thirty (30) days prior written notice to Bank, Borrowers may close stores and/or terminate
franchises in their sole, but reasonable, business judgment so long as no such closing or termination could reasonably be expected to have a Material Adverse Effect. 

  

 10 

	 	(f)	Maintain, as of the last day of each fiscal quarter, commencing with the fiscal quarter ending March 31, 2009; a ratio of Debt to Tangible Net Worth (for the four quarter
period ending on such date) of not more than the following: 

  

			
	 March 31,2009
	  	3.2 to 1.0
	 June 30, 2009
	  	3.7 to 1.00
	 September 30, 2009
	  	4.35 to 1.0
	 December 31,2009 and the last day of each fiscal quarter thereafter
	  	2.8 to 1.0

  

	 	(g)	Maintain, as of the last day of each month, commencing April 30, 2009, EBITDA (on a year to date basis) of not less the following; 

  

				
	 April 30, 2009
	  	(1,367,000	) 
	 May 31, 2009
	  	(2,278,000	) 
	 June 30, 2009
	  	(2,576,000	) 
	 July 31, 2009
	  	(2,835,000	) 
	 August 31, 2009
	  	(3,099,000	) 
	 September 30, 2009
	  	(3,069,000	) 
	 October 31, 2009
	  	(2,926,000	) 
	 November 30, 2009
	  	(2,008,000	) 
	 December 31, 2009
	  	1,998,000	  

  

	 	(h)	Maintain, as of the last day of each fiscal quarter, commencing with the fiscal quarter ending March 31, 2009, Tangible Net Worth of not less than the following:

  

				
	 March 31, 2009
	  	$	10,000,000
	 June 30, 2009
	  	$	8,600,000
	 September 30, 2009
	  	$	7,600,000
	 December 31, 2009 and the last day of each fiscal quarter thereafter
	  	$	10,200,000

  

	 	(i)	 At all times meet the minimum funding requirements of ERISA with respect to such Borrower’s and its Subsidiary’s employee benefit plans subject to ERISA;
promptly after such Borrower knows or has reason to know of the occurrence of any event, which would constitute a reportable event or prohibited transaction under ERISA, or that the PBGC, such 

  

 11 

	 	 
Borrower or any of its Subsidiaries has instituted or will institute proceedings to terminate an employee pension plan, deliver to Bank a certificate of an
authorized officer of such Borrower setting forth details as to such event or proceedings and the action which such Borrower proposes to take with respect thereto, together with a copy of any notice of such event which may be required to be filed
with the PBGC; and upon the request of Bank, furnish to Bank (or cause the plan administrator to furnish Bank) a copy of the annual return (including all schedules and attachments) for each plan covered by ERISA, and filed with the Internal Revenue
Service by such Borrower or any of its Subsidiaries, as applicable, not later than ten (10) days after such report has been so filed. Each such Borrower shall be permitted to voluntarily terminate employee pension or benefit plans, so long as
any such voluntary termination is done in accordance with ERISA and does not result in a material liability or obligation to such Borrower. 

  

	 	(j)	Comply in all material respects with all applicable Environmental Laws, and maintain all material permits, licenses and approvals required under applicable Environmental Laws, where
the failure to do so could result in a Material Adverse Effect; and promptly provide to Bank, immediately upon receipt thereof, copies of any material correspondence, notice, pleading, citation, indictment, complaint, order, decree, or other
document from any source asserting or alleging a violation of any Environmental Laws by such Borrower or any of its Subsidiaries, or of any circumstance or condition which requires or may require a financial contribution by such Borrower or any of
its Subsidiaries, or a clean-up, removal, remedial action or other response by or on behalf of such Borrower or any of its Subsidiaries under applicable Environmental Law(s), or which seeks damages or civil, criminal, or punitive penalties from such
Borrower or any of its Subsidiaries for any violation or alleged violation of any Environmental Law(s) by such Borrower or any of its Subsidiaries. Each Borrower hereby indemnifies, saves and holds Bank, and any of Bank’s past, present and
future officers, directors, shareholders, employees, representatives and consultants, harmless from any and all losses, damages, suites, penalties, costs, liabilities and expenses (including, without limitation, reasonable legal expenses and
attorneys’ fees) incurred or arising out of any claim, loss or damage of any property, injuries to or death of any persons, contamination of or adverse effects on the environment, or other violation of any applicable Environmental Law(s), in
any case, caused by such Borrower or any of its Subsidiaries, or in any way related to any property owned or operated by such Borrower or any of its Subsidiaries, or due to any acts of such Borrower or any of its Subsidiaries, or any of their
respective officers, directors, shareholders, employees, consultants and/or representatives; provided, however, that the foregoing indemnification shall not be applicable, and such Borrower shall not be liable for any such losses, damages, suits,
penalties, costs, liabilities or expenses, to the extent (but only to the extent) the same arise or result from any gross negligence or willful misconduct of Bank or any of its agents or employees. 

  

	 	(k)	Maintain all of its deposit accounts with Bank, except (i) those accounts set forth on Schedule 6(k) annexed hereto and (ii) such other deposit accounts at such other
financial institutions opened by Borrowers after obtaining Bank’s prior written consent (which such consent shall not be unreasonably withheld or delayed). 

  

 12 

	 	(l)	Comply in all material respects with all terms of the Licensing Agreements. 

  

	 	(m)	Within five (5) Business Days thereof, notify Bank if any party to a Licensing Agreement terminates, attempts to terminate or gives notice of termination of such Licensing
Agreement. 

  

	 	(n)	Within five (5) Business Days thereof, notify Bank if any party to an Occupancy Agreement terminates, attempts to terminate or gives notice of termination under or commits an
event of default, under the Occupancy Agreement, “Occupancy Agreement” shall mean any lease, warehousing agreement or any other agreement granting a Borrower occupancy, warehousing or storage rights on or with respect to any real property
or portion thereof. 

  

	 	(o)	Pay promptly and within the before or on the scheduled payment due date, all real estate rental obligations, including, without limitation, lease payments of any Borrower, any
Subsidiary, except to the extent being contested in good faith and, if requested by Bank, bonded in an amount and manner satisfactory to Bank. 

  

	 	(p)	Furnish Bank with (i) written notice (“Lease Payment Default Notice”) if any payment owing by any Borrower under any Occupancy Agreement remains unpaid for more than
10 days (not including periods of notice and cure), such Lease Payment Default Notice to be delivered to Bank within three (3) days, and (ii) written notice (“Lease Covenant Default Notice”) of the occurrence of any non-monetary
default under any Occupancy Agreement, such Lease Covenant Default Notice to be delivered to Bank within three (3) days of the occurrence of such default. 

 7. So long as Bank shall have any commitment or obligation, if any, to make any loans or extend credit to or in favor of Borrowers, or any of them, and
so long as any Liabilities remain unpaid and outstanding, each Borrower covenants and agrees that it shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of Bank: 
  

	 	(a)	Declare or pay any dividends on, or make any other distribution (whether by reduction of capital or otherwise) with respect to, any shares of its capital stock, except (i) cash
dividends payable to Dreams or one of its Subsidiaries and (ii) dividends payable solely in capital stock of such Borrower. 

  

	 	(b)	Purchase, redeem, retire or otherwise acquire any of the shares of its capital stock, or make any commitment to do so. 

  

 13 

	 	(c)	Create, incur, assume or suffer to exist any mortgage, pledge, encumbrance, security interest, lien or charge of any kind upon any of its property or assets, whether now owned or
hereafter acquired, other than the following (collectively, “Permitted Encumbrances”): 

  

	 	(i)	liens, mortgages, security interests and encumbrances to or in favor of Bank; 

  

	 	(ii)	liens for taxes, assessments or other governmental charges incurred in the ordinary course of business and for which no interest, late charge or penalty is attaching or which is
being contested in good faith by appropriate proceedings diligently pursued and, if requested by Bank, bonded in an amount and manner satisfactory to Bank; 

  

	 	(iii)	liens, not delinquent, created by statute in connection with workers’ compensation, unemployment insurance, social security, old age pensions (subject to the applicable
provisions of this Agreement) and similar statutory obligations; 

  

	 	(iv)	purchase money security interests to secure purchase money indebtedness of Dreams and/or its Consolidated Subsidiaries permitted under Section 7(d)(vi) of this Agreement, so
long as such security interests arise or are created substantially contemporaneously with the purchase or acquisition by Dreams and/or its Consolidated Subsidiaries, as applicable, of the respective property or assets to which such security
interests relate and the incurrence of the respective purchase money indebtedness which such security interests secure, secure only the respective purchase money indebtedness so incurred by Dreams and/or its Consolidated Subsidiaries to enable it to
so purchase or acquire such property or assets, and no other Debt, and encumber only the respective property or assets so purchased or acquired, and no other property or assets of Dreams and/or its Consolidated Subsidiaries;

  

	 	(v)	liens in favor of mechanics, materialmen; carriers, warehousemen or other like statutory or common law liens securing obligations incurred in good faith in the ordinary course of
business that are not yet due and payable; and 

  

	 	(vi)	the liens described on Schedule 9(c). 

  

	 	(d)	Incur, create, assume or permit to exist any Debt of any kind or nature whatsoever, except for (i) the Liabilities, (ii) existing indebtedness to the extent set forth on
attached Schedule 9(d) attached hereto, (iii) unsecured trade indebtedness incurred and paid in the ordinary course of business, (iv) indebtedness secured by Permitted Encumbrances, and (v) purchase money indebtedness and lease
obligations (whether in respect of capitalized leases, operating leases or otherwise), not otherwise disclosed in said Schedule 9(d), not to exceed Two Hundred Thousand Dollars ($200,000), in the aggregate, at any time,

  

 14 

	 	(e)	Make or allow to remain outstanding any investment (whether such investment shall be or the character of investment in shares of stock, evidence of indebtedness or other securities
or otherwise) in, or any loans or advances or extensions of credit to, any person, firm, corporation or other entity or association, except: 

  

	 	(i)	investments in existing Subsidiaries; 

  

	 	(ii)	advances made for expenses or purchases in the ordinary course of business; 

  

	 	(iii)	loans or advances made to officers, directors, or employees of Company, not to exceed in the aggregate Twenty Five Thousand Dollars ($25,000) at any one time outstanding;

  

	 	(iv)	(A) certificates of deposit with maturities of one year or less of United States commercial banks with capital, surplus and undivided profits in excess of $100,000,000.00, and
(B) direct obligations of the United States Government maturing within one year from the date of acquisition thereof; 

  

	 	(v)	unfinanced (cash) acquisitions of (A) all outstanding equity interests of an entity pursuant to which such entity becomes a wholly-owned subsidiary of the Borrower (“New
Subsidiary”) or (B) substantially all assets of an entity by the Borrower or one of the Borrower’s subsidiaries free and clear of liens and encumbrances other than Permitted Encumbrances; not to exceed for any such acquisition
$350,000 in the aggregate, and in any case, so long as not less than ten (10) days before the effective date of any such acquisition Bank shall have received an executed copy of the purchase agreement relating to such acquisition and, if
required by Bank in the exercise of its sole discretion, within ten (10) days after the effective date of such acquisition, the New Subsidiary shall have duly executed a guaranty of payment of the Liabilities and/or agreements granting Bank a
security interest in all present and future assets of such New Subsidiary as collateral security for the Liabilities. 

  

	 	(f)	Guarantee or otherwise, directly or indirectly, in any way be or become responsible for obligations of any other Person, whether by agreement to purchase the indebtedness of any
other Person, agreement for the furnishing of funds to any other Person through the furnishing of goods, supplies or services, by way of stock purchase, capital contribution, advance or loan, for the purpose of paying or discharging (or causing the
payment or discharge of) the indebtedness of any other Person, or otherwise, except (i) guaranties in favor of Bank; and (ii) the endorsement of negotiable instruments in the ordinary course of business for deposit or collection.

  

	 	(g)	Subordinate any indebtedness due to it from any Person to indebtedness of other creditors of such Person. 

  

	 	(h)	(i) sell, lease (as lessor), transfer or otherwise dispose of any of its properties or assets, except as to the sale of inventory in the ordinary course of business; (ii)
change its name, consolidate with or merge into any other Person, permit any other 

  

 15 

 Person to merge into it (except that each New Subsidiary may be merged into a Borrower); (iii) enter
into any reorganization or recapitalization; or (iv) enter into any sale-leaseback transaction. 
  

	 	(i)	Allow any fact, condition or event to occur or exist with respect to any employee pension or profit sharing plan established or maintained by it which might constitute grounds for
termination of any such plan or for the court appointment of a trustee to administer any such plan; or permit any such plan to be the subject of termination proceedings (whether voluntary or involuntary) which may result in a liability of Borrower
to the PBGC which, in the opinion of Bank), will have a Material Adverse Effect. 

  

	 	(j)	Furnish Bank with any certificate or other document that knowingly contains any untrue statement of a material fact or omits to state a material fact necessary to make such
certificate or document not misleading in light of the circumstances under which it was furnished. 

  

	 	(k)	Apply any of the proceeds of any loan, advance or other extension of credit by Bank to or in favor of such Borrower, to the purchase or carrying of any “margin stock”
within the meaning of Regulation U of the Board of Governors of the Federal Reserve System, or any regulations, interpretations or rulings thereunder. 

  

	 	(l)	Enter into any transaction or series of transactions with any Affiliate other than on terms and conditions as favorable to Borrower as would be obtainable in a comparable
arms-length transaction with a Person other than an Affiliate. 

  

	 	(m)	Create or acquire any Subsidiary except to the extent permitted under Section 7(e) above. 

  

	 	(n)	Amend or modify any document evidencing any Subordinated Debt or make any payment with respect to any Subordinated Debt except as permitted pursuant to the applicable subordination
agreement related to such Subordinated Debt. 

 8. An “Event of Default” shall be deemed to have occurred or exist
under this Agreement upon the occurrence and/or existence of any of the following conditions or events: 
  

	 	(a)	The Borrowers shall fail to pay the principal of or interest on or shall otherwise fail to pay any other amount owing by Borrowers, or any of them, to Bank, when due, under any of
the Liabilities, and such default in payment shall continue unremedied or uncured beyond any applicable period of grace provided with respect thereto, if any, in the relevant Loan Document(s); or 

  

	 	(b)	any representation, warranty, certification or statement made or deemed to have been made by Borrowers herein, or by any Person(s) (including, without limit, any Borrower) in any
certificate, financial statement or other written document or agreement delivered by or on behalf of Borrowers, or any of them in connection with the Liabilities or any of the Loan Documents, shall prove to be materially untrue or incomplete; or

  

 16 

	 	(c)	Borrowers, or any of them, shall fail to observe or perform any condition, covenant or agreement of Borrowers, or any of them, set forth herein; or 

  

	 	(d)	Any loss, theft, substantial damage or destruction to or of any Collateral, or the issuance or filing of any attachment, levy, garnishment or the commencement of any proceeding in
connection with any Collateral or of any other judicial process of, upon or in respect of any Collateral; or 

  

	 	(e)	there is any revocation, termination or attempted revocation or termination of termination, or notice of termination, or breach of any guaranty, pledge, collateral assignment or
subordination agreement relating to all or any part of the Liabilities; or 

  

	 	(f)	Sale or other disposition by Borrowers, or any of them, or any Guarantor of any substantial portion of its assets or property or voluntary suspension of the transaction of business
by Borrowers, or any of them, or any Guarantor, or death, dissolution, termination of existence, merger, consolidation, insolvency, business failure, or assignment for the benefit of creditors of or by Borrower or Borrowers, or any of them, or any
Guarantor; or commencement of any proceedings under any state or federal bankruptcy or insolvency laws or laws for the relief of debtors by or against Borrowers, or any of them, or any Guarantor (and if such proceeding is involuntary, continuance
thereof for more than 30 days); or the appointment of a receiver, trustee, court appointee, sequestrator or otherwise, for all or any part of the property of Borrowers, or any of them, or any Guarantor; or 

  

	 	(g)	if there is any failure by Borrowers, or any of them, or any Guarantor to pay, when due, any of its indebtedness in excess of $25,000 in the aggregate (other than to the Bank) or in
the observance or performance of any term, covenant or condition in any document evidencing, securing or relating to such indebtedness; or 

  

	 	(h)	Bank deems the margin of Collateral insufficient or itself insecure, in good faith believing that the prospect of payment of the Liabilities or performance of this Agreement is
impaired or shall fear deterioration, removal, or waste of Collateral; or 

  

	 	(i)	An event of default shall occur under any instrument, agreement or other document evidencing, securing or otherwise relating to any of the Liabilities; or 

 

	 	(j)	Any judgment(s) for the payment of money in excess of $50,000 in the aggregate shall be rendered against the Borrowers or any of them or any Guarantor and such judgment(s) shall
remain unpaid, unvacated, unbonded or unstayed by appeal or otherwise for a period of thirty (30) consecutive days from the date of its entry and such judgment(s) is (are) not covered by insurance from a solvent insurer who is defending such
action without reservation of rights; or 

  

 17 

	 	(k)	if Dreams shall fail, for any reason whatsoever, to own and control, directly or indirectly, 100% of the equity interests in any of the other Borrowers (other than Las Vegas) or
shall fail, for any reason whatsoever, to own and control, directly or indirectly, at least 75% of the equity interest in Las Vegas; or 

  

	 	(1)	the occurrence of any “reportable event”, as defined in ERISA, which (i) is determined to constitute grounds for (A) termination by the PBGC of any pension plan
of any Borrower or (B) the appointment by the appropriate United States District Court of a trustee to administer such plan and (ii) is reasonably likely to result in a Material Adverse Effect, and (iii) such reportable event is not
corrected and such determination is not revoked within thirty (30) days after (A) notice thereof has been given to the plan administrator or any Borrower; or (B) the institution of proceedings by the PBGC to terminate any such pension
plan or to appoint a trustee to administer such plan; or (C) the appointment of a trustee by the appropriate United States District Court to administer any such pension plan; or 

  

	 	(m)	any default by any party under any Occupancy Agreement and such failure continues beyond any period of grace provided with respect thereto. 

 9. Upon the occurrence and at any time during the continuance or existence of any Event of Default, Bank may give notice to Borrowers declaring all
outstanding Liabilities to be due and payable, whereupon all such Liabilities then outstanding shall immediately become due and payable, without further notice or demand, and any commitment or obligation, if any, on the part of Bank to make loans or
otherwise extend credit to or in favor of any of the Borrowers shall immediately terminate. Upon the occurrence and at any time during the continuance or existence of any Event of Default under Section 8(j) of this Agreement, then the
Liabilities and all indebtedness then outstanding thereunder shall automatically become immediately due and payable without any notice by Bank to any of the Borrowers and any commitment or obligation, if any, on the part of Bank to make loans or
otherwise extend credit to or in favor of any of the Borrowers shall immediately terminate. Further, upon the occurrence or at any time during the continuance or existence of any Event of Default hereunder, Bank may collect, deal with and dispose of
all or any part of any security in any manner permitted or authorized by the Michigan Uniform Commercial Code or other applicable law (including public or private sale), and after deducting expenses (including, without limitation, reasonable
attorneys’ fees and expenses), Bank may apply the proceeds thereof in part or full payment of any of the Liabilities, whether due or not, in any manner or order Bank elects. In addition to the foregoing, upon the occurrence and at any time
during the continuance or existence of any Event of Default hereunder, Bank may exercise any and all rights and remedies available to it as a result thereof, whether by agreement, by law, or otherwise. 
 10. Each of the Borrowers hereby acknowledges and agrees that in the event that any of the Liabilities shall at any time be on a demand basis, the
Borrowers’ compliance with the terms and conditions set forth herein, and the absence of any Event of Default hereunder, shall not, in any way whatsoever, limit, restrict or otherwise affect or impair Bank’s right or ability to make demand
for payment of any or all of such Liabilities which may be on a demand basis at any such time, in Bank’s sole and absolute discretion, with or without reason or cause, and the existence of any Event of Default hereunder 
  

 18 

 shall not be the sole reason or basis for enabling Bank to make demand for payment of all or any part of such
Liabilities. 
 11. No forbearance on the part of the Bank in enforcing any of its rights or remedies under this Agreement or any other
Loan Document, nor any renewal, extension or rearrangement of any payment or covenant to be made or performed by Borrower hereunder or any such other Loan Document, shall constitute a waiver of any of the terms of this Agreement or such Loan
Document or of any such right or remedy. 
 12. This Agreement shall be governed by and construed and enforced in accordance with the laws of
the State of Michigan. 
 13. All covenants, agreements, representations and warranties by or on behalf of Borrower made in connection with
this Agreement and any other Loan Documents shall survive the borrowing hereunder or thereunder and shall be deemed to have been relied upon by Bank. All statements contained in any certificate or other document delivered to Bank at any time by or
on behalf of Borrowers pursuant hereto shall constitute representations and warranties by Borrowers. 
 14. Each of the Borrowers agrees to
reimburse Bank, upon within five (5) Business Days after demand by Bank, for all costs and expenses (including, without limitation, reasonable attorneys’ fees, whether in-house or outside counsel) incurred by Bank in connection with the
documentation and preparation of this Agreement, the other Loan Documents, and otherwise in respect of the Liabilities, and the consummation and the closing of the transactions contemplated hereby or thereby, any default or events of default under
or in respect of any of the Liabilities or in collecting or in attempting to collect any of the Liabilities, in perfecting, maintaining or defending any of the Bank’s liens or security interests (or the priority thereof), if any, in any
collateral securing any part of any of the Liabilities, or otherwise in enforcing any of Bank’s rights or remedies under any of the Loan Documents or otherwise in respect of any of the Liabilities. 
 15. This Agreement shall inure to the benefit of and shall be binding upon the parties hereto and their respective successors and assigns; provided,
however, that none of the Borrowers shall assign or transfer any of its rights or obligations hereunder or otherwise in respect of any of the Liabilities without the prior written consent of Bank. 
 16. The obligations and liabilities of the Borrowers under this Agreement shall constitute the joint and several obligations and liabilities of the
Borrowers. 
 17. Each reference in any of the Loan Documents or any borrowing or supporting resolution (i) to StarsLive365, LLC as a
“limited liability corporation”, is amended to mean a “limited liability company”, (ii) to “Dream/Pro Sports, Inc,” is amended to mean “Dreams/Pro Sports, Inc.”, (iii) to “Fansedge
Corporation” is amended to mean “Fansedge Incorporated”. 
 18. Borrowers have advised Bank that they failed to comply with
the provisions of Section 8(f), 8(g) and 8(h) of the Prior Agreement for the fiscal quarters ending September 30, 2008 and December 31, 2008 and also failed to comply with the provisions of Section 8(f) of the Prior Agreement for
the fiscal quarter ending March 31, 2009 (the “Covenant Violations”). Borrowers have 

  

 19 

 
requested that the Bank waive any Event of Default existing under the Agreement resulting from the Covenant Violations. Bank hereby Waives any Event of
Default existing under the Agreement resulting from the Covenant Violations. This waiver shall not be deemed to amend or alter in any respect the terms and conditions of the Agreement or any of the other Loan Documents, or to constitute a waiver or
release by the Bank of any right, remedy or Event of Default under the Agreement or any of the other Loan Documents, except to the extent specifically set forth herein. 
 19. BACH OF THE BORROWERS AND BANK ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED. EACH PARTY, AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL
OF THEIR CHOICE, KNOWINGLY AND VOLUNTARILY, AND FOR THEIR MUTUAL BENEFIT, WAIVE ANY RIGHT TO TRIAL BY JURY IN THE EVENT OF LITIGATION REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN ANY WAY RELATED TO, THIS AGREEMENT OR THE LIABILITIES.

 [Remainder of Page Intentionally Left Blank] 
  

 20 

 If the foregoing is acceptable to Borrowers, please indicate such with the authorized signatures of
Borrowers as provided below. 
  

			
	Very truly yours,
	
	COMERICA BANK
		
	By:	 	/s/    Paul G. Russo
	Its:	 	Vice President

 ACCEPTED AND AGREED: 
 DREAMS, INC., on its own behalf and as 
 Authorized Agent for and on behalf of all other 
 Borrowers: 
 DREAMS FRANCHISE CORPORATION, 
 DREAMS ENTERTAINMENT, INC. 
 DREAMS PRODUCTS, INC. 
 DREAMS RETAIL CORPORATION 
 DREAMS/PRO SPORTS, INC. 
 FANSEDGE INCORPORATED 
 THE GREENE ORGANIZATION, INC. 
 THE SPORTS COLLECTIBLES & AUCTION COMPANY, INC. 
 DREAMS UNIQUE, INC.

 STARSLIVE365, LLC 
 365 LAS VEGAS, L.P. 
 BKJ CONSULTING CORP. 
  

			
		
	By:	 	/s/     David M. Gleene
	Its:	 	Senior V. P.

 Dated: June 30 , 2009 
  

 21 

 SCHEDULE 1 
 Licensing Agreements 
  

	1.	Merchandising License Agreement between Universal Studios Licensing, Inc. and Dreams Franchise Corporation, dated August 27,1992, as amended, for “Field of Dreams”.

  

	2.	License Agreement between NFL Properties, Inc. and Dreams Products, Inc. dated April 1, 2008. 

  

	3.	License Agreement between MLB and Dreams Products, Inc. (operating under an expired, undated license agreement). 

  

	4.	License Agreement between National Association for stock Car Auto Racing, Inc. and dreams, Inc., d/b/a Mounted Memories, dated September 1, 2002. 

 TO BE UPDATED BY BORROWERS 

 SCHEDULE 5(i) 
 TO BE UPDATED BY BORROWERS 
 Direct Subsidiaries of Dreams, Inc. 
 The address of each entity is: 
 2 S.
University Drive, Suite #325 
 Plantation, FL 33324 
  

						
	 Name and Address
	  	Place of
Incorporation/
Organization	  	Percent
Owned
by
Dreams	 
	 Dreams Franchise Corporation
	  	CA	  	100	% 
	 Dreams Retail Corporation
	  	FL	  	100	% 
	 The Greene Organization, lnc.
	  	FL	  	100	% 
	 Dreams Unique, Inc.
	  	FL	  	100	% 

 Direct Subsidiaries of each other Borrower 
  

								
	 Name and Address
	  	Place of
Incorporation/
Organization	  	Subsidiary of	  	Percent
Owned	 
	 Dreams Entertainment, Inc.
	  	UT	  	Dreams Franchise	  	100	% 
	 Dreams Products, Inc.
	  	UT	  	Dreams Franchise	  	100	% 
	 Dreams Paramus, LLC
	  	FL	  	Dreams Retail	  	100	% 
	 Dreams/Pro Sports, Inc.
	  	FL	  	Dreams Retail	  	100	% 
	 Fansedge Incorporated
	  	DE	  	Dreams Retail	  	100	% 
	 RIOFOD, L.P.
	  		  	Dreams Retail	  	73	% 
		  	NV	  	365 Las Vegas, L.P.	  	21	% 
	 CAEFOD, L.P.
	  		  	Dreams Retail	  	63.5	% 
		  	NV	  	365 Las Vegas, L.P.	  	30	% 
	 SWFOD, L.P.
	  		  	Dreams Retail	  	60	% 
		  	NV	  	365 Las Vegas, L.P.	  	40	% 
	 StarsLive 365, LLC
	  	NV	  	Dreams Retail	  	100	% 
	 365 Las Vegas, L.P.
	  	NV	  	StarsLive 365, LLC	  	76.25	% 
	 The Sports Collectibles & Auction Company, Inc.
	  	FL	  	The Greene
Organization	  	100	% 
	 BKJ Consulting Corp.
	  	IL	  		  		

 SCHEDULE 6 
 Approved non-Comerica Deposit Accounts 
  

	
	Dreams Finance Corp
	Dreams Retail Corp
	FE-DRC501(Fox Valley)
	FOD Boca Town Center
	FOD Caesar’s
	FOD Fashion Valley
	FOD Garden State Mall
	FOD M&M/CCLV
	FOD MacArthur Center
	FOD Northbridge
	FOD Orlando
	FOD Pier 39
	FOD RIO
	FOD S&W
	FOD Sawgrass
	FOD Scottsdale
	FOD SL 365
	FOD Warehouse
	FOD Wellington
	FOD Woodfield
	Las Vegas Outlet
	FOD West Farms
	FE Woodfield
	FE Orland
	FE Lincolnwood
	FE River Oak
	FE Northbridge
	Fans Edge
	FansEdge-Kiosk
	ProSports Memorabilia
	Dreams Products Inc (Mounted Memories)
	SCAC(the Greene Org.)
	BKJ Cons, d/b/a Schwartz Sports
	Dreams Unique, Inc.
	FANSEDGE/PROSPORTS MEMORIBILIA
	FANSEDGE/PROSPORTS MEMORIBILIA
	schwartzsports@aol.com
	FOD Cherry Creek
	FOD Park Meadows

 Schedule 7 (c)
 Dreams Inc.

 Capital leases 
  

			
	 Advantage Leasing Corp
	  	        $83,432.90

 Packaging equipment 

 Schedule 7(d) 
 Dreams Inc.

 Notes Payable 
  

				
	 Joseph Casey
	  	$	 309,608
	 Fashion Valley
	  	$	43,929
	 George Johnson
	  	$	575,000
	 Brian Schwartz
	  	$	200,000
	 Kevin Schwartz
	  	$	300,000
	 Joel Schwartz
	  	$	100,000
	 Mark Schwartz
	  	$	518,000
	 Ken Karlan
	  	$	300,000
		  	 	 
		  	$	2,346,538

 EXHIBIT “B” 
 COVENANT COMPLIANCE CERTIFICATE 
  

			
	To:	  	Comerica Bank
		
	 Re:
	  	Letter Agreement dated June             , 2009, as may be amended, restated, replaced or supplemented from time to time (the
“Agreement”) among Dreams, Inc., Dreams Franchise Corporation, Dreams Entertainment, Inc., Dreams Products, Inc., Dreams Retail Corporation, Dreams/Pro Sports, Inc., Fansedge Incorporated, The Greene Organization, The Sports Collectibles
& Auction Company, Inc., Dreams Unique, Inc., StarsLive365 LLC, 365 Las Vegas, L,P., and BKJ Consulting Corp. (collectively, “Borrowers”) and Comerica Bank (“Bank”).

 This Compliance Certificate (“Certificate”) is furnished pursuant to
Section 6(a)(iv) of the Agreement and sets forth various information as of             , 200    (the “Computation Date”). 
 1. Debt to Tangible Net Worth Ratio. On the Computation Date, the Debt to Tangible Net Worth Ratio, which is required to be not more than
            to 1.0, was              to 1.0 as computed in the supporting documents attached hereto as Schedule 1.

 2. EBITDA. On the Computation Date, EBITDA, which is required to be not less than
$            , was $            as computed in the supporting documents attached hereto as Schedule 2. 

3. Tangible Net Worth. On the Computation Date, the Consolidated Tangible Net Worth of Dreams and its Consolidated Subsidiaries, which is
required to be not less than $            , was 
 $             as computed in the supporting documents attached hereto as Schedule 3. 
 The undersigned officer of the Dreams hereby certifies that: 
 A. All of the information set forth in this
Certificate (and in any Schedule attached hereto) is true and correct in all material respects. 
 B. As of the Computation Date, Borrowers
have observed and performed all of their covenants and other agreements contained in the Agreement and in any other Loan Documents to be observed, performed and satisfied by Borrowers. 
 C. The undersigned has reviewed the Agreement and this Certificate is based on an examination sufficient to assure that this Certificate is accurate.

 D. Except as stated in Schedule 4 hereto (which shall describe any existing Default Event of Default and the notice and period of
existence thereof and any action taken with respect thereto or contemplated to be taken by Borrowers), no Default or Event of Default has occurred and is continuing on the date of this Certificate. 
 E. Borrowers are not past due on any payments for real estate rental obligations and have attached as Schedule 5 a schedule containing a list of payment
due dates and dates payments were paid for such real estate rental obligations, as of the date hereof. 
 Capitalized terms used in this
Certificate and in the schedules hereto, unless specifically defined to the contrary, have the meanings given to them in the Agreement and Note. 

 IN WITNESS WHEREOF, Dreams has caused this Certificate to be executed and delivered by
its duly authorized officer this             day of
            20        . 
  

	
	 DREAMS, INC., on its own behalf and as
 Authorized
Agent for and on bebalf of all
 other Borrowers:
 DREAMS
FRANCHISE CORPORATION,
 DREAMS ENTERTAINMENT, INC,
 DREAMS
PRODUCTS, INC,
 DREAMS RETAIL CORPORATION
 DREAMS/PRO SPORTS,
INC.
 FANSEDGE INCORPORATED
 THE GREENE ORGANIZATION

THE SPORTS COLLECTIBLES &
 AUCTION COMPANY, INC.
 DREAMS UNIQUE, INC,
 STARS LIVE 365 LLC
 365 LAS VEGAS, L.P.
 BKJ CONSULTING CORP.
  

			
	 By:
	 	  

	 Its:
	 	  

 _ 
  

 2

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