Document:

Form of Warrant issued together with the 12% Senior Secured Notes

 EXHIBIT 10.2 
 THIS SECURITY AND THE WARRANT SHARES TO BE ISSUED UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY, THE WARRANT SHARES TO BE ISSUED UPON ITS
EXERCISE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION. 
 THE TRANSFER OF THIS WARRANT IS RESTRICTED AS DESCRIBED HEREIN. 
  

 VELOCITY EXPRESS CORPORATION

 Warrant for the Purchase of Shares of Common Stock, 
 par value $0.004 per Share 
  

			
	 No.
                                
	  	                                 Shares

 THIS CERTIFIES that, for value received,
                    , whose address is
                     (the “Holder”), is entitled to purchase from Velocity Express Corporation, a Delaware corporation (the
“Company”), upon the terms and conditions set forth herein,                     
(                ) shares of the Company’s Common Stock, par value $0.004 per share (“Common Stock”), at an initial exercise price of $1.45
per share, subject to adjustment as provided in Section 12 (the “Exercise Price”) and partial cancellation as provided in Section 13. 
 The number of shares of Common Stock issuable upon exercise of this Warrant (the “Warrant Shares”) and the Exercise Price may be adjusted from time to time as provided in Section 12. The Warrant
Shares are entitled to the benefits, and subject to the obligations, set forth in the Registration Rights Agreement dated concurrently herewith by and among the Company, the initial Holder and the other parties named therein (the
“Registration Rights Agreement”). This is one of a series of warrants with like terms, initially exercisable for an aggregate of 26,966,897 shares of Common Stock (collectively, the “Class of Warrants”). 

This Warrant was originally issued by the Company in connection with an offering of Units, where each Unit was comprised of a Warrant and $1,000
aggregate principal amount of the Company’s 12% Senior Secured Notes Due 2010 (the “Notes”). Immediately upon issuance, this Warrant became separately transferable from the Notes that, together with this Warrant, comprised one
or more Units. 

 1. Exercise Rights and Exercise Period. 
 (a) At the Option of the Holder. This Warrant may be exercised at the option of the Holder at the Exercise Price at any time or from time to time
during the period commencing on the approval by the stockholders of the Company of the issue of the Warrant Shares in accordance with the requirements of the Nasdaq Stock Market and (ii) ending at 5:00 P.M. Eastern time on July 3,
2010 (the “Exercise Period”). The Company will deliver a notice to the Holder promptly, and any event within three (3) Business Days (as defined below) after this Warrant first becomes exercisable. An exercise of this Warrant
at the option of the Holder shall be made in accordance with the procedures set forth in Section 2. A Holder may not exercise this Warrant pursuant to this Section 1(a) after receipt of a Notice of Automatic Exercise pursuant to
Section 3, other than with respect to Warrant Shares that are not subject to such Notice of Automatic Exercise. 
 (b) Automatic
Exercise. If the stockholder approval referred to in Section 1(a) is obtained and becomes effective, and if at any time after July 3, 2008: 
 (i) the daily volume weighted average price of a share of Common Stock, as reported by Bloomberg (or, if Bloomberg terminates such reporting, then using such other reporting system as the Board of the Directors of the
Company may designate in good faith), on the Nasdaq Stock Market or, if the Common Stock ceases to be listed on the Nasdaq Stock Market, the primary national or regional securities exchange or quotation system on which the Common Stock is then
listed or quoted (the “Principal Market) is equal to or exceeds $2.75 per share (as such price may be adjusted pursuant to Section 12, the “Automatic Exercise Trading Threshold”) for twenty (20) of any thirty
(30) consecutive trading-day period (the “Automatic Exercise Value Trigger”); 
 (ii) the Warrant Shares
issuable upon the occurrence of the Automatic Exercise Value Trigger, as contemplated by Section 3, are available for immediate resale without restriction by the Holder without registration (or pursuant to an effective registration statement)
under the Securities Act of 1933, as amended (the “Securities Act”) on both (x) the date the Automatic Exercise Value Trigger occurs and (y) the date the Notice of Automatic Exercise is delivered (as defined in, and
delivered pursuant to, Section 3(a)) (the “Evaluation Dates”); 
 (iii) on each day during such thirty
(30) trading-day period and on the Evaluation Dates, the Common Stock is designated for quotation on the Principal Market and shall not have been suspended from trading on the Principal Market (other than suspensions of not more than two
(2) trading days due to business announcements by the Company, which suspensions have been lifted more than two (2) trading days prior to each of the Evaluation Dates); 
 (iv) delisting or suspension of the Common Stock by the Principal Market shall not have been threatened or be pending on either of the
Evaluation Dates, either (A) in writing by the Principal Market or (B) by reason of falling below the then effective minimum listing maintenance requirements of the Principal Market; 
  

 2 

 (v) during such thirty (30) trading-day period and on each of the Evaluation Dates
there shall not have occurred (A) the public announcement of a pending, proposed or intended merger (other than the merger contemplated by the merger agreement by and among the Company, a subsidiary of the Company and CD&L, Inc. entered
into concurrently with the initial issuance of this Warrant) which has not been abandoned, terminated or consummated, (B) an Event of Default under (and as such term is defined in) the Indenture dated July 3, 2006 related to the Notes or
(C) an event that with the passage of time or giving of notice would constitute such an Event of Default; and 
 (vi) the
Company shall have no knowledge on either of the Evaluation Dates of any fact that would cause (A) the registration statement required pursuant to the Registration Rights Agreement not to be effective and available for the resale of all
remaining Warrant Shares in accordance with the terms of the Registration Rights Agreement or (B) any Warrant Shares issuable upon exercise of the Warrants not to be eligible for sale without restriction pursuant to Rule 144(k) and any
applicable state securities laws, 
 then this Warrant shall be deemed to be exercised automatically at the Exercise Price, to the extent and in accordance
with the provisions of Section 3 and Section 7. 
 (c) Delay in Exercise Period. If the stockholder approval referred to in
Section 1(a) is not effective on or before October 27, 2006 (the “Approval Deadline”), then the Company will pay to the Holder, as liquidated damages and not as a penalty, an amount equal to one percent (1%) of the
aggregate Exercise Price for the Warrant Shares subject to this Warrant for each thirty (30) day period (and prorated for any portion thereof) after the Approval Deadline. Such payment shall be in partial compensation to the Holders, and shall
not constitute the Holders’ exclusive remedy for such events. The amounts payable as liquidated damages pursuant to this Section 1(c) shall be paid monthly within three (3) Business Days after the last day of each calendar month
following the Approval Deadline until such stockholder approval is effective. Such payments shall be made to the Holder in cash. 
 2.
Procedure for Optional Exercise by the Holder; Effect of Exercise. With respect to an optional exercise pursuant to Section 1(a), this Warrant may be exercised, in whole or in part, by the Holder during normal business hours on any
Business Day (as defined below) during the Exercise Period by (i) the presentation and surrender of this Warrant to the Company at its principal office along with a duly executed notice of exercise, in the form attached to this Warrant (the
“Notice of Exercise”), specifying the number of Warrant Shares to be purchased and (ii) delivery of payment to the Company of the Exercise Price for the number of Warrant Shares specified in the Notice of Exercise. 

For purposes of this Warrant, “Business Day” means any day other than a Saturday, Sunday or other day on which banking institutions in the city of
New York, New York are required or authorized by law or other governmental action to be closed. 
  

 3 

 3. Procedure for Automatic Exercise. 
 (a) Upon the occurrence of an Automatic Exercise Value Trigger (and if each of the conditions set forth in Section 1(b)(ii) through (vi) are
satisfied on such date) the Company will determine the amount of this Warrant to be automatically exercised as a result of an automatic exercise of this Warrant pursuant to Section 1(b) (assuming for this purpose each of the conditions set
forth in Section 1(b)(ii) through (vi) will be true on the date the Notice of Exercise is delivered) and within ten (10) Business Days after the occurrence of such Automatic Exercise Value Trigger the Company shall deliver to the
Holder a notice of automatic exercise (the “Notice of Automatic Exercise”) unless any of the conditions set forth in Section 1(b)(ii) through (vi) is not satisfied during such period. The amount of this Warrant to be
exercised upon the occurrence of an automatic exercise with respect to a Measurement Period shall not exceed the number of Warrant Shares equal to (x) twenty percent (20%) of the average of the dollar value of the Common Stock traded each
day (the “Common Stock Volume Value”) during such Measurement Period as reported by the Nasdaq Stock Market (or, if the Common Stock ceases to be listed on the Nasdaq Stock Market, the primary national or regional securities
exchange or quotation system on which the Common Stock is then listed or quoted); (y) divided by the Exercise Price in effect at the end of such Measurement Period; and (z) multiplied by the fraction whose numerator is the number of
Warrant Shares for which this Warrant is exercisable as of the end of such Measurement Period and whose denominator is the aggregate number of shares of Common Stock issuable upon exercise in full of the then outstanding Class of Warrants as of the
end of such Measurement Period. 
 For purposes of this Warrant, the “Measurement Period” means the first thirty (30) trading day
period in which the Automatic Exercise Value Trigger has been achieved. As contemplated by Section 3, there may be more than one automatic exercise of this Warrant, but if an automatic exercise occurs then no trading day included in the related
Measurement Period will be included in any subsequent Measurement Period, such that there will not be any overlap of different Measurement Periods. 
 (b) Upon the occurrence of an Automatic Exercise Value Trigger, if each of the conditions set forth in Section 1(b)(ii) through (vi) is also satisfied on such date, the Company will issue a press release to that effect within two
(2) Business Days after the occurrence of such Automatic Exercise Value Trigger, but identifying the additional condition that each of the conditions set forth in Section 1(b)(ii) through (vi) must be true on the date the Notice of
Exercise is delivered. Each such press release shall set forth the number of shares of Common Stock issuable upon exercise in full of the Class of Warrants outstanding as of the end of the related Measurement Period. The Notice of Automatic Exercise
shall: (i) state that the conditions for an automatic exercise of this Warrant have been satisfied, (ii) identify the number of Warrant Shares automatically exercised under this Warrant, (iii) identify the office of the Company to
which this Warrant and the Exercise Price should be delivered and (iv) set forth payment instructions for any Exercise Price paid in cash or in Notes. From and after the delivery of the Notice of Automatic Exercise: (I) the sole right of
the Holder with respect to the portion of this Warrant automatically exercised shall be (to the extent of such automatic exercise) to receive the Warrant Shares issuable upon such automatic exercise upon proper delivery of this Warrant and the
Exercise Price to the Company, (II) the Company shall not be obligated to allow and register transfer any Warrant or to permit any exercise at the option of the Holder with respect to 

  

 4 

 
any Warrant that has not been surrendered for automatic exercise in accordance with this Section 3 until the Holder has properly delivered this Warrant
and the Exercise Price for the Warrants subject to such automatic exercise and (III) the Warrant Shares issuable upon an automatic exercise of this Warrant will not be deemed to be outstanding until the Holder has properly delivered this Warrant and
the Exercise Price for the Warrants subject to such automatic exercise. Notwithstanding the foregoing, if the conditions to a cashless exercise pursuant to Section 5 are in effect at the time the Holder tenders this Warrant upon an automatic
exercise, the Holder may elect a cashless exercise with respect to the Warrant Shares to which such automatic exercise applies by delivering a duly executed Notice of Exercise specifying that cashless exercise will apply to such automatic exercise.

 4. Payment of the Exercise Price. 
 (a) The Exercise Price may be paid by the Holder by delivery to the Company (i) of cash, paid by wire transfer of immediately available funds to a bank account specified by the Company, or by certified or bank
cashier’s check payable to the Company, (ii) tender of Notes duly endorsed for transfer to the Company or accompanied by appropriate assignment documentation (in the case of a certificated Note) or designated by appropriate instructions to
the Trustee for transfer (in the case of a global note) or (iii) a combination of such cash and Notes. If in connection with any exercise of this Warrant the principal amount of Notes tendered in payment of the Exercise Price exceeds the
aggregate Exercise Price for the Warrant Shares subject to such exercise of this Warrant, the Company will cause a Note for the amount of such excess to be delivered to the Holder by delivery of a certificated Note (if the Notes tendered were
certificated Notes) or by appropriate designation on a global note (if the Notes tendered were part of a global note) within five (5) Business Days after the related Warrant Shares are deemed to be issued to the Holder pursuant to
Section 6. 
 (b) For purposes of this Section 4, each Note delivered in payment of the Exercise Price shall be deemed to have a
value equal to 100% of the principal amount of such Note. The amount, if any, of (i) accrued but unpaid interest on each such Note to and including the date the Notice of Exercise is delivered to the Company (with respect to an exercise at the
option of the Holder pursuant to Section 1(a)) or the date the Notice of Automatic Exercise is delivered to the Holder (with respect to an exercise pursuant to Section 1(b)) and (ii) if the Company has called such Note for redemption
prior to the delivery of such Notice of Exercise or Notice of Automatic Exercise, as the case may be, the applicable premium over the principal amount of such Note, if any, that would be paid to the Holder if such Note delivered to the Company in
payment of the Exercise Price was redeemed pursuant to such redemption call, shall be paid to the Holder as provided in the Indenture dated as of July 3, 2006 between the Company and Wells Fargo Bank, N.A., as Trustee, related to the Notes.

 5. Cashless Exercise. Notwithstanding any provision in this Warrant to the contrary, if, at any time following the Filing Deadline
(as defined in the Registration Rights Agreement) but during the Exercise Period, the Warrant Shares are not available for immediate resale without restriction by the Holder without registration (or pursuant to an effective registration statement)
under the Securities Act, the Holder may exercise this Warrant, in whole or in part, by a cashless exercise by the presentation and surrender of this Warrant to the Company at its principal office along with a duly executed Notice of Exercise
specifying the number of Warrant Shares to be 

  

 5 

 
applied to such exercise. The number of Warrant Shares to be delivered upon exercise of this Warrant pursuant to this Section 5 shall be computed using
the following formula: 
  

					
		 	 X =
	  	Y (B-A)
		 		  	      B
			
	 Where:
	 	 X =
	  	the number of shares of Common Stock to be issued to the Holder.
			
		 	 Y =
	  	the number of Warrant Shares identified in the Notice of Exercise as being applied to the subject exercise.
			
		 	 A =
	  	the Exercise Price on the date this Warrant and the properly executed Notice of Exercise are delivered to the Company for such exercise.
			
		 	 B =
	  	the volume weighted average price of one share of Common Stock on the date the on the date this Warrant and the properly executed Notice of Exercise are delivered to the Company for such
exercise.

 6. Effect of Exercise. 
 (a) Upon receipt by the Company of (i) this Warrant, a Notice of Exercise and proper payment of the Exercise Price as provided in Section 2 and
Section 4 (or a Notice of Exercise designating a cashless exercise as provided in Section 5) or (ii) this Warrant and proper payment of the Exercise Price as provided in Section 3 and Section 4 (or a Notice of Exercise
designating a cashless exercise as provided in Section 5), the Company agrees that such Warrant Shares shall be deemed to be issued to the Holder or its designee as the record holder of such Warrant Shares as of the close of business on the
date on which such receipt occurs, and the Holder or such designee shall be deemed to be the holder of record of the Warrant Shares, notwithstanding that the stock transfer books of the Company may then be closed or that certificates representing
such Warrant Shares shall not then be actually delivered to the Holder or its designee. As promptly as practicable, and in any event within three (3) Business Days after such Warrant Shares are deemed issued, (i) provided that the
Company’s transfer agent is then participating in the Depository Trust Company’s (“DTC”) Fast Automated Securities Transfer Program, the Company will cause to be credited such aggregate number of such Warrant Shares to the
balance account with DTC of the Holder or its designee through the Deposit Withdrawal Agent Commission system, or (B) if the Company’s transfer agent is not then participating in the DTC Fast Automated Securities Transfer Program, the
Company will issue and deliver to the address as specified in the Notice of Exercise or in a notice accompanying delivery of this Warrant to the Company pursuant to Section 3, as the case may be, a stock certificate or certificates for the
Warrant Shares issuable upon such exercise of this Warrant, registered in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder shall be entitled. The stock certificate(s) so delivered shall be in any
such denominations as may be reasonably specified by the Holder in the Notice of Exercise or in a notice accompanying delivery of this Warrant to the Company pursuant to Section 3, as the case may be. 
 (b) The Company understands that a delay in the delivery of the certificates representing the Warrant Shares upon exercise of this Warrant could result
in economic loss to 

  

 6 

 
the Holder. As compensation to the Holder for such loss, the Company agrees to pay (as liquidated damages and not as a penalty) to the Holder for such late
delivery of Warrant Shares upon exercise of this Warrant the amount of $100 per Business Day after the third Business Day after the Holder has properly exercised this Warrant for each $10,000 of Common Stock (measured by the Current Market Price as
of the date the Holder has properly exercised this Warrant and pro rated for amounts other than $10,000), and continuing until the date on which the certificate representing such Warrant Shares are delivered to the Holder (or its designee). The
Company shall pay any payments incurred under this Section 5(b) in immediately available funds upon demand. Furthermore, in addition to any other remedies which may be available to the Holder, in the event that the Company fails for any reason
to effect delivery as stated in Section 5a), the Holder will be entitled to revoke all or part of the relevant notice of exercise by delivery of a notice to such effect to the Company, whereupon the Company and the Holder shall each be restored
to their respective positions immediately prior to the delivery of such notice, except that the liquidated damages described above shall be payable through the date notice of revocation is given to the Company. 
 (c) In addition to any other rights available to the Holder, if the Company fails to make timely delivery in accordance with the provisions of
Section 6(b) to the Holder of a certificate or certificates representing the Warrant Shares for which this Warrant has been exercised, and if within seven (7) Business Days thereafter the Holder purchases (in an open market transaction or
otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Common Stock which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall pay in cash to the Holder (in
addition to any remedies available to or elected by the Holder) within five (5) Business Days after written notice from the Holder, the amount by which (i) the Holder’s total purchase price (including brokerage commissions, if any)
for the shares of Common Stock so purchased exceeds (ii) the aggregate Current Market Price of the Common Stock for which such exercise was not timely honored (as in effect on the date the Warrant Shares are deemed issued in accordance with
Section 5(a)) together with interest thereon at a rate of fifteen percent (15%) per annum, accruing from such dated of deemed issue until such amount and any accrued interest thereon is paid in full (which amount shall be paid as
liquidated damages and not as a penalty). For example, if the Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Warrant Shares having an aggregate Current
Market Price of $10,000 on the date of exercise, the Company shall be required to pay the Holder $1,000, plus interest. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In.

 7. Limitation on Exercise. The Company shall not effect the exercise of this Warrant, and the Holder shall not have the right to
exercise this Warrant, to the extent that after giving effect to such exercise, such Holder (together with such Holder’s Affiliates (as defined below)) would beneficially own in excess of 4.99% (the “Maximum Percentage”) of the
shares of Common Stock outstanding immediately after giving effect to such exercise. For purposes of the preceding sentence, the aggregate number of shares of Common Stock beneficially owned by such Holder and its Affiliates shall include the number
of shares of Common Stock issuable upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock which would be issuable (but have not been issued or deemed issued)
upon (i) exercise of the remaining, unexercised portion of this Warrant 

  

 7 

 
beneficially owned by such Holder and its Affiliates and (ii) exercise or conversion of the unexercised or unconverted portion of any other securities
of the Company beneficially owned by such Holder and its Affiliates (including, without limitation, any convertible notes or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein. Except as set
forth in the preceding sentence, for purposes of this Section 7, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). For
purposes of this Warrant, in determining the number of outstanding shares of Common Stock issued by the Company, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (I) the Company’s most recent Form
10-K, Form 10-Q, Current Report on Form 8-K or other public filing with the Securities and Exchange Commission, as the case may be, (II) a more recent public announcement by the Company or (III) any other notice by the Company setting forth the
number of shares of Common Stock outstanding. For any reason at any time, upon the written or oral request of the Holder, the Company shall within one Business Day confirm orally and in writing to the Holder the number of shares of Common Stock then
outstanding. By written notice to the Company, any Holder may from time to time increase or decrease the Maximum Percentage to any other percentage specified in such notice; provided that any such increase will not be effective until the
sixty-first (61st) day after such notice is delivered to the Company. 
 For purposes of this Warrant, “Affiliate” means, with respect
to any person or entity, any other person or entity directly or indirectly, through one or more intermediaries, controlling, controlled by or under direct or indirect common control with such specified person or entity, where ‘control’
means the power to manage or direct or cause the direction of the management and policies of such person or entity, directly or indirectly, whether through the ownership of voting stock, by contract or otherwise. 
 The limitations contained in this Section 7 shall apply to a successor Holder of this Warrant. 
 8. Partial Exercise. If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant for cancellation, execute
and deliver a new Warrant evidencing the right of the Holder to purchase the balance of the Warrant Shares subject to purchase hereunder. 
 9. Registration of Warrants; Transfer of Warrants. Any Warrants issued upon the transfer or exercise in part of this Warrant shall be numbered and shall be registered in a Warrant Register maintained by the Company or its designee as
they are issued. The Company shall be entitled to treat the registered holder of any Warrant on the Warrant Register as the owner in fact thereof for all purposes and shall not be bound to recognize any equitable or other claim to or interest in
such Warrant on the part of any other person or entity, and shall not be liable for any registration or transfer of Warrants which are registered or to be registered in the name of a fiduciary or the nominee of a fiduciary unless made with the
actual knowledge that a fiduciary or nominee is committing a breach of trust in requesting such registration or transfer, or with the knowledge of such facts that its participation therein amounts to bad faith. This Warrant shall be transferable
only on the books of the Company upon delivery thereof duly endorsed by the Holder or by such Holder’s duly authorized attorney or representative, or accompanied by proper evidence of succession, assignment, or authority to transfer. In all
cases of transfer by an attorney, executor, administrator, guardian or other legal representative, duly authenticated 

  

 8 

 
evidence of his or its authority shall be produced. Upon any registration of transfer, the Company shall deliver a new Warrant or Warrants to the person or
entity entitled thereto. Subject to Section 7, this Warrant may be exchanged, at the option of the Holder, for another Warrant or other Warrants of different denominations, of like tenor and representing in the aggregate the right to purchase a
like number of Warrant Shares, upon surrender to the Company. 
 10. (a) Transfer Restricted Security. The Holder, as of the date
of issuance of this Warrant, represents to the Company that such Holder is acquiring this Warrant for the Holder’s own account, for investment purposes and not with a present view to the distribution thereof or of the Warrant Shares.

 (b) Notice of Intention to Transfer; Conditions to Transfer. The Holder may not transfer this Warrant or any of the Warrant Shares
prior to the date which is two (2) years (or such shorter period as may be prescribed by Rule 144(k) under the Securities Act (or any successor provision) after the later of the original issue date of this Warrant (or any predecessor of this
Warrant) or such Warrant Share (or any predecessor of such Warrant Share, including this Warrant to the extent the holding period of this Warrant may be tacked thereto under the Securities Act) and the last date on which the Company or any of its
Affiliates was the owner of this Warrant or such Warrant Share (such period being the “Restriction Period”), except to: 
 (i) the Company or any of its subsidiaries; 
 (ii) pursuant to a registration statement which
has been declared effective under the Securities Act; 
 (iii) for so long as this Warrant is eligible for resale under Rule
144A under the Securities Act, to a person or entity the Holder reasonably believes is a “Qualified Institutional Buyer” as defined in Rule 144A that purchases for its own account or for the account of a Qualified Institutional Buyer to
whom notice is given that the transfer is being made in reliance on Rule 144A; 
 (iv) pursuant to offers and sales to
non-U.S. Purchasers that occur outside the United States within the meaning of Regulation S under the Securities Act, pursuant to Rule 904 of Regulation S; 
 (v) to an institutional “accredited investor” within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the Securities Act that is acquiring the Warrant for its own account, or
for the account of such an institutional accredited investor, for investment purposes and not with a view to, or for offer or sale in connection with, any distribution in violation of the Securities Act; or 
 (vi) pursuant to another available exemption from the registration requirements of the Securities Act and the securities laws of any other
jurisdiction, including any state of the United States, 

  

 9 

 
subject to the Company’s right, prior to any such transfer pursuant to the foregoing clauses (iv), (v) or (vi) to require the delivery of an
opinion of counsel, certification or other information reasonably satisfactory to the Company. 
 (c) Legend. During the applicable
Restriction Period, this Warrant and each certificate representing any Warrant Share issued upon exercise or exchange of this Warrant shall bear the following legend or an equivalent to such legend: 
 “THIS SECURITY HAS AND THE WARRANT SHARES TO BE ISSUED UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY, THE WARRANT SHARES TO BE ISSUED UPON ITS EXERCISE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.” 
 The Holder understands that the Company may place, and
may instruct any transfer agent or depository for the Warrant Shares to place, a stop transfer notation in the securities records in respect of the Warrant Shares. 
 (d) Legend Removal. At the expiration of the Restriction Period, or upon the sooner effectiveness of a registration statement covering all of the Warrant Shares, the Company shall remove the restrictive legend
promptly upon the request of the holder of the Warrant Shares. 
 11. Reservation of Shares. The Company shall at all times during the
Exercise Period reserve and keep available out of its authorized and unissued Common Stock, solely for the purpose of providing for the exercise of the rights to purchase all Warrant Shares granted pursuant to this Warrant, no less than one hundred
fifty percent (150%) of the number of shares of Common Stock as shall then be issuable upon the exercise of this Warrant. The Company covenants that any and all Warrant Shares, as and when issuable in accordance with this Warrant against the
Company’s receipt of the Exercise Price or other specified consideration therefor, shall be validly issued, fully paid, non-assessable, and free of preemptive rights. 
 12. Adjustments. The Exercise Price, the number of shares purchasable hereunder and the Automatic Exercise Trading Price Threshold are subject to
adjustment from time to time as provided in this Section 12. 
 (a) Exempt Issues. No adjustment shall be made pursuant to this
Section 12 with respect to any issue of Common Stock: 
 (i) upon conversion of shares of the Company’s Series M
Convertible Preferred Stock, Series N Convertible Preferred Stock, Series O Convertible Preferred Stock, Series P Convertible Preferred Stock or Series Q Convertible Preferred Stock, in each case at the exercise price in effect on July 3, 2006
(without giving any effect to the 

  

 10 

 
antidilution provisions thereof except to the extent the same may be adjusted in a manner consistent with Section 12(c) of this Warrant regarding stock
splits and dividends); 
 (ii) as payment of dividends in lieu of cash with respect to the Company’s Series M Convertible
Preferred Stock, Series N Convertible Preferred Stock, Series O Convertible Preferred Stock, Series P Convertible Preferred Stock or Series Q Convertible Preferred Stock, in each case to the extent specifically provided for under and strictly in
accordance with the express terms existing, effective and applicable to the foregoing on and as of July 3, 2006; 
 (iii)
(A) upon the exercise of warrants outstanding as of July 3, 2006 to purchase up to 30,630,538 shares of Common Stock (as the same may be adjusted in accordance with the antidilution provisions thereof, if any; provided, however, if
any such antidilution provisions are based on the exercise price of such warrants instead of fair market value of the securities or other property sold or distributed, then no such adjustment will be taken into account except to the extent the same
may be adjusted in a manner consistent with Section 12(c) of this Warrant), in each case to the extent specifically provided for under and strictly in accordance with the express terms existing, effective and applicable to the foregoing on and
as of July 3, 2006; or 
 (iv) upon the exercise of options or other rights to purchase up to 3,361,365 shares of Common
Stock outstanding as of July 3, 2006 under the Company’s 1995 Stock Option Plan, 2000 Stock Option Plan,1996 Director Stock Option Plan, and 2004 Stock Option Plan, in each case to the extent specifically provided for under and strictly in
accordance with the express terms existing, effective and applicable to the foregoing on and as of July 3, 2006. 
 (b) Adjustment of
Exercise Price. If the Company shall issue or sell, or is, in accordance with Sections 12(b)(1) through 12(b)(6), deemed to have issued or sold, any shares of any class of capital stock of the Company (“Capital Stock”) without
consideration (which shall include any issuance of Capital Stock that triggers the antidilution adjustments of the securities listed in Section 12(a)(i) except as set forth in that Section) or for a consideration per share less than the Current
Market Price of such Capital Stock immediately prior to the time of such issue or sale, then and in each such case (a “Trigger Issuance”) the then-existing Exercise Price shall be reduced by multiplying the Exercise Price in effect
immediately prior to such Trigger Issuance by: 
 (i) if such Capital Stock is Common Stock, a fraction the numerator of which
is the number of shares of Common Stock outstanding immediately prior to such Trigger Issuance plus the number of shares of Common Stock which could be purchased at the Current Market Price per share of Common Stock on the date of such Trigger
Issuance with the aggregate consideration (based on the fair market value thereof as determined by the Board of Directors, whose determination shall be conclusive and described in a certificate delivered to each Holder) received or receivable by the
Company in connection with such Trigger Issuance (the “Aggregate Consideration”), and the denominator of which is the number of shares of Common Stock outstanding immediately prior to such Trigger Issuance plus the number of shares
of Common Stock to be so issued or sold; or 
  

 11 

 (ii) if such Capital Stock is other than Common Stock, a fraction the numerator of which
is the Current Market Price per share of Common Stock immediately prior to such Trigger Issuance minus an amount equal to (A) the sum of (1) the Current Market Price per share of such Capital Stock multiplied by the number of shares of
such Capital Stock to be so issued minus (2) the Aggregate Consideration, divided by (B) the number of shares of Common Stock outstanding immediately prior to such Trigger Issuance, and the denominator of which is the Current Market Price
per share of Common Stock immediately prior to such Trigger Issue. 
 For purposes of this Section 12 and for the avoidance of doubt, if the Company
issues any shares of Capital Stock that trigger the antidilution protection provisions of the securities listed in Section 12(a)(i), then such issuance will be deemed to have been done without consideration (as that term is used in the first
sentence of Section 12(b)) such that the Aggregate Consideration attributable to that issuance will be zero ($0) and the Exercise Price of the Warrants will be adjusted as contemplated by this Section 12(b). 
 For purposes of this Section 12, a Trigger Issue shall be deemed to occur upon the earliest of (A) the date the Company enters into a firm contract for the
issuance or sale of the Capital Stock, (B) the record date for the determination of stockholders entitled to receive any such Capital Stock or (C) the date of actual issuance or sale of such Capital Stock. Any references to a different
date or dates in Sections 12(b)(1) to (6) below are for convenience only and this provision shall control over any such other reference. 
 For purposes
of this Warrant, “Current Market Price” means, when used with respect to any security as of any date, the last sale price, regular way, or, in case no such sale takes place on such date, the average of the closing bid and asked
prices, regular way, in either case as reported for consolidated transactions on the Nasdaq Stock Market or, if the security is not listed or admitted to trading on the Nasdaq Stock Market, as reported for consolidated transactions with respect to
such security listed on the principal national securities exchange on which such security is listed or admitted to trading or, if the security is not listed or admitted to trading on any national securities exchange, the last quoted price or, if not
so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by the National Association of Securities Dealers, Inc. Automated Quotations System or such other system then in use or, if the security is not
quoted by any such organization, the average of the closing bid and asked prices furnished by a New York Stock Exchange member firm selected by the Company. “Current Market Price” means, when used with respect to a security as to
which none of the above-mentioned prices are available and with respect to any property other than a security, as of any date, the market value of such security or property on such date as determined by the Board of Directors of the Company in good
faith, which shall be entitled to rely for such purposes on the advice of any firm of investment bankers or appraisers having familiarity with such property; provided, however, that if the Holder objects to a determination of Current Market
Price by the Board of Directors of the Company, the Company and the Holder shall engage an investment banking firm or appraisal firm of recognized national standing selected by the Company and acceptable to the Holder to make such determination (the
fees and expenses of such investment banking firm or appraisal firm to be shared equally by the Company and the Holder). 
  

 12 

 For purposes of this 12(b), the following Sections 12(b)(1) to 12(b)(6) shall be applicable. 
 (1) Issue of Rights or Options. If the Company at any time grants or issues in any manner any warrants or other rights to subscribe for or to
purchase, or any options for the purchase of, Capital Stock or for any stock or security convertible into or exchangeable for Capital Stock (such warrants, rights or options being called “Options”, and such convertible or
exchangeable stock or securities being called “Convertible Securities”), whether or not such Options or the right to convert or exchange any such Convertible Securities are immediately exercisable, and the price per share for which
Capital Stock is issuable upon the exercise of such Options or upon the additional conversion or exchange of such Convertible Securities (in each case as calculated in accordance with Section 12(b)(5)) is less than the Current Market Price per
share of such Capital Stock in effect immediately prior to the time of the grant or issue of such Options, then the total number of shares of Common Stock issuable upon the exercise of such Options or upon conversion or exchange of the total amount
of such Convertible Securities issuable upon the exercise of such Options shall be deemed to have been issued for such price per share as of the date of granting of such Options and thereafter shall be deemed to be outstanding for purposes of
adjusting the Exercise Price. Except as otherwise provided in Section 12(b)(3 ), no adjustment of the Exercise Price shall be made upon the actual issue of such Common Stock or of such Convertible Securities upon exercise of such Options or
upon the actual issue of such Common Stock upon conversion or exchange of such Convertible Securities. 
 (2) Issue of Convertible
Securities. If the Company at any time issues or sells in any manner or sell any Convertible Securities, whether or not the rights to exchange or convert any such Convertible Securities are immediately exercisable, and the price per share for
which Capital Stock is issuable upon such conversion or exchange (in each case as calculated in accordance with Section 12(b)(5)) is less than the Current Market Price per share of such Capital Stock in effect immediately prior to the time of
the issue or sale, then the total maximum number of shares of Capital Stock issuable upon conversion or exchange of such Convertible Securities shall be deemed to have been issued for such price per share as of the date of the issue or sale of such
Convertible Securities and thereafter shall be deemed to be outstanding for purposes of adjusting the Exercise Price. Except as otherwise provided in Section 12(b)(3), no adjustment of the Exercise Price shall be made upon the actual issuance
of such Capital Stock upon conversion or exchange of such Convertible Security. No further adjustment of the Exercise Price shall be made by reason of the issue or sale of Convertible Securities upon exercise of any Options to purchase any such
Convertible Securities for which adjustments of the Exercise Price have been made pursuant to the other provisions of Section 12(b)(1). 
 (3) Change in Option Price or Conversion Rate. If the purchase price provided for in any Right or Option referred to in Section 12(a)(l), the additional consideration, if any, payable upon the conversion or exchange of any
Convertible Securities referred to in Sections 12(a)(l) or 12(a)(2), or the rate at which Convertible Securities referred to in Sections 12(a)(l) or 12(a)(2) are convertible into Capital Stock shall change at any time (including, but not limited to,
changes under or by reason of provisions designed to protect against dilution), the Exercise Price in effect at the time of such event shall forthwith be readjusted to the Exercise 

  

 13 

 
Price which would have been in effect at such time had such Options or Convertible Securities still outstanding provided for such changed purchase price,
additional consideration or conversion rate, as the case may be, at the time initially granted, issued or sold. On the termination of any Option for which any adjustment was made pursuant to this Section 12(b) or any right to convert
Convertible Securities for which any adjustment was made pursuant to this Section 12(b) (including without limitation upon the redemption or purchase for consideration of such Convertible Securities by the Company), and after five
(5) calendar days notice to the Holder, the Exercise Price then in effect hereunder shall forthwith be changed to the Exercise Price which would have been in effect at the time of such termination had such Option or Convertible Securities, to
the extent outstanding immediately prior to such termination, never been issued. 
 (4) Stock Dividends. Subject to the provisions of
this Section 12(b), if the Company declares a dividend or makes any other distribution upon any Capital Stock of the Company (other than the Common Stock) payable in Capital Stock, Options or Convertible Securities, then any Capital Stock,
Options or Convertible Securities, as the case may be, issuable in payment of such dividend or distribution shall be deemed to have been issued or sold without consideration. 
 (5) Consideration for Stock. 
 (i) Options. For purposes of Section 12(b)(1), the price per share for which an Option is exercisable or for which a Convertible Security is convertible or exchangeable is equal to (A) the sum (which sum shall constitute
the Aggregate Consideration for purposes of the first sentence of this Section 12(b)) of (I) the total amount, if any, received or receivable by the Company as consideration for the granting of such Options, plus (II) the aggregate amount
of additional consideration payable to the Company upon the exercise of all such Options, plus (III), in the case of such Options which relate to Convertible Securities, the aggregate amount of additional consideration, if any, payable upon the
issue or sale of such Convertible Securities and upon the conversion or exchange thereof, divided by (B) the total maximum number of shares of Capital Stock issuable upon the exercise of such Options or upon the conversion or exchange of all
such Convertible Securities issuable upon the exercise of such Options). 
 (ii) Convertible Securities. For purposes
of Section 12(b)(2), the price per share for which a Convertible Security is convertible or exchangeable is equal to (A) the sum (which sum shall constitute the Aggregate Consideration for purposes of the first sentence of this
Section 12(b)) of (I) the total amount received or receivable by the Company as consideration for the issue or sale of such Convertible Security, plus (II) the aggregate amount of additional consideration, if any, payable to the Company
upon the conversion or exchange thereof, divided by (B) the total number of shares of Capital Stock issuable upon the conversion or exchange of such Convertible Security. 
 (iii) Generally. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for cash, the
consideration received therefor shall be deemed to be the net amount received by the Company therefor, after deduction therefrom of any expenses incurred or any underwriting commissions or concessions paid 

  

 14 

 
or allowed by the Company in connection therewith. In case any shares of Common Stock, Options or Convertible Securities shall be issued or sold for a
consideration other than cash, the amount of the consideration other than cash received by the Company shall be deemed to be the fair value of such consideration as determined in good faith by the Board of Directors of the Company, after deduction
of any expenses incurred or any underwriting commissions or concessions paid or allowed by the Company in connection therewith. In case any Options shall be issued in connection with the issue and sale of other securities of the Company, together
comprising one integral transaction in which no specific consideration is allocated to such Options by the parties thereto, such Options shall be deemed to have been issued for such consideration as determined in good faith by the Board of Directors
of the Company. If Common Stock, Options or Convertible Securities shall be issued or sold by the Company and, in connection therewith, other Options or Convertible Securities (the “Additional Rights”) are issued, then the
consideration received or deemed to be received by the Company shall be reduced by the fair market value of the Additional Rights (as determined using the Black-Scholes option pricing model or another method mutually agreed to by the Company and the
Holder). The Company shall respond promptly, in writing, to an inquiry by the Holder as to the fair market value of the Additional Rights. In the event that the Company and the Holder are unable to agree upon the fair market value of the Additional
Rights, the Company and the Holder shall jointly select an appraiser, who is experienced in such matters. The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne by the Company. 
 (6) Treasury Shares. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the
account of the Company or any of its wholly-owned subsidiaries, and the disposition of any such shares (other than the cancellation or retirement thereof) shall be considered an issue or sale of Common Stock for the purpose of this
Section 12(b). 
 (c) Stock Splits and Dividends. In the event that the Company shall subdivide its outstanding shares of Common
Stock into a greater number of shares, pay a dividend or make a distribution on its Common Stock in shares of Common Stock or combine its outstanding shares of Common Stock into a smaller number of shares, the Exercise Price and the Automatic
Exercise Trading Threshold in effect immediately prior thereto each shall be proportionately decreased in the case of a subdivision or increased in the case of a combination. An adjustment made pursuant to this Section 12(c) shall become
effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the date of such subdivision or combination, as the case may be. Such
adjustments shall be made successively whenever any event listed above in this Section 12(c) shall occur. 
 (d) Distributions.
In case the Company shall fix a payment date for the making of a distribution to all Holders of Capital Stock (including any such distribution made in connection with a consolidation or merger in which the Company is the continuing corporation) of
evidences of indebtedness or assets (other than dividends or distributions referred to in Section 12(c)), the Exercise Price to be in effect after such payment date shall be determined by multiplying the Exercise Price in effect immediately
prior to such payment date by a fraction, the 

  

 15 

 
numerator of which shall be the total number of shares of Common Stock outstanding multiplied by the Current Market Price per share of Common Stock
immediately prior to such payment date, less the Current Market Price of such assets or evidences of indebtedness so distributed, and the denominator of which shall be the total number of shares of Common Stock outstanding multiplied by such Market
Price per share of Common Stock immediately prior to such payment date. Such adjustment shall be made successively whenever such a payment date is fixed. 
 (e) Reorganization or Reclassification. In the event of (i) any reclassification (including, without limitation, a reclassification effected by means of an exchange or tender offer by the Company or any
subsidiary) or change of outstanding Common Stock (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), (ii) any consolidation, merger or
combination of the Company with another corporation as a result of which holders of Common Stock shall be entitled to receive securities or other assets (including cash) with respect to or in exchange for Common Stock or (iii) any sale or
conveyance of the assets of the Company as, or substantially as, an entirety to any other corporation as a result of which holders of Common Stock shall be entitled to receive securities or other assets (including cash) with respect to or in
exchange for Common Stock, then: (I) the Company or the successor or purchasing corporation, as the case may be, shall execute and deliver to the Holder upon surrender of this Warrant a supplemental warrant providing that the Holder shall have
the right thereafter (until the expiration of this Warrant) to receive, upon full exercise of this Warrant, the kind and amount of shares of stock and/or other securities and/or property receivable upon such reclassification, consolidation, merger,
combination, sale or conveyance by a holder of the number of shares of Common Stock for which this Warrant might have been exercised immediately prior to such reclassification, consolidation, merger, combination, sale or conveyance; and (II) the
Automatic Exercise Trading Threshold shall thereafter be measured by reference to the Current Market Value of the kind and amount of shares of stock and/or other securities and/or property receivable with respect to one share of Common Stock upon
such reclassification, consolidation, merger, combination, sale or conveyance (instead of being measured by reference to the daily volume weighted average price of a share of Common Stock). The supplemental warrant referred to in clause (I) of
the preceding sentence shall provide for adjustments (without regard to limitations on the exerciseability of this Warrant) which shall be as nearly equivalent as practicable to the adjustments provided for in this Section 12. The above
provision of this Section 12(e) shall similarly apply to successive consolidations or mergers. 
 (f) Reductions by the Company.
Anything in this Section 12 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Exercise Price, in addition to those required by this Section 12, as it in its discretion shall determine to be
advisable. 
 (g) Other Adjustments. In case any event shall occur as to which the other provisions of Section 12(b) to
(f) are not strictly applicable but as to which the failure to make any adjustment would not fairly protect the exercise rights represented by this Section 12 in accordance with the essential intent and principles hereof then, in each such
case, the Holder and the Company shall cooperate to agree upon an appropriate adjustment under this Section 12. If the Holder and the Company are unable to agree upon such an adjustment, the Company and the Holder shall jointly select an
appraiser, who is experienced in such matters. Upon receipt of 

  

 16 

 
such opinion, the Company will promptly mail a copy thereof to the Holder and shall make the adjustments described therein. The decision of such appraiser
shall be final and conclusive, and the cost of such appraiser shall be borne by the Company. 
 (h) Subsequent Adjustments. In the
event that, as a result of an adjustment made pursuant to this Section 12, Holders become entitled to receive any shares of Capital Stock of the Company other than shares of Common Stock, the number of such other shares so receivable upon the
exercise of the Warrants shall be subject thereafter to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Warrant Shares contained herein. 
 (i) Calculations. All calculations under this Section 12 shall be made to the nearest four decimal points. 
 (j) Adjustment in Number of Securities. Upon each adjustment of the Exercise Price pursuant to the provisions of Section 12(b), (c) or
(d), the number of shares of Common Stock issuable upon exercise at the adjusted Exercise Price of each Warrant shall be adjusted to the nearest full amount by multiplying a number equal to the Exercise Price in effect immediately prior to such
adjustment by the number of shares of Common Stock issuable upon exercise of Warrants immediately prior to such adjustment (without regard to limitations on the exerciseability of this Warrant) and dividing the product so obtained by the adjusted
Exercise Price. 
 (k) Minimum Adjustment. No adjustment of the Exercise Price shall be made unless such adjustment would require an
increase or decrease of at least $0.01 in such price; provided that any adjustments which by reason of this Section 12(k) are not required to be made shall be carried forward and shall be made at the time of and together with the next
subsequent adjustment which, together with adjustments so carried forward, shall require an increase or decrease of at least $0.01 in the Exercise Price then in effect hereunder. 
 (l) No Impairment. The Company shall not, by amendment of its Certificate of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed under this Section 12 by the Company but will at
all times in good faith assist in the carrying out of all the provisions of this Section 12 and in the taking of all such action as may be necessary or appropriate in order to protect the exercise rights of the Holder against dilution or other
impairment, including without limitation taking all such action from time to time as may be necessary or appropriate to ensure that the par value per share of the Common Stock is at all times equal to or less than the Exercise Price in effect at
such time. 
 (m) Validity of Warrant Certificate. Irrespective of any adjustments or changes in the Exercise Price or the amount of
Warrant Securities purchasable upon exercise of Warrants, Warrant Certificates theretofore and thereafter issued shall continue to express the Exercise Price per share and the amount of Warrant Securities purchasable thereunder as of the date such
Warrant Certificates were originally issued; provided, the Holder shall be entitled to exercise Warrants represented by such Warrant Certificates after giving effect to each such 

  

 17 

 
adjustment and change, and such Warrant Certificate shall be deemed to incorporate each such adjustment and change as if new Warrant Certificates reflecting
each such adjustment and change had been issued to the Holders. 
 13. Cancellation in Certain Circumstances. 
 (a) Upon the occurrence of a Special Redemption Trigger (as defined in the Indenture), then on the Special Mandatory Redemption Date (as defined in the
Indenture), the number of Warrant Shares for which this Warrant will be exercisable immediately after the Special Redemption Date shall be equal to one-half (1/2) of the number of Warrant Shares that were initially issuable pursuant to this
Warrant (as the same may have been adjusted prior to the time of such cancellation pursuant to Section 12) (and if the Holder has exercised more than one-half (1/2) of this Warrant prior to the Special Mandatory Redemption Date, then this
Warrant shall be cancelled in its entirety, but the Warrant Shares issued pursuant to such prior exercise of this Warrant shall not be affected). A reduction pursuant to this Section 13 in the number of Warrant Shares for which this Warrant is
exercisable will not affect any other provision of this Warrant. In the event a Special Redemption Trigger occurs, the Company shall: (i) deliver a notice of such occurrence to the Holder promptly, and in any event within five (5) Business
Days, after the occurrence of such Special Redemption Trigger, which notice shall (A) state the number of Warrant Shares subject to this Warrant shall be reduced on the Special Mandatory Redemption Date, (B) identify the Special Mandatory
Redemption Date and (C) state the number of Warrant Shares for which this Warrant will be exercisable after the Special Mandatory Redemption Date (assuming no exercise of this Warrant prior to the Special Mandatory Redemption Date); and
(ii) offer to exchange this Warrant on or after the Special Mandatory Redemption Date for a Warrant identical in all respects to this Warrant except such replacement Warrant shall state the reduced number of Warrant Shares for which this
Warrant is then exercisable. 
 (b) Notwithstanding the foregoing, this Section 13 will not apply to this Warrant if the Holder at the
time of such Special Mandatory Redemption Date is a ‘Holder’, as that term is defined in the Indenture, who elects to become a ‘Retained Holder’, as defined in and contemplated by Section 3.08 of the Indenture. 

14. Notices to Holders. 
 (a)
After each adjustment of the Exercise Price or the amount of Warrant Shares purchasable upon exercise of Warrants pursuant to Section 12, the Company will promptly prepare a certificate signed by the Chairman or President, and by the Treasurer
or an Assistant Treasurer or the Secretary or an Assistant Secretary, of the Company setting forth: (i) the Exercise Price, as so adjusted; (ii) the amount of Warrant Shares purchasable upon exercise of this Warrant after such adjustment;
and (iii) a brief statement of the facts accounting for such adjustment. The Company will promptly file such certificate with its records and cause a brief summary thereof to be delivered to each Holder. 
  

 18 

 (b) In the event: 
 (i) that the Company shall authorize the issuance to holders of shares of Common Stock of rights, options or warrants to subscribe for or
purchase shares of Common Stock or of any other subscription rights or warrants; 
 (ii) that the Company shall authorize the
distribution to holders of shares of Common Stock of cash, evidences of its indebtedness or assets; 
 (iii) of any
consolidation or merger to which the Company is a party and for which approval of any stockholders of the Company is required, or of the conveyance or transfer of the properties and assets of the Company substantially as an entirety, or of any
reclassification or change of Common Stock issuable upon exercise of the Warrants (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), or a tender
offer or exchange offer by the Company for shares of Common Stock; 
 (iv) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company; or 
 (v) that the Company proposes to take any action which would require an
adjustment of the Exercise Price pursuant to Section 12; 
 then the Company shall cause to be delivered to the Holder, at least fifteen (15) days
prior to the applicable record date hereinafter specified, or promptly in the case of events for which there is no record date, a notice stating (x) the date as of which the holders of record of shares of Common Stock to be entitled to receive
any such rights, options, warrants or distribution are to be determined, (y) the initial expiration date set forth in any tender offer or exchange offer for shares of Common Stock, or (z) the date on which any such consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up is expected to become effective or consummated, and the date as of which it is expected that holders of record of shares of Common Stock shall be entitled to exchange such shares for
securities or other property, if any, deliverable upon such reclassification, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding up. The failure to give the notice required by this Section 14 or any defect therein
shall not affect the legality or validity of any distribution, right, option, warrant, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding up, or the vote upon any action. 
 15. Transfer Taxes. The issuance of any shares or other securities upon the exercise of this Warrant, and the delivery of certificates or other
instruments representing such shares or other securities, shall be made without charge to the Holder for any tax or other charge in respect of such issuance. The Company shall not, however, be required to pay any tax which may be payable in respect
of any transfer involved in the issue and delivery of any certificate in a name other than that of the Holder and the Company shall not be required to issue or deliver any such certificate unless and until the person(s) or entity(ies) requesting the
issue thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid. 
  

 19 

 16. Loss or Mutilation of Warrant. Upon receipt of evidence satisfactory to the Company of the
loss, theft, destruction, or mutilation of this Warrant (and upon surrender of this Warrant if mutilated), and upon reimbursement of the Company’s reasonable incidental expenses, the Company shall execute and deliver to the Holder a new Warrant
of like date, tenor, and denomination. 
 17. Obtaining Stock Exchange Listings. The Company shall from time to time take all action
which may be reasonably necessary so that the Warrant Shares, immediately upon their issuance upon the exercise of Warrants, will be listed on a principal securities exchange, automated quotation system or other market within the United States of
America, if any, on which other shares of Common Stock are then listed, if any. 
 18. No Rights as a Stockholder. The Holder shall
not have, solely on account of the Holder’s status as a holder of a Warrant, any rights of a stockholder of the Company, either at law or in equity, or to any notice of meetings of stockholders or of any other proceedings of the Company, except
as provided in this Warrant. 
 19. Miscellaneous 
 (a) Notices. All notices, requests, consents and other communications hereunder shall be in writing, shall be mailed (i) if within domestic United States by first-class registered or certified airmail, or
nationally recognized overnight express courier, postage prepaid, or by facsimile, or (ii) if delivered from outside the United States, by International Federal Express (or comparable service) or facsimile, and shall be deemed given (A) if
delivered by first-class registered or certified mail domestic, three Business Days after so mailed, (B) if delivered by nationally recognized overnight carrier, one (1) Business Day after so mailed, (C) if delivered by International
Federal Express (or comparable service), two (2) Business Days after so mailed, (D) if delivered by facsimile, upon electric confirmation of receipt on the first Business Day after the transaction and shall be delivered as addressed as
follows: 
 (i) if to the Company, to: 
      Velocity Express Corporation 
      One Morningside Drive North 
      Building B – Suite 300 
      Westport, CT 06880 
      Attention: Chief Financial Officer 
      Telephone: (203) 349-4160 
      Telecopy: (203) 349-4198 
 (ii) if to the Holder, at such Holder’s address on the Warrant Register, or at such other address or addresses as may have been
furnished to the Company in writing. 
 (b) Successors. All the covenants and provisions of this Warrant by or for the benefit of the
Company or the Holder shall bind and inure to the benefit of their respective successors and assigns hereunder. No other person or entity shall have or be construed to have any legal or equitable right, remedy or claim under or in respect of or by
virtue of this Warrant or any provisions contained in this Warrant. 
  

 20 

 (c) Entire Agreement. This Warrant constitutes the entire agreement of the parties hereto and
supersedes all prior written or oral agreements, understandings and negotiations with respect to the subject matter hereof. 
 (d)
Headings. The headings of the various sections of this Warrant have been inserted for convenience of reference only and shall not be deemed to be part of this Warrant. 
 (e) Severability. In case any provision contained in this Warrant should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained in this Warrant shall not in any way be affected or impaired thereby. 
 (f) Amendments; Waivers; No Additional Consideration. No provision of this Warrant may be waived or amended except in a written instrument signed by the Company and the Holder. No waiver of any default with respect to any provision,
condition or requirement of this Warrant shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of either
party to exercise any right hereunder in any manner impair the exercise of any such right. 
 (g) Governing Law. This Warrant shall be
deemed to be a contract made under the laws of the State of Delaware and for all purposes shall be construed in accordance with the internal laws of said State. 
 (h) Consent to Jurisdiction, etc. 
 (i) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THE NEW YORK SUPREME COURT IN THE CITY AND STATE OF NEW YORK AND ANY APPELLATE COURT THEREFROM OR THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK AND ANY APPELLATE COURT THEREFROM (COLLECTIVELY, THE “NEW YORK COURTS”), IN ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS WARRANT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT RELATING THERETO, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH PROCEEDING MAY BE HEARD AND DETERMINED IN THE NEW YORK COURTS. EACH OF THE PARTIES HERETO AGREES THAT A
FINAL JUDGMENT IN ANY SUCH PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. 
  

 21 

 (ii) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS WARRANT OR THE TRANSACTIONS CONTEMPLATED HEREBY IN ANY OF THE NEW YORK
COURTS. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH PROCEEDING IN ANY OF THE NEW YORK COURTS. 
 (iii) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES
IN SECTION 19(a). NOTHING IN THIS WARRANT WILL AFFECT THE RIGHT OF ANY PARTY TO THIS WARRANT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. 
 (i) Interpretation. The language used in this Warrant shall be deemed to be the language chosen by the parties to express their mutual intent and no rule of strict construction shall be applied against any party. 
 (j) Counterparts and Facsimiles. This Warrant may be executed in two or more counterparts, each of which shall constitute an original, but all of
which, when taken together, shall constitute but one instrument, and shall become effective when one or more counterparts have been signed by each party hereto and delivered to the other parties. This Warrant may also be executed and delivered via
facsimile, which shall be deemed an original. 
 [Signature page follows] 
  

 22 

					
	 Dated: July 3, 2006
	 	 VELOCITY EXPRESS CORPORATION

			
		 	By:	 	  

		 		 	 Edward W. Stone

		 		 	 Chief Financial Officer

  

 23 

 FORM OF ASSIGNMENT 
 (To be executed by the registered holder if such holder desires to transfer the attached Warrant.) 
 FOR
VALUE RECEIVED,                                  hereby sells, assigns, and transfers
unto                                  a Warrant to purchase
                     shares of Common Stock, par value $0.004 per share, of Velocity Express Corporation (the “Company”), together
with all right, title, and interest therein, and does hereby irrevocably constitute and appoint
                                        
         attorney to transfer such Warrant on the books of the Company, with full power of substitution. 
  

			
	 Dated:
	 	  

			
		
	 By:
	 	  

		 	Signature

 The signature on the foregoing Assignment must correspond to the name as written upon the
face of this Warrant in every particular, without alteration or enlargement or any change whatsoever. 

 NOTICE OF EXERCISE 
 To: Velocity Express Corporation 
        One Morningside Drive North, 
        Bldg. B, Suite 300 
        Westport, Connecticut 06880 
        Attention: President 

The undersigned hereby exercises the accompanying Warrant to either (you must check a box): 
  

	 	 ̈	Purchase              Warrant Shares covered by the accompanying Warrant and tenders payment herewith pursuant to
Section 4 of the Warrant in the amount of $            ; or 

  

	 	 ̈	Effect a non-cash exercise pursuant to Section 5 of the Warrant, and the undersigned elects to apply             
Warrant Shares to such exercise; 

 and, in each case, requests that certificates for such securities be issued in the name of, and delivered
to: 
  

	
	   
	
	   
	
	   

 (Print Name, Address and Social Security 
 or Tax Identification Number) 
 and, if such
number of Warrant Shares shall not be all the Warrant Shares covered by the within Warrant, that a new Warrant for the balance of the Warrant Shares covered by the within Warrant be registered in the name of, and delivered to, the undersigned at the
address stated below. 
 If this Notice of Exercise is delivered to elect cashless exercise with respect to Warrant Shares subject to an automatic exercise
pursuant to Section 3 of the Warrant, check this box:  ̈ 
  

			
	 Dated:
	 	  

		
	 By:
	 	  

		 	Print Name
	
	  

	     Signature
	 	

  

	
	 Address:Security Agreement, dated as of July 3, 2006

 EXHIBIT 10.3 
 SECURITY AGREEMENT 
 SECURITY AGREEMENT (this “Agreement”) dated as of July 3,
2006 (the “Effective Date”), by VELOCITY EXPRESS CORPORATION, a corporation duly organized and validly existing under the laws of the State of Delaware (the “Company”); each of the Subsidiaries of the Company
identified under the caption “SUBSIDIARY GUARANTORS” on the signature pages hereto or that become “Subsidiary Guarantors” hereunder pursuant to Section 6.06 after the date hereof (individually, a “Subsidiary
Guarantor” and, collectively, the “Subsidiary Guarantors” and, together with the Company, individually a “Grantor Party” and, collectively, the “Grantor Parties”); to and in favor of WELLS
FARGO BANK, N.A., as Trustee for and on behalf of the Holders under (and as defined in) the Indenture referred to (and defined) below, acting, for purposes of this Agreement, on behalf and for the benefit of the Holders as their duly-appointed
representative and agent with regard to all matters pertaining to the Collateral (as defined below) and the various other rights, interests, obligations and liabilities created or evidenced hereby (in such Trustee capacity and as so acting
hereunder, the “Trustee”). 
 BACKGROUND 
 The Company has entered into an even-dated Indenture (the “Indenture”—capitalized terms used and not otherwise defined in this
Agreement being defined herein as therein provided) with and in favor of the Trustee, pursuant to which the Company has issued its 12% Senior Secured Notes Due 2010 (the “Notes”), in an aggregate principal amount of $81,500,000 and,
in connection therewith has executed and/or delivered to and in favor of the Holders (and/or the Trustee acting on their behalf) various other Transaction Documents providing for certain further undertakings of the Company in connection with the
Indenture transaction. 
 Pursuant to Section 10.01 of the Indenture, each Subsidiary Guarantor has, by its even-dated signature (or, as
contemplated by such Section 10.01 and the provisions hereof, by its later accession) to the Indenture, jointly and severally guaranteed any and all Note Obligations at any and all times arising or outstanding thereunder in favor of the Holders
(and/or the Trustee acting on their behalf) and has provided certain additional assurances to the Holders or the Trustee as to the due and punctual performance of any and all Company liabilities or obligations of any other nature or type provided
for under the Transaction Documents (the Note Obligations and such other Company liabilities and obligations, collectively, the “Secured Obligations”). 
 On and subject to the terms, conditions and limitations contained in Sections 4.16 and 4.16A of the Indenture, the Grantor Parties, may, at any time or from time to time after the Effective Date, be entering into the
Senior Facility Agreement with the Senior Facility Creditors providing, subject to the terms and conditions thereof, for extensions of credit (by means of loans and letters of credit) to be made by the Senior Facility Creditors to the Company and/or
applicable Subsidiary Guarantors in an aggregate principal amount not exceeding the Applicable Facility Cap and requiring the Company’s and/or applicable Subsidiary Guarantors’ execution and/or delivery to and in favor of the Senior
Facility Creditors and the Senior Facility Agent, as applicable, of the various promissory notes, security agreements, mortgages, pledges, guarantees and other agreements, instruments and documents as constituting, together with the Senior Facility
Agreement, the Senior Facility Documents referred to in the Indenture. 
 Accordingly, as a material inducement and fundamental condition to
each Holder’s willingness and agreement to extend and maintain, to and for the benefit of the Company and the Subsidiary Guarantors, the financing and other accommodations provided for in the Indenture and the other Transaction Documents, each
Grantor Party hereby agrees with, covenants to and undertakes in favor of the Trustee as follows: 
 Section 1.
Definitions. In addition to the incorporation into this Agreement of Indenture definitions as above noted, the following terms shall be defined as follows: 
 “Accounts” shall have the meaning assigned to such term in Article 9 of the Uniform Commercial Code. 

 “Collateral” has the meaning assigned to such term in Section 3.

 “Collateral Account” means the deposit account established and maintained in accordance with
Section 4.01. 
 “Copyright Collateral” means all material Copyrights, whether now owned or hereafter
acquired by any Grantor Party, including each Copyright identified in Annex 4. 
 “Copyrights” means all
copyrights, copyright registrations and applications for copyright registrations, including all renewals and extensions thereof, the right to recover for all past, present and future infringements thereof, and all other rights of any kind whatsoever
accruing thereunder or pertaining thereto. 
 “Deposit Account” shall mean and include the Collateral
Account, the Designated Account (as defined in the Control Agreement) and each other deposit account (as defined in Article 9 of the Uniform Commercial Code) and securities account as defined in Article 8 of the Uniform Commercial Code) at any time
titled in the name of or in trust for, or otherwise held or maintained by, any Grantor Party, including, without limitation, any such account into which funds are deposited or to be deposited as contemplated by the Transaction Documents. 

“Document” has the meaning assigned to such term in Section 3(g). 
 “Financial Assets” shall have the meaning assigned to such term in Article 8 of the Uniform Commercial Code. 

“Instruments” has the meaning assigned to such term in Section 3(d). 
 “Intangibles” means, with respect to any Grantor Party, all Intellectual Property, together with such Grantor
Party’s other “general intangibles” (including goodwill, registrations, licenses, franchises, tax refund claims, guarantee claims, contract rights, security interests and rights to indemnification, etc.) as defined in Uniform
Commercial Code. 
 “Intellectual Property” means collectively, all Copyright Collateral, all Patent
Collateral and all Trademark Collateral, together with (a) all inventions, processes, software, production methods, proprietary information, know-how and trade secrets with respect to any of the foregoing; (b) all licenses or user or other
agreements granted to any Grantor Party with respect to any of the foregoing, including software licenses, in each case whether now or hereafter owned or used including the licenses or other agreements with respect to the Copyright Collateral, the
Patent Collateral or the Trademark Collateral, listed in Annex 7 and (c) all information, data, plans, blueprints, specifications, designs, drawings, recorded knowledge, surveys, engineering reports, test reports, manuals, materials
standards, processing standards, performance standards, catalogs, computer and automatic machinery software and programs with respect to any of the foregoing. 
 “Inventory” shall have the meaning assigned to such term in Article 9 of the Uniform Commercial Code. 
 “Investment Property” shall have the meaning assigned to such term in Article 9 of the Uniform Commercial Code.

  

 2 

 “Issuers” means, collectively, (a) the respective corporations,
partnerships or other entities identified under the names of the Grantor Parties on Annex 3 under the caption “Issuer” and (b) any other entity that shall at any time be a Subsidiary Guarantor that is not a Restricted Subsidiary.

 “Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or
encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including any conditional sale or other title retention agreement, and any lease in the nature thereof), or the assignment
or conveyance of any right to receive income therefrom. 
 “Patent Collateral” means all material Patents of
the Grantor Parties as identified in Annex 5. 
 “Patents” means to the extent used, registered or
applied for within the United States of America or in any other jurisdiction, all patents, including the inventions and improvements described and claimed therein together with the reissues, divisions, continuations, renewals, extensions and
continuations-in-part thereof, all income, royalties, damages and payments now or hereafter due and/or payable under and with respect thereto, including damages and payments for past or future infringements thereof, the right to sue for past,
present and future infringements thereof. 
 “Perfection Certificate” means the Perfection Certificate
completed, executed and delivered of even date with the Effective Date by the Company to the Trustee, whereby the Company has, for itself and on behalf of each Subsidiary Guarantor, furnished and certified to the Trustee certain data pertaining to
the Collateral as requested therein for the Trustee’s reliance in making determinations as to the filings, actions and undertakings as are necessary and appropriate to result in the duly-perfected, first-priority Liens in the Collateral for the
Trustee’s’ benefit as required hereby. 
 “Person” means any individual, corporation, partnership,
limited liability company, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof or other entity of any kind. 
 “Pledged Debt” means any Indebtedness of a Subsidiary (as such terms are defined in the Indenture) held by any Grantor
Party, other than any Restricted Subsidiary Indebtedness. 
 “Pledged Stock” has the meaning assigned to such
term in Section 3(a). 
 “Permitted Investments” shall mean: (a) direct obligations of the United
States of America, or of any agency thereof, or obligations guaranteed as to principal and interest by the United States of America, or of any agency thereof, in either case maturing not more than 90 days from the date of acquisition thereof;
(b) certificates of deposit or time deposits issued by any bank or trust company organized under the laws of the United States of America or any state thereof and having capital, surplus and undivided profits of at least $500,000,000, maturing
not more than 90 days from the date of acquisition thereof; (c) fully collateralized repurchase agreements with a term of not more than 90 days for securities described in clause (a) of this definition and entered into with a financial
institution satisfying the criteria described in clause (b) of this definition; and (d) commercial paper rated A-1 or better or P-1 by Standard & Poor’s Ratings Services, a division of McGraw-Hill Companies, Inc., or
Moody’s Investors Services, Inc., respectively, maturing not more than 90 days from the date of acquisition thereof; in each case so long as the same (x) provide for the payment of principal and interest (and not principal alone or
interest alone) and (y) are not subject to any contingency regarding the payment of principal or interest. 
 “Secured Obligations” has the meaning assigned to such term in the recitals hereto. 
  

 3 

 “Stock Collateral” has the meaning assigned to such term in
Section 3(a)(ii). 
 “Trademark Collateral” means all material Trademarks, whether now owned or
hereafter acquired by any Grantor Party, including each Trademark identified in Annex 6. Notwithstanding the foregoing, the Trademark Collateral does not and shall not include any Trademark that would be rendered invalid, abandoned, void or
unenforceable by reason of its being included as part of the Trademark Collateral. 
 “Trademarks” means, to
the extent used, registered or applied for in the United States of America or in any other jurisdiction, all trade names, trademarks and service marks, logos, trademark and service mark registrations, and applications for trademark and service mark
registrations, including all renewals of trademark and service mark registrations, all rights corresponding thereto throughout the United States of America and any other jurisdiction, the right to recover for all past, present and future
infringements thereof, all other rights of any kind whatsoever accruing thereunder or pertaining thereto, together, in each case, with the product lines and goodwill of the business connected with the use of, and symbolized by, each such trade name,
trademark and service mark. 
 “Uniform Commercial Code” or “UCC” means the Uniform
Commercial Code as in effect from time to time in the State of New York, or, to the extent governing or mandatorily applicable to the attachment, perfection or priority of any Lien created or evidenced (or purported to be created or evidenced)
hereby in, on or with respect to any particular item(s) of Collateral subject or purported to be subject to any such Lien(s) and/or the terms and conditions of this Agreement, the Uniform Commercial Code as in effect from time to time in such other
jurisdiction(s) to which such Lien(s) or Collateral is or are so governed and subject. 
 SECTION 1A. SUBORDINATION AGREEMENT; EFFECT
ON TRUSTEE RIGHTS AND REMEDIES. THE TRUSTEE ACKNOWLEDGES AND AGREES WITH EACH GRANTOR PARTY THAT THIS AGREEMENT, TOGETHER WITH ANY AND ALL RIGHTS, REMEDIES, INTERESTS AND BENEFITS HEREIN CONFERRED ON THE TRUSTEE FOR THE BENEFIT OF THE
HOLDERS, ON AND SUBJECT TO THE TERMS AND CONDITIONS OF THE INDENTURE PERTAINING TO THE OCCURRENCE AND EFFECT OF THE SUBORDINATION REQUIRED DATE DESCRIBED THEREIN, MAY BE MADE SUBJECT TO THE SUBORDINATION AGREEMENT IF AND WHEN EXECUTED ON THE
SUBORDINATION REQUIRED DATE BY AND BETWEEN THE SENIOR FACILITY AGENT AND THE TRUSTEE SUBSTANTIALLY IN THE FORM ATTACHED AS EXHIBIT B. IMMEDIATELY UPON THE SUBORDINATION REQUIRED DATE AND FOR SO LONG THEREAFTER AS THE SAME SHALL REMAIN
APPLICABLE AND IN EFFECT PURSUANT TO ITS TERMS, THE SUBORDINATION AGREEMENT SHALL IN ALL RESPECTS GOVERN AND CONTROL THE RELATIVE PRIORITIES, RIGHTS, INTERESTS, LIENS AND REMEDIES AS BETWEEN THE TRUSTEE, ON THE ONE HAND, AND THE SENIOR FACILITY
AGENT, ON THE OTHER HAND, AND NO ACTIONS TAKEN OR OMISSIONS MADE AT ANY AND ALL SUCH TIMES BY ANY PERSON PURSUANT TO AND IN COMPLIANCE WITH ALL APPLICABLE TERMS AND CONDITIONS OF THE SUBORDINATION AGREEMENT SHALL RESULT IN ANY MISREPRESENTATION,
BREACH OR DEFAULT BY ANY GRANTOR PARTY HEREUNDER NOR GIVE RISE TO ANY RIGHT, REMEDY OR CLAIM OF THE TRUSTEE IN RESPECT THEREOF. UPON AND AT ALL TIMES DURING THE EFFECTIVENESS OF THE SUBORDINATION AGREEMENT, ALL TERMS AND CONDITIONS THEREOF AS
ATTACHED TO THIS AGREEMENT ON THE EFFECTIVE DATE AS EXHIBIT B HERETO SHALL BE INCORPORATED INTO AND MADE A PART OF THIS AGREEMENT AS IF FULLY WRITTEN AND SET FORTH HEREIN. THE TRUSTEE FURTHER AGREES THAT, UPON AND AFTER THE SUBORDINATION
REQUIRED DATE (IF AND WHEN OCCURRING), IT SHALL, AT THE SOLE COST AND EXPENSE OF THE COMPANY, COOPERATE WITH THE COMPANY IN TAKING SUCH ACTIONS AND PROVIDE SUCH ASSURANCES (INCLUDING, WITHOUT LIMITATION, THE HANDING OVER OF COLLATERAL ITEMS IN OR
UNDER THE SOLE POSSESSION AND CONTROL OF TRUSTEE, AS SECURED PARTY, FOR PERFECTION PURPOSES OR OTHERWISE) AS ARE REASONABLY REQUESTED BY THE SENIOR FACILITY AGENT AS 
  

 4 

 BEING NECESSARY TO GIVE FULL EFFECT TO THE LIEN PRIORITIES AND ASSOCIATED RIGHTS EXPRESSLY PROVIDED IN THE LATTER’S
FAVOR PURSUANT TO THE SUBORDINATION AGREEMENT TERMS AS ATTACHED IN EXHIBIT B HERETO. 
 EACH GRANTOR PARTY ACKNOWLEDGES AND AGREES
THAT: (1) THE FOREGOING PROVISIONS OF THIS SECTION 1A ARE STRICTLY LIMITED AS EXPRESSLY WRITTEN INTO THIS AGREEMENT, SUCH THAT, OTHER THAN THE LIMITED EXCEPTION MADE IN FAVOR OF THE SENIOR FACILITY AGENT PER THE SUBORDINATION AGREEMENT AS
AFORESAID, THE FIRST-PRIORITY LIEN AND SECURITY INTEREST CREATED AND GRANTED TO AND IN FAVOR OF TRUSTEE SHALL AT ALL TIMES BE AND REMAIN ABSOLUTE AND UNCONDITIONAL; (2) FOR SO LONG AS ANY SECURED OBLIGATIONS SHALL REMAIN OUTSTANDING, NO PERSON
OTHER THAN THE SENIOR FACILITY AGENT, ACTING IN ACCORDANCE WITH AND TO THE LIMITED EXTENT OF ITS PRIORITY RIGHTS AND INTERESTS AS EXPRESSLY STATED IN THE SUBORDINATION AGREEMENT TERMS ATTACHED TO THIS AGREEMENT, SHALL AT ANY SUCH TIME HAVE, RELATIVE
TO THE LIENS AND SECURITY INTERESTS IN FAVOR OF THE TRUSTEE CREATED OR EVIDENCED HEREBY OR BY ANY OTHER TRANSACTION DOCUMENTS, ANY SENIOR, PARI PASSU OR OTHERWISE COMPETING OR CONFLICTING RIGHTS, INTERESTS, ENTITLEMENTS OR CLAIMS WHATSOEVER IN, TO
OR WITH RESPECT TO THE COLLATERAL OR ANY OF THE VARIOUS RIGHTS, INTERESTS, REMEDIES AND BENEFITS OTHERWISE CONFERRED (OR PURPORTED TO BE CONFERRED) ON TRUSTEE PURSUANT HERETO; AND (3) IMMEDIATELY UPON TERMINATION OF, OR OTHERWISE TO THE EXTENT
OF THE INAPPLICABILITY IN ANY INSTANCE OR CIRCUMSTANCES OF, THE PRIORITIES GRANTED TO THE SENIOR FACILITY AGENT UNDER THE SUBORDINATION AGREEMENT, THE TRUSTEE’S LIENS AND SECURITY INTERESTS CREATED OR EVIDENCED HEREBY SHALL CONTINUE IN EFFECT
ON A FIRST-PRIORITY, PERFECTED BASIS AS IF SUCH SUBORDINATION AGREEMENT AND ASSOCIATED PRIORITIES HAD NEVER BEEN GRANTED OR EXISTED AT ANY TIME OR FOR ANY PURPOSE. 
 Section 2. Representations and Warranties. Each Grantor Party represents and warrants to the Trustee that: 
 (a) Title and Priority. Such Grantor Party is the sole beneficial owner of the Collateral in which it purports to grant a security
interest pursuant to Section 3 and no Lien exists or will exist upon such Collateral at any time, except for Permitted Liens. The security interest created pursuant hereto constitutes a valid and perfected security interest in the Collateral in
which such Grantor Party purports to grant a security interest pursuant to Section 3, subject to no senior, equal or prior Lien except as created hereby and no other Lien whatsoever except for Permitted Liens. 
 (b) Names, Etc. The full and correct legal name, type of organization, jurisdiction of organization, organizational ID number (if
applicable) and mailing address of each Grantor Party as of the date hereof are correctly set forth in Annex 1. Annex 1 correctly specifies the place of business of each Grantor Party or, if such Grantor Party has more than one place of business,
the location of the chief executive office of such Grantor Party. 
 (c) Changes in Circumstances. Such Grantor Party
has not (i) within the period of four months prior to the date hereof, changed its “location” (as defined in Section 9-307 of the Uniform Commercial Code), (ii) except as specified in Annex 1, heretofore changed its name, or
(iii) except as specified in Annex 2, heretofore become a “new debtor” (as defined in Section 9-102(a)(56) of the Uniform Commercial Code) with respect to a currently effective security agreement previously entered into by any
other Person. 
  

 5 

 (d) Pledged Stock. The Pledged Stock, if any, identified under the name of such
Grantor Party in Annex 3 is, and all other Pledged Stock in which such Grantor Party shall hereafter grant a security interest pursuant to Section 3 will be, duly authorized, validly issued, fully paid and non-assessable and none of such
Pledged Stock is or will be subject to any contractual restriction, or any restriction under the charter, by-laws or other organizational document of the respective Issuer of such Pledged Stock, upon the transfer of such Pledged Stock (except for
any restriction contained herein or under such organizational documents). 
 (e) Ownership of Pledged Stock. The
Pledged Stock, if any, identified under the name of such Grantor Party in Annex 3 constitutes in the case of each Issuer that is (i) a Restricted Subsidiary, 100% of all the issued and outstanding shares of capital stock of whatever class of
such Restricted Subsidiary beneficially owned by such Grantor Party on the date hereof (whether or not registered in the name of such Grantor Party) and (ii) an Unrestricted Subsidiary, 65% of the issued and outstanding shares of voting stock
of such Unrestricted Subsidiary and 100% of all other issued and outstanding shares of capital stock of whatever class of such Unrestricted Subsidiary beneficially owned by such Grantor Party on the date hereof (whether or not registered in the name
of such Grantor Party); Annex 3 correctly identifies, as at the date hereof, the respective Issuers of such Pledged Stock and the respective class and par value of the shares constituting such Pledged Stock and the respective number of shares
(and registered owners thereof) represented by each such certificate. 
 (f) Intellectual Property. Annexes 4, 5,
and 6, respectively, set forth under the name of such Grantor Party a complete and correct list of all material Copyrights, material Patents and material Trademarks (in each case to the extent encompassed within the definition of “Intellectual
Property” in Section 1(b) hereof) owned by such Grantor Party on the date hereof, and all registrations listed in Annexes 4, 5, and 6, are properly issued and in full force and effect. Annex 7 sets forth under the name of such Grantor
Party all licenses and other user agreements pursuant to which such Grantor Party has been granted the right to use any Copyrights, Patents or Trademarks owned by others and material to the business of such Grantor Party. 
 To such Grantor Party’s knowledge, (i) except as set forth in Annex 4, 5 or 6, there is no violation by others of any right
of such Grantor Party with respect to any material Copyright, Patent or Trademark listed in Annexes 4, 5, and 6, respectively, under the name of such Grantor Party and (ii) such Grantor Party is not infringing in any material respect upon
any copyright, patent or trademark of any other Person by virtue of the conduct of its business or, in the case of any such patent, use in connection with production at any of such Grantor Party’s facilities, as applicable; and no proceedings
have been instituted or are pending against such Grantor Party or, to such Grantor Party’s knowledge, threatened, and no claim against such Grantor Party has been received by such Grantor Party, alleging any such violation, except as may be set
forth in Annex 7. 
 As of the date hereof, such Grantor Party does not own any Trademarks registered in the United
States of America to which the last sentence of the definition of Trademark Collateral applies. 
 Section 3. Collateral.
As collateral security for the prompt payment in full when due (whether at stated maturity, by acceleration or otherwise) of the Secured Obligations, each Grantor Party hereby pledges and grants to the Trustee, for the benefit of the Holders, a
first-priority Lien on and security interest in all of such Grantor Party’s right, title and interest in the following property, whether now owned by such Grantor Party or hereafter acquired and whether now existing or hereafter coming into
existence (all being collectively referred to herein as “Collateral”): 
 (a) the shares of voting stock of
the Issuers identified in Annex 3 under the name of such Grantor Party and all other shares of capital stock of whatever class of the Issuers together with all rights, 
  

 6 

 privileges, authority and power of such Issuer with respect to such shares, in each case together with
the certificates, instruments and agreements, if any, evidencing the same (collectively, the “Pledged Stock”), together with: 
 (i) all shares, securities, moneys or property representing a dividend on any of the Pledged Stock, or representing a distribution or return of capital upon or in respect of the Pledged Stock, or resulting from a
split-up, revision, reclassification or other like change of the Pledged Stock or otherwise received in exchange therefor, and any subscription warrants, rights, agreements or options issued to the holders of, or otherwise in respect of, the Pledged
Stock; and 
 (ii) in the event of any consolidation or merger in which an Issuer is not the surviving corporation, all shares
of each class of the capital stock of the successor corporation (unless such successor corporation is such Grantor Party itself) formed by or resulting from such consolidation or merger (the Pledged Stock, together with all other certificates,
shares, securities, properties or moneys as may from time to time be pledged hereunder pursuant to this clause (ii) and clause (i) above being herein collectively called the “Stock Collateral”); 
 provided that, notwithstanding the foregoing, the Stock Collateral of any Unrestricted Subsidiary shall be limited to 65% of the issued and
outstanding shares of voting stock of such Unrestricted Subsidiary and 100% of all other issued and outstanding shares of capital stock of whatever class of such Issuer; 
 (b) the Pledged Debt; 
 (c) all Deposit Accounts (including all cash, Cash Equivalents, Investment Property, Financial Assets and other funds and assets deposited or maintained therein), Cash Equivalents and Accounts; 
 (d) all instruments, chattel paper (whether tangible or electronic), letter of credit rights (each as defined in the Uniform Commercial
Code) of such Grantor Party, including (but not limited to) promissory notes, drafts, bills of exchange and trade acceptances (herein collectively called “Instruments”); 
 (e) all Inventory and all computer hardware/software, equipment and fixtures (as defined in the Uniform Commercial Code), and all
improvements and accessions hereto; 
 (f) each contract and other agreement of such Grantor Party relating to the Permitted
Business and all Intellectual Property and other Intangibles (including payment intangibles) of such Grantor Party relating to the Permitted Business; 
 (g) all documents of title (as defined in the Uniform Commercial Code) or other receipts of such Grantor Party covering, evidencing or representing Inventory (herein collectively called “Documents”);

 (h) all rights, claims and benefits of such Grantor Party against any Person arising out of, relating to or in connection
with the Permitted Business conducted by such Grantor Party; 
 (i) all Investment Property and Financial Assets maintained in
the Collateral Account (including any Cash Equivalents constituting either of the foregoing that are so maintained); 
 (j)
the balance from time to time in the Collateral Account; and 
  

 7 

 (k) all proceeds, products, offspring, accessions, rents, profits, income, benefits,
substitutions and replacements of and to any of the Collateral and, to the extent related to any Collateral, all books, correspondence, credit files, records, invoices and other papers, including without limitation all tapes, cards, computer runs
and other papers and documents in the possession or under the control of such Grantor Party or any computer bureau or service company from time to time acting for such Grantor Party. 
 Section 4. Cash Proceeds of Collateral. 
 4.01 Collateral Account. The Trustee will cause to be established at a banking institution to be selected by the Trustee one or more cash collateral accounts (collectively, the “Collateral
Account”), which 
 (i) to the extent of all Investment Property or Financial Assets (other than cash) shall be a
“securities account” (as defined in Section 8-501 of the Uniform Commercial Code) in respect of which the Trustee shall be the “entitlement holder” (as defined in Section 8-102(a)(7) of the Uniform Commercial Code) and

 (ii) to the extent of any cash, shall be a deposit account in respect of which the Trustee is the customer (as contemplated
by Section 9-104(a)(3) of the Uniform Commercial Code) and 
 into which there shall be deposited from time to time the cash proceeds of any of the
Collateral (including proceeds of insurance thereon) that the Trustee requests pursuant to Section 4.02 be delivered hereunder and into which a Grantor Party may from time to time deposit any additional amounts that any of them wishes to pledge
to the Trustee as additional collateral security hereunder. The balance from time to time in the Collateral Account shall constitute part of the Collateral hereunder and shall not constitute payment of the Secured Obligations until applied as
hereinafter provided. If at any time following request by the Trustee pursuant to Section 4.02 no Event of Default shall be continuing, the Trustee shall remit the collected balance standing to the credit of the Collateral Account to or upon
the order of the respective Grantor Party as such Grantor Party through the Company shall from time to time instruct, provided that at any time during the continuance of an Event of Default, the Trustee may in its discretion apply or cause to
be applied (subject to collection) the balance from time to time standing to the credit of the Collateral Account to the payment of any Secured Obligation then due and payable in the manner specified in Section 5.09. In addition, the Company
may at any time request that the balance from time to time standing to the credit of the Collateral Account be applied to the payment of any Secured Obligations then due and payable in the manner specified in Section 5.09. The balance from time
to time in the Collateral Account shall be subject to withdrawal only as provided herein. 
 4.02 Proceeds of Accounts and Pledged
Debt. If requested by the Trustee at any time after the occurrence and during the continuance of an Event of Default, each Grantor Party shall instruct (i) all account debtors and other Persons obligated in respect of all Accounts of
such Grantor Party to make all payments in respect of the Accounts of such Grantor Party either (a) directly to the Trustee (by instructing that such payments be remitted to a post office box which shall be in the name and under the control of
the Trustee) or (b) to one or more other banks in the United States of America (by instructing that such payments be remitted to a post office box which shall be in the name and under the control of the Trustee) under arrangements, in form and
substance reasonably satisfactory to the Trustee, pursuant to which such Grantor Party shall have irrevocably instructed such other bank (and such other bank shall have agreed) to remit all proceeds of such payments directly to the Trustee for
deposit into the Collateral Account and (ii) all Domestic Subsidiaries obligated in respect of all Pledged Debt to make all payments in respect of the Pledged Debt directly to the Trustee. All payments made to the Trustee, as provided in the
preceding sentence, shall be immediately deposited by the Trustee in the Collateral Account. In addition to the foregoing, each Grantor Party agrees that after the occurrence and during the continuance of an Event of Default, if the proceeds of any
Collateral hereunder (including the payments made in respect of Accounts and Pledged Debt) shall be received by it, such Grantor Party shall, upon the request of the Trustee, as promptly as possible deposit 
  

 8 

 such proceeds into the Collateral Account. Until so deposited, all such proceeds shall be held in trust
by such Grantor Party for and as the property of the Trustee and shall not be commingled with any other funds or property of such Grantor Party. 
 4.03 Investment of Balance in Collateral Account. The cash balance standing to the credit of the Collateral Account shall be invested from time to time in such Permitted Investments as the respective Grantor Party through the
Company (or, after the occurrence and during the continuance of a Default, the Trustee) shall determine, which Permitted Investments shall be held in the name and be under the control of the Trustee (and, if the Collateral Account is a securities
account, credited to the Trustee), provided that at any time after the occurrence and during the continuance of an Event of Default, the Trustee may in its discretion at any time and from time to time elect to liquidate any such Permitted
Investments and to apply or cause to be applied the proceeds thereof to the payment of the Secured Obligations then due and payable in the manner specified in Section 5.09. 
 4.04 Designated Account Control Agreement. Each Grantor Party hereby agrees to execute and deliver to and in favor of the Trustee and the
Securities Intermediary referred to therein, a Designated Account Control Agreement (the “Control Agreement”) in substantially the form attached as Exhibit A hereto. Such Control Agreement shall apply to and in all respects govern
and control any and all items of Collateral meeting the definition of “Article 8 Collateral” as contained therein and not otherwise subject to perfection of Liens in accordance with the methods and procedures of perfection as contemplated
hereby. 
 Section 5. Further Assurances; Remedies. In furtherance of the grant of the pledge and security interest
pursuant to Section 3, the Grantor Parties hereby jointly and severally agree with the Trustee as follows: 
 5.01 Delivery and
Other Perfection. Each Grantor Party shall: 
 (a) if any of the shares, securities, moneys or property required to be
pledged by such Grantor Party under clauses (a)(i) or (a)(ii) of Section 3 are received by such Grantor Party forthwith, transfer and deliver to the Trustee such shares or securities so received by such Grantor Party (together with the
certificates for any such shares and securities duly endorsed in blank or accompanied by undated stock powers duly executed in blank), all of which thereafter shall be held by the Trustee, pursuant to the terms of this Agreement, as part of the
Collateral; 
 (b) deliver and pledge to the Trustee any and all Instruments constituting part of the Collateral in which such
Grantor Party purports to grant a security interest hereunder, endorsed and/or accompanied by such instruments of assignment and transfer in such form and substance as the Trustee may request; provided, that so long as no Event of Default
shall have occurred and be continuing, such Grantor Party may retain for collection in the ordinary course any Instruments received by such Grantor Party in the ordinary course of its business and the Trustee shall, promptly upon request of such
Grantor Party through the Company, make appropriate arrangements for making any Instrument pledged by such Grantor Party available to such Grantor Party for purposes of presentation, collection or renewal (any such arrangement to be effected, to the
extent deemed appropriate by the Trustee, against trust receipt or like document); 
 (c) deliver and pledge to the Trustee
any and all promissory notes or other instruments evidencing any of the Pledged Debt, endorsed and/or accompanied by such instruments of assignment and transfer in such form and substance as the Trustee may request; 
 (d) give, execute, deliver, file, register and record, authorize or obtain all such financing statements, notices, instruments, documents,
agreements or other papers, and take such other action, as 
  

 9 

 may be necessary or desirable (in the reasonable judgment of the Trustee) to create, preserve, publish
notice of, perfect, validate or preserve the perfection and priority of the security interest granted pursuant hereto or to enable the Trustee to exercise and enforce its rights hereunder with respect to such pledge and security interest, including
causing any or all of the Stock Collateral to be transferred of record into the name of the Trustee or its nominee (and the Trustee agrees that if any Stock Collateral is transferred into its name or the name of its nominee, the Trustee will
thereafter promptly give to the respective Grantor Party copies of any notices and communications received by it with respect to the Stock Collateral pledged by such Grantor Party hereunder), provided that notices to account debtors in
respect of any Accounts or Instruments shall be subject to the provisions of clause (h) below; 
 (e) keep accurate books
and records relating to the Collateral, and stamp or otherwise mark such books and records in such manner as the Trustee may reasonably require in order to reflect the security interests granted by this Agreement; 
 (f) permit representatives of the Trustee, upon reasonable notice, at any time during normal business hours to inspect and make abstracts
from its books and records pertaining to the Collateral, and, during the continuance of an Event of Default, permit representatives of the Trustee to be present at such Grantor Party’s place of business to receive copies of all communications
and remittances relating to the Collateral, and forward copies of any notices or communications received by such Grantor Party with respect to the Collateral, all in such manner as the Trustee may reasonably require; 
 (g) execute and deliver and, subject to the execution thereof by the Trustee, cause to be filed, such continuation statements, and do such
other acts and things, as may be necessary to maintain the perfection of the security interest granted pursuant hereto; and 
 (h) without limiting the provisions of Section 4.02 hereof, upon the occurrence and during the continuance of any Default, upon request of the Trustee, promptly notify (and such Grantor Party hereby authorizes the Trustee so to notify)
each account debtor in respect of any Accounts or Instruments that such Collateral has been assigned to the Trustee hereunder, and that any payments due or to become due in respect of such Collateral are to be made directly to the Trustee.

 5.02 Perfection Certificates and Updated Collateral Reporting. The Company hereby represents, warrants and covenants as
follows, for itself and on behalf of each of the Subsidiary Guarantors, to and in favor of the Trustee for its express reliance in taking or refraining from taking action with respect to the Secured Obligations and/or the Collateral for and on
behalf of the Holders: 
 (a) the Perfection Certificate truly, accurately and completely reflects, in all material respects
on and as of the Effective Date, the composition, location, nature, ownership and other requested data with respect to all assets, rights and interests of the Company and/or the Subsidiary Guarantors that are or may be subject to definition as, or
purported or otherwise required to be pledged for the benefit of the Trustee as, part of the Collateral subject to this Agreement and the other Security Documents; 
 (b) the Perfection Certificate initially delivered on and with respect to the Effective Date shall thereafter be updated (including, in
the case of any updates of a material nature or scope such as would be required, for example, upon the Merger Closing, by means of restatement of the Perfection Certificate in its entirety in order to truly, accurately and completely reflect any and
all Collateral as then constituted and existing) simultaneously with any additions to, subtractions from or other changes in or to the Collateral occurring on or after the Effective Date (including by reason of the Merger Closing and the immediate
and automatic inclusion among the Collateral subject hereto of the various assets, rights, interests or Capital Stock acquired by applicable Grantor Parties simultaneously therewith), except, in each case, for such additions, subtractions and/or
other changes as relate to Collateral items having de minimus value relative to the properly-reflected Collateral as a whole; and 
  

 10 

 (c) matters set forth with respect to the Collateral in the Perfection Certificate and/or
applicable updates as and when required thereto shall constitute representations and warranties made and, with each such update, affirmed in and pursuant to the Security Documents and, accordingly, any misrepresentation, inaccuracy or incompleteness
therein or thereof shall constitute, except as and unless (x) relating to Collateral items having de minimus value relative to the properly-reflected Collateral as a whole or (y) otherwise fully and promptly remedied (by the
Company’s written delivery of true, accurate and complete updating data and the taking of all appropriate Company/Subsidiary Guarantor actions as requisite to the valid attachment and due perfection of the Trustee’s first-priority Liens as
required hereby in and on all Collateral as reflected among such updates) within fifteen (15) Business Days following Trustee’s notice, an Event of Default as described in Section 6.01(5) or, to the extent that the Notes are not then
accelerated by virtue thereof, Section 6.01(4) of the Indenture. 
 5.03 Preservation of Rights. The Trustee shall not be
required to take steps necessary to preserve any rights against prior parties to any of the Collateral or to create, perfect or maintain the perfection or priority of any security interest in any of the Collateral. 
 5.04 Special Provisions Relating to Certain Collateral. 
 (a) Stock Collateral. 
 (1) Percentage Pledged. The Grantor Parties will cause the Stock Collateral to constitute at all times, in the case of all Issuers that are (i) Restricted Subsidiaries, 100% of all the total number of
shares of capital stock of each such Issuer then issued and outstanding and (ii) Unrestricted Subsidiaries, 65% of the total number of shares of the voting stock and 100% of the total number of shares of all other classes of capital stock of
such Issuer then issued and outstanding. 
 (2) Voting and Other Rights. So long as no Event of Default shall have
occurred and be continuing, the Grantor Parties shall have the right to exercise all voting, consensual and other powers of ownership pertaining to the Stock Collateral for all purposes not inconsistent with the terms of this Agreement;
provided that the Grantor Parties jointly and severally agree that they will not vote the Stock Collateral in any manner that results in a violation of the terms of this Agreement; and the Trustee shall execute and deliver to the Grantor
Parties or cause to be executed and delivered to the Grantor Parties all such proxies, powers of attorney, dividend and other orders, and all such instruments, without recourse, as the Grantor Parties may reasonably request for the purpose of
enabling the Grantor Parties to exercise the rights and powers that they are entitled to exercise pursuant to this Section 5.04(a)(2). 
 (3) Dividends. Unless and until an Event of Default has occurred and is continuing, the Grantor Parties shall be entitled to receive and retain any dividends on the Stock Collateral paid in cash out of earned
surplus. 
 (4) Rights Following Default. If any Event of Default shall have occurred, then so long as such Event of
Default shall continue, and whether or not the Trustee exercises any available right to declare any Secured Obligation due and payable or seeks or pursues any other relief or remedy available to it under applicable law or under or in respect of this
Agreement or the Indenture, all dividends and other distributions on the Stock Collateral shall be paid directly to the Trustee and retained by it in the Collateral Account as part of the Stock Collateral, subject to the terms of this Agreement,
and, if the Trustee shall so request in writing, the Grantor Parties jointly and severally agree to execute and deliver to the Trustee appropriate additional dividend, distribution and other orders and documents to that end, provided that if
such Event of Default is cured, any such dividend or distribution theretofore paid to the Trustee shall, upon 
  

 11 

 request of the Grantor Parties (except to the extent theretofore applied to the Secured Obligations), be
returned by the Trustee to the Grantor Parties. 
 (b) Intellectual Property. 
 (1) For the purpose of enabling the Trustee to exercise rights and remedies under Section 5.05 at such time as the Trustee shall be
lawfully entitled to exercise such rights and remedies, and for no other purpose, each Grantor Party hereby grants to the Trustee, to the extent assignable, an irrevocable, non-exclusive right (exercisable without payment of royalty or other
compensation to such Grantor Party) to use, assign, license or sublicense any of the Intellectual Property now owned or hereafter acquired by such Grantor Party, wherever the same may be located, including in such right reasonable access to all
media in which any of the Intellectual Property may be recorded or stored and to all computer programs used for the compilation or printout thereof. 
 (2) Notwithstanding anything contained herein to the contrary, the Grantor Parties will be permitted to exploit, use, enjoy, protect, license, sublicense, assign, sell, dispose of or take other actions with respect to
the Intellectual Property in the ordinary course of the business of the Grantor Parties. In furtherance of the foregoing, unless an Event of Default shall have occurred and be continuing the Trustee shall from time to time, upon the request of the
respective Grantor Party, execute and deliver any instruments, certificates or other documents, in the form so requested, that such Grantor Party through the Company shall have certified are appropriate (in its judgment) to allow it to take any
action permitted above (including relinquishment of the right provided pursuant to clause (1) immediately above as to any specific Intellectual Property). Further, upon the payment in full of all of the Secured Obligations or earlier expiration
of this Agreement or release of the Collateral, the Trustee shall grant back to the Grantor Parties the right granted pursuant to clause (1) immediately above. The exercise of rights and remedies under Section 5.05 by the Trustee shall not
terminate the rights of the holders of any licenses or sublicenses theretofore granted by the Grantor Parties in accordance with the first sentence of this clause (2). 
 (3) The Grantor Parties will furnish to the Trustee from time to time upon its request (but, unless a Default (as defined in the
Indenture) shall have occurred and be continuing, no more frequently than semi-annually) statements and schedules further identifying and describing the Copyright Collateral, the Patent Collateral and the Trademark Collateral, respectively, and such
other reports in connection with the Copyright Collateral, the Patent Collateral and the Trademark Collateral as the Trustee may reasonably request, all in reasonable detail; and promptly upon request of the Trustee, following receipt by the Trustee
of any statements, schedules or reports pursuant to this clause (3), modify this Agreement by amending Annexes 4, 5 and/or 6, as the case may be, to include any Copyright, Patent or Trademark that becomes part of the Collateral under
this Agreement. 
 (4) Until termination of this Agreement pursuant to Section 5.12 upon payment in full of all Secured
Obligations, each Grantor Party hereby undertakes to, at its own cost and expense, submit or deliver to, and/or file or record with, the United States Patent and Trademark Office such notices, statements and other filings and recordings as may be
necessary or appropriate to evidence the Liens and security interests in favor of Trustee for the benefit of the Holders on, in or with respect to the Copyright Collateral, the Patent Collateral and the Trademark Collateral and appoints, constitutes
and empowers the Trustee, as its agent and attorney-in-fact, to effect any or all of the foregoing actions in such Grantor Party’s name and stead and on its behalf, which appointment shall be coupled with and interest and irrevocable until such
termination as aforesaid. 
  

 12 

 5.05 Events of Default, Etc. During the period during which an Event of Default shall have
occurred and be continuing: 
 (a) each Grantor Party shall, at the request of the Trustee, assemble the Collateral owned by
it at such place or places, reasonably convenient to both the Trustee and such Grantor Party, designated in the Trustee’s request; 
 (b) the Trustee may make any reasonable compromise or settlement deemed desirable with respect to any of the Collateral and may extend the time of payment, arrange for payment in installments, or otherwise modify the
terms of, any of the Collateral; 
 (c) the Trustee shall have all of the rights and remedies with respect to the Collateral
of a secured party under the Uniform Commercial Code (whether or not the Uniform Commercial Code is in effect in the jurisdiction where the rights and remedies are asserted) and such additional rights and remedies to which a secured party is
entitled under the laws in effect in any jurisdiction where any rights and remedies hereunder may be asserted, including the right, to the fullest extent permitted by applicable law, to exercise all voting, consensual and other powers of ownership
pertaining to the Collateral as if the Trustee were the sole and absolute owner thereof (and each Grantor Party agrees to take all such action as may be appropriate to give effect to such right); 
 (d) the Trustee in its discretion may, in its name or in the name of any Grantor Party or otherwise, demand, sue for, collect or receive
any money or property at any time payable or receivable on account of or in exchange for any of the Collateral, but shall be under no obligation to do so; and 
 (e) the Trustee may, upon 10 Business Days’ prior written notice to the Grantor Parties of the time and place, with respect to the
Collateral or any part thereof which shall then be or shall thereafter come into the possession, custody or control of the Trustee, sell, lease, assign or otherwise dispose of all or any part of such Collateral, at such place or places as the
Trustee deems best, and for cash or for credit or for future delivery (without thereby assuming any credit risk), at public or private sale, without demand of performance or notice of intention to effect any such disposition or of the time or place
thereof (except such notice as is required above or by applicable statute and cannot be waived), and the Trustee or anyone else may be the purchaser, lessee, assignee or recipient of any or all of the Collateral so disposed of at any public sale
(or, to the extent permitted by law, at any private sale) and thereafter, to the fullest extent permitted by law, hold the same absolutely, free from any claim or right of whatsoever kind, including any right or equity of redemption (statutory or
otherwise), of the Grantor Parties, any such demand, notice and right or equity being hereby expressly waived and released, to the fullest extent permitted by law. In the event of any sale, assignment, or other disposition of any of the Trademark
Collateral, the goodwill connected with and symbolized by the Trademark Collateral subject to such disposition shall be included, and the Grantor Parties shall supply to the Trustee or its designee, for inclusion in such sale, assignment or other
disposition, all Intellectual Property relating to such Trademark Collateral. The Trustee may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and
place fixed for the sale, and such sale may be made at any time or place to which the sale may be so adjourned. 
 The proceeds of each collection, sale or
other disposition under this Section 5.05 shall be applied in accordance with Section 5.09. 
 The Grantor Parties recognize that,
by reason of certain prohibitions contained in the Securities Act of 1933, as amended, and applicable state securities laws, the Trustee may be compelled, with respect to any sale of all or any part of the Collateral, to limit purchasers to those
who will agree, among other things, to acquire the 
  

 13 

 Collateral for their own account, for investment and not with a view to the distribution or resale thereof. The Grantor
Parties acknowledge that any such private sales may be at prices and on terms less favorable to the Trustee than those obtainable through a public sale without such restrictions, and, notwithstanding such circumstances, agree that any such private
sale shall be deemed to have been made in a commercially reasonable manner and that the Trustee shall have no obligation to engage in public sales and no obligation to delay the sale of any Collateral for the period of time necessary to permit the
Company or issuer thereof to register it for public sale. 
 5.06 Deficiency. If the proceeds of sale, collection or other
realization of or upon the Collateral pursuant to Section 5.05 are insufficient to cover the costs and expenses of such realization and the payment in full of the Secured Obligations, the Grantor Parties shall remain liable for any deficiency.

 5.07 Locations; Names. Without at least 30 days’ prior written notice to the Trustee, no Grantor Party shall change its
“location” (as defined in Section 9-307 of the Uniform Commercial Code) or change its name from the name shown as its current legal name on Annex 1. 
 5.08 Private Sale. The Trustee shall incur no liability as a result of the sale of the Collateral, or any part thereof, at any private sale pursuant to Section 5.05 conducted in a commercially
reasonable manner. Each Grantor Party hereby waives any claims against the Trustee arising by reason of the fact that the price at which the Collateral may have been sold at such a private sale was less than the price which might have been obtained
at a public sale or was less than the aggregate amount of the Secured Obligations, even if the Trustee accepts the first offer received and does not offer the Collateral to more than one offeree. 
 5.09 Application of Proceeds. Except as otherwise herein expressly provided, the proceeds of any collection, sale or other realization of
all or any part of the Collateral pursuant hereto, and any other cash at the time held by the Trustee under this Section 5, shall be applied by the Trustee: 
 First, to the payment of the costs and expenses of such collection, sale or other realization, including reasonable
out-of-pocket costs and expenses of the Trustee and the fees and expenses of its agents and counsel, and all expenses incurred and advances made by the Trustee in connection therewith; 
 Second, to the payment in full of the Secured Obligations in such manner of application as required under the Indenture, the
Notes and/or the other Transaction Documents; and 
 Finally, to the payment to the respective Grantor Parties,
or their respective successors or assigns, or as a court of competent jurisdiction may direct, of any surplus then remaining. 
 5.10
Attorney-in-Fact. Without limiting any rights or powers granted by this Agreement to the Trustee while no Event of Default has occurred and is continuing, upon the occurrence and during the continuance of any Event of Default the Trustee
is hereby appointed the attorney-in-fact of each Grantor Party for the purpose of carrying out the provisions of this Section 5 and taking any action and executing any instruments which the Trustee may reasonably deem necessary or advisable to
accomplish the purposes hereof, which appointment as attorney-in-fact is irrevocable and coupled with an interest. Without limiting the generality of the foregoing, so long as the Trustee shall be entitled under this Section 5 to make
collections in respect of the Collateral, the Trustee shall have the right and power to receive, endorse and collect all checks made payable to the order of any Grantor Party representing any dividend, payment or other distribution in respect of the
Collateral or any part thereof and to give full discharge for the same. 
 5.11 Perfection. Prior to or concurrently with the
execution and delivery of this Agreement, each Grantor Party shall (i) file such financing statements and other documents in such offices as the Trustee may reasonably request to perfect the security interests granted by Section 3 of this
Agreement, (ii) deliver to the Trustee 
  

 14 

 all certificates evidencing any of the Pledged Stock, accompanied by undated stock powers duly executed in blank, and, to
the extent required by Section 3(b), all promissory notes and other instruments evidencing any Pledged Debt identified in Annex 8 and (iii) execute and deliver such short form assignments or security agreements relating to Collateral
consisting of the Intellectual Property as the Trustee may reasonably request. Without limiting the foregoing, each Grantor Party consents that Uniform Commercial Code financing statements may be filed describing the Collateral as set forth in
Section 3. 
 5.12 Termination. When all Secured Obligations shall have been paid in full, this Agreement, together with
all security interests and Liens created or evidenced hereby, shall immediately and automatically terminate and be of no further force or effect, and the Trustee shall forthwith cause to be assigned, transferred and delivered, against receipt but
without any recourse, warranty or representation whatsoever, any remaining Collateral and money received in respect thereof, to or on the order of the respective Grantor Party. The Trustee shall, at the expense of the Company, also execute and
deliver to the respective Grantor Party upon such termination such Uniform Commercial Code termination statements and such other documentation as shall be reasonably requested by the respective Grantor Party to effect the termination and release of
the Liens on the Collateral. 
 5.13 Further Assurances. Each Grantor Party agrees that, from time to time upon the written
request of the Trustee, such Grantor Party will execute and deliver such further documents and do such other acts and things as the Trustee may reasonably request in order fully to effect the purposes of this Agreement. 
 Section 6. Miscellaneous. 
 6.01 Notices. All notices, requests, consents and demands hereunder shall be in writing and telecopied or delivered to the respective parties hereto in the manner and at the locations specified for such parties in
Section 12.02 of the Indenture. 
 6.02 No Waiver. No failure on the part of the Trustee or any Holder to exercise, and no
course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Trustee of any right, power or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other right, power or remedy. The remedies herein are cumulative and are not exclusive of any remedies provided by law. 
 6.03 Amendments, Etc. The terms of this Agreement may be waived, altered or amended only by an instrument in writing duly executed by each Grantor Party and the Trustee. 
 6.04 Expenses. The Grantor Parties jointly and severally agree to reimburse the Trustee for all reasonable costs and expenses incurred by
the Trustee (including the expenses and reasonable fees of legal counsel) in connection with (i) any Default and any enforcement or collection proceeding resulting therefrom, including all manner of participation in or other involvement with
(w) performance by the Trustee of any obligations of the Grantor Parties in respect of the Collateral that the Grantor Parties have failed or refused to perform, (x) bankruptcy, insolvency, receivership, foreclosure, winding up or
liquidation proceedings, or any actual or attempted sale, or any exchange, enforcement, collection, compromise or settlement in respect of any of the Collateral, and for the care of the Collateral and defending or asserting rights and claims of the
Trustee in respect thereof, by litigation or otherwise, including expenses of insurance, (y) judicial or regulatory proceedings and (z) workout, restructuring or other negotiations or proceedings (whether or not the workout, restructuring
or transaction contemplated thereby is consummated) and (ii) the enforcement of this Section 6.04, and all such costs and expenses shall be Secured Obligations entitled to the benefits of the collateral security provided pursuant to
Section 3. 
  

 15 

 6.05 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit
of the respective successors and assigns of each Grantor Party, the Trustee and each holder of any of the Secured Obligations; provided that no Grantor Party shall assign or transfer its rights or obligations hereunder without the prior
written consent of the Trustee. 
 6.06 Additional Subsidiary Guarantors. New Subsidiaries of the Company formed or acquired by
the Company after the date hereof and any Subsidiary that ceases to be an “Unrestricted Subsidiary” (as defined in the Indenture) which become a Subsidiary Guarantor under the Indenture shall become a “Subsidiary Guarantor” under
this Agreement, by executing and delivering to the Trustee an instrument of assumption of guaranty and accession hereto in form and substance reasonably satisfactory to the Trustee. Accordingly, upon such execution and delivery by any such
Subsidiary, such new Subsidiary shall automatically and immediately, and without any further action on the part of any Person, become a “Subsidiary Guarantor” and an “Grantor Party” for all purposes of this Agreement. 

6.07 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and
the same instrument and any of the parties hereto may execute this Agreement by signing any such counterpart. 
 6.08 Governing
Law. This Agreement shall be governed by, and construed in accordance with, the law of the State of New York. 
 6.09
Captions. The captions and section headings appearing herein are included solely for convenience of reference and are not intended to affect the interpretation of any provision of this Agreement. 
 6.10 Agents and Attorneys-in-Fact. The Trustee may employ agents and attorneys-in-fact in connection herewith and shall not be responsible
for the negligence or willful misconduct of any such agents or attorneys-in-fact selected by it with due care. 
 6.11
Severability. If any provision hereof is invalid and unenforceable in any jurisdiction, then, to the fullest extent permitted by law, (a) the other provisions hereof shall remain in full force and effect in such jurisdiction and
(b) the invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction. 
 [Signatures appear on following pages] 
  

 16 

 EXHIBIT 10.7 
 IN WITNESS WHEREOF, the parties hereto have caused this Security Agreement to be duly executed and delivered as of the day and year first above written. 
 THE COMPANY 
  

	
	VELOCITY EXPRESS CORPORATION

			
		
	By:	 	 /s/ Edward W. Stone

		 	Name: Edward W. Stone
		 	Title:   Chief Financial Officer

 SUBSIDIARY GUARANTORS 
  

	
	 VELOCITY EXPRESS, INC

	 VXP MID-WEST, INC.

	 CORPORATE EXPRESS DISTRIBUTION SERVICES, INC.

	 VELOCITY EXPRESS LEASING, INC.

	 VXP LEASING MID-WEST, INC.

	 CD&L ACQUISITION CORP.

			
		
	By:	 	 /s/ Edward W. Stone

		 	Name: Edward W. Stone
		 	Title:   Chief Financial Officer

 THE `TRUSTEE 
  

	
	 WELLS FARGO BANK, N.A., as Trustee

			
		
	By:	 	 /s/ Jane Y. Schweiger

		 	Name: Jane Y. Schweiger
		 	 Title:   Vice President

 Signature Page to 
 Security Agreement 

 ANNEX 1 
 FILING DETAILS 
  

											
	 Current Legal Name
(no trade names)
	  	 Type
of
Organization
(corporation, limited liability
company, etc.)
	 	 Jurisdiction of
 Organization
	 	 Organizational
ID Number
 (if applicable)
	 	 Current Mailing
Address
	 	 Place of Business or
 Location of Chief
Executive Officer

	Velocity Express Corporation	  	Corporation	 	Delaware	 	87-0355929	 	One Morningside Drive, Westport, CT 06880	 	One Morningside Drive, Westport, CT 06880
						
	Velocity Express, Inc.	  	Corporation	 	Delaware	 	76-0424426	 	One Morningside Drive, Westport, CT 06880	 	One Morningside Drive, Westport, CT 06880
						
	CD&L Acquisition Corp.	  	Corporation	 	Delaware	 	4177343	 	One Morningside Drive, Westport, CT 06880	 	One Morningside Drive, Westport, CT 06880
						
	VXP Leasing Mid-West, Inc.	  	Corporation	 	Delaware	 	76-0660846	 	One Morningside Drive, Westport, CT 06880	 	One Morningside Drive, Westport, CT 06880
						
	VXP Mid-West, Inc.	  	Corporation	 	Delaware	 	76-0660845	 	One Morningside Drive, Westport, CT 06880	 	One Morningside Drive, Westport, CT 06880
						
	Velocity Express Leasing, Inc.	  	Corporation	 	Delaware	 	76-0486733	 	One Morningside Drive, Westport, CT 06880	 	One Morningside Drive, Westport, CT 06880
						
	Corporate Express Distribution Services, Inc.	  	Corporation	 	Michigan	 	38-1889687	 	One Morningside Drive, Westport, CT 06880	 	One Morningside Drive, Westport, CT 06880

 Annex 1 to Security Agreement 

 ANNEX 2 
 “NEW DEBTOR” EVENTS 
 None. 
 Annex 2 to Security Agreement 

 ANNEX 3 
 PLEDGED STOCK 
 Pledgor Party: VELOCITY EXPRESS
CORPORATION 
  

									
	 Issuer
	 	 Certificate
No(s).
	 	 Registered Owner
	 	 Authorized Shares/
 Outstanding Shares
	 	 Number of Shares Pledged (100% of total authorized
shares)

	Velocity Express, Inc.	 	1	 	Velocity Express Corporation	 	10,000†	 	10,000 shares common stock, par value $0.01 per share
					
	CD&L Acquisition Corp. (f/k/a Cobra Acquisition Corp.)	 	1	 	Velocity Express Corporation	 	1,000†	 	1,000 shares common stock, par value $0.004 per share
					
	CD&L Inc.	 	Pending	 	Velocity Express Corporation	 	30,000,000 (auth’d)/
22,803,970 (outstg)††	 	9,185,886 shares common stock, par value $0.001 per share

 Pledgor Party: VELOCITY EXPRESS, INC. 

 

									
	 Issuer
	 	 Certificate
No(s).
	 	 Registered Owner
	 	 Authorized Shares
	 	 Number of Shares Pledged (100% of total authorized
shares)

	Velocity Express Leasing, Inc. (f/k/a Velocity Express Leasing Southwest, Inc.)	 	1	 	Velocity Express, Inc.	 	1,000†	 	1,000 shares common stock, par value $1.00 per share
					
	VXP Mid-West, Inc.	 	1	 	Velocity Express, Inc.	 	1,000†	 	1,000 shares common stock, par value $0.01 per share
					
	Corporate Express Distribution Services, Inc.	 	1	 	Velocity Express, Inc.	 	1,000†	 	1,000 shares common stock, par value $1.00 per share

	†	Denotes that all authorized stock is issued and outstanding. 

	††	Based solely on Company’s reliance upon Target representations/warranties made in Target Merger Agreement, without Company investigation or inquiry.

 Annex 3 to Security Agreement 

 Pledgor Party: VELOCITY EXPRESS, INC. (cont’d)

  

									
	 Issuer
	 	 Certificate
No(s).
	 	 Registered Owner
	 	 Authorized
Shares
	 	 Number of Shares Pledged
(65% of total authorized
shares)

	 USDS Canada Ltd.
	 	A-3	 	Velocity Express, Inc.	 	100,000†	 	65,000 shares Class A Common Stock
					
		 	B-7	 	Velocity Express, Inc.	 	22,410†	 	14,566.5 shares of Class B Common Stock
					
		 	C-5	 	Velocity Express, Inc.	 	23,323†	 	15,159.95 shares of Class C Common Stock
					
		 	D-4	 	Velocity Express, Inc.	 	15,872†	 	10,316.8 shares of Class D Common Stock

 Pledgor Party: VXP Mid-West, Inc. 
  

									
	 Issuer
	  	 Certificate
No(s).
	  	 Registered Owner
	  	 Authorized Shares
	  	 Number of Shares Pledged
(100% of total authorized
shares)

	 VXP Leasing Mid-West, Inc.
	  	1	  	VXP Mid-West, Inc.	  	1,000†	  	1,000 shares common stock, par value $0.01 per share

	†	Denotes that all authorized stock is issued and outstanding. 

 Annex 3 to Security Agreement 

 ANNEX 4 
 LIST OF COPYRIGHTS, COPYRIGHT REGISTRATIONS AND 
 APPLICATIONS FOR COPYRIGHT REGISTRATIONS

 NONE 
 Annex 4 to
Security Agreement 

 ANNEX 5 
 LIST OF PATENTS AND PATENT APPLICATIONS 
 NONE 
 Annex 5 to Security Agreement 

 ANNEX 6 
 LIST OF TRADE NAMES, TRADEMARKS, SERVICES MARKS, 
 TRADEMARK AND SERVICE MARK REGISTRATIONS AND

 APPLICATIONS FOR TRADEMARK AND SERVICE MARK REGISTRATIONS 
 VELOCITY EXPRESS CORPORATION / VELOCITY EXPRESS INC. 
 Material U.S.
Trademark Applications 
 NONE 
 Material Non-US Trademark Applications 
 NONE 
 Material U.S. Trademark Registrations 
  

							
	 Owner
	  	 Trademark
	  	 Country
	  	 Registration No.

	 Velocity Express Corporation
	  	Relentless Reliability	  	U.S.	  	2765219
	 Velocity Express Inc.
	  	VXP	  	U.S.	  	2660102
	 Velocity Express Inc.
	  	Velocity	  	U.S.	  	2817675
	 Velocity Express Inc.
	  	Velocity Express	  	U.S.	  	2684089

 Material Non-U.S. Trademark Registrations 
 NONE 
 Annex 6 to Security Agreement

 ANNEX 7 
 LIST OF MATERIAL LICENSES AND OTHER USER AGREEMENTS 
 NONE 
 PROCEEDINGS / CLAIMS 
 On November 30, 2000,
Velocity Express, Inc. entered into a Settlement Agreement with Velocity Courier, Inc. in connection with the parties’ use of certain “Velocity” trademarks. Pursuant to the terms of the settlement, Velocity Express, Inc. is permitted
to use the Velocity trademarks anywhere in the United States except the City of Chicago and the territory that extends 50 miles from the Chicago city limits, but within the State of Illinois. The Settlement Agreement required Velocity Express, Inc.
to amend its trademark applications to reflect this exclusion. The Company anticipates that it will initiate concurrent use proceedings in order to clarify territorial rights with respect to two “Velocity” trademark registrations
(Velocity and Velocity Express). 
 Annex 7 to Security Agreement 

 ANNEX 8 
 PLEDGED DEBT 
 CD&L, Inc. Series A Convertible Subordinated Debentures in an aggregate principal amount of
$4,000,000 acquired by the Company simultaneously with the Effective Date pursuant to the Series A Convertible Subordinated Debenture Purchase Agreement entered into by the Company of even date with the various holders thereof. 

 EXHIBIT A 
 to Security Agreement 
 FORM OF 
 DESIGNATED ACCOUNT CONTROL AGREEMENT 
 This DESIGNATED ACCOUNT CONTROL AGREEMENT
(this “Control Agreement”) dated as of June 30, 2006 (the “Effective Date”) by and among (A) VELOCITY EXPRESS CORPORATION, a Delaware corporation (the “Pledgor”), and each of the several
Subsidiary Guarantors referred to in the Security Agreement described (and defined) below (each, a “Subsidiary Pledgor” and, collectively, the “Subsidiary Pledgor” and, together with Pledgor, the “Pledgor
Parties”) (B) WELLS FARGO BROKERAGE SERVICES, LLC, a Delaware limited liability company, in its capacity as securities intermediary (the “Securities Intermediary”) hereunder and (C) WELLS FARGO BANK, N.A., a
national banking association, as Trustee (the “Trustee”) for the benefit of the Holders under (and as defined in) the even-dated Indenture (as defined in the Security Agreement hereinafter referred to) and the even-dated Security
Agreement by the Pledgor Parties to and in favor of the Trustee (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Security Agreement”). Capitalized terms used but not defined herein shall
have the meanings assigned to such terms in the Security Agreement or, to the extent not so defined therein, in the Indenture referred to (and defined) therein. This Control Agreement is for the purpose of perfecting, with regard to certain
Collateral items that are securities, securities entitlements or other property underlying any financial assets, or are otherwise of a nature or type such that, as directed by applicable provisions of UCC Article 8, a security interest therein may
only be (or is otherwise most-effectively) perfected by means of a control agreement entered into along the lines hereof (any and all Collateral items of any such nature or type that are at any time after the Effective Date owned, held or maintained
by any Pledgor Party, collectively, the “Article 8 Collateral”), the Liens granted by the Pledgor Parties in favor of the Trustee pursuant to the Security Agreement. All references herein to the “UCC” shall mean the
Uniform Commercial Code as in effect from time to time in the State of New York. 
 1. Confirmation of Establishment and Maintenance of
the Designated Account. The Securities Intermediary hereby confirms that (i) the Securities Intermediary has established for the Pledgor Parties on or prior to the Effective Date and, as of such date, maintains and shall thereafter maintain
the Designated Account listed in Schedule I attached hereto (such account, the “Designated Account”), for the purpose of receiving deposits and credits of, and otherwise maintaining therein as subject to the
first-priority, perfected Liens of the Trustee pursuant to the Security Agreement, the Article 8 Collateral, (ii) the Designated Account is a “securities account” as such term is defined in Section 8-501(a) of the UCC,
(iii) the Securities Intermediary shall, unless it shall have received contrary written instruction from the Trustee to the effect that the applicable Pledgor Parties are not so entitled under specified Transaction Document provisions and as
otherwise subject to the terms of this Control Agreement and the Security Agreement, treat each Pledgor Party as entitled to the benefit, exercise and enforcement of voting, divident or other rights that comprise or appertain to any Article 8
Collateral credited to the Designated Account and (iv) all Article 8 Collateral credited to the Designated Account as of the Effective Date is and, for so long as any Secured Obligations shall remain outstanding, shall be registered in the name
of the Securities Intermediary, indorsed to the Securities Intermediary or in blank or credited to another securities or other designated account maintained in the name of the Securities Intermediary and in no case will Article 8 Collateral credited
to the Designated Account be registered in the name of any Pledgor Party, payable to the order of any Pledgor Party or indorsed to any Pledgor Party, except to the extent the foregoing have been indorsed to the Securities Intermediary or in blank.

 2. Pledgor Party Deposits/Credits to Designated Account. Each Pledgor Party represents, warrants and covenants to and for the
benefit of the Trustee that such Pledgor Party has, on or prior to the Effective Date, duly deposited or caused to be duly deposited or credited to the Designated Account and, for so long as any Secured Obligations shall remain outstanding, shall at
all times thereafter deposit or cause to be so deposited or credited any and all Article 8 Collateral at any and all such times owned, held or maintained by such Pledgor Party. 

 3. “Financial Assets” Election. The Securities Intermediary hereby agrees that each item
of Article 8 Collateral credited to the Designated Account shall be treated as a “financial asset” within the meaning of Section 8-102(a)(9) of the UCC. 
 4. Entitlement Order. If at any time the Securities Intermediary shall receive an “entitlement order”(within the meaning of Section 8-102(a)(8) of the UCC) from the Trustee and relating to the
Designated Account, the Securities Intermediary shall comply with such entitlement order without further consent by the Company or any other Person. 
 5. Subordination of Lien; Waiver of Set-Off. In the event that the Securities Intermediary subsequently obtains by agreement, operation of law or otherwise a security interest or other Lien in, on or with
respect to the Designated Account or any Collateral, the Securities Intermediary hereby agrees that such Lien shall be subordinate to the Liens in favor of the Trustee, except as provided herein with respect to Securities Intermediary’s liens
securing fees and charges, and payment for open trade commitments. The financial assets and other items deposited to the Designated Account will not be subject to deduction, set-off, banker’s lien, or any other right or Lien in favor of any
Person other than the Trustee for the benefit of the Holders (except for Securities Intermediary’s liens securing: (i) fees and charges owed by Pledgor with respect to the holding of the Article 8 Collateral, (ii) payment owed to
Securities Intermediary for open trade commitments with respect to the Article 8 Collateral; and (iii) except that the Securities Intermediary may set off the face amount of any checks or other items which have been credited to any Designated
Account but are subsequently returned unpaid because of uncollected or insufficient funds). 
 6. Choice of Law. Both this Control
Agreement and the Designated Account shall be governed by the laws of the State of New York. Regardless of any provision in any other agreement, for purposes of the UCC, New York shall be deemed to be the Securities Intermediary’s jurisdiction
and the Designated Account (as well as the security entitlements related thereto) shall be governed by the laws of the State of New York. 
 7. Conflict with Other Agreements; Amendments. As of the date hereof, there are no other agreements entered into between the Securities Intermediary and the Pledgor Parties with respect to the Designated Account or any security
entitlements or other financial assets credited thereto (other than the Security Agreement and standard and customary documentation with respect to the establishment and maintenance of the Designated Account). The Securities Intermediary and the
Pledgor Parties will not enter into any other agreement with respect to the Designated Account unless the Trustee shall have received prior written notice thereof. The Securities Intermediary and the Pledgor Parties will not enter into any other
agreement with respect to creation or perfection of any security interest or other Lien in or on, or control of security entitlements maintained in the Designated Account without the prior written consent of the Trustee acting in its sole
discretion. In the event of any conflict with respect to “control” over the Designated Account between this Control Agreement (or any portion hereof) and any other agreement now existing or hereafter entered into, the terms of this Control
Agreement shall prevail. No amendment or modification of this Control Agreement or waiver of any rights hereunder shall be binding on any party hereto unless it is in writing and is signed by all the parties hereto. 
 8. Certain Agreements. 
 (a) The Trustee has delivered to the Securities Intermediary a list, signed by its authorized representative, of the officers of the Trustee authorized (each, an “Authorized Trustee Representative”) to give approvals or
instructions under this Control Agreement (including notices and other instructions under Section 9 hereof) and the Securities Intermediary shall be entitled to rely on communications from such Authorized Trustee Representatives until
the earlier of (i) the termination of this Control Agreement in accordance with the terms hereof, (ii) notification by an Authorized Trustee Representative of a change in the Authorized Trustee Representatives and (iii) the assignment
of the rights of the Trustee in accordance with Section 11 hereof. 
 (b) Notice of Adverse Claims. Except
for the Trustee’s Liens pursuant to the Security Agreement, the Securities Intermediary on the date hereof does not know of any claim to, or security interest or other Lien in or on, the Designated Account or in any “financial asset”
(as defined in Section 

 8-102(a) of the UCC) credited thereto and does not know of any claim that any Person other than the
Trustee has been given “control” of the Designated Account or any such financial asset. If any Person asserts any Lien, encumbrance or adverse claim (including any writ, garnishment, judgment, warrant of attachment, execution or similar
process and any claim of “control”) against any financial asset or other Article 8 Collateral carried in the Designated Account, the Securities Intermediary will promptly notify the Trustee and the Pledgor Parties thereof. 
 (c) Maintenance of the Designated Account. In addition to, and not in lieu of, the obligation of the Securities Intermediary to
honor entitlement orders as agreed in Section 3 hereof, the Securities Intermediary agrees to maintain the Designated Account as follows: 
 (d) Notice of Sole Control. If at any time the Trustee delivers to the Securities Intermediary a notice of sole control, signed by an Authorized Trustee Representative, in substantially the form set forth in
Exhibit A attached hereto (the “Notice of Sole Control”) with respect to the Designated Account, the Securities Intermediary agrees that, after receipt of such notice, it will take all instructions with respect to the
Designated Account solely from the Trustee (without consent from the Pledgor Parties). Permitting settlement of trades pending at the time of receipt of such notice shall not constitute a violation of the immediately preceding sentence. Without
limiting the generality of the first sentence of this paragraph, upon receipt of a Notice of Sole Control, the Securities Intermediary shall (x) no longer permit any trading with respect to the applicable Article 8 Collateral to be initiated by
the Pledgor Parties or any representative of, or investment manager appointed by, the Pledgor Parties and the Securities Intermediary shall follow all instructions given by an Authorized Trustee Representative, including without limitation
instructions for distribution or transfer of any Article 8 Collateral in the Designated Account to be made to the Trustee and (y) follow all instructions given by an Authorized Trustee Representative, including, without limitation, instructions
for distribution or transfer of any funds in the Designated Account to be made to the Trustee. 
 (e) Statements and
Confirmations. The Securities Intermediary will send copies of all statements and other correspondence (excluding routine confirmations) required under this Agreement, in Section 2(g) or elsewhere in the Security Agreement or otherwise
concerning the Designated Account or any financial assets constituting Collateral credited thereto simultaneously to each of the Pledgor Parties and the Trustee at their respective addresses as provided in Section 12. 
 9. Voting Rights; Dispositions. Except to the extent expressly permitted by the Security Agreement, Pledgor Parties shall have no right to direct
the Securities Intermediary with respect to the sale, exchange or transfer of such Article 8 Collateral held in the Designated Account. At such time as the Securities Intermediary receives a Notice of Sole Control pursuant to Section 8(e) of
this Section, the Trustee exclusively shall direct the Securities Intermediary with respect to the matters contemplated in the immediately preceding sentence. 
 10. Bailee for Perfection. The Securities Intermediary acknowledges that, in the event that it should come into possession of any certificate representing any security or other assets held as Article 8
Collateral in the Designated Account, the Securities Intermediary shall retain possession of the same for the benefit of the Trustee (and such act shall cause the Securities Intermediary to be deemed a bailee for the Trustee, if necessary) to
perfect the Trustee’s Liens in such securities or assets. The Securities Intermediary hereby acknowledges its receipt of a copy of the Security Agreement as notice to the Securities Intermediary regarding notice of a Lien in favor of Trustee in
collateral held by a bailee. 
 11. Representations, Warranties and Covenants of the Securities Intermediary. The Securities
Intermediary hereby makes the following representations, warranties and covenants: 
 (a) The Designated Account has been
established as set forth in Section 1 hereof and the Designated Account will be maintained in the manner set forth herein and in the Security Agreement until termination of this Control Agreement and the Security Agreement. The
Securities Intermediary 

 shall not change the name or account number of the Designated Account without the prior written consent
of the Trustee. 
 (b) No financial asset constituting Collateral is or will be registered in the name of the applicable
Pledgor Party, payable to its order or indorsed to it, except to the extent such financial asset has been indorsed to the Securities Intermediary (or its nominee) or in blank. 
 (c) This Control Agreement is the valid and legally binding obligation of the Securities Intermediary. 
 (d) The Securities Intermediary has not entered into any agreement with any other Person pursuant to which it has agreed to comply with
entitlement orders (as defined in Section 8-102(a)(8) of the UCC) with respect to the financial assets credited to the Designated Account, except for the Security Agreement. Until the termination of this Control Agreement and the Security
Agreement, the Securities Intermediary will not, without the written approval of the Trustee, enter into any agreement with any Person relating to the Designated Account or any financial assets credited thereto pursuant to which it agrees to comply
with entitlement orders of such Person, except for the Security Agreement. 
 (e) The Securities Intermediary has not entered
into any other agreement with the Pledgor Parties or Trustee purporting to limit or condition the obligation of the Securities Intermediary to comply with entitlement orders with respect to financial assets credited to the Designated Account as set
forth in Section 3 hereof other than the Security Agreement. 
 12. Successors; Assignment. The terms of this Control
Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their respective corporate successors and permitted assignees. 
 13. Notices; Wiring Instructions. All notices, instructions and communications required to be given hereunder shall be in writing in English and shall be deemed sufficiently given when received by hand or
courier delivery, by telecopier or registered or certified mail, postage prepaid, return receipt requested at the addresses specified below each party’s signature hereto (with all notices to any Subsidiary Pledgor to be sent care of and to be
deemed duly delivered if transmitted to Pledgor) until such time as the parties hereto designate a different or additional address or addresses in the manner provided herein or therein. Wiring instructions for each of the parties hereto are either
contained in the Security Agreement or will be provided to the Securities Intermediary in a timely written notice signed by an Authorized Trustee Representative. 
 14. Termination. The obligations of the Securities Intermediary hereunder shall continue in effect until the Liens in favor of the Trustee for the benefit of the Noteholders with respect to the Article 8
Collateral and other Collateral have been terminated in accordance with the provisions of the Security Agreement and an Authorized Trustee Representative has notified the Securities Intermediary of such termination in writing; or until thirty
(30) days after Trustee’s receipt of notice from any Pledgor Party or the Securities Intermediary of the termination of the Designated Account and Securities Intermediary’s delivery of all Article 8 Collateral to Trustee or its
designee in accordance with Trustee’s written instructions. 
 15. Severability. If any term or provision set forth in this
Agreement shall be invalid or unenforceable, the remainder of this Agreement, other than those provisions held invalid or unenforceable, shall be construed in all respects as if such invalid or unenforceable term or provision were omitted.

 16. Counterparts. This Control Agreement may be executed in any number of counterparts, all of which shall constitute one and the
same instrument, and any party hereto may execute this Control Agreement by signing and delivering one or more counterparts. 
 17. EFFECT
OF SUBORDINATION AGREEMENT. UPON AND DURING EFFECTIVENESS OF THE SUBORDINATION AGREEMENT REFERRED TO IN SECTION 1A OF THE SECURITY AGREEMENT, 

 SUCH SUBORDINATION AGREEMENT SHALL IN ALL RESPECTS GOVERN AND CONTROL ALL RIGHTS, INTERESTS, REMEDIES AND OBLIGATIONS TO
THE SAME EXTENT AS PROVIDED IN SUCH SECTION 1A AS IF THIS ENTIRE CONTROL AGREEMENT WERE FULLY INCORPORATED INTO AND SET FORTH WITHIN THE BODY OF THE SECURITY AGREEMENT ITSELF. 
 18. AGREEMENT OF THE PLEDGOR PARTIES. Pledgor Parties agree to indemnify and hold harmless Securities Intermediary, its officers, directors,
employees and agents, against claims, liabilities or expenses (including reasonable attorney’s fees) arising out of Securities Intermediary’s compliance with any instructions from Trustee with respect to the Designated Account, except if
such claims, liabilities or expenses are caused by Securities Intermediary’s negligence or willful misconduct. 
 [Singature pages
follow] 

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

					
	SECURITIES INTERMEDIARY
	
	         WELLS FARGO BROKERAGE SERVICES, LLC,

            as Securities Intermediary

		
	         By:
	 	  

		 	 Name:
	 	
		 	 Title:
	 	
		
		 	 Address for Notices:
 Wells Fargo Brokerage Services, LLC

		 	 Institutional Brokerage & Sales

		 	 MAC N9303-050, Suite 500

		 	 608 Second Avenue South

		 	 Minneapolis, MN 55479

		 	 Attn:                                     
                                        
                                        
       

		 	 Fax:                                      
                                        
                                        
       

		
	TRUSTEE	 	
	
	         WELLS FARGO BANK, N.A., as Trustee

		
	         By:
	 	  

		 	 Name:
	 	
		 	 Title:
	 	
		 	  
 Address for
Notices:
	 	
		 	 Wells Fargo Bank, N.A.
	 	
		 	 Corporate Trust Services
	 	
		 	 Sixth and Marquette, Mac N9303-120

		 	 Minneapolis, MN 55479
	 	
		 	 Attn: Lynn M. Steiner, Vice President

		 	 Fax No. 612-667-9825
	 	
			
		 	 with copies to each of:
	 	
			
		 	 Morgan, Lewis & Bockius LLP
	 	Kelley Drye & Warren LLP
		 	 101 Park Avenue
	 	8000 Towers Crescent Dr., Suite 1200
		 	 New York, New York 10178
	 	Vienna, VA 22182
		 	 Attn: Stephen P. Farrell, Esq.
	 	Attn: Jay Schifferli
		 	 Fax No. 212-309-6001
	 	Fax No. 703-918-2450

 Signature Page to 
 Designated Account Control Agreement 

  

					
	PLEDGOR	 		 	
	
	         VELOCITY EXPRESS CORPORATION
  

	         By:
	 	
		 	 
		 	Name:	 	
		 	Title:	 	
			
		 	Address for Notices:	 	
		 	Velocity Express Corporation
		 	One Morningside Drive North
		 	Building B Suite 300	 	
		 	Westport, CT 06880	 	
		 	Attn: Ted Stone	 	
		 	 Fax No. (952) 835-4997
  
 with copies to each of:
  

		 	Briggs and Morgan, P.A.	 	Budd Larner
		 	2200 IDS Center	 	150 John F. Kennedy Parkway
		 	80 South Eighth Street	 	Short Hills, New Jersey 07078
		 	Minneapolis, MN 55402	 	Attn: Mark Larner
		 	Attn: Avron L. Gordon	 	Fax No. 973-379-7734
		 	Fax No. 612-977-8650	 	
	
	SUBSIDIARY PLEDGORS
	
	         VELOCITY EXPRESS, INC.

	         VXP MID-WEST, INC.

	         CORPORATE EXPRESS DISTRIBUTION SERVICES, INC.

	         VELOCITY EXPRESS LEASING, INC.

	         VXP LEASING MID-WEST, INC.

	         CD&L ACQUISITION CORP. (f/k/a Cobra Acquisition
Corp.)

			
	         By:
	 		 	
		 	 
		 	Name:
		 	Title:
		
		 	Address for Notices:
		 	All notices to name applicable Subsidiary Pledgor addressee(s) and be sent care of Pledgor at its address set forth above.

 Signature Page to 
 Designated Account Control Agreement 

 SCHEDULE I 
 Designated Account 
 Velocity Express Corporation Pledge Security Account 
 Account No.: 12907473

 EXHIBIT A 
 to 
 Designated Account Control Agreement 
 FORM OF NOTICE OF SOLE CONTROL 
 [LETTERHEAD OF TRUSTEE] 
 Dated [                        ]

 Wells Fargo Brokerage Services, LLC 
 Institutional
Brokerage & Sales 
 MAC N9303-050, Suite 500 
 608
Second Avenue South 
 Minneapolis, MN 55479 
 Attn: 

Re: Notice of Sole Control—Velocity Express Corporation Designated Account No. 12907473
 Dear [                    ]: 
 As referenced in Section 7(e) of the Designated Account Control Agreement dated as of June 30, 2006 (the “Control
Agreement”; capitalized terms used but not defined herein shall have the meanings assigned to such terms in the Control Agreement, a copy of which is attached) among Wells Fargo Brokerage Services, LLC, a Delaware limited liability company,
as Securities Intermediary, Wells Fargo Bank, N.A., a national banking association, as Trustee, and Velocity Express Corporation, a Delaware corporation, as Pledgor, we hereby give you notice of our sole control over Article 8 Collateral maintained
in the Designated Account, account number 12907473 (the “Designated Account”). You are hereby instructed not to accept any direction, instruction or entitlement order with respect to the Article 8 Collateral maintained in the
Designated Account or the financial assets constituting Article 8 Collateral credited thereto from any Person other than the undersigned, unless otherwise ordered by a court of competent jurisdiction. 
 You are instructed to deliver a copy of this notice by facsimile transmission to Pledgor. 
  

			
	 Very truly yours,
  

	 Wells Fargo Bank, N.A., as Trustee
  

	 By:
	 	  

		 	 Name:

		 	 Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00106-of-00352.parquet"}]]