Document:

Loan Agreement, dated August 19, 2003

 Exhibit 10.1.9 
  
 This Agreement has been subordinated to the terms of that certain Revolving Credit and Term Loan Agreement dated as of August 19, 2003, by
and among Staktek Holdings, Inc., SC Merger Sub, Inc., Research Applications, Inc., Comerica Bank as Agent (“Agent”) and the other financial institutions party thereto from time to time (the “Banks”), as the same may be amended,
restated or otherwise modified from time to time after the date hereof pursuant to the terms of that certain Subordination Agreement dated as of August 19, 2003, by and among Agent, the Banks, Austin Ventures VII, L.P. and Austin Ventures VIII,
L.P., as the same may be amended, restated or otherwise modified from time to time after the date hereof. 
  
 LOAN AGREEMENT 
  
 This Loan Agreement (“Agreement”) is made as of August 19, 2003, by and among Austin Ventures VII, L.P., a Delaware limited partnership, and Austin Ventures VIII, L.P., a Delaware limited partnership
(collectively, “Lender”), and Staktek Holdings, Inc., a Delaware corporation (“Borrower”), with reference to the following facts: 
  
 A. Borrower has requested that Lender extend to Borrower credit on the terms and conditions set forth herein. 
  
 B. Lender is prepared to extend such credit as aforesaid, but only on the
terms and conditions set forth in this Agreement. 
  
 NOW
THEREFORE, in consideration of the covenants contained herein, Borrower and Lender agree as follows: 
  
 1. DEFINITIONS 
  
 1.1
Certain Defined Terms. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Senior Credit Agreement (as defined below). For the purposes of this Agreement the following terms will have the following
meanings: 
  
 “Affiliate” shall mean, with respect to
any Person, any other Person or group acting in concert in respect of the first Person that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with such first Person. For purposes
of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person or group of Persons, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of management and policies of such Person, whether through the ownership of voting securities or by contract or otherwise. Unless otherwise specified to the contrary herein, or
the context requires otherwise, Affiliate shall refer to Affiliates of Borrower. Officers and employees of Borrower are not affiliates of the Person by virtue of their office or employment alone. 
  
 “Asset Sale” shall mean the sale, transfer or other disposition by
any Party of any asset (other than stock or other ownership interests of any Subsidiary) to any Person (other than to the Borrower or any Guarantor), other than sales, transfers or other dispositions of inventory in the 

 
ordinary course of business and sales of assets or other dispositions of assets that have been damaged, become obsolete, worn out or are no longer useable or
useful in the conduct of the business of such Party. 
  
 “Bankruptcy Code” shall mean Title 11 of the United States Code and the rules promulgated thereunder. 
  
 “Business Day” shall mean any day other than a Saturday or a Sunday on which commercial Lender are open for domestic and international business
in the State of Texas. 
  
 “Capital Expenditures” shall
mean, for any period, with respect to any Person, the aggregate of all expenditures incurred by such Person and its Subsidiaries during such period for the acquisition or leasing (pursuant to a Capitalized Lease) of fixed or capital assets or
additions to equipment, plant and property that should be capitalized under GAAP on a consolidated balance sheet of such Person and its Subsidiaries. 
  
 “Capital Stock” shall mean (i) in the case of any corporation, all capital stock and any securities exchangeable for or convertible into capital
stock, (ii) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents of corporate stock (however designated) in or to such association or entity, (iii) in the case of a partnership
or limited liability company, partnership or membership interests (whether general or limited) and (iv) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distribution of assets
of, the issuing Person, and including, in all of the foregoing cases described in clauses (i), (ii), (iii) or (iv), any warrants, rights or other options to purchase or otherwise acquire any of the interests described in any of the foregoing cases.

  
 “Capitalized Lease” shall mean, as applied to any
Person, any lease of any property (whether real, personal or mixed) with respect to which the discounted present value of the rental obligations of such Person as lessee thereunder, in conformity with GAAP, is required to be capitalized on the
balance sheet of that Person. 
  
 “Collateral” shall
mean all property or rights in which a security interest, mortgage, lien or other encumbrance for the benefit of Lender is or has been granted by any Person or arises or has arisen, under or in connection with this Agreement, the other Loan
Documents, or otherwise to secure the Indebtedness. 
  
 “Collateral Documents” shall mean the Security Agreement, the Mexican Equipment Pledge, any Mortgages, the other acknowledgments, certificates, stock powers, financing statements, instruments and other security documents executed
by any Party in favor of Lender including all such additional documents necessary to secure a first priority perfected Lien in favor of Lender in the assets of Staktek Group L.P., a Texas limited partnership, located in Mexico in each case as of the
Effective Date or, from time to time, subsequent thereto, in connection with such collateral documents, in each case, as such collateral documents may be amended or otherwise modified from time to time. 
  
 “Consolidated” (or “consolidated”) or
“Consolidating” (or “consolidating”) shall mean, when used with reference to any financial term in this Agreement, Borrower and its Subsidiaries, 

  

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of the amounts signified by such term for all such Persons determined on a consolidated (or consolidating) basis in accordance with GAAP, applied on a
consistent basis. Unless otherwise specified herein, “Consolidated” and “Consolidating” shall refer to the Parties, determined on a Consolidated or Consolidating basis. 
  
 “Contractual Obligation” shall mean, as to any Person, any
provision of any security issued by such Person or of any material agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound. 
  
 “Debt” shall mean as to any Person, without duplication (a) all
Funded Debt of a Person, (b) all Guarantee Obligations of such Person, (c) all obligations of such Person under conditional sale or other title retention agreements relating to property or assets purchased by such Person, (d) all indebtedness of
such Person arising in connection with any interest rate swap transaction, basis swap transaction, forward rate transaction, commodity swap transaction, equity transaction, equity index transaction, foreign exchange transaction, cap transaction,
floor transaction (including any option with respect to any of these transactions and any combination of any of the foregoing) entered into by such Person (in each case measured for financial covenant reporting purposes based on the termination
value thereof, assuming termination on the applicable date of determination), (e) Capitalized Leases and any other items which would be classified as liabilities on the balance sheet of such Person and (f) all Off-Balance Sheet Liabilities.

  
 “Default” shall mean any event which with the giving
of notice or the passage of time, or both, would constitute an Event of Default under this Agreement. 
  
 “Distribution” is defined in Section 5.6 hereof. 
  
 “Dollars” and the sign “$” shall mean lawful money of the United States of America. 
  
 “Effective Date” shall mean the date that the loan to be made
hereunder is advanced to Borrower. 
  
 “Event of
Default” shall mean each of the Events of Default specified in Section 6.1 hereof. 
  
 “Funded Debt” of any Person shall mean, without duplication, (a) all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services as of such date (other than
operating leases and trade liabilities incurred in the ordinary course of business and payable in accordance with customary practices) or which is evidenced by a note, bond, debenture or similar instrument, (b) the principal component of all
obligations of such person under Capitalized Leases, (c) all reimbursement obligations (actual, contingent or otherwise) of such Person in respect of letters of credit, acceptances or similar obligations issued or created for the account of such
Person, (d) all liabilities secured by any liens on any property owned by such Person as of such date even though such Person has not assumed or otherwise become liable for the payment thereof, in each case determined in accordance with GAAP;
provided however that so long as such Person is not personally liable for such liabilities, the amount of such liability shall be deemed to be the lesser of the fair market value at such date of the property subject to the lien securing such
liability and the amount of the liability secured, and (e) all Guarantee Obligations in respect of any liability which constitutes Funded Debt; provided, 

  

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however that Funded Debt shall not include any interest rate swap transaction, basis swap transaction, forward rate transaction, commodity swap transaction,
equity transaction, equity index transaction, foreign exchange transaction, cap transaction, floor transaction (including any option with respect to any of these transactions and any combination of any of the foregoing) entered into by such Person
prior to the occurrence of a termination event with respect thereto. 
  
 “GAAP” shall mean generally accepted accounting principles in the United States of America, consistently applied. 
  
 “Governmental Obligations” means noncallable direct general obligations of the United States of America or obligations the payment of principal
of and interest on which is unconditionally guaranteed by the United States of America. 
  
 “Guarantee Obligation” shall mean as to any Person (the “guaranteeing person”) any obligation of the guaranteeing person in respect of any obligation of another Person (including, without
limitation, any bank under any letter of credit), the creation of which was induced by a reimbursement agreement, guaranty agreement, keepwell agreement, purchase agreement, counterindemnity or similar obligation issued by the guaranteeing person,
in either case guaranteeing or in effect guaranteeing any Debt, leases, dividends or other obligations (the “primary obligations”) of any other third Person (the “primary obligor”) in any manner, whether directly or indirectly,
including, without limitation, any obligation of the guaranteeing person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (1)
for the purchase or payment of any such primary obligation or (2) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities
or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the term Guarantee Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guarantee Obligation of
any guaranteeing person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made and (b) the maximum amount for which such
guaranteeing person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in
which case the amount of such Guarantee Obligation shall be such guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined by the Guarantor in good faith. 
  
 “Guarantor(s)” shall mean each Subsidiary of Borrower now or
hereafter existing which has executed and delivered or otherwise joined into the Guaranty. 
  
 “Guaranty” shall mean a guaranty of all Indebtedness of the Borrower, to be executed and delivered to Lender by all Guarantors, as amended from time to time. 
  
 “Income Taxes” shall mean for any period the aggregate amount of
taxes based on income or profits for such period of the operations of the Parties determined in accordance with GAAP on a Consolidated basis (to the extent such income and profits were included in computing Consolidated Net Income). 
  

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 “Indebtedness” shall mean all indebtedness and liabilities (including without limitation
interest (including without limitation interest accruing at the then applicable rate provided in this Agreement or any other applicable Loan Document after the Maturity Date and interest accruing at the then applicable rate provided in this
Agreement or any other applicable Loan Document after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Parties whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), fees and other charges) arising under this Agreement or any of the other Loan Documents, whether direct or indirect, absolute or contingent, of any Party to Lender, in any manner and at any time, whether
arising under this Agreement, or under the Guaranty or any of the other Loan Documents, due or hereafter to become due, now owing or that may hereafter be incurred by any Party to Lender, and any judgments that may hereafter be rendered on such
indebtedness or any part thereof, with interest according to the rates and terms specified, or as provided by law, and any and all consolidations, amendments, renewals, replacements, substitutions or extensions of any of the foregoing; provided,
however that for purposes of calculating the Indebtedness outstanding under this Agreement or any of the other Loan Documents, the direct and indirect and absolute and contingent obligations of the Parties (whether direct or contingent) shall be
determined without duplication. 
  
 “Internal Revenue
Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated thereunder. 
  
 “Investment” shall mean, when used with respect to any Person, (a) any loan, investment or advance made by such Person to any other Person
(including, without limitation, any contingent obligation) in respect of any Capital Stock, Debt, obligation or liability of such other Person and (b) any other investment made by such Person (however acquired) in Capital Stock in any other Person,
including, without limitation, any investment made in exchange for the issuance of Capital Stock of such Person. 
  
 “Lien” shall mean the security interest or lien arising from any pledge, assignment, hypothecation, mortgage, security interest, deposit
arrangement, option, trust receipt, conditional sale or title retaining contract, sale and leaseback transaction, financing statement or comparable notice or other filing or recording, Capitalized Lease, consignment or bailment for security,
subordination of any claim or right, or any other type of lien, charge, encumbrance, title exception, preferential or priority arrangement affecting property (including, with respect to stock, any stockholder agreements, voting rights agreements,
buy-back agreements and all similar arrangements), whether based on common law or statute. 
  
 “Loan Documents” shall mean, collectively, this Agreement, the Note, the Guaranty, the Collateral Documents, and any other documents, certificates, instruments or agreements executed or delivered pursuant to
or in connection with any such document or this Agreement, as such documents may be amended or otherwise modified from time to time. 
  

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 “Material Adverse Effect” shall mean a material adverse effect on (a) the business, operations,
property or condition (financial or otherwise) of the Parties, taken as a whole, (b) the ability of the Parties to perform their respective obligations under this Agreement, the Note or any other Loan Document to which any of them is a party, or (c)
the validity or enforceability of this Agreement, the Note or any of the other Loan Documents or the rights or remedies of Lender hereunder or thereunder. 
  
 “Maturity Date” shall mean August 20, 2008. 
  
 “Mexican Equipment Pledge” shall mean a pledge or security agreement in form acceptable to Lender pursuant to which a security interest in
assets of Staktek Group L.P., a Texas limited partnership located in Mexico is granted to Lender and perfected therein. 
  
 “Note” shall mean the promissory note, made by Borrower to Lender in form acceptable to Lender, as such Note may be amended or supplemented from
time to time, and any other notes issued in substitution, replacement or renewal thereof from time to time. 
  
 “Off-Balance Sheet Liability(ies)” of a Person shall mean (i) any repurchase obligation or liability of such Person with respect to accounts or
notes receivables sold by such Person, (ii) any liability under any sale and leaseback transaction which is not a Capitalized Lease, (iii) any liability under any so-called “synthetic lease” transaction entered into by such Person, or (iv)
any obligation arising with respect to any other transaction which is the functional equivalent of or takes place of borrowing but which does not constitute a liability on the balance sheets of such person, but excluding from this clause operating
leases. 
  
 “Party(ies)” shall mean Borrower and
Guarantors and each of their respective direct and indirect Subsidiaries. 
  
 “Permitted Investments” shall mean with respect to any Person: 
  
 (a) Governmental Obligations; 
  
 (b) Obligations of a state of the United States, the District of Columbia or any possession of the United States, or any political subdivision thereof,
which are described in Section 103(a) of the Internal Revenue Code and are graded in any of the highest three (3) major grades as determined by at least one Rating Agency; or secured, as to payments of principal and interest, by a letter of credit
provided by a financial institution or insurance provided by a bond insurance company which in each case is itself or its debt is rated in one of the highest three (3) major grades as determined by at least one Rating Agency; 
  
 (c) Banker’s acceptances, commercial accounts, demand deposit accounts,
certificates of deposit, or depository receipts issued by or maintained with any a bank, trust company, savings and loan association, savings bank or other financial institution whose deposits are insured by the Federal Deposit Insurance Corporation
and whose reported capital and surplus equal at least $250,000,000, provided that such minimum capital and surplus requirement shall not apply to demand deposit accounts maintained by any Party in the ordinary course of business; 
  

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 (d) Commercial paper rated at the time of purchase within the two highest classifications established by
not less than two Rating Agencies, and which matures within 270 days after the date of issue; 
  
 (e) Secured repurchase agreements against obligations itemized in paragraph (a) above, and executed by a bank or trust company or by members of the association of primary dealers or other recognized dealers in United
States government securities, the market value of which must be maintained at levels at least equal to the amounts advanced; and 
  
 (f) Any fund or other pooling arrangement which exclusively purchases and holds the investments itemized in (a) through (e) above. 
  
 “Permitted Liens” shall mean with respect to any Person:

  
 (a) Liens for taxes, assessments or other governmental
charges not yet delinquent or which are being contested in good faith by appropriate proceedings, provided that adequate reserves with respect thereto are maintained on the books of such Person in conformity with GAAP; 
  
 (b) carriers’, warehousemen’s, mechanics’, materialmen’s,
repairmen’s, landlord’s liens or other like Liens arising in the ordinary course of business which are not overdue for a period of more than 30 days or which are being contested in good faith by appropriate proceedings and for which
appropriate reserves have been made, therefor and the aggregate amount of such Liens is less than $200,000; 
  
 (c) pledges or deposits in connection with workers’ compensation, unemployment insurance and other social security legislation in the ordinary course
of business; and deposits securing liability to insurance carriers under insurance or self-insurance arrangements in aggregate amount for such insurance or self-insurance arrangements not to exceed $500,000; 
  
 (d) deposits to secure (i) the performance of tenders or bids, trade
contracts (other than for borrowed money), statutory obligations, surety, customs, stay and appeal bonds, performance and return of money bonds, government contracts and other obligations of a like nature or (ii) the performance of leases permitted
hereunder, in each case given or incurred on terms, in amounts and otherwise in the ordinary course of business not to exceed in the aggregate $500,000; and 
  
 (e) easements, rights-of-way, restrictions, minor defects or irregularities in title and other similar encumbrances or Liens incurred in the ordinary
course of business which, in the aggregate, are not substantial in amount and which do not in any case materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of such
Person. 
  
 “Person” shall mean a natural person,
corporation, limited liability company, partnership, limited liability partnership, trust, incorporated or unincorporated organization, joint venture, joint stock company, or a government or any agency or political subdivision thereof or other
entity of any kind. 
  

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 “Responsible Officer” shall mean the chief executive officer, chief financial officer,
treasurer or the president of the respective Party, or with respect to compliance with financial covenants, the chief financial officer or the treasurer of the respective Party or any other officer having substantially the same authority and
responsibility. 
  
 “Security Agreement” shall mean
collectively, one or more security agreements executed and delivered as of the date hereof, or to be executed and delivered after the Effective Date, by Borrower and its Subsidiaries in favor of Lender, as the same is amended from time to time.

  
 “Senior Credit Agreement” means that certain
Revolving Credit and Term Loan Agreement dated August 19, 2003, by and between Staktek Holdings, Inc., SC Merger Sub, Inc. and Research Applications, Inc., Comerica Bank as administrative agent, documentation agent, structuring lender and lead
arranger (the “Agent”), and the banks from time to time party thereto, as the same may be amended, restated or otherwise modified from time to time after the date thereof. 
  
 “Senior Credit Facility” means the loan transaction evidenced by the Senior Credit Agreement. 
  
 “Subsidiary(ies) “ shall mean any other corporation, association,
joint stock company, business trust, limited liability company or any other business entity of which more than fifty percent (50%) of the outstanding voting stock, share capital, membership or other interests, as the case may be, is owned either
directly or indirectly by any Person or one or more of its Subsidiaries, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by any Person and/or its Subsidiaries. Unless otherwise
specified to the contrary herein or the context otherwise requires, Subsidiary(ies) shall refer to the Subsidiary(ies) of Borrower. 
  
 “Uniform Commercial Code” or “UCC” shall mean the Uniform Commercial Code of any applicable state. 
  
 2. TERM LOAN 
  
 2.1 Term Loan. Subject to the terms and conditions hereof, Lender agrees to lend to the Borrower, in a single
disbursement, the amount of Thirty-four Million Five Hundred Thousand Dollars ($34,500,000). Of such amount, Seventeen Million One Hundred Ninety-eight Thousand Two Hundred Fifty Dollars ($17,198,250) shall be advanced by Austin Ventures VII, L.P.
and Seventeen Million Three Hundred One Thousand Seven Hundred Fifty Dollars ($17,301,750) shall be advanced by Austin Ventures VIII, L.P. Borrower hereby unconditionally promises to pay to Lender the unpaid principal amount of the Term Loan
outstanding on the Maturity Date together with accrued and unpaid interest thereon pursuant to the terms of this Agreement. 
  
 2.2 Accrual of Interest. The unpaid principal Indebtedness outstanding from time to time under the Term Loan shall bear interest at the rate of
seventeen percent (17%) per annum, compounded quarterly on the last day of each calendar quarter beginning September 30, 2003. There shall be no readvance or reborrowings of any principal reductions of the Term Loan. Interest shall be computed on
the basis of a 360 day year and assessed for the actual number of days elapsed. 
  

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 2.3 Repayment. To the extent not prohibited by the AV Subordination Agreement, accrued but unpaid
interest on principal outstanding from time to time shall be payable at the rate of twelve percent (12%) per annum on the first day of each calendar quarter commencing January 1, 2005. Accrued but unpaid interest (including but not limited to
interest on outstanding principal in an amount equal to the difference between the rate of interest accrued pursuant to Section 2.2 above and the amount to be paid under this Section 2.3) shall be added to principal and shall thereafter accrue
interest. Principal and all unpaid interest shall be payable in full on the Maturity Date. Payments shall be applied first to interest owing, then to any other sums (other than principal) owing under this Agreement or the other Loan Documents, and
finally to principal. All payments made shall be credited prorata to each Lender in proportion to the then outstanding principal amount owed to such Lender. 
  
 2.4 Interest on Default. In the event and so long as any Event of Default shall exist, interest shall accrue on the principal amount of the Term
Loan from time to time outstanding (and, to the extent delinquent, on all other monetary obligations of the Borrower hereunder and under the other Loan Documents) at a per annum rate equal to the interest rate set forth in Section 2.2 above plus two
percent (2%) per annum. 
  
 3. REPRESENTATIONS AND WARRANTIES 

 
 Borrower represents and warrants (and such representations and warranties
shall survive until the Maturity Date and thereafter until the final payment in full of the Indebtedness and the performance by Borrower of all other obligations under this Agreement): 
  
 3.1 Corporate Authority. Borrower and each Guarantor is a corporation (or other business entity) duly organized and
existing in good standing under the laws of the state or jurisdiction of its incorporation and is duly qualified and authorized to do business as a foreign corporation in each jurisdiction where the character of its assets or the nature of its
activities makes such qualification and authorization necessary except where failure to be so qualified could not reasonably be expected to have a Material Adverse Effect. 
  
 3.2 Due Authorization. Execution, delivery and performance of this Agreement and the other Loan Documents are within
Borrower’s and each Guarantor’s respective power, have been duly authorized, are not in contravention of any law applicable to such Party or the terms of such Party’s organizational documents and do not require the consent or approval
of any governmental body, agency or authority. 
  
 3.3
Enforceability of Agreement and Loan Documents. This Agreement and each of the other Loan Documents have each been duly executed and delivered by Borrower’s or Guarantor’s, as the case may be, duly authorized officers and constitute
the valid and binding obligations of such Party, enforceable in accordance with their respective terms, except as enforcement thereof may be limited by applicable bankruptcy, reorganization, insolvency, fraudulent conveyance, moratorium or similar
laws affecting the enforcement of creditor’s rights, generally and by general principles of equity (regardless of whether enforcement is considered in a proceeding in law or equity). 
  

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 3.4 Consents, Approvals and Filings, Etc. No authorization, consent, approval, license,
qualification or formal exemption from, nor any filing, declaration or registration with, any court, governmental agency or regulatory authority or any securities exchange or any other person or party (whether or not governmental) is required in
connection with the execution, delivery and performance by Borrower or any other Party (other than Lender) of this Agreement and any of the other Loan Documents or any other documents or instruments to be executed and or delivered by Borrower or any
other Party in connection therewith or herewith. 
  
 3.5
Incorporation of Representations and Warranties Under Senior Credit Facility. Borrower hereby incorporates by reference as though set forth herein in their entirety and reaffirms, as to each borrower under the Senior Credit Agreement, each of
the representations and warranties contained in the Senior Credit Agreement or made in connection with the Senior Credit Facility. 
  
 4. AFFIRMATIVE COVENANTS 
  
 Borrower covenants and agrees that it will, and, as applicable, it will cause each of the Parties to, until the Maturity Date and until final payment in
full of the Indebtedness and the performance by Borrower of all other obligations under this Agreement and the other Loan Documents: 
  
 4.1 Financial Statements. Furnish to Lender: 
  
 (a) as soon as available, but in any event within ninety (90) days after the end of each fiscal year of Borrower and its Subsidiaries, a copy of the
audited Consolidated and unaudited Consolidating financial statements of the Parties as at the end of such year and the related audited Consolidated and unaudited Consolidating statements of income, stockholders equity, and cash flows for such year
or partial year and underlying assumptions, setting forth in each case in comparative form the figures for the previous year, certified as being fairly stated in all material respects by an independent, nationally recognized certified public
accounting firm reasonably satisfactory to Lender; 
  
 (b) as soon
as available, but in any event not later than forty-five (45) days after the end of each fiscal quarter, a report (the “Intellectual Property Report”) certified to by a Responsible Officer as being true and correct, listing all (i)
registered patents, trademarks and copyrights acquired or otherwise obtained by any Party during the prior fiscal quarter, (ii) all applications made for registration of patents, trademarks or copyrights during the prior fiscal quarter by any Party
and (iii) all new licenses agreements, or amendments to existing license agreements to or by any Party relating to any intellectual property entered into during the prior fiscal quarter. Copies of all such license agreements shall be attached as an
exhibit to the Intellectual Property Report; and 
  
 (c) as soon
as available, but in any event not later than thirty (30) days after the end of each month commencing with the first full month after the date hereof, internally prepared unaudited Consolidated and Consolidating balance sheets of the Parties as at
the end of such 

  

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month and the related unaudited statements of income, stockholders equity and cash flows of the Parties for the portion of the fiscal year through the end of
such fiscal month, setting forth in each case in comparative form (i) the figures for the corresponding periods in the previous year and (ii) the figures for the relevant period set forth in the projections delivered for such year pursuant to
Section 4.2(d), and certified by a Responsible Officer as being fairly stated in all material respects and attaching a schedule of outstanding Funded Debt (other than Debt under the Senior Credit Facility or the loan evidenced hereby) of the Parties
describing in reasonable detail for each debt issue or loan outstanding the principal amount and amount of accrued interest with respect to each such debt issue or loan; and 
  
 all such financial statements to be complete and correct in all material respects and to be prepared in reasonable detail and in accordance
with GAAP throughout the periods reflected therein and with prior periods (except as approved by such officer and disclosed therein), provided however that the financial statements delivered pursuant to clauses (b) and (c) hereof will not be
required to include footnotes and will be subject to year-end adjustments. 
  
 4.2 Certificates; Other Information. Furnish to Lender: 
  
 (a) Within thirty (30) days after and as the end of each fiscal quarter, a Covenant Compliance Report in form reasonably satisfactory to Lender.

  
 (b) Promptly upon receipt thereof, Borrower shall deliver
copies of all final significant reports submitted by the Parties’ firm of certified public accountants in connection with each annual, interim or special audit or review of any type of the financial statements or related internal control
systems of the Parties made by such accountants, including any comment letter submitted by such accountants to management in connection with their services; 
  
 (c) Any other financial reports, statements, press releases or any other material information delivered to the holders of the Senior Credit Facility
pursuant to the Senior Credit Facility documents (to the extent not otherwise required hereunder), as and when delivered to such Persons; 
  
 (d) Not later than October 31st of any year, Borrower shall prepare and deliver to Lender projections of Borrower and its Subsidiaries for the next
succeeding fiscal year, on a month to month basis, including a balance sheet, income instatement and statement of cash flows as at the end of each relevant period and for the period commencing at the beginning of the fiscal year and ending on the
last day of such relevant period; and 
  
 (e) Promptly and in form
to be reasonably satisfactory to Lender, such additional financial and/or other information, or other reports as Lender may from time to time reasonably request. 
  
 Borrower shall furnish to Lender from time to time, such additional schedules, certificates and reports respecting all or any of the
Collateral, the items or amounts received by the Parties in full or partial payment thereof, and any goods (the sale or lease of which shall have given rise to any of the Collateral) possession of which has been obtained by the Parties, all to such
extent as Lender may reasonably request. Any such schedule, certificate or report shall be certified as accurate by a Responsible Officer and shall be in such form and detail as Lender may reasonably specify. 
  

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 4.3 Payment of Obligations. Pay, discharge or otherwise satisfy, at or before maturity or before
they become delinquent, as the case may be, all of its material obligations of whatever nature, except where the amount or validity thereof is currently being contested in good faith by appropriate proceedings and reserves in conformity with GAAP
with respect thereto have been provided on the books of the Parties. 
  
 4.4 Conduct of Business and Maintenance of Existence; Compliance with Laws. 
  
 (a) Continue to engage (whether through Subsidiaries or otherwise) in the business as substantially now conducted by the Parties and businesses related thereto; and preserve, renew and keep in full force and effect
its existence, except as otherwise permitted pursuant to Sections 5.4 and 5.5, and in the case of Borrower, continue to be solely a holding company and not acquire any material operating or other assets, other than shares of stock or membership or
other equity interest in the Parties; 
  
 (b) take all reasonable
action it deems necessary in its reasonable business judgment to maintain all rights, privileges and franchises necessary in the normal conduct of its business except as otherwise permitted pursuant to Section 5.5 or where the failure to so maintain
would not reasonably be expected to have a Material Adverse Effect; and 
  
 (c) comply with all Contractual Obligations and Requirements of Law (as defined in the Senior Credit Agreement), except to the extent that failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect. 
  
 4.5 Maintenance of Property; Insurance.
Keep all material property it deems, in its reasonable business judgment, useful and necessary in its business in working order (ordinary wear and excepted), except where the failure to maintain such property could not reasonably be expected to have
a Material Adverse Effect and maintain insurance coverage on its physical assets and against other business risks in such amounts and of such types as are customarily carried by companies similar in size and nature (including without limitation
casualty and public liability and property damage insurance), and in the event of acquisition of additional property, real or personal, or of incurrence of additional risks of any nature, increase such insurance coverage in such manner and to such
extent as prudent business judgment and present practice or any applicable Requirements of Law would dictate; and in the case of all policies covering any Collateral, all such insurance policies shall provide that the loss payable thereunder shall
be payable to such Party, and to Lender (as mortgagee, or, in the case of personal property interests, lender loss payee) as their respective interests may appear, and certificates evidencing such policies, including all endorsements thereto, to be
deposited with Lender upon its request. 
  
 4.6 Inspection of
Property; Books and Records, Discussions. Permit Lender, through its authorized attorneys, accountants and representatives (a) at all reasonable times during normal business hours, upon the request of Lender, to examine each Party’s books,
accounts, records, ledgers and assets and properties of every kind and description wherever located; (b) at any time and from time to time, upon the request of Lender, to conduct full or partial collateral audits of the Parties to be completed by an
appraiser as may be selected by Lender and consented to by 

  

 12 

 
Borrower (such consent not to be unreasonably withheld), with all reasonable costs and expenses of such audits to be reimbursed by Borrower, provided that,
so long as no Default or Event of Default has occurred and is continuing, Borrower shall not be obligated to reimburse Lender for more than two (2) such audits in any calendar year and provided further that Borrower shall be obligated to reimburse
Lender for all collateral audits performed after the occurrence and during the continuance of a Default or an Event of Default; and (c) permit Lender or its authorized representatives, at reasonable times to visit all of their respective offices,
discuss their respective financial matters with their respective officers and independent certified or chartered public accountants, as applicable, and, by this provision, Borrower authorizes such accountants to discuss the finances and affairs of
any Party (provided that Borrower is given an opportunity to participate in such discussions) and examine any of its or their books and other corporate records. 
  

4.7 Notices. Promptly give notice to Lender of: 
  
 (a) the occurrence of any Default or Event of Default of which any Party has knowledge; 
  
 (b) any (i) litigation, investigation or proceeding which may exist at any time between any Party and any Governmental
Authority or other third party, which in either case, if not cured or if it is reasonably likely to be adversely determined, as the case may be, would have a Material Adverse Effect or (ii) any adverse change in the financial condition of any Party
since the date of the last audited financial statements delivered pursuant to Section 4.1(a) hereof which could reasonably be expected to have a Material Adverse Effect; 
  
 (c) any event which any Party believes could reasonably be expected to have a Material Adverse Effect; 
  
 (d) promptly after becoming aware of the taking by the Internal Revenue
Service or any foreign taxing jurisdiction of a written tax position (or any such tax position taken by any Party) which could reasonably be expected to have a Material Adverse Effect upon any Party setting forth the details of such position and the
financial impact thereof; 
  
 (e) provide prompt written notice to
Lender of (i) all jurisdictions in which any Party becomes qualified after the Effective Date to transact business, (ii) the acquisition or creation of any new Subsidiaries, and (iii) any material change after the Effective Date in the authorized
and issued Capital Stock of any Party or any other material amendment to their charter, by-laws or other organizational documents, such notice, in each case, to identify the applicable jurisdictions, capital structures or amendments as applicable;
and 
  
 (f) concurrently with the delivery thereof, any written
notices to the holders of the Senior Credit Facility (in their capacity as holders of such debt). 
  
 Each notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer setting forth details of the occurrence referred to therein and stating what action the Borrower has taken or proposes
to take with respect thereto. 
  

 13 

 4.8 Hazardous Material Laws. (a) Use and operate all of its facilities and properties in material
compliance with all applicable Hazardous Material Laws, keep all required material permits, approvals, certificates, licenses and other authorizations required under such Hazardous Material Laws in effect and remain in material compliance therewith,
and handle all Hazardous Materials in material compliance with all applicable Hazardous Material Laws, in each case, except where the failure to do so would not reasonably be expected to have a Material Adverse Effect; 
  
 (b) Promptly notify Lender and provide copies upon receipt of all written
claims, complaints, notices or inquiries received by any Party of a material nature relating to its facilities and properties or compliance with Hazardous Material Laws which, if adversely determined, could reasonably be expected to have a Material
Adverse Effect and shall promptly cure and have dismissed with prejudice to the satisfaction of Lender any actions and proceedings relating to compliance with Hazardous Material Laws to which any Party is named a party, other than such actions or
proceedings being contested in good faith and with the establishment of reasonable reserve; 
  
 (c) To the extent necessary to materially comply with Hazardous Material Laws, remediate or monitor contamination arising from a release or disposal of Hazardous Material; and 
  
 (d) Provide such information and certifications which Lender may reasonably
request from time to time to evidence compliance with this Section 4.8. 
  
 4.9 Fixed Charge Coverage Ratio. From and after repayment of the Senior Credit Facility and termination of the “Revolving Credit Aggregate Commitment” thereunder, maintain a Fixed Charge Coverage Ratio (as defined in the
Senior Credit Agreement) for each fiscal quarter (commencing with the quarter including September 30, 2003) of not less than 1.25 to 1.00. 
  
 4.10 Senior Leverage Ratio. From and after full repayment of the Senior Credit Facility and termination of the “Revolving Credit Aggregate
Commitment” thereunder, maintain a Senior Leverage Ratio (as defined in the Senior Credit Agreement) for each fiscal quarter ending during the periods specified below of not more than the following amounts during the periods specified below:

  

	 Period

	  	Ratio

	 September 30, 2003 through December 31, 2003
	  	2.00 to 1.00
		
	 January 1, 2004 through December 31, 2004
	  	1.50 to 1.00

  

 14 

 4.11 Total Leverage Ratio. From and after full repayment of the Senior Credit Facility and
termination of the “Revolving Credit Aggregate Commitment” thereunder, maintain as of the end of each fiscal quarter during the periods specified below, of not more than the following amounts during the periods specified below: 

 

	 Period

	  	Ratio

	 September 30, 2003 through December 31, 2003
	  	3.00 to 1.00
		
	 January 1, 2004 through March 31, 2004
	  	2.75 to 1.00

  
 4.12 Current
Ratio. From and after full repayments of the Senior Credit Facility and termination of the “Revolving Credit Aggregate Commitment” thereunder, maintain as of the end of each fiscal quarter during the periods specified below, a Current
Ratio (as defined in the Senior Credit Agreement) of not less than 1.00 to 1.00. 
  
 4.13 Minimum Tangible Net Worth. From and after full repayment of the Senior Credit Facility and termination of the “Revolving Credit Aggregate Commitment” thereunder, maintain a Minimum Tangible Net
Worth (as defined in the Senior Credit Agreement), as specified by Lender to the Borrower in writing following receipt by Lender of the Post-Closing Balance Sheet as described in Section 4.20 hereof. 
  
 4.14 Minimum Liquidity and Minimum EBITDA. 
  
 (a) From and after full repayment of the Senior Credit Facility and
termination of the “Revolving Credit Aggregate Commitment” thereunder, maintain a minimum Liquidity (as defined in the Senior Credit Agreement) of $13,500,000. 
  
 (b) From and after full repayment of the Senior Credit Facility and termination of the “Revolving Credit Aggregate
Commitment” thereunder, maintain a minimum EBITDA as of the end of each fiscal quarter of Borrower ending during the periods specified below; of not less than the following amounts during the periods specified below: 
  

	 Period

	  	Ratio

	 January 1, 2004 through March 31, 2004
	  	$	27,000,000
		
	 April 1, 2004 through June 30, 2004
	  	$	29,000,000

  
 4.15 Governmental
and Other Approvals. Apply for, obtain and/or maintain in effect, as applicable, all authorizations, consents, approvals, licenses, qualifications, exemptions, filings, declarations and registrations (whether with any court, governmental agency,
regulatory authority, securities exchange or otherwise) which are necessary in connection with the execution, delivery and performance by any Party, of this Agreement, the other Loan 

  

 15 

 
Documents, or any other documents or instruments to be executed and/or delivered by any Party, as applicable in connection therewith or herewith, except
where the failure to so apply for, obtain or maintain could not reasonably be expected to have a Material Adverse Effect. 
  
 4.16 Compliance with ERISA; ERISA Notices. (a) Comply in all material respects with all applicable requirements imposed by ERISA as presently in
effect or hereafter promulgated or the Internal Revenue Code, including, but not limited to, the minimum funding requirements of any Pension Plan, except where the failure to comply could not reasonably be expected to have a Material Adverse Effect.

  
 (b) Promptly notify Lender upon the occurrence of any of the
following events if such event could reasonably be expected to have a Material Adverse Effect: 
  
 (i) the termination, other than a standard termination, as defined in ERISA, of any Pension Plan subject to Subtitle C of Title IV of ERISA by any Party;

  
 (ii) any Party’s receipt of notice of the appointment of
a trustee by a United States District Court to administer any Pension Plan subject to Title IV of ERISA; 
  
 (iii) any Party’s receipt of notice of the commencement by the Pension Benefit Guaranty Corporation, or any successor thereto, of any proceeding to
terminate any Pension Plan subject to Title IV of ERISA; 
  
 (iv)
the failure of any Party to make any payment in respect of any Pension Plan required under Section 412 of the Internal Revenue Code; 
  
 (v) the withdrawal of any Party from any Multiemployer Plan if Borrower reasonably believes that such withdrawal would give rise to the imposition of
withdrawal liability with respect thereto; or 
  
 (vi) the
occurrence of (i) a “reportable event” which is required to be reported by a Party under Section 4043 of ERISA as defined in ERISA other than any event for which the reporting requirement has been waived by the PBGC or (ii) a
“prohibited transaction” as defined in Section 406 of ERISA or Section 4975 of the Internal Revenue Code other than a transaction for which a statutory exemption is available or an administrative exemption has been obtained. 
  
 4.17 Security. Take such actions as Lender may from time to time
reasonably request to establish and maintain first perfected security interests in and Liens on all of its Collateral (including machinery, equipment, inventory and other assets owned any domestic Party and located in Mexico) subject only to
Permitted Liens and other Liens permitted under Section 5.2 hereof. 
  
 4.18 Defense of Collateral. Defend the Collateral from any Liens other than Liens permitted by Section 5.2. 
  

 16 

 4.19 Future Subsidiaries; Additional Collateral. 
  
 (a) With respect to each Person which is or becomes a Subsidiary of Borrower
(directly or indirectly) on or subsequent to the Effective Date, within thirty (30) days of the date such Person becomes a Subsidiary, cause such Subsidiary to execute and deliver to Lender (x) a Guaranty in form and substance satisfactory to Lender
pursuant to which such Subsidiary guarantees all of the Indebtedness and (y) a Security Agreement in form and substance satisfactory to Lender securing all obligations of such Subsidiary under the Guaranty; 
  
 (b) With respect to real property located in the United States owned, leased
or otherwise acquired by any Party after the Effective Date, not later than sixty (60) days after such property is acquired, such Party shall execute or cause to be executed (unless waived by Lender) (i) in the case of real property owned by a
Party, a Mortgage covering such owned real property so long as such real property has an appraised value of greater than $100,000 (such mortgage to be subordinated to any Mortgage granted to secure the Senior Credit Facility) and (ii) in the case of
real property leased by a Party, a lessor’s acknowledgment and consent in form and substance reasonably acceptable to Lender so long as Collateral with an appraised value of greater than $100,000 is located on such leased property, together
with such real estate documentation and environmental reports and audits as may be required by Lender in its sole discretion, provided, further, if a Default or Event of Default has occurred and is continuing, the applicable Party shall execute or
cause to be executed a Mortgage or lessor’s acknowledgement and consent, as applicable, irregardless of the appraised value of the real property or Collateral, and deliver such Mortgage or lessor’s acknowledgment to Lender together with
such real estate documentation as may be required by Lender, in its sole discretion; 
  
 in each case in form reasonably satisfactory to Lender, in its reasonable discretion, together with such supporting documentation, including without limitation corporate authority items, certificates and opinions of counsel, as reasonably
required by Lender and the Parties shall take, or cause to be taken, such steps as are necessary or advisable under applicable law to perfect the liens contemplated by this Section 4.19. 
  
 4.20 Post-Closing Balance Sheet. Within sixty (60) days after the date hereof deliver to Lender a post-closing
balance sheet (“Post-Closing Balance Sheet”), such post-closing balance sheet to be true and correct in all material respects and certified by a Responsible Officer, and otherwise satisfactory in form and substance to Lender. 

 
 4.21 Further Assurances. Execute and deliver or cause to be
executed and delivered to Lender within a reasonable time following Lender’s request, and at Borrower’s expense, such other documents or instruments as Lender may reasonably require to effectuate more fully the purposes of this Agreement
or the other Loan Documents. 
  
 4.22 Senior Credit
Facility. Pay and perform all obligations of Borrower and its Subsidiaries under the Senior Credit Facility in a timely manner when due. 
  

 17 

 5. NEGATIVE COVENANTS. 
  

Borrower covenants and agrees that, until the Maturity Date and thereafter until final payment in full of the Indebtedness and the performance by
Borrower of all other obligations under this Agreement and the other Loan Documents, it will not, and it will not cause, allow or permit its Subsidiaries to: 
  
 5.1 Limitation on Debt. Create, incur, assume or suffer to exist any Debt, except: 
  
 (a) Indebtedness under this Agreement and the other Loan Documents; 
  
 (b) any Debt existing on the date hereof (including the Senior Credit
Facility) and any renewals, extensions or refinancing of such Debt in amounts not exceeding the scheduled principal amounts (less any required amortization according to the terms thereof), on substantially the same terms as in effect on the date
hereof and otherwise in compliance with this Agreement; 
  
 (c)
Debt of Borrower or any Subsidiary, excluding Debt otherwise permitted under this Section 5.1, incurred to finance the acquisition of fixed or capital assets (whether pursuant to a loan or a Capitalized Lease), provided that both at the time of and
immediately after giving effect to the incurrence thereof and the retirement of any Indebtedness which is concurrently being retired, (i) no Default or Event of Default shall have occurred and be continuing and (ii) the aggregate amount of all such
Debt shall not exceed $750,000 at any one time outstanding; 
  
 (d) Unsecured Funded Debt which has been subordinated in right of payment and priority to (i) the Senior Credit Facility on terms and conditions reasonably satisfactory to the Agent and the Majority Banks thereunder, and (ii) the terms of
the Indebtedness on terms and conditions reasonably satisfactory to Lender; 
  
 (e) Debt under any Hedging Transactions; 
  
 (f) Guarantee Obligations permitted under Section 5.3 or any other Loan Document; 
  
 (g) current unsecured trade, utility or nonextraordinary accounts payable (including without limitation, operating leases and short term Debt owed to
vendors) arising in the ordinary course of Borrower’s or such Subsidiaries’ businesses; 
  
 (h) Debt in respect of taxes, assessments or governmental charges to the extent that payment thereof shall not at the time be required to be made in
accordance with Section 4.3; 
  
 (i) Debt arising from judgments
or decrees in circumstances not constituting an Event of Default under Section 6.1; 
  
 (j) Intercompany Loans, but only to the extent permitted under Section 5.8 hereof; 
  
 (k) Non-current liabilities for post-employment healthcare and other insurance benefits; 
  
 (l) Debt secured by Permitted Liens; 
  

 18 

 (m) Additional unsecured Debt not otherwise described above, provided that both at the time of and
immediately after giving effect to the incurrence thereof and after giving effect to retirement of any Indebtedness which is concurrently being retired (i) no Default or Event of Default shall have occurred and be continuing and (ii) the aggregate
amount of all such Debt shall not exceed $500,000 at any one time outstanding; 
  
 (n) Debt incurred in the ordinary course of business with respect to surety and appeal bonds, performance and return-of-money bonds and other similar obligations, all in the ordinary course of business in accordance
with customary industry practices, in amounts and for the purposes customary in the Borrower’s industry; 
  
 (o) Debt under the “Holdings Note” described in the Senior Credit Agreement, provided, however, that payments of principal on the Holdings Note
shall be made solely as permitted in the Senior Credit Agreement; and 
  
 (p) Debt incurred under Sections 5.1(b), (c), (i) and (m) may not exceed $2,000,000 in the aggregate at any one time outstanding. 
  
 5.2 Limitation on Liens. Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except for: 
  
 (a) Permitted Liens;

  
 (b) Liens securing Debt permitted by Section 5.1(c), provided
that (i) such Liens shall be created substantially simultaneously with the acquisition of such fixed or capital asset, (ii) such Liens do not at any time encumber any property other than the property, equipment or improvements financed by such Debt,
and (iii) the principal amount of Debt secured by any such Lien shall at no time exceed 100% of the original purchase price of such property, equipment or improvements and related costs and charges imposed by the vendors thereof; 
  
 (c) Liens in favor of Lender, as security for the Indebtedness; 

 
 (d) attachments, judgments and other similar Liens (other than any
judgment that constitutes an Event of Default under Section 6.1), arising in connection with court proceedings, provided that the execution or other enforcement of such Liens is effectively stayed and claims secured thereby are being actively
contested in good faith by appropriate proceedings; 
  
 (e) other
Liens, existing on the Effective Date, set forth on Schedule 8.2 attached to the Senior Credit Agreement and renewals, refinancings and extensions thereof on substantially the same terms as in effect on the Effective Date and otherwise in compliance
with this Agreement; 
  
 (f) Liens arising from precautionary UCC
financing statements regarding operating leases; 
  
 (g) Liens
granted to Lender or other financial institutions in the ordinary course of business in connection with, and which solely encumber, deposit, disbursement or concentration accounts (other than in connection with borrowed money) maintained with such
Lender or financial institutions on funds and other items in such accounts; 
  

 19 

 (h) deposits made in the ordinary course of business to secure liabilities to insurance carriers;

  
 (i) any interest of title to a lessor or a sub-lessor under
any lease; and 
  
 (j) Liens in favor of the Agent as security for
the obligations of Borrower and its Subsidiaries under the Senior Credit Facility. 
  
 5.3 Limitation on Guarantee Obligations. Create, incur, assume or suffer to exist any Guarantee Obligation except (a) the Guaranty, (b) Guarantee Obligations by Borrower or any Subsidiary in respect of Debt
incurred by Borrower or any Guarantor, as the case may be, in compliance with this Agreement, (c) Guarantee Obligations of Borrower or its Subsidiaries in respect of the Subordinated Debt (provided that such Guarantee Obligations are subordinated to
the Indebtedness on terms acceptable to Lender), (d) Guarantee Obligations existing on the date hereof, (e) Guarantee Obligations arising pursuant to the RAI Merger Documents and the Merger Documents or with respect to customary indemnification and
purchase price adjustment obligations incurred in connection with any sale or disposition of assets, (f) Guarantee Obligations incurred in the ordinary course of business with respect to surety and appeal bonds, performance and return-of-money bonds
and similar obligations provided that the aggregate amount of such Guarantee Obligations does not exceed $250,000 in the aggregate, and (g) Guarantee Obligations arising under indemnity agreements to title insurers to cause such title insurer to
issue to Lender mortgagee title insurance policies. 
  
 5.4
Acquisitions. Purchase or otherwise acquire or become obligated for the purchase of all or substantially all or any material portion of the assets or business interests of any Person, firm or corporation, or any shares of stock (or other
ownership interests) of any corporation, trusteeship or association, or any business or going concern, or in any other manner effectuate or attempt to effectuate an expansion of present business by acquisition. 
  
 5.5 Limitation on Mergers, other Fundamental Changes or Sale of
Assets. Enter into any merger or consolidation or convey, sell, lease, assign, transfer or otherwise dispose of any of its property, business or assets (including, without limitation, receivables and leasehold interests), whether now owned or
hereafter acquired or make any material change in its capital structure or present method of conducting business, except: 
  
 (a) inventory leased or sold in the ordinary course of business; 
  

(b) the disposition of obsolete or worn out property or equipment, or property or equipment no longer useful in the conduct of Borrower’s or any
Subsidiary’s business; 
  
 (c) the Merger and the RAI Merger;

  
 (d) mergers or consolidations of any domestic Subsidiary with
or into the Borrower or any Guarantor (so long as the Borrower or such Guarantor shall be the continuing or surviving entity); provided that at the time of each such merger or consolidation, both before and after giving effect thereto, no Default or
Event of Default shall have occurred and be continuing; 
  

 20 

 (e) any Subsidiary may liquidate or dissolve into Borrower if Borrower determines in good faith that such
liquidation or dissolution is in the best interests of the Borrower; 
  
 (f) sales or transfers, including upon voluntary liquidation (other than sales or transfers of stock or other ownership interests) (i) between Borrower and any Guarantor or (ii) from any Subsidiary to Borrower or any Guarantor; 

 
 (g) Asset Sales in which the sales price is at least the fair market value
of the assets sold and the consideration received is cash and where the aggregate amount of such Asset Sales does not exceed $100,000 in any fiscal year and (ii) other Asset Sales approved by Lender in its sole discretion; 
  
 (h) the sale or disposition of Permitted Investments and other cash
equivalents in the ordinary course of business; and 
  
 (i)
dispositions of owned or leased vehicles in the ordinary course of business. 
  
 5.6 Restricted Payments. Declare or make, or permit any Subsidiary, to, declare or make any distributions, dividend, payment or other distribution of assets, properties, cash, rights, obligations or securities
(collectively, “Distributions”) on account of any of its Capital Stock, as applicable, or purchase, redeem or otherwise acquire for value any Capital Stock, as applicable, or any warrants, rights or options to acquire such shares or
membership interests, now or hereafter outstanding (collectively, “Purchases”), except that: 
  
 (a) the Parties may make Distributions to Borrower; 
  
 (b) Borrower may accrue, but not pay, dividends on its Capital Stock; and 
  
 (c) the Parties may declare and make dividends to their respective shareholders payable solely in shares of that class of
stock held by such shareholders. 
  
 Distributions permitted by
Sections (b) -(c) above shall not be made while a Default or Event of Default shall have occurred and is continuing. 
  
 5.7 Limitation on Capital Expenditures. Make or commit to make (by way of the acquisition of securities of a Person or otherwise) any expenditure
in respect of the purchase or other acquisition of fixed or capital assets (excluding any such asset acquired in connection with normal replacement and maintenance programs properly charged to current operations) except for Capital Expenditures, the
amount of which in any fiscal year shall not exceed the amounts indicated on Schedule 8.7 to the Senior Credit Agreement on the date hereof. 
  
 5.8 Limitation on Investments, Loans and Advances. Make or allow to remain outstanding any Investment (whether such investment shall be of the
character of investment in shares of stock, evidences of indebtedness or other securities or otherwise) in, or any loans or advances to, any Person, firm, corporation or other entity or association, other than: 
  
 (a) Permitted Investments; 
  

 21 

 (b) Investments existing on the Effective Date and listed on Schedule 8.8 of the Senior Credit Agreement
on the date hereof; 
  
 (c) extensions of trade credit in the
ordinary course of business; 
  
 (d) Intercompany Loans, Advances
or Investments made on or after the Effective Date by Borrower or Guarantor to Borrower or any Guarantor, provided that any Intercompany Loan hereunder shall be evidenced by and funded under an Intercompany Note encumbered pursuant to the
appropriate Collateral Document, and provided further that at the time any such loan, advance or investment is made (both before and after giving effect thereto), no Default or Event of Default has occurred and is continuing; 
  
 (e) Investments in respect of Hedging Transactions; 
  
 (f) Investments received in connection with the bankruptcy or reorganization
of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case in the ordinary course of business; 
  
 (g) loans and advances to employees, officers and directors of Borrower or any Guarantor in connection with equity incentive arrangements after the date
hereof, provided that the proceeds of such loans and advances are paid to Borrower or Guarantor, as applicable, in connection with such equity incentive arrangements; and provided further that both at the time of and immediately after giving effect
to any such Investment, (i) no Default or Event of Default shall have occurred and be continuing and (ii) the aggregate amount of such Investment shall not exceed $500,000 over the term of this Agreement; 
  
 (h) Investments constituting deposits made in connection with the purchase of
goods or services in the ordinary course of business such deposits to be within normal commercial standards and not to exceed $750,000 in the aggregate; and 
  
 (i) Investments consisting of loans and advances to employees for moving, entertainment, travel and other similar expenses in the ordinary course of
business not to exceed $750,000 in the aggregate at any time outstanding. 
  
 (j) Other Investments not described above provides that at the time of making such Investment and immediately after giving effect to such Investment no Default or Event of Default shall have occurred and be continuing
and the aggregate amount of all such Investments shall not exceed $750,000 over the term of this Agreement. 
  
 In valuing any Investments for the purpose of applying the limitations set forth in this Section 5.8 (except as otherwise expressly provided herein), such
Investment shall be taken at the original cost thereof, without allowance for any subsequent write-offs or appreciation or depreciation, but less any amount repaid or recovered on account of capital or principal. 
  

 22 

 5.9 Transactions with Related Parties. Except as set forth in Schedule 8.9 to the Senior Credit
Agreement, enter into any transaction, including, without limitation, any purchase, sale, lease or exchange of property or the rendering of any service, with any Related Parties of the Parties except (a) transactions otherwise permitted under this
Agreement (including, without limitation, pursuant to Section 5.15 hereof); (b) transactions in the ordinary course of a Party’s business and upon fair and reasonable terms no less favorable to such Party than it would obtain in a comparable
arms length transaction from unrelated third parties and disclosed in writing to Lender on an annual basis. 
  
 5.10 Sale and Leaseback. Enter into any arrangement with any Person providing for the leasing by a Party of real or personal property which has
been or is to be sold or transferred by such Party to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of such Party, as the case may be.

  
 5.11 Limitation on Negative Pledge Clauses. After the
date hereof, except for such agreements, documents or instruments which are in effect on the date hereof and which are set forth on Schedule 8.11 to the Senior Credit Agreement, enter into any agreement, document or instrument which would (i)
restrict or prevent the Parties from granting Lender Liens upon their respective assets which are senior in priority to all other Liens, except for the Permitted Liens and Liens permitted by Section 5.2 and any other agreements, documents or
instruments pursuant to which Liens not prohibited by the terms of this Agreement are created, entered into, or allowed to exist (but limited to the property encumbered by such Lien) and customary anti-assignment provisions contained in leases or
licensing agreements entered into by any such Person (as lessee) in the ordinary course of business, or (ii) enter into any agreement, contract or arrangement (excluding this Agreement and the other Loan Documents) restricting the ability of any
Subsidiary of Borrower to pay or make dividends or distributions in cash or kind to Borrower or Guarantor, to make loans, advances or other payments of whatever nature to any Party, or to make transfers or distributions of all or any part of its
assets to any Party. 
  
 5.12 Prepayment of Debts. Prepay,
purchase, redeem or defease any Debt for money borrowed or any Capitalized Leases other than (i) payments (including prepayments) of the Senior Credit Facility and the Holdings Note and (ii) payments under this facility. 
  
 5.13 Intentionally Omitted. 
  
 5.14 Modification of Certain Agreements. (a) Make, permit or consent
to any amendment or other modification to the constitutional documents of the Parties, the RAI Merger Documents or the Merger Documents except to the extent that any such amendment or modification (i) does not violate the terms and conditions of
this Agreement or any of the other Loan Documents, (ii) does not materially adversely affect the interest of the Banks as creditors under this Agreement, the other Loan Documents or any other document or instrument delivered in connection therewith
in any respect and (iii) could not reasonably be expected to have a Material Adverse Effect, and (b) without the written consent of Lender (i) amend, permit or consent to the amendment of the Samsung License Agreement (as defined in the Senior
Credit Agreement) prior to the Samsung License Maturity Date (as defined in the Senior Credit Agreement) if as a result of such amendment the cumulative royalties that would reasonably be 

  

 23 

 
expected to be received on or before June 30, 2007, under the Samsung License, as amended, are less that the projected cumulative royalty payments (as set
forth on Schedule 8.14 attached to the Senior Credit Agreement) to be received from the date of such amendment to the Samsung License Maturity Date, or (ii) terminate, or consent to the termination of the Samsung License Agreement prior to the
Samsung License Maturity Date. 
  
 5.15 . Intentionally
Omitted. 
  
 5.16 Fiscal Year. Permit the fiscal year
of any Party to end on a day other than December 31. 
  
 5.17
Lease Obligations. Enter into, assume or permit to exist any obligations for the payment of rent under operating leases and real property leases in excess, in the aggregate of $500,000 in any fiscal year, except as described on Schedule 8.17
attached to the Senior Loan Agreement, provided, further, that any operating and real property lease agreements which require rent payments in excess of $500,000 in any fiscal year which are entered into after the Effective Date shall be subject to
the review and approval of the Majority Lender, in their reasonable discretion. 
  
 6. DEFAULTS 
  
 6.1 Events of Default. The
occurrence of any of the following events shall constitute an Event of Default hereunder: 
  
 (a) non-payment when due of principal, interest or any other sum owing hereunder or under any of the other Loan Documents; 
  
 (b) non-payment of any money by the Borrower under this Agreement or by any Party under any of the other Loan Documents to which it is a party, other than
as set forth in subsection (a) above, within three (3) Business Days after notice from Agent that the same is due and payable; 
  
 (c) default in the observance or performance of any of the conditions, covenants or agreements of Borrower set forth in Sections 4.1 through 4.6,
inclusive, 4.7(a), (b), (c) and (e), 4.8, 4.9 through 4.14, inclusive, 4.16 through 4.20, inclusive or 5 in its entirety, provided that an Event of Default arising from a breach of Sections 4.1(a) through (c) or 4.2(a) through (e) shall be deemed to
have been cured upon delivery of the required item; and provided further that any Event of Default arising solely due to a breach of Section 4.7(a) shall be deemed cured upon the earlier of (i) the giving of the notice required by Section 4.7(a) and
(ii) the date upon which the Default or event of Default giving rise to the notice obligation is cured or waived; 
  
 (d) default in the observance or performance of any of the other conditions, covenants or agreements set forth in this Agreement or any of the other Loan
Documents by any Party and continuance thereof for a period of thirty (30) consecutive days; 
  
 (e) any default in the observance or performance of any of the conditions, covenants or agreements set forth in this Agreement or any of the other Loan Documents; 
  

 24 

 (f) any representation or warranty made by any Party herein or in any instrument submitted pursuant
hereto proves untrue or misleading in any material adverse respect when made; 
  
 (g) [Intentionally Omitted]; 
  
 (h) the rendering of any judgment(s) for the payment of money in excess of the sum of One Hundred Thousand Dollars ($100,000) (or the equivalent thereof in any currency other than Dollars) individually or in the aggregate against any Party,
and such judgments shall remain unpaid, unvacated, unbonded or unstayed by appeal or otherwise for a period of thirty (30) consecutive days, except as covered by adequate insurance with a reputable carrier as to which the relevant insurance company
has acknowledged coverage; 
  
 (i) Borrower shall be dissolved
(other than a technical dissolution of a Subsidiary which is cured within 30 days of notice thereof) or liquidated (or any judgment, order or decree therefor shall be entered) except as otherwise permitted herein; or if a creditors’ committee
shall have been appointed for the business of Borrower; or if Borrower shall have made a general assignment for the benefit of creditors or shall have been adjudicated bankrupt and if not an adjudication based on a filing by Borrower, it shall not
have been dismissed within sixty (60) days, or shall have filed a voluntary petition in bankruptcy or for reorganization or to effect a plan or arrangement with creditors or shall fail to pay its debts generally as such debts become due in the
ordinary course of business (except as contested in good faith and for which adequate reserves are made in such party’s financial statements); or shall file an answer to a creditor’s petition or other petition filed against it, admitting
the material allegations thereof for an adjudication in bankruptcy or for reorganization; or shall have applied for or permitted the appointment of a receiver or trustee or custodian for any of its property or assets; or such receiver, trustee or
custodian shall have been appointed for any of its property or assets (otherwise than upon application or consent of Borrower) and shall not have been removed within sixty (60) days; or if an order shall be entered approving any petition for
reorganization of Borrower and shall not have been reversed or dismissed within sixty (60) days; or Borrower shall take any action (corporate or other) authorizing or in furtherance any of the actions described above in this subsection; or

  
 (j) any Loan Document shall at any time for any reason cease
to be valid, binding and enforceable against any party thereto (other than in accordance with the terms thereof), as applicable, or the validity, binding effect or enforceability thereof shall be contested by any party thereto, or such Person shall
deny that it has any or further liability or obligation under any Loan Document, or any such Loan Document shall be terminated (other than in accordance with the terms thereof), invalidated, revoked or set aside or in any way cease to give or
provide to Lender the benefits purported to be created thereby. 
  
 6.2 Exercise of Remedies. If an Event of Default has occurred and is continuing hereunder Lender may exercise any remedy permitted by law or at equity (subject to the terms and conditions of the AV Subordination Agreement).

  
 6.3 Rights Cumulative. No delay or failure of Lender in
exercising any right, power or privilege hereunder shall affect such right, power or privilege, nor shall any single or partial 

  

 25 

 
exercise thereof preclude any further exercise thereof, or the exercise of any other power, right or privilege. The rights of Lender under this Agreement are
cumulative and not exclusive of any right or remedies which Lender would otherwise have. 
  
 6.4 Waiver by Borrower of Certain Laws. To the extent permitted by applicable law, the Borrower hereby agrees to waive, and do hereby absolutely and irrevocably waive and relinquish the benefit and advantage of
any valuation, stay, appraisement, extension or redemption laws now existing or which may hereafter exist, which, but for this provision, might be applicable to any sale made under the judgment, order or decree of any court, on any claim for
interest due, or any security interest or mortgage contemplated by or granted under or in connection with this Agreement. These waivers have been voluntarily given, with full knowledge of the consequences thereof. 
  
 6.5 Waiver of Defaults. No Event of Default shall be waived by Lender
except in a writing. No single or partial exercise of any right, power or privilege hereunder, nor any delay in the exercise thereof, shall preclude other or further exercise of rights by Lender. No waiver of any Event of Default shall extend to any
other or further Event of Default. No forbearance on the part of Lender in enforcing any of its rights shall constitute a waiver of any of its rights. 
  
 7. MISCELLANEOUS 
  
 7.1 Law of Texas. This Agreement and the other Loan Documents shall be governed by and construed and enforced in accordance with the laws of the
State of Texas (without regard to its conflict of laws provisions). Whenever possible each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement
shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

  
 7.2 Interest. In the event the obligation of Borrower
to pay interest on the principal balance of the loan evidenced hereby is or becomes in excess of the maximum interest rate which Borrower is permitted by law to contract or agree to pay, then, in that event, the rate of interest shall be deemed to
be immediately reduced to such maximum rate and all previous payments in excess of the maximum rate shall be deemed to have been payments in reduction of principal and not of interest. 
  
 7.3 Closing Costs. Borrower agrees to pay, or reimburse Lender for all reasonable closing costs and expenses.

  
 7.4 Notices. Except as expressly provided otherwise in
this Agreement, all notices and other communications provided to any party hereto under this Agreement or any other Loan Document shall be in writing and shall be given by personal delivery, by mail, by reputable overnight courier, by telex or by
facsimile and addressed or delivered to it at its address set forth on the signature pages hereof or at such other address as may be designated by such party in a notice to the other parties that complies as to delivery with the terms of this
Section. Any notice, if personally delivered or if mailed and properly addressed with postage prepaid and sent by registered or certified mail, shall be deemed given when received or when delivery is refused; 

  

 26 

 
any notice, if given to a reputable overnight courier and properly addressed, shall be deemed given two (2) Business Days after the date on which it was
sent, unless it is actually received sooner by the named addressee; and any notice, if transmitted by telex or facsimile, shall be deemed given when received (answer back confirmed in the case of telexes and receipt confirmed in the case of
telecopies). 
  
 7.5 Further Action. From time to time,
upon written request of Lender, Borrower shall make, execute, acknowledge and deliver or cause to be made, executed, acknowledged and delivered, all such further and additional instruments, and take all such further action as may reasonably be
required to carry out the intent and purpose of this Agreement or the Loan Documents, according to the intent and purpose herein and therein expressed. 
  
 7.6 Successors and Assigns; Participations; Assignments. 
  

(a) This Agreement shall be binding upon and shall inure to the benefit of Borrower and Lender and their respective successors and assigns. 

 
 (b) The foregoing shall not authorize any assignment by Borrower of its
rights or duties hereunder, and, except as otherwise provided herein, no such assignment shall be made (or effective) without the prior written approval of Lender. 
  
 7.7 Counterparts. This Agreement may be executed in several counterparts, and each executed copy shall constitute an
original instrument, but such counterparts shall together constitute but one and the same instrument. 
  
 7.8 Amendment and Waiver. No amendment or waiver of any provision of this Agreement or any other Loan Document, nor consent to any departure by any
Party therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto. 
  
 7.9 Taxes and Fees. Should any tax, recording or filing fee become payable in respect of this Agreement or any of the other Loan Documents or any
amendment, modification or supplement hereof or thereof (other than taxes measured on income), Borrower agrees to pay the same, together with any interest or penalties thereon arising from Borrower’s act or omission, and agrees to hold Lender
harmless with respect thereto. 
  
 7.10 WAIVER OF JURY
TRIAL. BORROWER AND LENDER KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY RELATED INSTRUMENT OR AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY COURSE OF CONDUCT, DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTION OF ANY OF THEM. NEITHER BORROWER NOR LENDER SHALL SEEK TO CONSOLIDATE, BY COUNTERCLAIM OR OTHERWISE, ANY SUCH ACTION IN
WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THESE PROVISIONS SHALL NOT BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY LENDER EXCEPT BY A WRITTEN INSTRUMENT
EXECUTED BY LENDER. 
  

 27 

 7.11 Complete Agreement; Conflicts. This Agreement and the Loan Documents contain the entire
agreement of the parties hereto, superseding all prior agreements, discussions and understandings relating to the subject matter hereof, and none of the parties shall be bound by anything not expressed in writing. In the event of any conflict
between the terms of this Agreement and the other Loan Documents, this Agreement shall govern. 
  

 28 

 WITNESS the due execution hereof as of the day and year first above written. 
  

	AUSTIN VENTURES VII, L.P., a Delaware Limited Partnership
		
	By:	 	AV Partners VII, L.P.
	Its:	 	General Partner
		
	 By:
	 	 /s/ Joseph C. Aragona

	 	 	 Joseph C. Aragona

	 	 	 General Partner

	
	 Address for Notices:

	 c/o Austin Ventures

	 300 West Sixth Street, Suite 2300

	 Austin, Texas 78701

	 Attention: Chief Financial Officer

	 Facsimile No.: (512) 476-3952

  

	AUSTIN VENTURES VIII, L.P., a Delaware Limited Partnership
		
	By:	 	AV Partners VIII, L.P.
	Its:	 	General Partner
		
	 By:
	 	 /s/ Joseph C. Aragona

	 	 	 Joseph C. Aragona

	 	 	 General Partner

	
	 Address for Notices:

	 c/o Austin Ventures

	 300 West Sixth Street, Suite 2300

	 Austin, Texas 78701

	 Attention: Chief Financial Officer

	 Facsimile No.: (512) 476-3952

  
 SIGNATURE
PAGE TO LOAN AGREEMENT 

	STAKTEK HOLDINGS, INC., A Delaware corporation
		
	 By:
	 	 /s/ Joseph C. Aragona

	 	 	 Joseph C. Aragona

	 	 	 President

	
	 Address for Notices:

	 c/o Austin Ventures

	 300 West Sixth Street, Suite 2300

	 Austin, Texas 78701

	 Attention: Chief Financial Officer

	 Facsimile No.: (512) 476-3952

  
 SIGNATURE
PAGE TO LOAN AGREEMENTSecurity Agreement, dated August 19, 2003

 Exhibit 10.1.10 
  
 This Agreement has been subordinated to the terms of that certain Revolving Credit and Term Loan Agreement dated as of
August 19, 2003, by and among Staktek Holdings, Inc., SC Merger Sub, Inc., Research Applications, Inc., Comerica Bank as Agent (“Agent”) and the other financial institutions party thereto from time to time (the “Banks”), as the
same may be amended, restated or otherwise modified from time to time after the date hereof pursuant to the terms of that certain Subordination Agreement dated as of August 19, 2003, by and among Agent, the Banks, Austin Ventures VII, L.P. and
Austin Ventures VIII, L.P., as the same may be amended, restated or otherwise modified from time to time after the date hereof. 
  
 SECURITY AGREEMENT 
  
 THIS SECURITY AGREEMENT (the “Agreement”) is entered into as of August 19, 2003, by and among Staktek Holdings, Inc., a Delaware
corporation (“Debtor”) and Austin Ventures VII, L.P., a Delaware limited partnership, and Austin Ventures VIII, L.P., a Delaware limited partnership (collectively, “Lender”), with reference to the following facts:

  
 A. Debtor has entered into that certain Loan Agreement dated
as of August 19, 2003 (as amended, supplemented, amended and restated or otherwise modified from time to time the “Loan Agreement”) with Lender, to extend or financial accommodations to Borrower, as provided therein. 
  
 B. Pursuant to the Loan Agreement, Lender has required that Debtor grant (or
cause to be granted) certain liens and security interest to Lender, all to secure the obligations of the Borrower under the Loan Agreement. 
  
 NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the adequacy, receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows: 
  
 ARTICLE 1 
 Definitions 
  
 Section 1.1 Definitions. As used in this Agreement, capitalized terms not otherwise defined
herein have the meanings provided for such terms in the Loan Agreement. References to “Sections,” “subsections” and “Schedules” shall be to Sections, subsections and Schedules, respectively, of this Agreement unless
otherwise specifically provided. All references to statutes and regulations shall include any amendments of the same and any successor statutes and regulations. References to particular sections of the UCC should be read to refer also to parallel
sections of the Uniform Commercial Code as enacted in each state or other jurisdiction where any portion of the Collateral is or may be located. 
  

 1 

 The following terms have the meanings indicated below, all such definitions to be equally applicable to
the singular and plural forms of the terms defined: 
  
 “Account” means any “account,” as such term is defined in Article or Chapter 9 of the UCC, now owned or hereafter acquired by Debtor, and, in any event, shall include, without limitation, each of the following,
whether now owned or hereafter acquired by Debtor: (a) all rights of Debtor to payment for goods sold or leased or services rendered, whether or not earned by performance, (b) all accounts receivable of Debtor, (c) all rights of Debtor to receive
any payment of money or other form of consideration, (d) all security pledged, assigned or granted to or held by Debtor to secure any of the foregoing, (e) all guaranties of, or indemnifications with respect to, any of the foregoing, and (f) all
rights of Debtor as an unpaid seller of goods or services, including, but not limited to, all rights of stoppage in transit, replevin, reclamation and resale. 
  

“Business Day” has the meaning specified in the Loan Agreement. 
  
 “Chattel Paper” means any “chattel paper,” as such term is defined in Article or Chapter 9 of the
UCC, now owned or hereafter acquired by Debtor, and shall include electronic chattel paper and tangible chattel paper. 
  
 “Collateral” has the meaning specified in Section 2.1 of this Agreement. 
  
 “Computer Records” has the meaning specified in Section
2.1(i) of this Agreement. 
  
 “Copyright
Licenses” shall mean all license agreements with any other person in connection with any of the Copyrights or such other person’s copyrights, whether Debtor is a licensor or a licensee under any such license agreement, including,
without limitation, the license agreements listed on Schedule E hereto and made a part hereof, subject, in each case, to the terms of such license agreements and the right to prepare for sale, sell and advertise for sale, all
inventory now or hereafter covered by such licenses. 
  
 “Copyrights” shall mean all United States copyrights and mask works, whether or not registered, and all applications for registration of all copyrights and mask works, including, but not limited to all copyrights and mask
works, and all applications for registration of all copyrights and mask works identified on Schedule E attached hereto and made a part hereof, and including without limitation (a) the right to sue or otherwise recover for any
and all past, present and future infringements and misappropriations thereof; (b) all income, royalties, damages and other payments now and hereafter due and/or payable with respect thereto (including, without limitation, payments under all
Copyright Licenses entered into in connection therewith, and damages and payments for past or future infringements thereof); and (c) all rights corresponding thereto and all modifications, adaptations, translations, enhancements and derivative
works, renewals thereof, and all other rights of any kind whatsoever of Debtor accruing thereunder or pertaining thereto (Copyrights and Copyright Licenses being, collectively, the “Copyright Collateral”). 
  
 “Default” has the meaning specified in the Loan Agreement.

  
 “Deposit Account” shall mean a demand, time,
savings, passbook, or similar account maintained with a bank. The term does not include investment property, investment accounts or accounts evidenced by an instrument. 
  

 2 

 “Document” means any “document,” as such term is defined in Article or Chapter
9 of the UCC, now owned or hereafter acquired by Debtor, including, without limitation, all documents of title and all receipts covering, evidencing or representing goods now owned or hereafter acquired by Debtor. 
  
 “Equipment” means any “equipment,” as such term is
defined in Article or Chapter 9 of the UCC, now owned or hereafter acquired by Debtor and, in any event, shall include, without limitation, all machinery, equipment, furniture, trade fixtures, tractors, trailers, rolling stock, vessels, aircraft and
vehicles now owned or hereafter acquired by Debtor and any and all additions, substitutions and replacements of any of the foregoing, wherever located, together with all attachments, components, parts, equipment and accessories installed thereon or
affixed thereto. 
  
 “Event of Default” has the
meaning specified in the Loan Agreement. 
  
 “General
Intangibles” means any “general intangibles,” as such term is defined in Article or Chapter 9 of the UCC, now owned or hereafter acquired by Debtor and, in any event, shall include, without limitation, each of the following,
whether now owned or hereafter acquired by Debtor: (a) all of Debtor’s Patents, Patent Licenses, Copyrights, Copyright Licenses, Trademarks, Trademark Licenses, trade secrets, registrations, goodwill, franchises, permits, proprietary
information, customer lists, designs, inventions and all other intellectual property and proprietary rights, including without limitation those described on Schedule E attached hereto and incorporated herein by reference
(collectively, the “Intellectual Property Collateral”); (b) all of Debtor’s books, records, data, plans, manuals, computer software, computer tapes, computer disks, computer programs, source codes, object codes and all rights
of Debtor to retrieve data and other information from third parties; (c) all of Debtor’s contract rights, commercial tort claims, partnership interests, membership interests, joint venture interests, securities, deposit accounts, investment
accounts and certificates of deposit; (d) all rights of Debtor to payment under chattel paper, documents, instruments and similar agreements; (e) letters of credit, letters of credit rights supporting obligations and rights to payment for money or
funds advanced or sold of Debtor; (f) all tax refunds and tax refund claims of Debtor; (g) all choses in action and causes of action of Debtor (whether arising in contract, tort or otherwise and whether or not currently in litigation) and all
judgments in favor of Debtor; (h) all rights and claims of Debtor under warranties and indemnities; and (i) all rights of Debtor under any insurance, surety or similar contract or arrangement. 
  
 “Governmental Authority” shall mean any nation or
government, any state, province or other political subdivision thereof, any central bank (or similar monetary or regulatory authority) thereof, any entity exercising executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or controlled, through stock or capital ownership or otherwise, by any of the foregoing. 
  
 “Indebtedness” has the meaning specified in the Loan Agreement. 
  
 “Instrument” means any “instrument,” as such term is defined in Article or Chapter 9 of the UCC,
now owned or hereafter acquired by Debtor, and, in any event, shall include all promissory notes, drafts, bills of exchange and trade acceptances, whether now owned or hereafter acquired. 
  

 3 

 “Intellectual Property Collateral” is defined in clause (a) of the definition of General
Intangibles. 
  
 “Intellectual Property Report”
has the meaning specified in the Loan Agreement. 
  
 “Inventory” means any “inventory,” as such term is defined in Article or Chapter 9 of the UCC, now owned or hereafter acquired by Debtor, and, in any event, shall include, without limitation, each of the
following, whether now owned or hereafter acquired by Debtor: (a) all goods and other personal property of Debtor that are held for sale or lease or to be furnished under any contract of service; (b) all raw materials, work-in-process, finished
goods, supplies and materials of Debtor; (c) all wrapping, packaging, advertising and shipping materials of Debtor; (d) all goods that have been returned to, repossessed by or stopped in transit by Debtor; and (e) all Documents evidencing any of the
foregoing. 
  
 “Investment Property” means any
“investment property” as such term is defined in Article or Chapter 9 of the UCC, now owned or hereafter acquired by Debtor, and in any event, shall include without limitation all shares of stock and other equity, partnership or membership
interests constituting securities, of the domestic Subsidiaries of Debtor from time to time owned or acquired by Debtor in any manner, and the certificates and all dividends, cash, instruments, rights and other property from time to time received,
receivable or otherwise distributed or distributable in respect of or in exchange for any or all of such shares, but excluding any shares of stock or other equity, partnership or membership interests in any foreign Subsidiaries of Debtor.

  
 “Loan Agreement” has the meaning specified in
the recitals hereto. 
  
 “Loan Documents” has the
meaning specified in the Loan Agreement. 
  
 “Patent
Licenses” shall mean all license agreements with any other person in connection with any of the Patents or such other person’s patents, whether Debtor is a licensor or a licensee under any such license agreement, including, without
limitation, the license agreements listed on Schedule E hereto and made a part hereof, subject, in each case, to the terms of such license agreements and the right to prepare for sale, sell and advertise for sale, all inventory
now or hereafter covered by such licenses. 
  
 “Patents” shall mean all United States letters patent, patent applications and patentable inventions, including, without limitation, all patents and patent applications identified on Schedule E attached
hereto and made a part hereof, and including without limitation (a) all inventions and improvements described and claimed therein, and patentable inventions, (b) the right to sue or otherwise recover for any and all past, present and future
infringements and misappropriations thereof, (c) all income, royalties, damages and other payments now and hereafter due and/or payable with respect thereto (including, without limitation, payments under all Patent Licenses entered into in
connection therewith, and damages and payments for past or future infringements thereof), and (d) all rights corresponding thereto in the United States and all reissues, divisions, continuations, continuations-in-part, substitutes, renewals, and
extensions 

  

 4 

 
thereof, all improvements thereon, and all other rights of any kind whatsoever of Debtor accruing thereunder or pertaining thereto (Patents and Patent
Licenses being, collectively, the “Patent Collateral”). 
  
 “Permitted Liens” shall mean any lien or encumbrance which is a Permitted Lien under the Loan Agreement. 
  
 “Proceeds” means any “proceeds,” as such term is defined in Article or Chapter 9 of the UCC and, in any event, shall include,
but not be limited to, (a) any and all proceeds of any insurance, indemnity, warranty or guaranty payable to Debtor from time to time with respect to any of the Collateral, (b) any and all payments (in any form whatsoever) made or due and payable to
Debtor 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, or purporting to act, for or on behalf of any
governmental authority), and (c) any and all other amounts from time to time paid or payable under or in connection with any of the Collateral. 
  
 “Records” is defined in Section 4.9 of this Agreement. 
  
 “Software” means all (i) computer programs and supporting information provided in connection with a
transaction relating to the program, and (ii) computer programs embedded in goods and any supporting information provided in connection with a transaction relating to the program whether or not the program is associated with the goods in such a
manner that it customarily is considered part of the goods, and whether or not, by becoming the owner of the goods, a person acquires a right to use the program in connection with the goods, and whether or not the program is embedded in goods that
consist solely of the medium in which the program is embedded. 
  
 “Subsidiary” has the meaning specified in the Loan Agreement. 
  
 “Trademark Licenses” shall mean all license agreements with any other person in connection with any of the Trademarks or such other person’s names or trademarks, whether Debtor is a licensor or a
licensee under any such license agreement, including, without limitation, the license agreements listed on Schedule E hereto and made a part hereof, subject, in each case, to the terms of such license agreements, and the right
to prepare for sale, sell and advertise for sale, all inventory now or hereafter covered by such licenses. 
  
 “Trademarks” shall mean all trademarks, service marks, trade names, trade dress or other indicia of trade origin, trademark and service
mark registrations, and applications for trademark or service mark registrations (except for “intent to use” applications for trademark or service mark registrations filed pursuant to Section 1(b) of the Lanham Act, unless and until an
Amendment to Allege Use or a Statement of Use under Sections 1(c) and 1(d) of said Act has been filed), and any renewals thereof, including, without limitation, each registration and application identified on Schedule E attached
hereto and made a part hereof, and including without limitation (a) the right to sue or otherwise recover for any and all past, present and future infringements and misappropriations thereof, (b) all income, royalties, damages and other payments now
and hereafter due and/or payable with respect thereto (including, without 

  

 5 

 
limitation, payments under all Trademark Licenses entered into in connection therewith, and damages and payments for past or future infringements thereof)
and (c) all rights corresponding thereto in the United States and all other rights of any kind whatsoever of Debtor accruing thereunder or pertaining thereto, together in each case with the goodwill of the business connected with the use of, and
symbolized by, each such trademark, service mark, trade name, trade dress or other indicia of trade origin (Trademarks and Trademark Licenses being, collectively, the “Trademark Collateral”). 
  
 “UCC” means the Uniform Commercial Code as in effect in the
State of Michigan; provided, that if, by applicable law, the perfection or effect of perfection or non-perfection of the security interest created hereunder in any Collateral is governed by the Uniform Commercial Code as in effect on or after
the date hereof in any other jurisdiction, “UCC” means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or the effect of perfection or non-perfection.

  
 ARTICLE 2 
 Security Interest 
  
 Section 2.1 Security Interest. As collateral security for the prompt payment and performance in full when due of
the Indebtedness (whether at stated maturity, by acceleration or otherwise), Debtor hereby pledges, assigns, transfers and conveys to Lender as collateral, and grants to Lender a continuing lien on and security interest in, all of Debtor’s
right, title and interest in and to the following, whether now owned or hereafter arising or acquired and wherever located (collectively, the “Collateral”): 
  
 (a) all Accounts; 
  
 (b) all Chattel Paper; 
  
 (c) all General Intangibles; 
  
 (d) all Equipment; 
  
 (e) all Inventory; 
  
 (f) all Documents; 
  
 (g) all Instruments; 
  
 (h) all Deposit Accounts; 
  
 (i) all computer records (“Computer Records”) and Software, whether relating to the foregoing Collateral or otherwise, but in the case of
such Software, subject to the rights of any non-affiliated licensee of software; 
  
 (j) all Investment Property; and 
  

 6 

 (k) the Proceeds, in cash or otherwise, of any of the property described in the foregoing clauses (a)
through (j) and all liens, security, rights, remedies and claims of Debtor with respect thereto; 
  
 provided, however, that (i) “Collateral” shall not include rights under or with respect to any General Intangible, license, permit or authorization to the extent any such General Intangible,
license, permit or authorization, by its terms or by law, prohibits the assignment of, or the granting of a security interest in, the rights of a grantor thereunder or which would be invalid or unenforceable upon any such assignment or grant, and
(ii) so long as the Senior Credit Facility (as defined in the Loan Agreement) shall remain outstanding, “Collateral” shall also not include any equity interests in any Subsidiary of Debtor. The pledge and grant of a security interest in
Proceeds shall not be deemed to give Debtor any right to dispose of any of the Collateral, except as may otherwise be permitted herein or in the Loan Agreement. 
  

Debtor hereby irrevocably authorizes Lender at any time and from time to time to file in any filing office in any UCC jurisdiction any initial
financing statements and amendments thereto that (a) indicate any or all of the Collateral upon which Debtor has granted a Lien, and (b) provide any other information required by Part 5 of Article 9 of the UCC, including organizational information
and in the case of a fixture filing or indicating Collateral as as-extracted collateral or timber to be cut, a sufficient description of real property to which the Collateral related. Debtor agrees to furnish any such information required by the
preceding paragraph to Lender promptly upon request. 
  
 Section 2.2 Debtor Remains Liable. Notwithstanding anything to the contrary contained herein, (a) Debtor shall remain liable under the contracts, agreements, documents and instruments included in the Collateral
to the extent set forth therein to perform all of its duties and obligations thereunder to the same extent as if this Agreement had not been executed, (b) the exercise by Lender of any of its rights or remedies hereunder shall not release Debtor
from any of their duties or obligations under the contracts, agreements, documents and instruments included in the Collateral, and (c) Lender shall not have any indebtedness, liability or obligation (by assumption or otherwise) under any of the
contracts, agreements, documents and instruments included in the Collateral by reason of this Agreement, and shall not be obligated to perform any of the obligations or duties of Debtor thereunder or to take any action to collect or enforce any
claim for payment assigned hereunder. 
  
 ARTICLE 3

 Representations and Warranties 
  
 To induce Lender to enter into this Agreement and the Loan Agreement, Debtor represents and warrants to Lender that as of
the date hereof: 
  
 Section 3.1
Title. Debtor is, and with respect to Collateral acquired after the date hereof Debtor will be, the legal and beneficial owner of the Collateral free and clear of any Lien or other encumbrance, except for the Permitted Liens and
the other Liens permitted under the Loan Agreement. 
  

 7 

 Section 3.2 Financing Statements. No financing statement, security agreement
or other Lien instrument covering all or any part of the Collateral is on file in any public office with respect to any outstanding obligation of Debtor except (i) as may have been filed in favor of Lender pursuant to this Agreement and the other
Loan Documents and (ii) financing statements filed to perfect Permitted Liens or other Liens permitted under the Loan Agreement. As of the date hereof, and to Debtor’s knowledge, except as otherwise disclosed on Schedule F
hereto, Debtor does not do business and has not done business under a trade name or any name other than its legal name set forth at the beginning of this Agreement. 
  
 Section 3.3 Principal Place of Business; Registered Organization; Change in Form or
Jurisdiction. The principal place of business and chief executive office of Debtor, and the office where Debtor keeps its books and records, is located at the address of Debtor shown on the signature page hereto. Debtor is duly organized and
validly existing as a corporation (or other business organization) under the laws of its jurisdiction of organization, as set forth on Schedule C, and has the registration number set forth on such Schedule C, and Debtor
has not changed its corporate form or its jurisdiction of organization at any time during the past five (5) years, except as set forth on such Schedule C. 
  
 Section 3.4 Location of Collateral.  
  
 (a) All Inventory (except Inventory in transit) and Equipment (other than vehicles) of Debtor in the possession of Debtor
are located at the places specified on Schedule A hereto. 
  
 (b) The name and address of the landlord leasing any location to Debtor is identified on Schedule A hereto. 
  

(c) The name of and address of each bailee or warehouseman and the location of any Inventory or Equipment held by such bailee or warehouseman is
identified on Schedule A hereto. 
  
 (d) All
Deposits Accounts of Debtor (other than Deposit Accounts located with the “Agent” pursuant to the Senior Credit Facility described in the Loan Agreement) are located at the banks and have the account numbers specified on Schedule
Aattached hereto. 
  
 (e) None of the Inventory or
Equipment of Debtor (other than trailers, rolling stock, vessels, aircraft and vehicles) is evidenced by a Document (including, without limitation, a negotiable document of title). 
  
 Section 3.5 Perfection. Upon (a) the filing of Uniform Commercial Code financing statements in
the jurisdictions listed on Schedule B attached hereto, and (b) the recording of this Agreement in the United States Patent and Trademark Office and the United States Copyright Office, the security interest in favor of Lender created
herein will constitute a valid and perfected Lien upon and security interest in the Collateral which may be created and perfected either under the UCC by filing financing statements or obtaining possession thereof or by a filing with the Patent and
Trademark Office and the United States Copyright Office, subject to: only to those Liens (if any) which constitute Permitted Liens or other Liens permitted under the Loan Agreement with respect to all other Collateral. 
  

 8 

 Section 3.6 Intentionally Omitted. 
  
 Section 3.7 Intellectual Property.Set
forth on Schedule E is a complete and accurate list of the Trademarks, Patents and Copyrights owned by Debtor as of the date hereof. Debtor has made all necessary filings and recordations to protect and maintain its interest in the
Trademarks, Patents and Copyrights set forth on Schedule E, including, without limitation, all necessary filings and recordings, and payments of all maintenance fees, in the United States Patent and Trademark Office and United States
Copyright Office to the extent such Trademarks, Patents and Copyrights are material to Debtor’s business. Also set forth on Schedule E is a complete and accurate list of all of the material Trademark Licenses, Patent Licenses and
Copyright Licenses owned by Debtor as of the date hereof. 
  
 (b)
(i) Each Trademark of Debtor set forth on Schedule E is subsisting and has not been adjudged invalid, unregisterable or unenforceable, in whole or in part, and, to Debtor’ knowledge, is valid, registrable and enforceable,
(ii) each of the Trademark Licenses set forth on Schedule E is validly subsisting and has not been adjudged invalid or unenforceable, in whole or in part, and, to Debtor’ knowledge, is valid and enforceable, and (iii)
Debtor has notified Lender in writing of all uses of any material item of Trademark Collateral of which Debtor is aware which could reasonably be expected to lead to such item becoming invalid or unenforceable, including unauthorized uses by third
parties and uses which were not supported by the goodwill of the business connected with such Collateral. 
  
 (c) (i) Each Patent of Debtor set forth on Schedule E is subsisting and has not been adjudged invalid, unpatentable or unenforceable,
in whole or in part, and, to Debtor’s knowledge, is valid, patentable and enforceable except as otherwise set forth on Schedule E, (ii) each of the Patent Licenses set forth on Schedule E is validly subsisting
and has not been adjudged invalid or unenforceable, in whole or in part, and, to Debtor’s knowledge, is valid and enforceable, and (iii) Debtor has notified Lender in writing of all uses of any item of Patent Collateral material to
Debtor’s business of which Debtor is aware which could reasonably be expected to lead to such item becoming invalid or unenforceable. 
  
 (d) (i) Each Copyright of Debtor set forth on Schedule E is subsisting and has not been adjudged invalid, uncopyrightable or unenforceable,
in whole or in part, and, to Debtor’s knowledge, is valid, copyrightable and enforceable, (ii) each of the Copyright Licenses set forth on Schedule E is validly subsisting and has not been adjudged invalid or unenforceable, in
whole or in part, and, to Debtor’s knowledge, is valid and enforceable, and (iii) Debtor has notified Lender in writing of all uses of any item of Copyright Collateral material to Debtor’s business of which Debtor is aware which could
reasonably be expected to lead to such item becoming invalid or unenforceable. 
  
 (e) Debtor have not made a previous assignment, sale, transfer or agreement constituting a present or future assignment, sale, transfer or encumbrance of any of the Intellectual Property Collateral, except with
respect to non-exclusive licenses granted in the ordinary course of business or as permitted by this Agreement or the Loan Documents. No Debtor has granted any license, shop right, release, covenant not to sue, or non-assertion assurance to any
person with respect to any part of the Intellectual Property Collateral, except as set forth on Schedule E. 
  

 9 

 (f) Debtor has marked its products with the trademark registration symbol, copyright notices, the numbers
of all appropriate patents, the common law trademark symbol or the designation “patent pending,” as the case may be, to the extent that Debtor in good faith, believes is reasonably and commercially practicable. 
  
 (g) Except for the Trademark Licenses, Patent Licenses and Copyright Licenses
listed on Schedule E hereto under which Debtor is a licensee, Debtor has no knowledge of the existence of any right or any claim (other than as provided by this Agreement) that is likely to be made under or against any item of
Intellectual Property Collateral contained on Schedule E to the extent such claim could reasonably be expected to have a Material Adverse Effect. 
  
 (h) Except as set forth on Schedule G, no claim has been made and is continuing or, to Debtor’s
knowledge, threatened that the use by Debtor of any item of Intellectual Property Collateral is invalid or unenforceable or that the use by Debtor of any Intellectual Property Collateral does or may violate the rights of any person. To Debtor’s
knowledge, there is currently no infringement or unauthorized use of any item of Intellectual Property Collateral contained on Schedule E. 
  
 (i) No consent of any party (other than Debtor) to any Patent License, Copyright License or Trademark License constituting Intellectual Property
Collateral is required, or purports to be required, to be obtained by or on behalf of Debtor in connection with the execution, delivery and performance of this Agreement that has not been obtained. Each Patent License, Copyright License and
Trademark License constituting Intellectual Property Collateral is in full force and effect and constitutes a valid and legally enforceable obligation of Debtor and (to the knowledge of Debtor) each other party thereto except as enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditor’s rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law). No
consent or authorization of, filing with or other act by or in respect of any governmental authority is required in connection with the execution, delivery, performance, validity or enforceability of any of the Patent Licenses, Copyright Licenses or
Trademark Licenses by any party thereto other than those which have been duly obtained, made or performed and are in full force and effect. Neither Debtor nor (to the knowledge of Debtor) any other party to any Patent License, Copyright License or
Trademark License constituting Collateral is in default in the performance or observance of any of the terms thereof, except for such defaults as would not reasonably be expected, in the aggregate, to have a material adverse effect on the value of
the Intellectual Property Collateral. To the knowledge of Debtor, the right, title and interest of Debtor in, to and under each Patent License, Copyright License and Trademark License constituting Intellectual Property Collateral is not subject to
any defense, offset, counterclaim or claim. 
  
 ARTICLE 4

 Covenants 
  
 Debtor covenants and agrees with Lender that until the Indebtedness is paid and performed in full (other than any contingent Indebtedness, such contingent
Indebtedness to exclude guaranties but to include contingent Indebtedness arising under the Loan Agreement and 

  

 10 

 
Sections 5.5 and 5.6 of this Agreement) for which a claim is not then outstanding or asserted) and all commitments to lend or provide other credit
accommodations under the Loan Agreement have been terminated: 
  
 Section 4.1 Encumbrances. Debtor shall not create, permit or suffer to exist, and shall defend the Collateral against, any Lien (other than the Permitted Liens or other Liens permitted under the Loan Agreement)
or any restriction upon the pledge or other transfer thereof (other than as provided in the Loan Agreement), and shall, subject only to the Permitted Liens and the other Liens permitted under the Loan Agreement, defend Debtor’s title to and
other rights in the Collateral and Lender’s pledge and collateral assignment of and security interest in the Collateral against the claims and demands of all Persons. Except to the extent permitted by the Loan Agreement or in connection with
any release of Collateral under Section 7.13 hereof (but only to the extent of any Collateral so released), Debtor shall do nothing to impair the rights of Lender in the Collateral. 
  
 Section 4.2 Collection of Accounts and Contracts.
Debtor shall, in accordance with its usual business practices in effect from time to time, endeavor to collect or cause to be collected from each account debtor under its Accounts, as and when due, any and all amounts owing under such Accounts.

  
 Section 4.3 Disposition of
Collateral. To the extent prohibited by the terms of the Loan Agreement, Debtor shall not enter into or consummate any transfer or other disposition of assets without the prior written consent of Lender, except as permitted under the terms
of the Loan Agreement. 
  
 Section 4.4 Further
Assurances. At any time and from time to time, upon the request of Lender, and at the sole expense of Debtor, Debtor shall promptly execute and deliver all such further agreements, documents and instruments and take such further action as
Lender may reasonably deem necessary or appropriate to preserve and perfect its security interest in and pledge and collateral assignment of the Collateral (including causing Lender’s name to be noted as secured party on any certificate of
title for a titled good if such notation is a condition of Lender’s ability to enforce its security interest in such Collateral) and carry out the provisions and purposes of this Agreement or to enable Lender to exercise and enforce its rights
and remedies hereunder with respect to any of the Collateral. Except as otherwise expressly permitted by the terms of the Loan Agreement relating to disposition of assets and except for Permitted Liens and other Liens permitted the Loan Agreement,
Debtor agrees to maintain and preserve Lender’s security interest in and pledge and collateral assignment of the Collateral hereunder. Without limiting the generality of the foregoing, Debtor shall (a) execute and deliver to Lender such
financing statements as Lender may from time to time reasonably require; and (b) execute and deliver to Lender such other agreements, documents and instruments, including without limitation control agreements or stock powers, as Lender may
reasonably require to perfect and maintain the validity, effectiveness and priority of the Liens intended to be created by the Loan Documents. 
  
 Section 4.5 Insurance. The Collateral pledged by Debtor will be insured (to the extent such Collateral is insurable) with
insurance coverage in such amounts and of such types as are required by the terms of the Loan Agreement. In the case of all such insurance policies, 

  

 11 

 
Debtor shall designate Lender, as mortgagee or lender loss payee and such policies shall provide that any loss be payable to Lender, as mortgagee or lender
loss payee, as its interests may appear. Further, upon the request of Lender, Debtor shall deliver certificates evidencing such policies, including all endorsements thereon and those required hereunder, to Lender; and Debtor assigns to Lender, as
additional security hereunder, all its rights to receive proceeds of insurance with respect to the Collateral. All such insurance shall, by its terms, provide that the applicable carrier shall, prior to any cancellation before the expiration date
thereof, mail thirty (30) days’ prior written notice to Lender of such cancellation. Debtor further shall provide Lender upon request with evidence reasonably satisfactory to Lender that Debtor is at all times in compliance with this paragraph.
Upon the occurrence and during the continuance of a Default or an Event of Default, Lender may act as Debtor’s attorney-in-fact in obtaining, adjusting, settling and compromising such insurance and endorsing any drafts. Upon Debtor’s
failure to insure the Collateral as required in this covenant, Lender may procure such insurance and its costs therefor shall be charged to Debtor, payable on demand, with interest at the highest rate set forth in the Loan Agreement and added to the
Indebtedness secured hereby. The disposition of proceeds payable to Debtor of any insurance on the Collateral (the “Insurance Proceeds”) shall be governed by the following: 
  
 (a) provided that no Default or Event of Default has occurred and is
continuing hereunder, (a) if the amount of Insurance Proceeds in respect of any loss or casualty does not exceed One Hundred Thousand Dollars ($100,000), Debtor shall be entitled, in the event of such loss or casualty, to receive all such Insurance
Proceeds and to apply the same toward the replacement of the Collateral affected thereby or to the purchase of other assets to be used in Debtor’s business (provided that such assets shall be subjected to a first lien in favor of Lender); and
(b) if the amount of Insurance Proceeds in respect of any loss or casualty exceeds One Hundred Thousand Dollars ($100,000), such Insurance Proceeds shall be paid to and received by Lender, for release to Debtor for the replacement of the Collateral
affected thereby or to the purchase of other assets to be used in Debtor’s business (provided that such assets shall be subjected to a first lien in favor of Lender); or, upon written request of Debtor (accompanied by reasonable supporting
documentation), for such other use or purpose as approved by Lender, in its reasonable discretion, it being understood and agreed in connection with any release of funds under this subparagraph (b), that Lender may impose reasonable and customary
conditions on the disbursement of such Insurance Proceeds; and 
  
 (b) if a Default or Event of Default has occurred or is continuing and is not waived as provided in the Loan Agreement, all Insurance Proceeds in respect of any loss or casualty shall be paid to and received by Lender, to be applied by
Lender against the Indebtedness and/or to be held by Lender as cash collateral for the Indebtedness. 
  
 Section 4.6 Furnishing of Information and Inspection Rights. Debtor will, at any time and from time to time during regular
business hours, upon reasonable advance notice (except if any Default or Event of Default has occurred and is continuing, when no prior notice shall be required), permit Lender, or its agents or representatives, to examine and make copies of and
abstracts from all Records, to visit the offices and properties of Debtor for the purpose of examining such Records, and to discuss matters relating to Debtor’s performance hereunder and under the other Loan Agreement with any of the officers,
directors, employees or independent public accountants of Debtor having knowledge of such matters; provided, however, that Lender 

  

 12 

 
acknowledges that, in exercising the rights and privileges conferred in this Section 4.6, it or its agents and representatives may, from time to time,
obtain knowledge of information, practices, books, correspondence and records of a confidential nature and in which Debtor has a proprietary interest. Lender agrees that all such information, practices, books, correspondence and records are to be
regarded as confidential information and agrees that it shall be subject to the Loan Agreement. Notwithstanding anything to the contrary in this Agreement or in the Loan Agreement, Lender may reply to a request from any Person for information
related to any Collateral referred to in any financing statement filed to perfect the security interest and liens established hereby, to the extent necessary to maintain the perfection or priority of such security interests or liens, or otherwise
required under applicable law. Furthermore, Debtor shall permit Lender and its representatives to examine, inspect and audit the Collateral and to examine, inspect and audit Debtor’s books and Records to the extent provided under the Loan
Agreement. 
  
 Section 4.7 Corporate
Changes. Debtor shall not change its name, identity, corporate structure or jurisdiction of organization in any manner that might make any financing statement filed in connection with this Agreement seriously misleading within the meaning of
Section 9-506 of the UCC unless Debtor shall have given Lender thirty (30) days prior written notice with respect to any change in Debtor’s corporate structure, jurisdiction of organization, name or identity and shall have taken all action
deemed reasonably necessary by Lender under the circumstances to protect its Liens and the perfection and priority thereof. Debtor shall give prompt written notice of any change in its principal place of business, chief executive office or place
where it keeps its books and records. 
  
 Section 4.8
Books and Records. Debtor shall keep accurate and complete books and records (the “Records”) of the Collateral and Debtor’s business and financial condition in accordance with the Loan Agreement. 

 
 Section 4.9 Equipment and Inventory. 
  
 (a) Debtor shall keep the Equipment (other than vehicles) and Inventory
(other than Inventory in transit) which is in Debtor’s possession or in the possession of any bailee or warehouseman at any of the locations specified on Schedule A hereto or, upon prompt written notice to Lender, at such other
places within the United States of America or Mexico where all action required to perfect Lender’s security interest in the Equipment and Inventory with the priority required by this Agreement shall have been taken (including the execution and
delivery of landlord consents or bailee waivers in form and substance acceptable to Lender). 
  
 (b) Debtor shall maintain the Equipment and Inventory in accordance with the terms of the Loan Agreement. 
  
 Section 4.10 Notification. Debtor shall promptly notify Lender in writing of any Lien, encumbrance or claim
(other than a Permitted Lien or other Liens permitted under Section 8.2 of the Loan Agreement, to the extent not otherwise subject to any notice requirements under the Loan Agreement) that has attached to or been made or asserted against any
of the Collateral upon becoming aware of the existence of such Lien, encumbrance or claim. 
  

 13 

 Section 4.11 Collection of Accounts. So long as no Default or Event of
Default has occurred and is continuing and except as otherwise provided in this Section 4.11 and Section 6.3, Debtor shall have the right to collect and receive payments on its Accounts, and to use and expend the same in its operations
in each case in compliance with the terms of each of the Loan Agreement. 
  
 Section 4.12 Intentionally Omitted. 
  
 Section 4.13 Possession; Reasonable Care. Lender may appoint one or more agents (which in no case shall be Debtor or an affiliate of Debtor) to hold physical custody, for the account of
Lender, of any or all of the Collateral. Lender shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which Lender
accords its own property, it being understood that Lender shall not have any responsibility for (a) ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relative to any Collateral, whether
or not Lender has or is deemed to have knowledge of such matters, or (b) taking any necessary steps to preserve rights against any parties with respect to any Collateral. Following the occurrence and continuance of an Event of Default, Lender shall
be entitled to take possession of the Collateral in accordance with the UCC. 
  
 Section 4.14 Intentionally Omitted. 
  
 Section 4.15 Future Subsidiaries / Additional Collateral.  
  
 (a) With respect to each Person which becomes a domestic Subsidiary (which, for all purposes of this Agreement, shall include any Subsidiary which is not
a “controlled foreign corporation” under Section 956 of the Internal Revenue Code, or any successor provision) subsequent to the date hereof, within thirty (30) days of the date such Person becomes a domestic Subsidiary, Debtor will cause
such Subsidiary to execute and deliver to Lender, a security agreement, in form and substance acceptable to Lender, granting to Lender, a first priority security interest, mortgage and lien encumbering all right, title and interest of such Person in
property, rights and interests of the type included in the definition of the Collateral, subject only to the Permitted Liens and other Liens permitted under the Loan Agreement with respect to all other Collateral. 
  
 (b) With respect to any intellectual property owned, licensed or otherwise
acquired by Debtor after the date hereof, and with respect to any patent, trademark or copyright which is not registered or filed with the U.S. Patent and Trademark Office and/or the U.S. Copyright Office at the time such Collateral is pledged by
Debtor to Lender pursuant to this Security Agreement, and which is subsequently registered or filed by Debtor in the appropriate office, Debtor shall execute or cause to be executed and delivered to Lender, simultaneously with the delivery of the
Intellectual Property Report required by the Loan Agreement (i) an amendment to this Agreement, duly executed by Debtor, in form and content acceptable to Lender, in respect of such additional or newly registered collateral, granting to Lender a
first priority security interest, pledge and lien therein (subject only to the Permitted Liens and the other Liens permitted under the Loan Agreement) hereunder in such additional collateral, or (ii) a new security agreement, duly executed by
Debtor, in substantially the form of this Agreement, 

  

 14 

 
in respect of such additional or newly registered collateral, granting to Lender, a first priority security interest, pledge and lien thereon (subject only
to the Permitted Liens and the other Liens permitted under the Loan Agreement), together in each case with all certificates, notes or other instruments representing or evidencing the same, and shall, upon Lender’s request, execute or cause to
be executed any financing statement or other document (including without limitation, filings required by the U.S. Patent and Trademark Office and/or the U.S. Copyright Office in connection with any such additional or newly registered collateral).
Debtor hereby (x) authorizes Lender to attach each Amendment to this Agreement, (y) agrees that all such additional collateral listed in any Amendment delivered to Lender shall for all purposes hereunder constitute Collateral, and (z) is deemed to
have made, upon the delivery of each such Amendment, the representations and warranties contained in Sections 3.1, 3.2, 3.5, and 3.7 of this Agreement with respect to the Collateral covered thereby. 
  
 Section 4.16 Promissory Notes and Tangible Chattel Paper.

  
 (a) If Debtor shall, now or at any time hereafter, hold
or acquire any promissory notes or tangible Chattel Paper, worth, in the aggregate, in excess of $100,000, Debtor shall forthwith endorse, assign and deliver the same to Lender, accompanied by such instruments of transfer or assignment duly executed
in blank as Lender may from time to time reasonably specify. 
  
 Section 4.17 Electronic Chattel Paper and Transferable Records. 
  
 If Debtor, now or at any time hereafter, hold or acquire an interest in any electronic Chattel Paper or any “transferable record,” as that term is defined in the federal Electronic Signatures in Global and
National Commerce Act, or in the Uniform Electronic Transactions Act as in effect in any relevant jurisdiction, worth, in the aggregate, in excess of $100,000, Debtor shall promptly notify Lender thereof and, at the request and option of Lender,
shall take such action as Lender may reasonably request to vest in Lender control, under Section 9-105 of the UCC, of such electronic chattel paper or control under the federal Electronic Signatures in Global and National Commerce Act, or the
Uniform Electronic Transactions Act, as so in effect in such jurisdiction, of such transferable record. 
  
 Section 4.18 Letter-of-Credit Rights.  
  
 If Debtor is, now or at any time hereafter, beneficiary under letters of credit, with an aggregate face amount in excess of $100,000, Debtor shall
promptly notify Lender thereof and, at the request and option of Lender, Debtor shall, pursuant to an agreement in form and substance reasonably satisfactory to Lender either (a) arrange for the issuer and any confirmer of such letters of credit to
consent to an assignment to Lender of the proceeds of the letters of credit or (b) arrange for Lender to become the transferee beneficiary of the letters of credit, with Lender agreeing, in each case, that the proceeds of the letters of credit are
to be applied as an optional prepayment as described in the Loan Agreement. 
  
 Section 4.19 Commercial Tort Claims. 
  
 If Debtor shall, now or at any time hereafter, hold or acquire commercial tort claims, which in the aggregate are in excess of $100,000, Debtor shall immediately notify Lender in a 

  

 15 

 
writing signed by Debtor of the particulars thereof and grant to Lender in such writing a security interest therein and in the proceeds thereof, all upon the
terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Lender. 
  
 Section 4.20 Intentionally Omitted. 
  
 Section 4.21 Intentionally Omitted. 
  
 Section 4.22 Intellectual Property. 
  
 (a) Debtor agrees to take all necessary steps, including, without limitation, in the United States Patent and Trademark Office or in any court, to (i)
defend, enforce, preserve the validity and ownership of, and maintain each trademark registration and each Trademark License identified on Schedule E hereto, and (ii) pursue each trademark application now or hereafter identified on
Schedule E hereto, including, without limitation, the filing of responses to office actions issued by the United States Patent and Trademark Office, the filing of applications for renewal, the filing of affidavits under Sections 8 and
15 of the United States Trademark Act, and the participation in opposition, cancellation, infringement and misappropriation proceedings, except, in each case in which Debtor has determined, using its commercially reasonable judgment, that any of the
foregoing is not of material economic value to Debtor. Debtor agrees to take corresponding steps with respect to each new or acquired trademark registration, trademark application or any rights obtained under any Trademark License, in each case,
which it is now or later becomes entitled, except in each case in which Debtor has determined, using its commercially reasonable judgment, that any of the foregoing is not of material economic value to Debtor. Any expenses incurred in connection
with such activities shall be borne by Debtor. 
  
 (b) Debtor
shall take all necessary steps, including, without limitation, in the United States Patent and Trademark Office or in any court, to (i) defend, enforce, preserve the validity and ownership of, and maintain each Patent and each Patent License
identified on Schedule E hereto, and (ii) pursue each patent application, now or hereafter identified on Schedule E hereto, including, without limitation, the filing of divisional, continuation, continuation-in-part and
substitute applications, the filing of applications for reissue, renewal or extensions, the payment of maintenance fees, and the participation in interference, reexamination, opposition, infringement and misappropriation proceedings, except in each
case in which Debtor has determined, using its commercially reasonable judgment, that any of the foregoing is not of material economic value to Debtor. Debtor agrees to take corresponding steps with respect to each new or acquired Patent, patent
application, or any rights obtained under any Patent License, in each case, which it is now or later becomes entitled, except in each case in which Debtor has determined, using its commercially reasonable judgment, that any of the foregoing is not
of material economic value to them. Any expenses incurred in connection with such activities shall be borne by Debtor. 
  
 (c) Debtor agrees to take all necessary steps, including, without limitation, in the United States Copyright Office or in any court, to (i) defend,
enforce, and preserve the validity and ownership of each Copyright and each Copyright License identified on Schedule E hereto, and (ii) pursue each copyright and mask work application, now or hereafter identified on Schedule
E hereto, including, without limitation, the payment of applicable fees, and the 

  

 16 

 
participation in infringement and misappropriation proceedings, except in each case in which Debtor has determined, using its commercially reasonable
judgment, that any of the foregoing is not of material economic value to them. Debtor agrees to take corresponding steps with respect to each new or acquired Copyright, copyright and mask work application, or any rights obtained under any Copyright
License, in each case, which it is now or later becomes entitled, except in each case in which Debtor has determined, using its commercially reasonable judgment, that any of the foregoing is not of material economic value to Debtor. Any expenses
incurred in connection with such activities shall be borne by Debtor. 
  
 (d) Debtor shall not abandon any Trademark, Patent, Copyright or any pending trademark, copyright, mask work or patent application, without the written consent of Lender, unless Debtor shall have previously determined, using their
commercially reasonable judgment, that such use or the pursuit or maintenance of such trademark registration, Patent, Copyright registration or pending trademark, copyright, mask work or patent application is not of material economic value to
Debtor, in which case, Debtor give notice of any such abandonment to Lender in the Intellectual Property Report delivered to Lender pursuant to the requirements of the Loan Agreement. 
  
 (e) In the event that Debtor becomes aware that any item of the Intellectual Property Collateral which Debtor has
determined, using its commercially reasonable judgment, to be material to Debtor’s business is infringed or misappropriated by a third party, Debtor shall promptly notify Lender promptly and in writing, in reasonable detail, and shall take such
actions as Debtor or Lender deems reasonably appropriate under the circumstances to protect such Intellectual Property Collateral, including, without limitation, suing for infringement or misappropriation and for an injunction against such
infringement or misappropriation. Any expense incurred in connection with such activities shall be borne by Debtor. Debtor will advise Lender promptly and in writing, in reasonable detail, of any adverse determination or the institution of any
proceeding (including, without limitation, the institution of any proceeding in the United States Patent and Trademark Office, the United States Copyright Office or any court) regarding any item of the Intellectual Property Collateral. 

 
 For purposes of this Section 4.22, so long as no Default or Event of
Default has occurred and is continuing under the Loan Agreement, Debtor’s exercise of good faith business judgment under this Section 4.22 shall be deemed to constitute the exercise of commercially reasonable judgment. 
  
 ARTICLE 5 
 Rights of Lender 
  
 Section 5.1 Power of Attorney. Debtor hereby irrevocably constitutes and appoints Lender and any officer or Lender thereof,
with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the name of Debtor or in its own name, to take, after the occurrence and during the continuance of an Event of Default, any and all
actions, and to execute any and all documents and instruments which Lender at any time and from time to time deems necessary, to accomplish the purposes of this Agreement and, without limiting the generality of the foregoing, Debtor hereby gives
Lender the power and right on behalf of Debtor and in its own name to do any of the following after the occurrence and during the continuance of an Event of Default, without notice to or the consent of Debtor: 
  
 (a) to demand, sue for, collect or receive, in the name of Debtor or in its
own name, any money or property at any time payable or receivable on account of or in exchange for any of the Collateral and, in connection therewith, endorse checks, notes, drafts, acceptances, money orders, documents of title or any other
instruments for the payment of money under the Collateral or any policy of insurance; 
  

 17 

 (b) to pay or discharge taxes, Liens (other than Permitted Liens and the other Liens permitted under the
Loan Agreement) or other encumbrances levied or placed on or threatened against the Collateral; 
  
 (c) (A) to direct account Debtor and any other parties liable for any payment under any of the Collateral to make payment of any and all monies due and to
become due thereunder directly to Lender or as Lender shall direct; (B) to receive payment of and receipt for any and all monies, claims and other amounts due and to become due at any time in respect of or arising out of any Collateral; (C) to sign
and endorse any invoices, freight or express bills, bills of lading, storage or warehouse receipts, drafts against Debtor, assignments, proxies, stock powers, verifications and notices in connection with accounts and other documents relating to the
Collateral; (D) to commence and prosecute any suit, action or proceeding 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; (E) to
defend any suit, action or proceeding brought against Debtor with respect to any Collateral; (F) to settle, compromise or adjust any suit, action or proceeding described above and, in connection therewith, to give such discharges or releases as
Lender may deem appropriate; (G) to exchange any of the Collateral for other property upon any merger, consolidation, reorganization, recapitalization or other readjustment of the issuer thereof and, in connection therewith, deposit any of the
Collateral with any committee, depositary, transfer Lender, registrar or other designated agency upon such terms as Lender may determine; (H) to add or release any guarantor, indorser, surety or other party to any of the Collateral; (I) to renew,
extend or otherwise change the terms and conditions of any of the Collateral; (J) to make, settle, compromise or adjust any claim under or pertaining to any of the Collateral (including claims under any policy of insurance); (K) subject to any
pre-existing rights or licenses, to assign any Patent, Copyright or Trademark constituting Intellectual Property Collateral (along with the goodwill of the business to which any such Patent, Copyright or Trademark pertains), for such term or terms,
on such conditions and in such manner, as Lender shall in its sole discretion determine, and (L) to sell, transfer, pledge, convey, make any agreement with respect to, or otherwise deal with, any of the Collateral as fully and completely as though
Lender were the absolute owner thereof for all purposes, and to do, at Lender’s option and Debtor’s expense, at any time, or from time to time, all acts and things which Lender deems necessary to protect, preserve, maintain, or realize
upon the Collateral and Lender’s security interest therein. 
  
 This power of attorney is a power coupled with an interest and shall be irrevocable. Lender shall be under no duty to exercise or withhold the exercise of any of the rights, powers, privileges and options expressly or implicitly granted to
Lender in this Agreement, and shall not be liable for any failure to do so or any delay in doing so. This power of attorney is conferred on 

  

 18 

 
Lender solely to protect, preserve, maintain and realize upon its security interest in the Collateral. Lender shall not be responsible for any decline in the
value of the Collateral and shall not be required to take any steps to preserve rights against prior parties or to protect, preserve or maintain any Lien given to secure the Collateral. 
  
 Section 5.2 Setoff. In addition to and not in limitation of any rights of Lender under
applicable law, Lender shall, upon the occurrence and continuance of an Event of Default, without notice or demand of any kind, have the right to appropriate and apply to the payment of the Indebtedness owing to it (whether or not then due) any and
all balances, credits, deposits, accounts or moneys of Debtor then or thereafter on deposit with Lender; provided, however, that any such amount so applied by Lender on any of the Indebtedness owing to it shall be subject to the provisions of the
Loan Agreement. 
  
 Section 5.3 Assignment by
Lender. Lender may at any time assign or otherwise transfer all or any portion of its rights and obligations as Lender under this Agreement and the other Loan Documents (including, without limitation, the Indebtedness) to any
other Person, to the extent permitted by, and upon the conditions contained in, the Loan Agreement and such Person shall thereupon become vested with all the benefits and obligations thereof granted to Lender herein or otherwise. 
  
 Section 5.4 Performance by Lender. If Debtor
shall fail to perform any covenant or agreement contained in this Agreement, Lender may (but shall not be obligated to) perform or attempt to perform such covenant or agreement on behalf of Debtor, in which case Lender shall exercise good faith and
make diligent efforts to give Debtor prompt prior written notice of such performance or attempted performance. In such event, Debtor shall, at the request of Lender, promptly pay any reasonable amount expended by Lender in connection with such
performance or attempted performance to Lender, together with interest thereon at the interest rate set forth in the Loan Agreement, from and including the date of such expenditure to but excluding the date such expenditure is paid in full.
Notwithstanding the foregoing, it is expressly agreed that Lender shall not have any liability or responsibility for the performance (or non-performance) of any obligation of Debtor under this Agreement. 
  
 Section 5.5 Certain Costs and Expenses. Debtor
shall pay or reimburse Lender within five (5) Business Days after demand for all reasonable costs and expenses (including reasonable attorney’s and paralegal fees) incurred by it in connection with the enforcement, attempted enforcement, or
preservation of any rights or remedies under this Agreement or any other Loan Document during the existence of an Event of Default or after acceleration of any of the Indebtedness (including in connection with any “workout” or
restructuring regarding the Indebtedness, and including in any insolvency proceeding or appellate proceeding). The agreements in this Section 5.5 shall survive the payment in full of the Indebtedness. 
  
 Section 5.6 Indemnification. Debtor shall
indemnify, defend and hold Lender, and each of its officers, directors, employees, counsel, agents and attorneys-in-fact (each, an “Indemnified Person”) harmless from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, charges, expenses and disbursements (including reasonable attorneys’ and paralegals’ fees) of any kind or nature whatsoever which may at any time (including at any time following
repayment of the Indebtedness and the 

  

 19 

 
termination, resignation or replacement of Lender) be imposed on, incurred by or asserted against any such Indemnified Person in any way relating to or
arising out of this Agreement or any other Loan Document or any document relating to or arising out of or referred to in this Agreement or any other Loan Document, or the transactions contemplated hereby, or any action taken or omitted by any such
Indemnified Person under or in connection with any of the foregoing, including with respect to any investigation, litigation or proceeding (including any “Bankruptcy Proceeding” (as defined in the Loan Agreement) or appellate proceeding)
related to or arising out of this Agreement or the Indebtedness or the use of the proceeds thereof, whether or not any Indemnified Person is a party thereto (all the foregoing, collectively, the “Indemnified Liabilities);
provided, that Debtor shall have no obligation under this Section 5.6 to any Indemnified Person with respect to Indemnified Liabilities to the extent resulting from the gross negligence or willful misconduct of such Indemnified Person.
The agreements in this Section 5.6 shall survive payment of all other Indebtedness. 
  
 ARTICLE 6 
 Default 
  
 Section 6.1 Rights and Remedies. If an Event of Default shall have occurred and be continuing,
Lender shall have the following rights and remedies: 
  
 (a)
Lender may exercise any of the rights and remedies set forth in the Loan Agreement (including, without limitation, in Article 5 of this Agreement) or by applicable law. 
  
 (b) In addition to all other rights and remedies granted to Lender in this Agreement, the Loan Agreement or by applicable
law, Lender shall have all of the rights and remedies of a secured party under the UCC (whether or not the UCC applies to the affected Collateral) and Lender may also, without previous demand or notice except as specified below or in the Loan
Agreement, sell the Collateral or any part thereof in one or more parcels at public or private sale, at any exchange, broker’s board or at any of Lender’s offices or elsewhere, for cash, on credit or for future delivery, and upon such
other terms as Lender may, in its reasonable discretion, deem commercially reasonable or otherwise as may be permitted by law. Without limiting the generality of the foregoing, Lender may (A) without demand or notice to Debtor (except as required
under the Loan Agreement or applicable law), collect, receive or take possession of the Collateral or any part thereof, and for that purpose Lender (and/or its agents, servicers or other independent contractors) may enter upon any premises on which
the Collateral is located and remove the Collateral therefrom or render it inoperable, and/or (B) sell, lease or otherwise dispose of the Collateral, or any part thereof, in one or more parcels at public or private sale or sales, at Lender’s
offices or elsewhere, for cash, on credit or for future delivery, and upon such other terms as Lender may, in its reasonable discretion, deem commercially reasonable or otherwise as may be permitted by law. Lender shall have the right at any public
sale or sales, and, to the extent permitted by applicable law, at any private sale or sales, to bid (which bid may be, in whole or in part, in the form of cancellation of indebtedness) and become a purchaser of the Collateral or any part thereof
free of any right of redemption on the part of Debtor, which right of redemption is hereby expressly waived and released by Debtor to the extent permitted by applicable law. Lender may require Debtor to assemble the Collateral and make it available
to Lender at any place designated by Lender to allow Lender to take possession or dispose of such Collateral. Debtor agrees that Lender shall not be obligated to give more than 

  

 20 

 
five (5) days prior written notice of the time and place of any public sale or of the time after which any private sale may take place and that such notice
shall constitute reasonable notice of such matters. The foregoing shall not require notice if none is required by applicable law. Lender shall not be obligated to make any sale of Collateral if, in the exercise of its reasonable discretion, it shall
determine not to do so, regardless of the fact that notice of sale of Collateral may have been given. Lender may, without notice or publication (except as required by applicable law), 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 sale, and such sale may, without further notice, be made at the time and place to which the same was so adjourned. Debtor shall be liable for all reasonable expenses of
retaking, holding, preparing for sale or the like, and all reasonable attorneys’ fees, legal expenses and other costs and expenses incurred by Lender in connection with the collection of the Indebtedness and the enforcement of Lender’s
rights under this Agreement and the Loan Agreement. Debtor shall, to the extent permitted by applicable law, remain liable for any deficiency if the proceeds of any such sale or other disposition of the Collateral (conducted in conformity with this
clause (ii) and applicable law) applied to the Indebtedness are insufficient to pay the Indebtedness in full. Lender shall apply the proceeds from the sale of the Collateral hereunder against the Indebtedness in such order and manner as provided in
the Loan Agreement. 
  
 (c) Lender may cause any or all of the
Collateral held by it to be transferred into the name of Lender or the name or names of Lender’s nominee or nominees. 
  
 (d) Lender may exercise any and all rights and remedies of Debtor under or in respect of the Collateral, including, without limitation, any and all rights
of Debtor to demand or otherwise require payment of any amount under, or performance of any provision of any of the Collateral and any and all voting rights and corporate powers in respect of the Collateral. 
  
 (e) On any sale of the Collateral, Lender is hereby authorized to comply with
any limitation or restriction with which compliance is necessary (based on a reasoned opinion of Lender’s counsel) in order to avoid any violation of applicable law or in order to obtain any required approval of the purchaser or purchasers by
any applicable Governmental Authority. 
  
 (f) Lender may direct
account Debtor and any other parties liable for any payment under any of the Collateral to make payment of any and all monies due and to become due thereunder directly to Lender or as Lender shall direct. 
  
 (g) In the event of any sale, assignment or other disposition of the
Intellectual Property Collateral, the goodwill of the business connected with and symbolized by any Trademark Collateral subject to such disposition shall be included, and Debtor shall supply to Lender or its designee Debtor’s know-how and
expertise related to the Intellectual Property Collateral subject to such disposition, and Debtor’s notebooks, studies, reports, records, documents and things embodying the same or relating to the inventions, processes or ideas covered by and
to the manufacture of any products under or in connection with the Intellectual Property Collateral subject to such disposition. 
  
 (h) For purposes of enabling Lender to exercise its rights and remedies under this Section 6.1 and enabling Lender and its successors and assigns
to enjoy the full benefits of 

  

 21 

 
the Collateral, Debtor hereby grant to Lender an irrevocable, nonexclusive license (exercisable without payment of royalty or other compensation to Debtor)
to use, assign, license or sublicense any of the Intellectual Property Collateral, Computer Records or Software (including in such license reasonable access to all media in which any of the licensed items may be recorded or stored and all computer
programs used for the completion or printout thereof), exercisable upon the occurrence and during the continuance of an Event of Default (and thereafter if Lender succeeds to any of the Collateral pursuant to an enforcement proceeding or voluntary
arrangement with Debtor), except as may be prohibited by any licensing agreement relating to such Computer Records or Software. This license shall also inure to the benefit of all successors, assigns, transferees of and purchasers from Lender.

  
 Section 6.2 Intentionally Omitted.

  
 Section 6.3 Intentionally Omitted.

  
 Section 6.4 Default Under Loan
Agreement. Subject to any applicable notice and cure provisions contained in the Loan Agreement, the occurrence of any Event of Default (as defined in the Loan Agreement), including without limit a breach of any of the provisions of this
Agreement, shall be deemed to be an Event of Default under this Agreement. This Section 6.4 shall not limit the Events of Default set forth in the Loan Agreement. 
  
 ARTICLE 7 
 Miscellaneous 
  
 Section
7.1 No Waiver; Cumulative Remedies. No failure on the part of Lender to exercise and no delay in exercising, and no course of dealing with respect to, any right, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. The rights and remedies provided
for in this Agreement are cumulative and not exclusive of any rights and remedies provided by law. 
  
 Section 7.2 Successors and Assigns. Subject to the terms and conditions of the Loan Agreement, this Agreement shall be binding
upon and inure to the benefit of Debtor and Lender and their respective heirs, successors and assigns, except that Debtor may not assign any of their rights or obligations under this Agreement without the prior written consent of Lender. 

 
 Section 7.3 AMENDMENT; ENTIRE AGREEMENT.
. THIS AGREEMENT AND THE LOAN AGREEMENT REFERRED TO HEREIN EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL,
RELATING TO THE SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES HERETO.
The provisions of this Agreement may be amended or waived only by an instrument in writing signed by the parties hereto. 
  

 22 

 Section 7.4 Notices. All notices, requests, consents, approvals, waivers and
other communications hereunder shall be in writing (including, by facsimile transmission) and mailed, faxed or delivered to the address or facsimile number specified for notices on signature pages hereto; or, as directed to Debtor or Lender, to such
other address or number as shall be designated by such party in a written notice to the other. All such notices, requests and communications shall, when sent by overnight delivery, or faxed, be effective when delivered for overnight (next business
day) delivery, or transmitted in legible form by facsimile machine (with electronic confirmation of receipt), respectively, or if mailed, upon the third Business Day after the date deposited into the U.S. mail, or if otherwise delivered, upon
delivery; except that notices to Lender shall not be effective until actually received by Lender. 
  
 Section 7.5 GOVERNING LAW; SUBMISSION TO JURISDICTION; SERVICE OF PROCESS. 
  
 (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF TEXAS.

  
 (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF TEXAS, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF DEBTOR AND LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF DEBTOR AND LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY LOAN DOCUMENT. 
  
 Section 7.6 Headings. The headings, captions, and arrangements used in this Agreement are for convenience only
and shall not affect the interpretation of this Agreement. 
  
 Section 7.7 Survival of Representations and Warranties. All representations and warranties made in this Agreement or in any certificate delivered pursuant hereto shall survive the execution and delivery of this
Agreement, and no investigation by Lender shall affect the representations and warranties or the right of Lender to rely upon them. 
  
 Section 7.8 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same instrument. 
  
 Section 7.9 Waiver of Bond. In the event Lender seeks to take possession of any or all of the Collateral by judicial process, Debtor hereby irrevocably waives any bonds and any surety or
security relating thereto that may be required by applicable law as an incident to such possession, and waives any demand for possession prior to the commencement of any such suit or action. 
  
 Section 7.10 Severability. Any provision of this
Agreement which is determined by a court of competent jurisdiction to be prohibited or unenforceable in any jurisdiction shall, as to 

  

 23 

 
such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Agreement, and
any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 
  
 Section 7.11 Construction. Debtor and Lender acknowledge that each of them has had the benefit of legal counsel of its own
choice and has been afforded an opportunity to review this Agreement with its legal counsel and that this Agreement shall be construed as if jointly drafted by Debtor and Lender. 
  
 Section 7.12 Termination. If all of the Indebtedness (other than contingent liabilities pursuant
to any indemnity, including without limitation Sections 5.5 and 5.6 hereof, for claims which have not been asserted, or which have not yet accrued) shall have been indefeasibly paid and performed in full (in cash) and all commitments
to extend credit or other credit accommodations under the Loan Agreement have been terminated, Lender shall, upon the written request of Debtor, execute and deliver to Debtor a proper instrument or instruments acknowledging the release and
termination of the security interests created by this Agreement, and shall duly assign and deliver to Debtor (without recourse and without any representation or warranty) such of the Collateral as may be in the possession of Lender and has not
previously been sold or otherwise applied pursuant to this Agreement. 
  
 Section 7.13 Release of Collateral. Lender shall, upon the written request of Debtor, execute and deliver to Debtor a proper instrument or instruments acknowledging the release of the security interest and liens
established hereby on any Collateral: (a) if the sale or other disposition of such Collateral is permitted under the terms of the Loan Agreement and, at the time of such proposed release, both before and after giving effect thereto, no Default or
Event of Default has occurred and is continuing, or (b) if the sale or other disposition of such Collateral is not permitted under the terms of the Loan Agreement, provided that Lender shall have consented to such sale or disposition. 
  
 Section 7.14 WAIVER OF JURY TRIAL. DEBTOR AND
LENDER EACH WAIVES ITS RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR
OTHER LITIGATION OF ANY TYPE 
  
 BROUGHT BY EITHER SUCH PARTY
AGAINST THE OTHER, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. DEBTOR AND LENDER AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, EACH SUCH PARTY
FURTHER AGREES THAT ITS RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION 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 THE OTHER
LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. 
  

 24 

 Section 7.15 Consistent Application. The rights and duties created by this
Agreement shall, in all cases, be interpreted consistently with, and shall be in addition to (and not in lieu of), the rights and duties created by the Loan Agreement or the other Loan Documents. In the event that any provision of this Agreement
shall be inconsistent with any provision of the Loan Agreement, such provision of the Loan Agreement shall govern. 
  
 Section 7.16 Continuing Lien. The security interest granted under this Security Agreement shall be a continuing
security interest in every respect (whether or not the outstanding balance of the Indebtedness is from time to time temporarily reduced to zero) and Lender’s security interest in the Collateral as granted herein shall continue in full force and
effect for the entire duration that the Loan Agreement remains in effect and until all of the Indebtedness are repaid and discharged in full, and no commitment (whether optional or obligatory) to extend any credit under the Loan Agreement remain
outstanding. 
  
 Section 7.17 Subordination. The
security interests and other rights and powers granted to the Lender hereunder shall be subordinated to any security interests, rights and powers granted to Comerica Bank, as Agent (the “Agent”), under that certain Revolving Credit and
Term Loan Agreement dated as of August 19, 2003, by and among Staktek Holdings, Inc., SC Merger Sub, Inc., Research Applications, Inc., the Agent and the financial institutions party thereto from time to time (the “Senior Credit
Agreement”) as provided in the AV Subordination Agreement (as defined in the Senior Credit Agreement), as each may be amended, restated or otherwise modified after the date hereof. 
  

 25 

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

	STAKTEK HOLDINGS, INC., A Delaware
corporation
		
	 By:
	 	             /s/ Joseph C.
Aragona

	 	 	 Joseph C. Aragona

	 	 	 President

	
	 Address for Notices:

	 c/o Austin Ventures

	 300 West Sixth Street, Suite 2300

	 Austin, Texas 78701

	 Attention: Chief Financial Officer

	 Facsimile No.: (512) 476-3952

	
	 AUSTIN VENTURES VII, L.P., a Delaware
 Limited Partnership

		
	 By:
	 	 AV Partners VII, L.P.

	 Its:
	 	 General Partner

		
	 By:
	 	             /s/ Joseph C.
Aragona

	 	 	 Joseph C. Aragona

	 	 	 General Partner

	
	 Address for Notices:

	 c/o Austin Ventures

	 300 West Sixth Street, Suite 2300

	 Austin, Texas 78701

	 Attention: Chief Financial Officer

	 Facsimile No.: (512) 476-3952

  
 Signature Page to Security Agreement 

	 AUSTIN VENTURES VIII, L.P., a Delaware
 Limited Partnership

		
	 By:
	 	 AV Partners VIII, L.P.

	 Its:
	 	 General Partner

		
	 By:
	 	             /s/ Joseph C.
Aragona

	 	 	 Joseph C. Aragona

	 	 	 General Partner

	
	 Address for Notices:

	 c/o Austin Ventures

	 300 West Sixth Street, Suite 2300

	 Austin, Texas 78701

	 Attention: Chief Financial Officer

	 Facsimile No.: (512) 476-3952

  
 Signature Page to Security Agreement 

 Schedule A — Location of Collateral 
 Schedule B — Jurisdictions for Filing of Financing Statements 
 Schedule C — Jurisdiction of Organization

 Schedule D — N/A 
 Schedule E — Intellectual Property
Collateral 
 Schedule F — Other Names 
 Schedule G —
Infringement Claims

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