Document:

Exhibit 10.8

 

THIS NOTE IS ISSUED WITH ORIGINAL
ISSUE DISCOUNT. BEGINNING NO LATER THAN 10 DAYS AFTER THE ISSUE DATE OF THIS NOTE, USELL.COM, INC., A DELAWARE CORPORATION, LOCATED
AT 171 MADISON AVENUE, 17TH FLOOR, NEW YORK, NEW YORK 10016, SHALL PROMPTLY MAKE AVAILABLE TO THE HOLDER OR HOLDERS
OF THIS NOTE UPON REQUEST THE INFORMATION DESCRIBED IN TREASURY REGULATION SECTION 1.1275-3(b)(1)(i).

 

THIS NOTE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION
IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

 

THIS NOTE IS REGISTERED WITH THE AGENT
PURSUANT TO SECTION 13.5(b) OF THE PURCHASE AGREEMENT (AS DEFINED BELOW). TRANSFER OF ALL OR ANY PORTION OF THIS NOTE IS PERMITTED
SUBJECT TO THE PROVISIONS SET FORTH IN SUCH SECTION 13.5 WHICH REQUIRE, AMONG OTHER THINGS, THAT NO TRANSFER IS EFFECTIVE UNTIL
THE TRANSFEREE IS REFLECTED AS SUCH ON THE REGISTRY MAINTAINED WITH THE AGENT PURSUANT TO SUCH SECTION 13.5(b).

 

SECURED TERM NOTE

 

FOR VALUE RECEIVED,
each of USELL.COM, INC., a Delaware corporation (“USELL”), BST DISTRIBUTION, INC., a New York corporation (“BST”),
WE SELL CELLULAR LLC, a Delaware limited liability company (“WE SELL”; together with USELL and BST, the “Companies”
and each a “Company”), hereby promises to pay to Senior Health Insurance Company of Pennsylvania (the “Holder”)
or its registered assigns or successors in interest, the sum of FOUR MILLION FORTY THOUSAND DOLLARS ($4,040,000), together with
any accrued and unpaid interest hereon subject to the terms and conditions set forth herein.

 

Capitalized terms used
herein without definition shall have the meanings ascribed to such terms in that certain Note Purchase Agreement, dated as October
23, 2015 (as amended, restated, modified and/or supplemented from time to time, the “Purchase Agreement”) among
Companies, the Holder, each other Purchaser and BAM ADMINISTRATIVE SERVICES LLC, as agent for the Purchasers (the “Agent”
and together with the Purchasers (including the Holder), collectively, the “Creditor Parties”), pursuant to
which this Secured Term Note was issued.

 

The following term
shall apply to this Secured Term Note (this “Note”):

 

“Maturity
Date” shall mean October 23, 2018.

 

     

     

    

  

ARTICLE
I

CONTRACT RATE AND AMORTIZATION

 

1.1          Contract
Rate. Subject to Sections 1.7 and 2.9, interest payable on the outstanding principal amount of this Note (the “Principal
Amount”) shall accrue at a rate per annum equal to thirteen percent (13.0%) (the “Contract Rate”).
Interest shall be (i) calculated on the basis of a 360 day year comprised of twelve (12) months with the actual number of days
for each month, and (ii) payable monthly, in arrears, commencing on November 1, 2015, and on the first business day of each consecutive
calendar month thereafter through and including the Maturity Date, and on the Maturity Date, whether by acceleration or otherwise.

 

1.2          Contract
Rate Payments. The Contract Rate shall be calculated on the last business day of each calendar month hereafter until the applicable
Maturity Date and shall be subject to adjustment as set forth herein.

 

1.3          Principal
Payments. This Note shall be payable in monthly installments, in each case equal to the lesser of (a) one forty-eighth (1/48th)
of the original Principal Amount of this Note and (b) the outstanding Principal Amount of this Note at the time of the payment
then being made, on the first business day of each consecutive calendar month, commencing on May 1, 2016. The remaining outstanding
Principal Amount together with any accrued and unpaid interest and any and all other unpaid amounts which are then owing by Companies
to the Holder under this Note, the Purchase Agreement and/or any other Related Agreement shall be due and payable on the Maturity
Date, whether by acceleration or otherwise.

 

1.4          Optional
Prepayment. Companies may redeem the outstanding principal balance of this Note in whole or in part in increments of at least
$500,000 each, at any time after October 23, 2016, upon at least fifteen (15) days’ prior written notice delivered to Agent
and the Holder, at the prepayment price of 103% of the outstanding Principal Amount of this Note so redeemed plus all accrued but
unpaid interest hereunder.

 

To exercise its right
to prepay this Note as provided in this Section 1.4, Companies must deliver written notice of such election to the Agent and each
Purchaser at least fifteen (15) days prior to the repayment date, as set forth in such notice, and Companies must take the same
action with respect to all of the holders of the Notes, on a pro rata basis (based upon the respective outstanding principal amounts
thereof).

 

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1.5          Mandatory
Prepayment Events. Unless waived in writing by the Agent, Companies shall prepay the Notes from the net proceeds of (a) any
incurrence of Indebtedness or other capital raising or financing transaction (other than net proceeds of any purchase money Indebtedness
incurred as permitted by clause (e)(i)(x) of Section 8.24 of the Purchase Agreement), (b) any insurance claims relating to any
of the Collateral (to the extent such proceeds are not used to replace, restore or repair such Collateral), or (c) any sale of
Collateral (other than as permitted by clause (e)(iv) of Section 8.24 of the Purchase Agreement), each a “Mandatory Prepayment
Event.” Notwithstanding the foregoing, in the event Companies raise capital solely through the issuance of equity or
receives cash proceeds from the exercise of outstanding warrants (“Equity Raise”), such Equity Raise shall not
subject Companies to a Mandatory Prepayment Event, provided that no Event of Default exists at the time of the Equity Raise or
would have occurred but for the passage of time or the giving of notice, or both, in which case the Equity Raise would create a
Mandatory Prepayment Event. Any prepayments made by Companies pursuant to a Mandatory Prepayment Event shall be applied to the
outstanding principal balance of the Notes on a pro rata basis (based upon the respective outstanding principal amounts thereof).
No prepayment fees shall be due as a result of any Mandatory Prepayment Event under this Section 1.5 except for a Mandatory Prepayment
Event from the proceeds of an Equity Raise while an Event of Default exists or would have occurred but for the passage of time
or the giving of notice, or both.

 

1.6          Events
of Default. The occurrence of any of the following events set forth in this Section 1.6 shall constitute an event of default
(“Event of Default”) hereunder:

 

(a)          Failure
to Pay. Any Company fails to pay when due any installment of principal, interest or other fees hereon in accordance herewith,
or any Company fails to pay any of the other Obligations (under and as defined in the Security Agreement) within three (3) business
days of when due;

 

(b)          Breach
of Covenant. Any Company or any of its Subsidiaries breaches any covenant or any other term or condition of this Note in any
material respect and such breach, if subject to cure, continues for a period of fifteen (15) days after the occurrence thereof;

 

(c)          Breach
of Representations and Warranties. Any representation, warranty or statement made or furnished by any Company or any of its
Subsidiaries in this Note, the Purchase Agreement or any other Related Agreement shall at any time be false or misleading in any
material respect on the date as of which made or deemed made;

 

(d)          Default
Under Other Agreements. The occurrence of any default (or similar term) or other event relating to any Indebtedness or Contingent
Obligation of any Company or any of such Company’s Subsidiaries beyond the period of grace (if any), (i) the effect of which
default or other event is to cause, or permit the holder or holders of such indebtedness or beneficiary or beneficiaries of such
contingent obligation to cause, such Indebtedness to become due prior to its stated maturity or any such Contingent Obligation
to become payable and (ii) (x) the aggregate amount of any such Indebtedness to become due prior to its stated maturity and any
such Contingent Obligations to become payable is in excess of $100,000, or (y) such default or other event is reasonably likely
to result in a Material Adverse Effect;

 

(e)          Bankruptcy.
Any Company or any of its Subsidiaries shall (i) apply for, consent to or suffer to exist the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property, (ii) make
a general assignment for the benefit of creditors, (iii) commence a voluntary case under the federal bankruptcy laws (as now or
hereafter in effect), (iv) be adjudicated a bankrupt or insolvent, (v) file a petition seeking to take advantage of any other
law providing for the relief of debtors, (vi) acquiesce to, without challenge within fifteen (15) days of the filing thereof, or
failure to have dismissed, within forty-five (45) days, any petition filed against it in any involuntary case under such bankruptcy
laws, or (vii) take any action for the purpose of effecting any of the foregoing;

 

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(f)          Judgments.
Attachments or levies are made upon any Company’s or any of its Subsidiary’s assets or a judgment is rendered against
any Company or any of its Subsidiaries or any of its or their property involving a liability which is in excess of $100,000 in
the aggregate with any other such liability (other than liability covered under available insurance) or could reasonably be expected
to have a Material Adverse Effect and which shall not have been vacated, discharged, stayed or bonded within thirty (30) days from
the entry thereof;

 

(g)          Insolvency.
Any Company or any of its Subsidiaries shall admit in writing its inability, or be generally unable, to pay its debts as they become
due or cease operations of its present business;

 

(h)          Change
of Control. A Change of Control (as defined below) shall occur with respect to any Company or any Guarantor, unless the Agent
shall have expressly consented to such Change of Control in writing. A “Change of Control” shall mean (i) any event
or circumstance as a result of which any “Person” or “group” (as such terms are defined in Sections 13(d)
and 14(d) of the Exchange Act, as in effect on the date hereof), other than a Holder of a Note, is or becomes the “beneficial
owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of 20% or more on a fully
diluted basis of the then outstanding voting equity interests of any Company or any Guarantor (other than a “Person”
or “group” that beneficially owns 20% or more of such outstanding voting equity interests of any Company or any Guarantor
on the date hereof), (ii) any event or circumstance as a result of which USELL shall at any time own less than 100% of all issued
and outstanding equity interests of any of the following entities: HD Capital Holdings LLC, Upstream Phone Company USA, Inc., BST
Distribution, Inc. and/or Upstream Holdings, Inc., (iii) any event or circumstance as a result of which BST Distribution, Inc.
shall at any time own less than 100% of all issued an outstanding equity interests of We Sell Cellular, LLC, (iv) any change in
the composition of the Board of Directors of any Company or any Guarantor (the “Board”) such that the Continuing
Directors (as defined below) cease for any reason to constitute at least a majority of the Board (as used herein, “Continuing
Directors” means those individuals who as of the Initial Closing Date constituted the Board and each other director that
was elected by at least 66 2/3% of the Continuing Directors, or as applicable, such director’s nomination for election to
the Board is recommended by 66 2/3% of the Continuing Directors), (v) any Company or any of the Guarantors merges or consolidates
with, or sells all or substantially all of its assets to, any other Person, or (vi) the consummation of a purchase, tender or exchange
offer made to, and accepted by, the holders of more than a majority of the outstanding shares of common stock of any Company or
any Guarantor;

 

(i)          Failure
of Liens. The Agent’s lien on any Collateral deemed material by Agent shall fail or cease to be a first priority validly
perfected security interest;

 

(j)          Breach
of Covenant. The Company or any of its Subsidiaries breaches any covenant set forth in Section 8 of the Purchase Agreement;

 

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(k)          Exercise
of Certain Rights Under Stock Purchase Agreement. The exercise or attempted exercise by any Seller of any Buy-Back Right under
and as each such term is defined in the Stock Purchase Agreement, in each case prior to the indefeasible payment in full of all
Liabilities (as defined in the Security Agreement). For purposes hereof, the term “Stock Purchase Agreement” means
the Stock Purchase Agreement dated October 23, 2015, and effective as of October 1, 2015 by and among BST Distribution, Inc., the
Sellers described therein and USELL; or

 

(l)          Material
Variations. With respect to the income statements and balance sheets for WE SELL and BST for the fiscal year ending 2015 as
reflected in the audited Consolidating Financial Statements delivered to Agent in accordance with Section 8.4(a) of the Purchase
Agreement, such Consolidating Financial Statements shall disclose any material variation from the income statements and balance
sheets of WE SELL and BST for the corresponding period which were analyzed by Marcum LLP in its due diligence report dated August
11, 2015, a copy of which was delivered by USELL to Agent prior to the Initial Closing Date.

 

1.7           Default
Interest. Following the occurrence and during the continuance of any Event of Default, Companies shall pay additional interest
on the outstanding principal balance of this Note, at a rate per annum which is determined by adding five percent (5.0%) per annum
to the Contract Rate (“Default Interest Rate”), and all outstanding obligations under this Note, the Purchase
Agreement and each other Related Agreement, including unpaid interest, shall continue to accrue interest at the Default Interest
Rate from the date of such Event of Default until the date such Event of Default is cured or waived in writing by the Agent.

 

1.8           Acceleration.
If any Event of Default shall have occurred and be continuing, (a) if such event is an Event of Default specified in Section
1.6(e), all of the Notes at the time outstanding shall automatically become immediately due and payable together with interest
accrued thereon, without any requirement of presentment, demand, protest or notice of any kind, all of which are hereby waived,
and (b) if such event is not an Event of Default specified in Section 1.6(e) (as a result of which the Notes have already been
accelerated), the Agent or the holders of a majority of the outstanding principal amount of the Notes may at their option, by notice
in writing to Companies, declare all of the Notes to be, and all of the Notes shall thereupon be and become, immediately due and
payable together with interest accrued thereon, without any requirement of further presentment, demand, protest or other notice
of any kind, all of which are hereby waived and with the consent of the Creditor Parties, the Agent shall exercise on behalf of
the Creditor Parties (including the holders of all of the Notes) all rights and remedies available to them under the Security Agreement
and any other Related Document.

 

ARTICLE
II

MISCELLANEOUS

 

2.1           Cumulative
Remedies. The remedies under this Note shall be cumulative.

 

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2.2          Failure
or Indulgence Not Waiver. No failure or delay on the part of the Holder hereof in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privilege. All rights and remedies existing hereunder are cumulative
to, and not exclusive of, any rights or remedies otherwise available.

  

2.3          Notices.
Any notice herein required or permitted to be given shall be given in writing in accordance with the terms of the Purchase Agreement.

 

2.4          Amendment
Provision. The term “Note” and all references thereto, as used throughout this instrument, shall mean this
instrument as originally executed, or if later amended or supplemented, then as so amended or supplemented, and any successor instrument
as such successor instrument may be amended or supplemented.

 

2.5          Assignability.
This Note shall be binding upon each Company and its successors and assigns, and shall inure to the benefit of the Holder and its
successors and assigns, and may be assigned by the Holder in accordance with the requirements of the Purchase Agreement. No Company
may assign any of its obligations under this Note without the prior written consent of the Holder, any such purported assignment
without such consent being null and void.

 

2.6          Cost
of Collection. In case of the occurrence of an Event of Default under this Note, Companies shall pay the Holder the Holder’s
costs of collection, including reasonable fees associated with the hiring of experts and reasonable attorneys’ fees.

 

2.7          Governing
Law, Jurisdiction and Waiver of Jury Trial.

 

(a)          THIS
NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAW.

 

(b)          EACH
COMPANY HEREBY CONSENTS AND AGREES THAT THE STATE AND/OR FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL
HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN ANY COMPANY, ON THE ONE HAND, AND THE HOLDER AND/OR
ANY OTHER CREDITOR PARTY, ON THE OTHER HAND, PERTAINING TO THIS NOTE OR ANY OF THE OTHER RELATED AGREEMENTS OR TO ANY MATTER ARISING
OUT OF OR RELATED TO THIS NOTE OR ANY OF THE RELATED AGREEMENTS; PROVIDED, THAT EACH COMPANY ACKNOWLEDGES THAT ANY APPEALS
FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW YORK; AND FURTHER
PROVIDED, THAT NOTHING IN THIS NOTE SHALL BE DEEMED OR OPERATE TO PRECLUDE THE HOLDER AND/OR ANY OTHER CREDITOR PARTY FROM
BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION WHERE ANY OF THE COLLATERAL IS LOCATED TO COLLECT THE LIABILITIES
(AS DEFINED IN THE SECURITY AGREEMENT), TO REALIZE ON THE COLLATERAL (AS DEFINED IN THE SECURITY AGREEMENT) OR ANY OTHER SECURITY
FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE HOLDER AND/OR ANY OTHER CREDITOR PARTY. EACH
COMPANY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH
COMPANY HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON
CONVENIENS. EACH COMPANY HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION
OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED
TO SUCH COMPANY AT THE ADDRESS SET FORTH IN THE PURCHASE AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE
EARLIER OF SUCH COMPANY’S ACTUAL RECEIPT THEREOF OR FIVE (5) DAYS AFTER DEPOSIT IN THE U.S. MAIL, PROPER POSTAGE PREPAID.

 

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(c)          EACH
COMPANY DESIRES THAT ITS DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION
OF THE BENEFITS OF THE JUDICIAL SYSTEM AND/OR OF ARBITRATION, EACH COMPANY HERETO WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION,
SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE HOLDER AND/OR ANY
OTHER CREDITOR PARTY, ON THE ONE HAND, AND EACH COMPANY, ON THE OTHER HAND, ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL
TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS NOTE, ANY OTHER RELATED AGREEMENT OR THE TRANSACTIONS RELATED
HERETO OR THERETO.

 

2.8           Severability.
In the event that any provision of this Note is invalid or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with
such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision of this Note.

 

2.9           Maximum
Payments. Nothing contained herein shall be deemed to establish or require the payment of a rate of interest or other charges
in excess of the maximum permitted by applicable law. In the event that the rate of interest required to be paid or other charges
hereunder exceed the maximum rate permitted by such law, any payments in excess of such maximum rate shall be credited against
amounts owed by Companies to the Holder and thus refunded to Companies.

 

2.10         Security
Interest. The Agent, for the ratable benefit of the Creditor Parties, has been granted a security interest in certain assets
of Companies and the Guarantors as more fully described in the Security Agreement and the other Related Agreements.

 

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2.11         Construction;
Counterparts. Each party acknowledges that its legal counsel participated in the preparation of this Note and, therefore, stipulates
that the rule of construction that ambiguities are to be resolved against the drafting party shall not be applied in the interpretation
of this Note to favor any party against the other. Unless the context otherwise requires, (i) words in the singular or plural include
the singular and plural and pronouns stated in either the masculine, the feminine or neuter gender shall include the masculine,
feminine and neuter, (ii) the words “hereof,” “herein” and words to similar effect refer to this Note in
its entirety, and (iii) the use of the word “including” in this Note shall be by way of example rather than limitation.
This Note may be executed by the parties hereto in one or more counterparts, each of which shall be deemed an original and all
of which when taken together shall constitute one and the same instrument. Any signature delivered by a party by facsimile or electronic
transmission shall be deemed to be an original signature hereto.

 

2.12         Registered
Obligation. This Note shall be registered (and such registration shall thereafter be maintained) as set forth in Section 13.5(b)
of the Purchase Agreement. Notwithstanding any document, instrument or agreement relating to this Note to the contrary, transfer
of this Note (or the right to any payments of principal or stated interest thereunder) may only be effected by (i) surrender of
this Note and either the reissuance by Companies of this Note to the new holder or the issuance by Companies of a new instrument
to the new holder or (ii) registration of such holder as an assignee in accordance with Section 13.5 of the Purchase Agreement.

 

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

 

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IN WITNESS WHEREOF,
each Company has caused this Secured Term Note to be signed in its name effective as of this ___ day of October, 2015.

 

	 	USELL.COM, INC.
	 	 	 
	 	By:	 
	 	 	Name:  Nikhil Raman
	 	 	Title:  Chief Executive Officer
	 	 	 
	 	BST DISTRIBUTION, INC.
	 	 	 
	 	By:	 
	 	 	Name:  Brian Tepfer
	 	 	Title:  Chief Executive Officer
	 	 	 
	 	WE SELL CELLULAR LLC
	 	 	 
	 	By:	 
	 	 	Name:  Nikhil Raman
	 	 	Title:  Manager

 

	 	 	SIGNATURE PAGE TO

SECURED TERM NOTEExhibit 10.9

 

SECURITY AGREEMENT

 

THIS SECURITY AGREEMENT
(as amended, restated, supplemented or otherwise modified from time to time, this “Agreement”) dated as of October
23, 2015 among USELL.COM, INC., a Delaware corporation (“USELL”), BST DISTRIBUTION, INC., a New York corporation
(“BST”), WE SELL CELLULAR LLC, a Delaware limited liability company (“WE SELL”; together
with USELL and BST, the “Companies” and each a “Company”), HD CAPITAL HOLDINGS LLC, a Delaware
limited liability company (“HD Capital”), UPSTREAM PHONE COMPANY USA, INC., a Delaware corporation (“UPSTREAM”),
and UPSTREAM PHONE HOLDINGS, INC., a Delaware corporation (“UPSTREAM HOLDINGS”); together with HD CAPITAL, and
UPSTREAM, each a “Subsidiary” and collectively, the “Subsidiaries”), together with each other
Person who becomes a party to this Agreement by execution of a joinder in the form of Exhibit A attached hereto, is hereinafter
sometimes referred to individually as a “Debtor” and, collectively, as the “Debtors”) and
BAM Administrative Services LLC, a Delaware limited liability company, in its capacity as Agent (together with its successors and
assigns in such capacity, the “Secured Party”) for the benefit of itself and each of the Purchasers (as hereinafter
defined).

 

WITNESSETH:

 

WHEREAS, Senior
Health Insurance Company of Pennsylvania and the other Purchasers from time to time parties to the Note Purchase Agreement (as
hereafter defined) (each a “Purchaser”, and together with their successors and assigns and each other purchaser
of a Note (as defined below) and their respective successors and assigns, individually and collectively, the “Purchasers”)
will purchase from the Companies certain senior secured notes each made by the Companies and dated as of the date hereof in an
original aggregate principal amount of $4,040,000 and a deferred aggregate amount of up to $4,040,000 (such notes, together with
any promissory notes or other securities issued in exchange or substitution therefor or replacement thereof, and as any of the
same may be amended, supplemented, restated or modified and in effect from time to time, the “Notes”);

 

AND WHEREAS,
the Notes are being acquired by Purchasers, and Purchasers have made certain financial accommodations to the Companies pursuant
to a Note Purchase Agreement dated as of the date hereof among the Companies, the Secured Party and Purchasers (as the same may
be amended, restated, supplemented or otherwise modified from time to time, the “Note Purchase Agreement”).
Capitalized terms used herein but not otherwise defined shall have the meanings set forth in the Note Purchase Agreement;

 

AND WHEREAS,
each Debtor will derive substantial benefit and advantage from the financial accommodations to the Companies set forth in the Note
Purchase Agreement and the Notes, and it will be to each such Debtor’s direct interest and economic benefit to assist the
Companies in procuring said financial accommodations from Purchasers;

 

     

     

    

  

AND WHEREAS,
to induce Purchasers to enter into the Note Purchase Agreement and purchase the Notes, (i) each Debtor (other than the Companies)
will guaranty the Liabilities (as hereinafter defined) of the Companies pursuant to the terms of one or more guaranties by each
such Debtor in favor of Secured Party (on its behalf and on behalf of the Purchasers) (such guaranties, as amended, restated, modified
or supplemented and in effect from time to time, individually and collectively, the “Subsidiary Guaranty”) and
(ii) each Debtor will pledge and grant a security interest in all of its right, title and interest in and to the Collateral (as
hereinafter defined) as security for its Liabilities for the benefit of the Secured Party, Purchasers and their respective successors
and assigns.

 

NOW, THEREFORE, in
consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:

 

Section
1.          Definitions. Capitalized terms used herein without
definition and defined in the Note Purchase Agreement are used herein as defined therein. In addition, as used herein:

 

“Accounts”
means any “account,” as such term is defined in the UCC, and, in any event, shall include, without limitation, “supporting
obligations” as defined in the UCC.

 

“Chattel Paper”
means any “chattel paper,” as such term is defined in the UCC.

 

“Collateral”
shall have the meaning ascribed thereto in Section 3 hereof.

 

“Commercial
Tort Claims” means “commercial tort claims”, as such term is defined in the UCC.

 

“Contracts”
means all contracts, undertakings, or other agreements (other than rights evidenced by Chattel Paper, Documents or Instruments)
in or under which a Debtor may now or hereafter have any right, title or interest, including, without limitation, with respect
to an Account, any agreement relating to the terms of payment or the terms of performance thereof.

 

“Copyrights”
means any copyrights, rights and interests in copyrights, works protectable by copyrights, copyright registrations and copyright
applications, including, without limitation, the copyright registrations and applications listed on Schedule III attached
hereto (if any), and all renewals of any of the foregoing, all income, royalties, damages and payments now and hereafter due and/or
payable under or with respect to any of the foregoing, including, without limitation, damages and payments for past, present and
future infringements of any of the foregoing and the right to sue for past, present and future infringements of any of the foregoing.         

 

“Deposit Accounts”
means all “deposit accounts” as such term is defined in the UCC, now or hereafter held in the name of a Debtor.

 

“Documents”
means any “documents,” as such term is defined in the UCC, and shall include, without limitation, all documents of
title (as defined in the UCC), bills of lading or other receipts evidencing or representing Inventory or Equipment.

 

“Equipment”
means any “equipment,” as such term is defined in the UCC and, in any event, shall include, Motor Vehicles.

 

    	 	2	 

     

    

  

“Event of Default”
shall have the meaning set forth in the Notes.

 

“Excluded Assets”
means each of the following: (1) any lease, license or other agreement or any property subject to a capital lease, purchase money
security interest or similar arrangement, to the extent that a grant of a Lien thereon in favor of Secured Party would violate
or invalidate such lease, license, agreement or capital lease, purchase money security interest or similar arrangement or create
a right of termination in favor of any other party thereto (other than the Debtors), so long as such provision exists and so long
as such lease, license or agreement was not entered into in contemplation of circumventing the obligation to provide Collateral
hereunder or in violation of the Note Purchase Agreement, other than to the extent that any such term would be rendered ineffective
pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdiction
or any other applicable law including the bankruptcy code, or principles of equity.

 

“General Intangibles”
means any “general intangibles,” as such term is defined in the UCC, and, in any event, shall include, without limitation,
all right, title and interest in or under any Contract, models, drawings, materials and records, claims, literary rights, goodwill,
rights of performance, Copyrights, Trademarks, Patents, warranties, rights under insurance policies and rights of indemnification.

 

“Goods”
means any “goods”, as such term is defined in the UCC, including, without limitation, fixtures and embedded Software
to the extent included in “goods” as defined in the UCC.

 

“Governmental
Authority” means the government of the United States of America or any other nation, or any political subdivision thereof,
whether state or local, or any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administration powers or functions of or pertaining to government over
any Debtor or any of its Subsidiaries, or any of their respective properties, assets or undertakings.

 

“Instruments”
means any “instrument,” as such term is defined in the UCC, and shall include, without limitation, promissory notes,
drafts, bills of exchange, trade acceptances, letters of credit, letter of credit rights (as defined in the UCC), and Chattel Paper.

 

“Inventory”
means any “inventory,” as such term is defined in the UCC.

 

“Investment
Property” means any “investment property”, as such term is defined in the UCC.

 

“Liabilities”
means all obligations, liabilities and indebtedness of every nature of Debtors from time to time owed or owing under or in respect
of this Agreement, the Note Purchase Agreement, the Notes, the Account Control Agreements, the Pledge Agreement, the Subsidiary
Guaranty, any of the other Security Documents and any of the other Transaction Documents, as the case may be, including, without
limitation, the principal amount of all debts, claims and indebtedness, accrued and unpaid interest and all fees, costs and expenses,
whether primary, secondary, direct, contingent, fixed or otherwise, heretofore, now and/or from time to time hereafter owing, due
or payable whether before or after the filing of a bankruptcy, insolvency or similar proceeding under applicable federal, state,
foreign or other law and whether or not an allowed claim in any such proceeding.

 

    	 	3	 

     

    

  

“Lien”
has the meaning set forth in the Note Purchase Agreement.

 

“Motor Vehicles”
shall mean motor vehicles, tractors, trailers and other like property, whether or not the title thereto is governed by a certificate
of title or ownership. The term “Motor Vehicles” shall specifically include mobile drilling rigs.

 

“Patents”
means any patents and patent applications, including, without limitation, the inventions and improvements described and claimed
therein, all patentable inventions and those patents and patent applications listed on Schedule IV attached hereto
(if any), and the reissues, divisions, continuations, renewals, extensions and continuations-in-part of any of the foregoing, and
all income, royalties, damages and payments now or hereafter due and/or payable under or with respect to any of the foregoing,
including, without limitation, damages and payments for past, present and future infringements of any of the foregoing and the
right to sue for past, present and future infringements of any of the foregoing.

 

“Permitted Encumbrance”
has the meaning set forth in the Note Purchase Agreement.

 

“Proceeds”
means “proceeds,” as such term is defined in the UCC and, in any event, includes, without limitation, (a) any and all
proceeds of any insurance, indemnity, warranty or guaranty payable with respect to any of the Collateral, (b) any and all payments
(in any form whatsoever) made or due and payable from time to time in connection with any requisition, confiscation, condemnation,
seizure or forfeiture of all or any part of the Collateral by any Governmental Authority (or any person acting under color of Governmental
Authority), and (c) any and all other amounts from time to time paid or payable under, in respect of or in connection with any
of the Collateral.

 

“Representative”
means any Person acting as agent, representative or trustee on behalf of the Secured Party from time to time.

 

“Security Documents”
means this Agreement, the Subsidiary Guaranty, the Account Control Agreements, the Pledge Agreement, the Trademark Security Agreement
by USELL in favor of the Secured Party, and any other documents securing the Liens of the Secured Party hereunder. 

 

“Software”
means all “software” as such term is defined in the UCC, now owned or hereafter acquired by a Debtor, other than software
embedded in any category of Goods, including, without limitation, all computer programs and all supporting information provided
in connection with a transaction related to any program.

 

“Trademarks”
means any trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service
marks, logos, other business identifiers, prints and labels on which any of the foregoing have appeared or appear, all registrations
and recordings thereof, and all applications in connection therewith, including, without limitation, the trademarks and applications
listed in Schedule V attached hereto (if any) and renewals thereof, and all income, royalties, damages and payments now
or hereafter due and/or payable under or with respect to any of the foregoing, including, without limitation, damages and payments
for past, present and future infringements of any of the foregoing and the right to sue for past, present and future infringements
of any of the foregoing.

 

    	 	4	 

     

    

  

“Transaction
Documents” means the Note Purchase Agreement, the Notes, the Security Documents and the other Related Agreements.

 

“UCC”
shall mean the Uniform Commercial Code as in effect from time to time in the State of New York; provided, that to the extent that
the Uniform Commercial Code is used to define any term herein and such term is defined differently in different Articles or Divisions
of the Uniform Commercial Code, the definition of such term contained in Article or Division 9 shall govern.

 

Section
2.          Representations, Warranties and Covenants of Debtors.
Each Debtor represents and warrants to, and covenants with, the Secured Party as follows:

 

(a)       Such
Debtor has or will have rights in and the power to transfer the Collateral in which it purports to grant a security interest pursuant
to Section 3 hereof (subject, with respect to after acquired Collateral, to such Debtor acquiring the same) and no Lien
other than Permitted Encumbrances exists or will exist upon such Collateral at any time.

 

(b)       This
Agreement is effective to create in favor of Secured Party a valid security interest in and Lien upon all of such Debtor’s
right, title and interest in and to the Collateral, and upon (i) the filing of appropriate UCC financing statements in the jurisdictions
listed on Schedule I attached hereto, (ii) each Deposit Account being subject to an Account Control Agreement (as hereinafter
defined) between the applicable Debtor and depository institution and the Secured Party on behalf of Purchasers, (iii) filings
in the United States Patent and Trademark Office, or United States Copyright Office with respect to Collateral that is Patents
and Trademarks, or Copyrights, as the case may be, (iv) the filing of the Mortgages in the jurisdictions listed on Schedule
I hereto, (v) the delivery to the Secured Party of the Pledged Collateral together with assignments in blank, (vi) the security
interest created hereby being noted on each certificate of title evidencing the ownership of any Motor Vehicle in accordance with
Section 4.1(d) hereof and (v) delivery to the Secured Party or its Representative of Instruments duly endorsed by such Debtor
or accompanied by appropriate instruments of transfer duly executed by such Debtor with respect to Instruments not constituting
Chattel Paper, such security interest will be a duly perfected first priority perfected security interest (subject to Permitted
Encumbrances) in all of the Collateral.

 

(c)       All
of the Equipment, Inventory and Goods owned by such Debtor is located at the places as specified on Schedule I attached
hereto. Except as disclosed on Schedule I, none of the Collateral is in the possession of any bailee, warehousemen, processor
or consignee. Schedule I discloses such Debtor’s name as of the date hereof as it appears in official filings in the
state or province, as applicable, of its incorporation, formation or organization, the type of entity of such Debtor (including
corporation, partnership, limited partnership or limited liability company), organizational identification number issued by such
Debtor’s state of incorporation, formation or organization (or a statement that no such number has been issued), such Debtor’s
state or province, as applicable, of incorporation, formation or organization and the chief place of business, chief executive
office and the office where such Debtor keeps its books and records and the states in which such Debtor conducts its business.
Such Debtor has only one state or province, as applicable, of incorporation, formation or organization. Such Debtor does not do
business and has not done business during the past five (5) years under any trade name or fictitious business name except as disclosed
on Schedule II attached hereto.

 

    	 	5	 

     

    

  

(d)       No
Copyrights, Patents or Trademarks listed on Schedules III, IV and V, respectively, if any, have been adjudged invalid or
unenforceable or have been canceled, in whole or in part, or are not presently subsisting. Each of such Copyrights, Patents and
Trademarks (if any) is valid and enforceable. Such Debtor is the sole and exclusive owner of the entire and unencumbered right,
title and interest in and to each of such Copyrights, Patents and Trademarks, identified on Schedules III, IV and V, as
applicable, as being owned by such Debtor, free and clear of any liens, charges and encumbrances, including without limitation
licenses, shop rights and covenants by such Debtor not to sue third persons. Such Debtor has adopted, used and is currently using,
or has a current bona fide intention to use, all of such Trademarks and Copyrights. Such Debtor has no notice of any suits or actions
commenced or threatened with reference to the Copyrights, Patents or Trademarks owned by it.

 

(e)       Each
Debtor agrees to deliver to the Secured Party an updated Schedule I, II, III, IV and/or V within five (5) Business Days
of any change thereto.

 

(f)        All
depositary and other accounts including, without limitation, Deposit Accounts, securities accounts, brokerage accounts and other
similar accounts, maintained by each Debtor are described on Schedule VI hereto, which description includes for each such
account the name of the Debtor maintaining such account, the name, address and telephone and telecopy numbers of the financial
institution at which such account is maintained, the account number and the account officer, if any, of such account. No Debtor
shall open any new Deposit Accounts, securities accounts, brokerage accounts or other accounts unless such Debtor shall have given
Secured Party ten (10) Business Days’ prior written notice of its intention to open any such new accounts. Each Debtor shall
deliver to Secured Party a revised version of Schedule VI showing any changes thereto within five (5) Business Days of any
such change. Each Debtor hereby authorizes the financial institutions at which such Debtor maintains an account to provide Secured
Party with such information with respect to such account as Secured Party from time to time reasonably may request, and each Debtor
hereby consents to such information being provided to Secured Party. In addition, all of such Debtor’s depositary, security,
brokerage and other accounts including, without limitation, Deposit Accounts shall be subject to the provisions of Section 4.5
hereof.

 

(g)       Such
Debtor does not own any Commercial Tort Claim except for those disclosed on Schedule VII hereto (if any).

 

(h)       Such
Debtor does not have any interest in real property with respect to real property except as disclosed on Schedule VIII (if
any). Each Debtor shall deliver to Secured Party a revised version of Schedule VIII showing any changes thereto within ten
(10) Business Days of any such change. Except as otherwise agreed to by Secured Party, all such interests in real property with
respect to such real property are subject to a mortgage and deed of trust (in form and substance satisfactory to Secured Party)
in favor of Secured Party (hereinafter, a “Mortgage”).

 

    	 	6	 

     

    

  

(i)        Each
Debtor shall duly and properly record each interest in real property held by such Debtor except with respect to easements,
rights of way, access agreements, surface damage agreements, surface use agreements or similar agreements that such Debtor,
using prudent customs and practices in the industry in which it operates, does not believe are of material value or material to
the operation of such Debtor’s business or, with respect to state and federal rights of way, are not capable of being
recorded as a matter of state and federal law.

 

(j)        All
Equipment (including, without limitation, Motor Vehicles) owned by a Debtor and subject to a certificate of title or ownership
statute is described on Schedule IX hereto.

 

Section
3.          Collateral. As collateral security for the prompt payment
in full when due (whether at stated maturity, by acceleration or otherwise) of the Liabilities, each Debtor hereby pledges and
grants to the Secured Party, for the benefit of itself and each Purchaser, a Lien on and security interest in and to all of such
Debtor’s right, title and interest in the following properties and assets of such Debtor, whether now owned by such Debtor
or hereafter acquired and whether now existing or hereafter coming into existence and wherever located (all being collectively
referred to herein as “Collateral”):

 

(a)          all
Instruments, together with all payments thereon or thereunder:

 

(b)          all
Accounts;

 

(c)          all
Inventory;

 

(d)          all
General Intangibles (including payment intangibles (as defined in the UCC) and Software);

 

(e)          all
Equipment;

 

(f)          all
Documents;

 

(g)          all
Contracts;

 

(h)          all
Goods;

 

(i)          all
Investment Property, including without limitation all equity interests now owned or hereafter acquired by such Debtor;

 

(j)          all
Deposit Accounts, including, without limitation, the balance from time to time in all bank accounts maintained by such Debtor;

 

(k)          all
Commercial Tort Claims specified on Schedule VII;

 

    	 	7	 

     

    

  

(l)          all
Trademarks, Patents and Copyrights;

 

(m)        all
books and records pertaining to the other Collateral; and

 

(n)         all
other tangible and intangible property of such Debtor, including, without limitation, all interests in real property, Proceeds,
tort claims, products, accessions, rents, profits, income, benefits, substitutions, additions and replacements of and to any of
the property of such Debtor described in the preceding clauses of this Section 3 (including, without limitation, any proceeds
of insurance thereon, insurance claims and all rights, claims and benefits against any Person relating thereto), other rights to
payments not otherwise included in the foregoing, and all books, correspondence, files, records, invoices and other papers, including
without limitation all tapes, cards, computer runs, computer programs, computer files and other papers, documents and records in
the possession or under the control of such Debtor, any computer bureau or service company from time to time acting for such Debtor.

 

Notwithstanding anything to the contrary
contained herein or in any Transaction Document, in no event shall the security interest granted herein or therein attach to any
Excluded Assets.

 

Section
4.             Covenants; Remedies. In furtherance of the grant of
the pledge and security interest pursuant to Section 3 hereof, each Debtor hereby agrees with the Secured Party as follows:

 

4.1          Delivery
and Other Perfection; Maintenance, etc.

 

(a)          Delivery
of Instruments, Documents, Etc. Each Debtor shall deliver and pledge to the Secured Party or its Representative any and all
Instruments, negotiable Documents, Chattel Paper and certificated securities (accompanied by stock powers executed in blank, which
stock powers may be filled in and completed at any time upon the occurrence of any Event of Default) duly endorsed and/or accompanied
by such instruments of assignment and transfer executed by such Debtor in such form and substance as the Secured Party or its Representative
may request; provided, that so long as no Event of Default shall have occurred and be continuing, each Debtor may retain
for collection in the ordinary course of business any Instruments, negotiable Documents and Chattel Paper received by such Debtor
in the ordinary course of business, and the Secured Party or its Representative shall, promptly upon request of a Debtor, make
appropriate arrangements for making any other Instruments, negotiable Documents and Chattel Paper pledged by such Debtor available
to such Debtor for purposes of presentation, collection or renewal (any such arrangement to be effected, to the extent deemed appropriate
by the Secured Party or its Representative, against a trust receipt or like document). If a Debtor retains possession of any Chattel
Paper, negotiable Documents or Instruments pursuant to the terms hereof, such Chattel Paper, negotiable Documents and Instruments
shall be marked with the following legend: “This writing and the obligations evidenced or secured hereby are subject to the
security interest of BAM Administrative Services LLC, in its capacity as Agent for the benefit of Purchasers, as secured party.”

 

    	 	8	 

     

    

  

(b)          Other
Documents and Actions. Each Debtor shall give, execute, deliver, file and/or record any financing statement, registration,
notice, instrument, document, agreement, Mortgage or other papers that may be necessary or desirable (in the reasonable judgment
of the Secured Party or its Representative) to create, preserve, perfect or validate the security interest granted pursuant hereto
(or any security interest or mortgage contemplated or required hereunder, including with respect to Section 2(h) of this
Agreement) or to enable the Secured Party or its Representative to exercise and enforce the rights of the Secured Party hereunder
with respect to such pledge and security interest, provided that notices to account debtors in respect of any Accounts or
Instruments shall be subject to the provisions of clause (e) below. Notwithstanding the foregoing each Debtor hereby irrevocably
authorizes the Secured Party at any time and from time to time to file in any filing office in any jurisdiction any initial financing
statements (and other similar filings or registrations under other applicable laws and regulations pertaining to the creation,
attachment, or perfection of security interests) and amendments thereto that (a) indicate the Collateral (i) as all assets of such
Debtor or words of similar effect, regardless of whether any particular asset comprised in the Collateral falls within the scope
of Article 9 of the UCC, or (ii) as being of an equal or lesser scope or with greater detail, and (b) contain any other information
required by part 5 of Article 9 of the UCC for the sufficiency or filing office acceptance of any financing statement or amendment,
including (i) whether such Debtor is an organization, the type of organization and any organization identification number issued
to such Debtor, and (ii) in the case of a financing statement filed as a fixture filing, a sufficient description of real property
to which the Collateral relates. Each Debtor agrees to furnish any such information to the Secured Party promptly upon request.
Each Debtor also ratifies its authorization for the Secured Party to have filed in any jurisdiction any like initial financing
statements or amendments thereto if filed prior to the date hereof.

 

(c)          Books
and Records. Each Debtor (or a Company on behalf of a Debtor) shall maintain at its own cost and expense complete and accurate
books and records of the Collateral, including, without limitation, a record of all payments received and all credits granted with
respect to the Collateral and all other dealings with the Collateral. Upon the occurrence and during the continuation of any Event
of Default, each Debtor shall deliver and turn over any such books and records (or true and correct copies thereof) to the Secured
Party or its Representative at any time on demand. Each Debtor shall permit any Representative of the Secured Party, in accordance
with Section 8.13 of the Note Purchase Agreement, to inspect such books and records at any time during reasonable business hours
and will provide photocopies thereof at such Debtor’s expense to the Secured Party upon request of the Secured Party.

 

(d)          Motor
Vehicles. Each Debtor shall, promptly upon acquiring same, cause the Secured Party to be listed as the lienholder on each certificate
of title or ownership covering any items of Equipment, including Motor Vehicles, having a value in excess of $50,000 individually
or in the aggregate for all such items of Equipment of the Debtor, or otherwise comply with the certificate of title or ownership
laws of the relevant jurisdiction issuing such certificate of title or ownership in order to properly evidence and perfect Secured
Party’s security interest in the assets represented by such certificate of title or ownership.

 

(e)          Notice
to Account Debtors; Verification. (i) Upon the occurrence and during the continuance of any Event of Default (or if any rights
of set-off (other than set-offs against an Account arising under the Contract giving rise to the same Account) or contra accounts
may be asserted, upon request of the Secured Party or its Representative, each Debtor shall promptly notify (and each Debtor hereby
authorizes the Secured Party and its Representative so to notify) each account debtor in respect of any Accounts or Instruments
or other Persons obligated on the Collateral that such Collateral has been assigned to the Secured Party hereunder, and that any
payments due or to become due in respect of such Collateral are to be made directly to the Secured Party, and (ii) the Secured
Party and its Representative shall have the right at any time or times to make direct verification with the account debtors or
other Persons obligated on the Collateral of any and all of the Accounts or other such Collateral.

 

    	 	9	 

     

    

 

(f)          Intellectual
Property. Each Debtor represents and warrants that the Copyrights, Patents and Trademarks listed on Schedules III, IV and
V, respectively (if any), constitute all of the registered Copyrights and all of the Patents and Trademarks now owned by such
Debtor. If such Debtor shall (i) obtain rights to any new patentable inventions, any registered Copyrights or any Patents or Trademarks,
or (ii) become entitled to the benefit of any registered Copyrights or any Patents or Trademarks or any improvement on any Patent,
the provisions of this Agreement above shall automatically apply thereto and such Debtor shall give to Secured Party prompt written
notice thereof. Each Debtor hereby authorizes Secured Party to modify this Agreement by amending Schedules III, IV and V,
as applicable, to include any such registered Copyrights or any such Patents and Trademarks. Each Debtor shall have the duty (i)
to prosecute diligently any patent, trademark, or service mark applications pending as of the date hereof or hereafter, (ii) to
preserve and maintain all rights in the Copyrights, Patents and Trademarks, to the extent material to the operations of the business
of such Debtor and (iii) to ensure that the Copyrights, Patents and Trademarks are and remain enforceable, to the extent material
to the operations of the business of such Debtor. Any expenses incurred in connection with such Debtor’s obligations under
this Section 4.1(f) shall be borne by such Debtor. Except for any such items that a Debtor reasonably believes (using prudent
industry customs and practices) are no longer necessary for the on-going operations of its business, no Debtor shall abandon any
material right to file a patent, trademark or service mark application, or abandon any pending patent, trademark or service mark
application or any other Copyright, Patent or Trademark without the prior written consent of Secured Party, which consent shall
not be unreasonably withheld.

 

(g)          Further
Identification of Collateral. Each Debtor will, when and as often as requested by the Secured Party or its Representative,
furnish to the Secured Party or such Representative, statements and schedules further identifying and describing the Collateral
and such other reports in connection with the Collateral as the Secured Party or its Representative may reasonably request, all
in reasonable detail.

 

(h)          Investment
Property. Each Debtor will take any and all actions required or requested by the Secured Party, from time to time, to (i) cause
the Secured Party to obtain exclusive control of any Investment Property owned by such Debtor in a manner acceptable to the Secured
Party and (ii) obtain from any issuers of Investment Property and such other Persons, for the benefit of the Secured Party, written
confirmation of the Secured Party’s control over such Investment Property. For purposes of this Section 4.1(h), the
Secured Party shall have exclusive control of Investment Property if (i) such Investment Property consists of certificated securities
and a Debtor delivers such certificated securities to the Secured Party (with appropriate endorsements if such certificated securities
are in registered form); (ii) such Investment Property consists of uncertificated securities and either (x) a Debtor delivers such
uncertificated securities to the Secured Party or (y) the issuer thereof agrees, pursuant to documentation in form and substance
satisfactory to the Secured Party, that it will comply with instructions originated by the Secured Party without further consent
by such Debtor, and (iii) such Investment Property consists of security entitlements and either (x) the Secured Party becomes the
entitlement holder thereof or (y) the appropriate securities intermediary agrees, pursuant to the documentation in form and substance
satisfactory to the Secured Party, that it will comply with entitlement orders originated by the Secured Party without further
consent by any Debtor.

 

    	 	10	 

     

    

  

(i)          Commercial
Tort Claims. Each Debtor shall promptly notify Secured Party of any Commercial Tort Claim acquired by it that concerns a claim
in excess of $50,000 and unless otherwise consented to by Secured Party, such Debtor shall enter into a supplement to this Agreement
granting to Secured Party a Lien on and security interest in such Commercial Tort Claim.

 

4.2         Other
Liens. Debtors will not create, permit or suffer to exist, and will defend the Collateral against and take such other action
as is necessary to remove, any Lien on the Collateral except Permitted Encumbrances, and will defend the right, title and interest
of the Secured Party in and to the Collateral and in and to all Proceeds thereof against the claims and demands of all Persons
whatsoever.

 

4.3         Preservation
of Rights. Whether or not any Event of Default has occurred or is continuing, the Secured Party and its Representative may,
but shall not be required to, take any steps the Secured Party or its Representative deems necessary or appropriate to preserve
any Collateral or any rights against third parties to any of the Collateral, including obtaining insurance for the Collateral at
any time when such Debtor has failed to do so, and Debtors shall promptly pay, or reimburse the Secured Party for, all expenses
incurred in connection therewith.

 

4.4         Formation
of Subsidiaries; Name Change; Location; Bailees.

 

(a)          No
Debtor shall form or acquire any subsidiary unless (i) such Debtor pledges all of the stock or equity interests of such subsidiary
to the Secured Party pursuant to an agreement in a form agreed to by the Secured Party, (ii) such subsidiary becomes a party to
this Agreement and all other applicable Security Documents and (iii) the formation or acquisition of such Subsidiary is not prohibited
by the terms of the Transaction Documents.

 

(b)          No
Debtor shall (i) reincorporate or reorganize itself under the laws of any jurisdiction other than the jurisdiction in which it
is incorporated or organized as of the date hereof, or (ii) otherwise change its name, identity or corporate structure, in each
case, without the prior written consent of Secured Party, which consent shall not be unreasonably withheld. Each Debtor will notify
Secured Party promptly in writing prior to any such change in the proposed use by such Debtor of any tradename or fictitious business
name other than any such name set forth on Schedule II attached hereto.

 

(c)          Except
for the sale of Inventory in the ordinary course of business and other sales of assets expressly permitted by the terms of the
Note Purchase Agreement, each Debtor will keep the Collateral at the locations specified in Schedule I. Each Debtor will
give Secured Party thirty (30) day’s prior written notice of any change in such Debtor’s chief place of business or
of any new location for any of the Collateral.

 

    	 	11	 

     

    

  

(d)          If
any Collateral is at any time in the possession or control of any warehousemen, bailee, consignee or processor, such Debtor shall,
upon the request of Secured Party or its Representative, notify such warehousemen, bailee, consignee or processor of the Lien and
security interest created hereby and shall instruct such Person to hold all such Collateral for Secured Party’s account subject
to Secured Party’s instructions.

 

(e)          Each
Debtor acknowledges that it is not authorized to file any financing statement or amendment or termination statement with respect
to any financing statement without the prior written consent of Secured Party and agrees that it will not do so without the prior
written consent of Secured Party, subject to such Debtor’s rights under Section 9-509(d)(2) to the UCC.

 

(f)          No
Debtor shall enter into any Contract that restricts or prohibits the grant to Secured Party of a security interest in Accounts,
Chattel Paper, Instruments or payment intangibles or the proceeds of the foregoing.

 

4.5         Bank
Accounts and Securities Accounts.

 

(a)          On
or prior to the date hereof, the Secured Party and each Debtor, as applicable, shall enter into an account control agreement or
securities account control agreement, as applicable (each an “Account Control Agreement”), in a form reasonably
acceptable to the Secured Party, with each financial institution with which such Debtor maintains from time to time any Deposit
Accounts (general or special), securities accounts, brokerage accounts or other similar accounts, which financial institutions
are set forth on Schedule VI attached hereto. Pursuant to the Account Control Agreements and pursuant hereto, each such
Debtor grants and shall grant to the Secured Party a continuing lien upon, and security interest in, all such accounts and all
funds at any time paid, deposited, credited or held in such accounts (whether for collection, provisionally or otherwise) or otherwise
in the possession of such financial institutions, and each such financial institution shall act as the Secured Party’s agent
in connection therewith. Following the Closing Date, no Debtor shall establish any Deposit Account, securities account, brokerage
account or other similar account with any financial institution unless prior thereto the Secured Party and such Debtor shall have
entered into an Account Control Agreement with such financial institution which purports to cover such account. Each Debtor shall
deposit and keep on deposit all of its funds into a Deposit Account which is subject to an Account Control Agreement.

 

(b)          Each
Debtor shall establish lock-box or blocked accounts (collectively, “Blocked Accounts”) in such Debtor’s
name with such banks as are reasonably acceptable to the Secured Party (“Collecting Banks”), subject to irrevocable
instructions in a form reasonably acceptable to the Secured Party, to which the obligors of all Accounts shall directly remit all
payments on Accounts and in which such Debtor will immediately deposit all cash payments for Inventory or other cash payments constituting
proceeds of Collateral in the identical form in which such payment was made, whether by cash or check. In addition, the Secured
Party may establish one or more depository accounts at each Collecting Bank or at a centrally located bank (collectively, the “Depository
Account”). All amounts held or deposited in the Blocked Accounts held by such Collecting Bank shall be transferred to
the Depository Account without any further notice or action required by Secured Party. Upon and during the continuance of an Event
of Default, subject to the foregoing, each Debtor hereby agrees that all payments received by the Secured Party whether by cash,
check, wire transfer or any other instrument, made to such Blocked Accounts or otherwise received by the Secured Party and whether
in respect of the Accounts or as proceeds of other Collateral or otherwise will be the sole and exclusive property of the Secured
Party. Each Debtor, and any of its Affiliates, employees, agents and other Persons acting for or in concert with such Debtor shall,
acting as trustee for the Secured Party, receive, as the sole and exclusive property of the Secured Party, any moneys, checks,
notes, drafts or other payments relating to and/or proceeds of Accounts or other Collateral which come into the possession or under
the control of such Debtor or any Affiliates, employees, agent or other Persons acting for or in concert with such Debtor, and
immediately upon receipt thereof, such Debtor or Persons shall deposit the same or cause the same to be deposited in kind, in a
Blocked Account.

 

    	 	12	 

     

    

  

4.6         Events
of Default, Etc. During the period during which an Event of Default shall have occurred and be continuing:

 

(a)          each
Debtor shall, at the request of the Secured Party or its Representative, assemble the Collateral and make it available to Secured
Party or its Representative at a place or places designated by the Secured Party or its Representative which are reasonably convenient
to Secured Party or its Representative, as applicable, and such Debtor;

 

(b)          the
Secured Party or its Representative may make any reasonable compromise or settlement deemed desirable with respect to any of the
Collateral and may extend the time of payment, arrange for payment in installments, or otherwise modify the terms of, any of the
Collateral;

 

(c)          the
Secured Party shall have all of the rights and remedies with respect to the Collateral of a secured party under the UCC (whether
or not said UCC is in effect in the jurisdiction where the rights and remedies are asserted) and such additional rights and remedies
to which a secured party is entitled under the laws in effect in any jurisdiction where any rights and remedies hereunder may be
asserted, including, without limitation, the right, to the maximum extent permitted by law, to: (i) exercise all voting, consensual
and other powers of ownership pertaining to the Collateral as if the Secured Party were the sole and absolute owner thereof (and
each Debtor agrees to take all such action as may be appropriate to give effect to such right) and (ii) to the appointment of a
receiver or receivers for all or any part of the Collateral or business of a Debtor, whether such receivership be incident to a
proposed sale or sales of such Collateral or otherwise and without regard to the value of the Collateral or the solvency of any
person or persons liable for the payment of the Liabilities secured by such Collateral. Each Debtor hereby consents to the appointment
of such receiver or receivers, waives any and all defenses to such appointment and agrees that such appointment shall in no manner
impair, prejudice or otherwise affect the rights of Secured Party under this Agreement. Each Debtor hereby expressly waives notice
of a hearing for appointment of a receiver and the necessity for bond or an accounting by the receiver;

 

(d)          the
Secured Party or its Representative in its discretion may, in the name of the Secured Party or in the name of a Debtor or otherwise,
demand, sue for, collect or receive any money or property at any time payable or receivable on account of or in exchange for any
of the Collateral, but shall be under no obligation to do so;

 

    	 	13	 

     

    

  

(e)          the
Secured Party or its Representative may take immediate possession and occupancy of any premises owned, used or leased by a Debtor
and exercise all other rights and remedies which may be available to the Secured Party;

 

(f)          the
Secured Party may, upon reasonable notice (such reasonable notice to be determined by Secured Party in its sole and absolute discretion,
which shall not be less than ten (10) days), with respect to the Collateral or any part thereof which shall then be or shall thereafter
come into the possession, custody or control of the Secured Party or its Representative, sell, lease, license, assign or otherwise
dispose of all or any part of such Collateral, at such place or places as the Secured Party deems best, and for cash or for credit
or for future delivery (without thereby assuming any credit risk), at public or private sale, without demand of performance or
notice of intention to effect any such disposition or of the time or place thereof (except such notice as is required above or
by applicable statute and cannot be waived), and the Secured Party or anyone else may be the purchaser, lessee, licensee, assignee
or recipient of any or all of the Collateral so disposed of at any public sale (or, to the extent permitted by law, at any private
sale) and thereafter hold the same absolutely, free from any claim or right of whatsoever kind, including any right or equity of
redemption (statutory or otherwise), of Debtors, any such demand, notice and right or equity being hereby expressly waived and
released. The Secured Party may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned
from time to time by announcement at the time and place fixed for the sale, and such sale may be made at any time or place to which
the sale may be so adjourned; and

 

(g)          the
rights, remedies and powers conferred by this Section 4.6 are in addition to, and not in substitution for, any other rights, remedies
or powers that the Secured Party may have under any Transaction Document, at law, in equity or by or under the UCC or any other
statute or agreement. The Secured Party may proceed by way of any action, suit or other proceeding at law or in equity and no right,
remedy or power of the Secured Party will be exclusive of or dependent on any other. The Secured Party may exercise any of its
rights, remedies or powers separately or in combination and at any time.

 

The proceeds of each collection, sale or
other disposition under this Section 4.6 shall be applied in accordance with Section 4.9 hereof.

 

4.7         Deficiency.
If the proceeds of sale, collection or other realization of or upon the Collateral are insufficient to cover the costs and expenses
of such realization and the payment in full of the Liabilities, Debtors shall remain jointly and severally liable for any deficiency.

 

    	 	14	 

     

    

  

4.8         Private
Sale. Each Debtor recognizes that the Secured Party may be unable to effect a public sale of any or all of the Collateral consisting
of securities by reason of certain prohibitions contained in the Securities Act of 1933, as amended (the “Act”),
and applicable state securities laws, but may be compelled to resort to one or more private sales thereof to a restricted group
of purchasers who will be obliged to agree, among other things, to acquire such Collateral for their own account for investment
and not with a view to the distribution or resale thereof. Each Debtor acknowledges and agrees that any such private sale may result
in prices and other terms less favorable to the seller than if such sale were a public sale and each Debtor agrees that it is not
commercially unreasonable for Secured Party to engage in any such private sales or dispositions under such circumstances. The Secured
Party shall be under no obligation to delay a sale of any of the Collateral to permit a Debtor to register such Collateral for
public sale under the Act, or under applicable state securities laws, even if Debtors would agree to do so. The Secured Party shall
not incur any liability as a result of the sale of any such Collateral, or any part thereof, at any private sale provided for in
this Agreement conducted in a commercially reasonable manner, and so long as Secured Party conducts such sale in a commercially
reasonable manner each Debtor hereby waives any claims against the Secured Party arising by reason of the fact that the price at
which the Collateral may have been sold at such a private sale was less than the price which might have been obtained at a public
sale or was less than the aggregate amount of the Liabilities, even if the Secured Party accepts the first offer received and does
not offer the Collateral to more than one offeree.

 

Each Debtor further agrees
to do or cause to be done all such other acts and things as may be necessary to make such sale or sales of any portion or all of
any such Collateral valid and binding and in compliance with any and all applicable laws, regulations, orders, writs, injunctions,
decrees or awards of any and all courts, arbitrators or governmental instrumentalities, domestic or foreign, having jurisdiction
over any such sale or sales, all at such Debtor’s expense. Each Debtor further agrees that a breach of any of the covenants
contained in this Section 4.8 will cause irreparable injury to the Secured Party, that the Secured Party has no adequate
remedy at law in respect of such breach and, as a consequence, agrees that each and every covenant contained in this Section
4.8 shall be specifically enforceable against Debtors, and each Debtor hereby waives and agrees not to assert any defenses
against an action for specific performance of such covenants except for a defense that no Event of Default has occurred and is
continuing.

 

4.9         Application
of Proceeds. The proceeds of any collection, sale or other realization of all or any part of the Collateral, and any other
cash at the time held by the Secured Party under this Agreement, shall be applied to the Liabilities in such order as Secured Party
shall elect.

 

4.10       Attorney-in-Fact.
Each Debtor hereby irrevocably constitutes and appoints the Secured Party, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and stead of such Debtor and in the name of such Debtor
or in its own name, from time to time in the discretion of the Secured Party, for the purpose of carrying out the terms of this
Agreement, to take any and all appropriate action and to execute and deliver any and all documents and instruments which may be
necessary or desirable to perfect or protect any security interest granted hereunder, to maintain the perfection or priority of
any security interest granted hereunder, or to otherwise accomplish the purposes of this Agreement, and, without limiting the generality
of the foregoing, hereby gives the Secured Party the power and right, on behalf of such Debtor, without notice to or assent by
such Debtor (to the extent permitted by applicable law), to do the following:

 

    	 	15	 

     

    

  

(a)          to
take any and all appropriate action and to execute and deliver any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement;

 

(b)          upon
the occurrence and during the continuation of an Event of Default, to ask, demand, collect, receive and give acquittance and receipts
for any and all moneys due and to become due under any Collateral and, in the name of such Debtor or its own name or otherwise,
to take possession of and endorse and collect any checks, drafts, notes, acceptances or other Instruments for the payment of moneys
due under any Collateral and to file any claim or to take any other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Secured Party for the purpose of collecting any and all such moneys due under any Collateral whenever
payable and to file any claim or to take any other action or proceeding in any court of law or equity or otherwise deemed appropriate
by the Secured Party for the purpose of collecting any and all such moneys due under any Collateral whenever payable;

 

(c)          to
pay or discharge charges or liens levied or placed on or threatened against the Collateral, to effect any insurance called for
by the terms of this Agreement and to pay all or any part of the premiums therefor;

 

(d)          to
direct any party liable for any payment under any of the Collateral to make payment of any and all moneys due, and to become due
thereunder, directly to the Secured Party or as the Secured Party shall direct, and to receive payment of and receipt for any and
all moneys, claims and other amounts due, and to become due at any time, in respect of or arising out of any Collateral;

 

(e)          upon
the occurrence and during the continuation of an Event of Default, to sign and indorse any invoices, freight or express bills,
bills of lading, storage or warehouse receipts, drafts against debtors, assignments, verifications and notices in connection with
accounts and other Documents constituting or relating to the Collateral;

 

(f)          upon
the occurrence and during the continuation of an Event of Default, to commence and prosecute any suits, actions or proceedings
at law or in equity in any court of competent jurisdiction to collect the Collateral or any part thereof and to enforce any other
right in respect of any Collateral;

 

(g)          upon
the occurrence and during the continuation of an Event of Default, to defend any suit, action or proceeding brought against a Debtor
with respect to any Collateral;

 

(h)          upon
the occurrence and during the continuation of an Event of Default, to settle, compromise or adjust any suit, action or proceeding
described above and, in connection therewith, to give such discharges or releases as the Secured Party may deem appropriate;

 

(i)          to
the extent that a Debtor’s authorization given in Section 4.1(b) of this Agreement is not sufficient to file such
financing statements with respect to this Agreement, with or without such Debtor’s signature, or to file a photocopy of this
Agreement in substitution for a financing statement, as the Secured Party may deem appropriate and to execute in such Debtor’s
name such financing statements and amendments thereto and continuation statements which may require such Debtor’s signature;

 

    	 	16	 

     

    

  

(j)          upon
the occurrence and during the continuation of an Event of Default, generally to sell, transfer, pledge, make any agreement with
respect to or otherwise deal with any of the Collateral as fully and completely as though the Secured Party were the absolute owners
thereof for all purposes; and

 

(k)          to
do, at the Secured Party’s option and at such Debtor’s expense, at any time, or from time to time, all acts and things
which the Secured Party reasonably deems necessary to protect or preserve or, upon the occurrence and during the continuation of
an Event of Default, realize upon the Collateral and the Secured Party’s lien therein, in order to effect the intent of this
Agreement, all as fully and effectively as such Debtor might do.

 

Each Debtor hereby
ratifies, to the extent permitted by law, all that such attorneys lawfully do or cause to be done by virtue hereof provided the
same is performed in a commercially reasonable manner. The power of attorney granted hereunder is a power coupled with an interest
and shall be irrevocable until the Liabilities are indefeasibly paid in full in cash and this Agreement is terminated in accordance
with Section 4.12 hereof.

 

Each Debtor also authorizes
the Secured Party, at any time from and after the occurrence and during the continuation of any Event of Default, (x) to communicate
in its own name with any party to any Contract with regard to the assignment of the right, title and interest of such Debtor in
and under the Contracts hereunder and other matters relating thereto and (y) to execute, in connection with any sale of Collateral
provided for in Section 4.6 hereof, any endorsements, assignments or other instruments of conveyance or transfer with respect
to the Collateral.

 

4.11       Perfection.
Prior to or concurrently with the execution and delivery of this Agreement, each Debtor shall:

 

(a)          file
such financing statements, assignments for security and other documents in such offices as may be necessary or as the Secured Party
or the Representative may request to perfect the security interests granted by Section 3 of this Agreement;

 

(b)          at
Secured Party’s request, deliver to the Secured Party or its Representative the originals of all Instruments together with,
in the case of Instruments constituting promissory notes, allonges attached thereto showing such promissory notes to be payable
to the order of a blank payee;

 

(c)          deliver
to the Secured Party or its Representative an Account Control Agreement for each Deposit Account owned by such Debtor, acceptable
in all respects to Secured Party, duly executed by the applicable Debtor and the financial institution at which such Debtor maintains
such Deposit Account; and

 

(d)          deliver
to the Secured Party or its Representative the originals of all Motor Vehicle Titles, duly endorsed indicating the Secured Party’s
interest therein as a lienholder, together with such other documents as may be required consistent with Section 4.1(d) hereof
to perfect the security interest granted by Section 3 in all such Motor Vehicles (if any).

 

    	 	17	 

     

    

  

4.12       Termination;
Partial Release of Collateral. This Agreement and the Liens and security interests granted hereunder shall not terminate until
the termination of the Note Purchase Agreement and the Notes and the full and complete performance and indefeasible satisfaction
of all the Liabilities (i) in respect of the Transaction Documents (including, without limitation, the indefeasible payment in
full in cash of all such Liabilities) and (ii) with respect to which claims have been asserted by Agent and/or Purchasers, whereupon
the Secured Party shall forthwith cause to be assigned, transferred and delivered, against receipt but without any recourse, warranty
or representation whatsoever, any remaining Collateral to or on the order of Debtors. The Secured Party shall also execute and
deliver to Debtors upon such termination and at Debtors’ expense such UCC termination statements, certificates for terminating
the liens on the Motor Vehicles (if any) and such other documentation as shall be reasonably requested by Debtors to effect the
termination and release of the Liens and security interests in favor of the Secured Party affecting the Collateral.

 

4.13       Further
Assurances. At any time and from time to time, upon the written request of the Secured Party or its Representative, and at
the sole expense of Debtors, Debtors will promptly and duly execute and deliver any and all such further instruments, documents
and agreements and take such further actions as the Secured Party or its Representative may reasonably require in order for the
Secured Party to obtain the full benefits of this Agreement and of the rights and powers herein granted in favor of the Secured
Party, including, without limitation, using Debtors’ best efforts to secure all consents and approvals necessary or appropriate
for the assignment to the Secured Party of any Collateral held by Debtors or in which a Debtor has any rights not heretofore assigned,
the filing of any financing or continuation statements under the UCC with respect to the liens and security interests granted hereby,
transferring Collateral to the Secured Party’s possession (if a security interest in such Collateral can be perfected by
possession), placing the interest of the Secured Party as lienholder on the certificate of title of any Motor Vehicle, obtaining
waivers of liens from landlords and mortgagees and delivering to Secured Party all such Account Control Agreements as Secured Party
shall require duly executed by the applicable Debtor and the financial institution at which such Debtor maintains a Deposit Account
covered by such Account Control Agreement. Each Debtor also hereby authorizes the Secured Party and its Representative to file
any such financing or continuation statement without the signature of such Debtor to the extent permitted by applicable law.

 

4.14       Limitation
on Duty of Secured Party. The powers conferred on the Secured Party under this Agreement are solely to protect the Secured
Party’s interest on behalf of itself and Purchasers in the Collateral and shall not impose any duty upon it to exercise any
such powers. The Secured Party shall be accountable only for amounts that it actually receives as a result of the exercise of such
powers and neither the Secured Party nor its Representative nor any of their respective officers, directors, employees or agents
shall be responsible to Debtors for any act or failure to act, except for gross negligence or willful misconduct. Without limiting
the foregoing, the Secured Party and any Representative shall be deemed to have exercised reasonable care in the custody and preservation
of the Collateral in their possession if such Collateral is accorded treatment substantially equivalent to that which the relevant
Secured Party or any Representative, in its individual capacity, accords its own property consisting of the type of Collateral
involved, it being understood and agreed that neither the Secured Party nor any Representative shall have any responsibility for
taking any necessary steps (other than steps taken in accordance with the standard of care set forth above) to preserve rights
against any Person with respect to any Collateral.

 

    	 	18	 

     

    

  

Also without limiting
the generality of the foregoing, neither the Secured Party nor any Representative shall have any obligation or liability under
any Contract or license by reason of or arising out of this Agreement or the granting to the Secured Party of a security interest
therein or assignment thereof or the receipt by the Secured Party or any Representative of any payment relating to any Contract
or license pursuant hereto, nor shall the Secured Party or any Representative be required or obligated in any manner to perform
or fulfill any of the obligations of Debtors under or pursuant to any Contract or license, or to make any payment, or to make any
inquiry as to the nature or the sufficiency of any payment received by it or the sufficiency of any performance by any party under
any Contract or license, or to present or file any claim, or to take any action to collect or enforce any performance or the payment
of any amounts which may have been assigned to it or to which it may be entitled at any time or times.

 

Section
5.            Miscellaneous.

 

5.1         No
Waiver. No failure on the part of the Secured Party or any of its Representatives to exercise, and no course of dealing with
respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise by the Secured Party or any of its Representatives of any right, power or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other right, power or remedy. The rights and remedies hereunder provided are
cumulative and may be exercised singly or concurrently, and are not exclusive of any rights and remedies provided by law.

 

5.2         Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed
by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other
than the State of New York.

 

5.3         Notices.
All notices, approvals, requests, demands and other communications hereunder shall be delivered or made in the manner set forth
in, and shall be effective in accordance with the terms of, the Note Purchase Agreement; provided, that, to the extent any such
communication (i) is being made or sent to a Debtor that is not a Company, such communication shall be effective as to such Debtor
if made or sent to any Company in accordance with the foregoing or (ii) is being made or sent to Agent, such communication shall
be made to Agent at the address set forth below Agent’s signature hereto. Debtors and Agent may change their respective notice
addresses by written notice given to each other party five (5) days prior to the effectiveness of such change.

 

5.4         Amendments,
Etc. The terms of this Agreement may be waived, altered or amended only by an instrument in writing duly executed by the Debtor
sought to be charged or benefited thereby and the Secured Party. Any such amendment or waiver shall be binding upon the Secured
Party and the Debtor sought to be charged or benefited thereby and their respective successors and assigns.

 

    	 	19	 

     

    

  

5.5         Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of each
of the parties hereto, provided, that no Debtor shall assign or transfer its rights hereunder without the prior written
consent of the Secured Party. Secured Party, in its capacity as Agent, may assign its rights hereunder without the consent of Debtors,
in which event such assignee shall be deemed to be Secured Party hereunder with respect to such assigned rights; provided, so long
as no Event of Default has occurred and is continuing, the Secured Party shall not assign any of its rights hereunder to a competitor
of any Company.

 

5.6         Counterparts;
Headings. This Agreement may be authenticated in any number of counterparts, all of which taken together shall constitute one
and the same instrument and any of the parties hereto may authenticate this Agreement by signing any such counterpart. This Agreement
may be authenticated by manual signature or facsimile, .pdf or similar electronic signature, all of which shall be equally valid.
The headings in this Agreement are for convenience of reference only and shall not alter or otherwise affect the meaning hereof.

 

5.7         Severability.
If any provision hereof is invalid and unenforceable in any jurisdiction, then, to the fullest extent permitted by law, (a) the
other provisions hereof shall remain in full force and effect in such jurisdiction and shall be liberally construed in favor of
the Secured Party and its Representative in order to carry out the intentions of the parties hereto as nearly as may be possible
and (b) the invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability
of such provision in any other jurisdiction.

 

5.8         SUBMISSION
TO JURISDICTION; WAIVER OF VENUE; SERVICE OF PROCESS. EACH DEBTOR HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION
OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT SITTING IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT AND EACH DEBTOR HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION
OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS
TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL LIMIT THE RIGHT OF SECURED PARTY TO BRING PROCEEDINGS AGAINST ANY DEBTOR IN THE COURTS OF ANY OTHER JURISDICTION.
ANY JUDICIAL PROCEEDING BY A DEBTOR AGAINST SECURED PARTY, ANY PURCHASER OR ANY AFFILIATE THEREOF INVOLVING, DIRECTLY OR INDIRECTLY,
ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTION WITH THIS AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN NEW YORK,
NEW YORK (AND SECURED PARTY AND PURCHASERS HEREBY SUBMIT TO THE JURISDICTION OF SUCH COURT). EACH DEBTOR HERETO HEREBY IRREVOCABLY
WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH ACTION OR PROCEEDING BY MAILING BY REGISTERED
OR CERTIFIED MAIL A COPY THEREOF TO SUCH DEBTOR AT THE ADDRESS FOR NOTICES TO IT IN ACCORDANCE WITH SECTION 5.3 OF THIS AGREEMENT
AND AGREES THAT SUCH NOTICE SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN
SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT OF SECURED PARTY OR ANY PURCHASER TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.

 

    	 	20	 

     

    

  

5.9         WAIVER
OF RIGHT TO TRIAL BY JURY. EACH DEBTOR AND SECURED PARTY WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY
OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY,
IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH DEBTOR AND SECURED PARTY AGREE THAT ANY SUCH CLAIM OR CAUSE OF
ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE
RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION 5.9 AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS,
IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY
TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

 

5.10       Joint
and Several. The obligations, covenants and agreements of Debtors hereunder shall be the joint and several obligations, covenants
and agreements of each Debtor, whether or not specifically stated herein without preferences or distinction among them.

 

5.11       Agent
and Purchaser Indemnification.

 

(a)          Each
Purchaser has pursuant to an Agency Agreement designated and appointed the Agent as the administrative agent of such Purchaser
under this Agreement and the Related Agreements.

 

(b)          Nothing
in this Section 5.11 shall be deemed to limit or otherwise affect the rights of Secured Party or Purchasers to exercise
any remedy provided in this Agreement or any other Transaction Document.

 

(c)          If
pursuant to any Related Agreement Secured Party is given the discretion to allocate proceeds received by Secured Party pursuant
to the exercise of remedies under the Related Agreements or at law or in equity (including without limitation with respect to any
secured creditor remedies exercised against the Collateral and any other collateral security provided for under any Related Agreement),
Secured Party shall apply such proceeds to the then outstanding Liabilities in the following order of priority (with amounts received
being applied in the numerical order set forth below until exhausted prior to the application to the next succeeding category and
each of the Purchasers or other Persons entitled to payment shall receive an amount equal to its pro rata share of amounts available
to be applied pursuant to clauses second, third and fourth below):

 

    	 	21	 

     

    

  

first,
to payment of fees, costs and expenses (including reasonable attorney’s fees) owing to the Secured Party;

 

second,
to payment of all accrued unpaid interest and fees (other than fees owing to Agent) on the Liabilities;

 

third,
to payment of principal of the Liabilities;

 

fourth,
to payment of any other amounts owing constituting Liabilities; and

 

fifth,
any remainder shall be for the account of and paid to whoever may be lawfully entitled thereto.

 

5.12       No
Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party.

 

5.13       ENTIRE
AGREEMENT; AMENDMENT. THIS AGREEMENT, TOGETHER WITH THE OTHER TRANSACTION DOCUMENTS, SUPERSEDES ALL OTHER PRIOR ORAL OR WRITTEN
AGREEMENTS BETWEEN SECURED PARTY, THE DEBTORS, THEIR AFFILIATES AND PERSONS ACTING ON THEIR BEHALF WITH RESPECT TO THE MATTERS
DISCUSSED HEREIN, AND THIS AGREEMENT, TOGETHER WITH THE OTHER TRANSACTION DOCUMENTS AND THE OTHER INSTRUMENTS REFERENCED HEREIN
AND THEREIN, CONTAIN THE ENTIRE UNDERSTANDING OF THE PARTIES WITH RESPECT TO THE MATTERS COVERED HEREIN AND THEREIN AND, EXCEPT
AS SPECIFICALLY SET FORTH HEREIN OR THEREIN, NEITHER THE SECURED PARTY NOR ANY DEBTOR MAKES ANY REPRESENTATION, WARRANTY, COVENANT
OR UNDERTAKING WITH RESPECT TO SUCH MATTERS. AS OF THE DATE OF THIS AGREEMENT, THERE ARE NO UNWRITTEN AGREEMENT BETWEEN THE PARTIES
WITH RESPECT TO THE MATTERS DISCUSSED HEREIN. NO PROVISION OF THIS AGREEMENT MAY BE AMENDED, MODIFIED OR SUPPLEMENTED OTHER THAN
BY AN INSTRUMENT IN WRITING SIGNED BY THE DEBTORS AND THE SECURED PARTY.

 

- Remainder of Page Intentionally Left
Blank; Signature Page Follows -

 

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IN WITNESS WHEREOF,
the parties hereto have caused this Security Agreement to be duly executed and delivered as of the day and year first above written.

 

	DEBTORS:	 	 
	 	 	 
	USELL.COM, INC.,	 	BST DISTRIBUTION, INC.,
	a Delaware corporation	 	a New York corporation
	 	 	 	 	 
	By:	/s/ Nikhil Raman	 	By:	/s/ Brian Tepfer
	 	Name: Nikhil Raman	 	 	Name:  Brian Tepfer
	 	Title:   Chief Executive Officer	 	 	Title:    Chief Executive Officer
	 	 	 	 	 
	WE SELL CELLULAR LLC,	 	UPSTREAM PHONE COMPANY USA, 
	a Delaware limited liability company	 	INC., a Delaware corporation
	 	 	 
	By:	/s/ Nikhil Raman	 	By:	/s/ Nikhil Raman
	 	Name: Nikhil Raman	 	 	Name: Nikhil Raman
	 	Title:   Manager	 	 	Title:   President
	 	 	 	 	 
	UPSTREAM PHONE HOLDINGS, INC., 	 	HD CAPITAL HOLDINGS LLC,
	a Delaware corporation	 	a Delaware limited liability company
	 	 	 
	By:	/s/ Nikhil Raman	 	By:	/s/ Daniel Brauser
	 	Name: Nikhil Raman	 	 	Name: Daniel Brauser
	 	Title:   President	 	 	Title:   Manager

 

SIGNATURE PAGE TO

SECURITY AGREEMENT

 

     

     

    

  

	 	SECURED PARTY:
	 	 	 
	 	BAM ADMINISTRATIVE SERVICES LLC, a

Delaware limited liability company, in its capacity

as Agent for Purchasers
	 	 	 
	 	By:	 /s/
	 	 	Name:
	 	 	
        Title: 

	 	 	 
	 	Notice Address:
	 	 
	 	1370 Avenue of the Americas
	 	32nd Floor
	 	New York, New York 10019
	 	Attn: Daniel Saks
	 	Facsimile: (212) 260-5051
	 	Email: dsaks@bassetmanager.com

 

SIGNATURE PAGE TO

SECURITY AGREEMENT

 

     

     

    

  

EXHIBIT A

 

Form of Joinder

 

Joinder to Security Agreement

 

The undersigned, ______________________________,
hereby joins in the execution of that certain Security Agreement dated as of ______________ __, 2015 (as amended, restated, supplemented
or otherwise modified from time to time, the “Security Agreement”) by USELL.COM, INC., BST DISTRIBUTION, INC.,
WE SELL CELLULAR LLC, HD CAPITAL HOLDINGS LLC, UPSTREAM PHONE COMPANY USA, INC., and UPSTREAM PHONE HOLDINGS, INC., the Purchasers
(as defined therein), and each other Person that becomes a Debtor or a Purchaser thereunder after the date thereof and hereof and
pursuant to the terms thereof, to and in favor of BAM ADMINISTRATIVE SERVICES LLC, in its capacity as Agent for Purchasers. By
executing this Joinder, the undersigned hereby agrees that it is a Debtor thereunder and agrees to be bound by all of the terms
and provisions of the Security Agreement. The undersigned represents and warrants that the representations and warranties set forth
in the Security Agreement are, with respect to the undersigned, true and correct as of the date hereof.

 

The undersigned represents
and warrants to Secured Party that:

 

(a)          all
of the Equipment, Inventory and Goods owned by such Debtor is located at the places as specified on Schedule I and such
Debtor conducts business in the jurisdiction set forth on Schedule I;

 

(b)          except
as disclosed on Schedule I, none of such Collateral is in the possession of any bailee, warehousemen, processor or consignee;

 

(c)          the
chief place of business, chief executive office and the office where such Debtor keeps its books and records are located at the
place specified on Schedule I;

 

(d)          such
Debtor (including any Person acquired by such Debtor) does not do business or has not done business during the past five years
under any tradename or fictitious business name, except as disclosed on Schedule II;

 

(e)          all
Copyrights, Patents and Trademarks owned or licensed by the undersigned are listed in Schedules III, IV and V,
respectively;

 

(f)          all
Deposit Accounts, securities accounts, brokerage accounts and other similar accounts maintained by such Debtor, and the financial
institutions at which such accounts are maintained, are listed on Schedule VI;

 

(g)          all
Commercial Tort Claims of such Debtor are listed on Schedule VII;

 

(h)          all
interests in real property and mining rights held by such Debtor are listed on Schedule VIII;

 

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(i)          all
Equipment (including Motor Vehicles) owned by such debtor are listed on Schedule IX.

 

	 	________________, a ________
	 	 	 
	 	By:	 
	 	 	Title:
	 	 	FEIN: _____________

 

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