Document:

Exhibit 4.2

 

NEITHER THIS SECURITY NOR ANY SECURITIES WHICH MAY BE ISSUED
UPON EXERCISE OF THIS SECURITY HAVE BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
COMMISSION OF ANY U.S. STATE OR OTHER JURISDICTION OR ANY EXCHANGE OR SELF-REGULATORY ORGANIZATION, IN RELIANCE UPON EXEMPTIONS
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, AND SUCH OTHER LAWS AND REQUIREMENTS, AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR LISTING OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, SUCH REGISTRATION AND/OR LISTING REQUIREMENTS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL
TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH WILL BE REASONABLY ACCEPTABLE TO THE COMPANY.

 

NDB ENERGY, INC.

 

FORM OF SERIES C WARRANT

 

No. C-______

 

_______________, 2012

 

NDB Energy, Inc., a Nevada corporation (the “Company”),
hereby certifies that ______________________________, its permissible transferees, designees, successors and assigns (collectively,
the “Holder”), for value received, is entitled to purchase from the Company at any time and from time to time
commencing on the date first appearing above (the “Issuance Date”), up to and through 12:01a.m. (EST) on the
date seven (7) years from the Issuance Date (the “Termination Date”) up to ________ shares (each, a “Share”
and collectively the “Shares”) of the Company’s common stock, par value $0.001 (the “Common Stock”),
at an exercise price per Share equal to $3.00 (the “Exercise Price”). The number of Shares purchasable hereunder
and the Exercise Price are subject to adjustment as provided in Section 4 hereof.

 

This Warrant is being delivered pursuant
to the terms and conditions of that certain Share Exchange Agreement (the “SEA”) date March <>, 2012 by
and among the Company, Armada Oil, Inc. (“Armada”), the Holder and the other signatories thereto, in exchange
for the Armada Series B Stock Purchase Warrants owned by the Holder and exchanged and cancelled in accordance with the terms of
the SEA.

 

		19.	Method of Exercise; Payment.

 

(a)Exercise. The purchase rights
represented by this Warrant may be exercised, for cash only, by the Holder, in whole or in part, at any time, or from time to time,
by the surrender of this Warrant (with the notice of exercise form (the “Notice of Exercise”) attached hereto
as Exhibit A duly executed) at the principal office of the Company, and by payment to the Company of an amount equal to
the Exercise Price multiplied by the number of the Shares being purchased, which amount may be paid, at the election of the Holder,
by wire transfer or certified check payable to the order of the Company. The person or persons in whose name(s) any certificate(s)
representing Shares shall be issuable upon exercise of this Warrant shall be deemed to have become the holder(s) of record of,
and shall be treated for all purposes as the record holder(s) of, the Shares represented thereby (and such Shares shall be deemed
to have been issued) immediately prior to the close of business on the date or dates upon which this Warrant is exercised.

 

(b)Stock Certificates. In the
event of any exercise of the rights represented by this Warrant, as promptly as practicable after this Warrant is surrendered and
delivered to the Company along with all other appropriate documentation on or after the date of exercise and in any event within
ten (10) days thereafter, the Company at its expense shall issue and deliver to the person or persons entitled to receive the same
a certificate or certificates for the number of Shares issuable upon such exercise. In the event this Warrant is exercised in part,
the Company at its expense will execute and deliver a new Warrant of like tenor exercisable for the number of Shares for which
this Warrant may then be exercised.

    	 

    	 

    

 

(c)Taxes. The issuance of the
Shares upon the exercise of this Warrant, and the delivery of certificates or other instruments representing such Shares, shall
be made without charge to the Holder for any tax or other charge in respect of such issuance.

 

		20.	Warrant.

 

(a)Transfer and Replacement.
Subject to compliance with applicable securities laws, this Warrant and all rights hereunder (including, without limitation, any
registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company
or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto as Exhibit
B duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of
such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants
in the name of the assignee or assignees and in the denomination or denominations specified in such instrument of assignment, and
shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly
be cancelled. A Warrant, if properly assigned, may be exercised by a new holder for the purchase of Warrant Shares without having
a new Warrant issued. The Holder consents that the Company may, if it desires, permit the transfer of this Warrant out of the Holder’s
name only when the Holder’s request for transfer is accompanied by an opinion of counsel reasonably satisfactory to the Company
that neither the sale nor the proposed transfer results in a violation of the Securities Act of 1933, as amended (the “Securities
Act”), or any applicable state “blue sky” laws. At any time prior to the exercise hereof, this Warrant may
be exchanged upon presentation and surrender to the Company, alone or with other warrants of like tenor of different denominations
registered in the name of the same Holder, for another warrant or warrants of like tenor in the name of such Holder exercisable
for the aggregate number of Shares as the warrant or warrants surrendered.

 

(b)Replacement of Warrant. Upon
receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of this Warrant and,
in the case of any such loss, theft, or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form and
amount to the Company, or, in the case of any such mutilation, upon surrender and cancellation of this Warrant, the Company, at
its expense, will execute and deliver in lieu thereof, a new Warrant of like tenor.

 

(c)Cancellation. Payment of Expenses.
Upon the surrender of this Warrant in connection with any transfer, exchange or replacement as provided in this Section 2, this
Warrant shall be promptly canceled by the Company. The Holder shall pay all taxes and all other expenses (including legal expenses,
if any, incurred by the Holder or transferees) and charges payable in connection with the preparation, execution and delivery of
Warrants pursuant to this Section 2.

 

(d)Warrant Register. The Company
shall maintain, at its principal executive offices (or at the offices of the transfer agent for the Warrant or such other office
or agency of the Company as it may designate by notice to the holder hereof), a register for this Warrant (the “Warrant
Register”), in which the Company shall record the name and address of the person in whose name this Warrant has been
issued, as well as the name and address of each transferee and each prior owner of this Warrant.

 

		21.	Rights and Obligations of Holders of this Warrant.

 

The Holder of this Warrant shall not, by
virtue hereof, be entitled to any rights of a shareholder in the Company, either at law or in equity; provided, however, that in
the event any certificate representing shares of Common Stock or other securities is issued to the holder hereof upon exercise
of this Warrant, such holder shall, for all purposes, be deemed to have become the holder of record of such Common Stock on the
date on which this Warrant, together with a duly executed Notice of Exercise, was surrendered and payment of the aggregate Exercise
Price was made, irrespective of the date of delivery of such Common Stock certificate.

 

		22.	Adjustments.

 

During the Exercise Period, the Exercise
Price and the number of Warrant Shares shall be subject to adjustment from time to time as provided in this Paragraph 4.

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(a)Subdivision or Combination of
Common Stock. If the Company at any time subdivides (by any stock split, stock dividend, recapitalization, reorganization,
reclassification or otherwise) the shares of Common Stock acquirable hereunder into a greater number of shares, then, after the
date of record for effecting such subdivision, the Exercise Price in effect immediately prior to such subdivision will be proportionately
reduced. If the Company at any time combines (by reverse stock split, recapitalization, reorganization, reclassification or otherwise)
the shares of Common Stock acquirable hereunder into a smaller number of shares, then, after the date of record for effecting such
combination, the Exercise Price in effect immediately prior to such combination will be proportionately increased.

 

(b)Adjustment in Number of Shares. Upon each
adjustment of the Exercise Price pursuant to the provisions of this Paragraph 4, the number of shares of Common Stock issuable
upon exercise of this Warrant shall be adjusted 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 this Warrant immediately prior to such adjustment
and dividing the product so obtained by the adjusted Exercise Price.

 

(c)Consolidation, Merger or Sale. In case of
any consolidation of the Company with, or merger of the Company into any other corporation, or in case of any sale or conveyance
of all or substantially all of the assets of the Company other than in connection with a plan of complete liquidation of the Company,
then as a condition of such consolidation, merger or sale or conveyance, adequate provision will be made whereby the holder of
this Warrant will have the right to acquire and receive upon exercise of this Warrant in lieu of the shares of Common Stock immediately
theretofore acquirable upon the exercise of this Warrant, such shares of stock, securities or assets as may be issued or payable
with respect to or in exchange for the number of shares of Common Stock immediately theretofore acquirable and receivable upon
exercise of this Warrant had such consolidation, merger or sale or conveyance not taken place. In any such case, the Company will
make appropriate provision to insure that the provisions of this Paragraph 4 hereof will thereafter be applicable as nearly as
may be in relation to any shares of stock or securities thereafter deliverable upon the exercise of this Warrant. The Company will
not effect any consolidation, merger or sale or conveyance unless prior to the consummation thereof, the successor corporation
(if other than the Company) assumes by written instrument the obligations under this Paragraph 4 and the obligations to deliver
to the holder of this Warrant such shares of stock, securities or assets as, in accordance with the foregoing provisions, the holder
may be entitled to acquire.

 

(d)Distribution of Assets. In case the Company
shall declare or make any distribution of its assets (including cash) to holders of Common Stock as a partial liquidating dividend,
by way of return of capital or otherwise, then, after the date of record for determining shareholders entitled to such distribution,
but prior to the date of distribution, the holder of this Warrant shall be entitled upon exercise of this Warrant for the purchase
of any or all of the shares of Common Stock subject hereto, to receive the amount of such assets which would have been payable
to the holder had such holder been the holder of such shares of Common Stock on the record date for the determination of shareholders
entitled to such distribution.

(e)Notice of Adjustment. Upon the occurrence
of any event which requires any adjustment of the Exercise Price, then, and in each such case, the Company shall give notice thereof
to the holder of this Warrant, which notice shall state the Exercise Price resulting from such adjustment and the increase or decrease
in the number of Warrant Shares purchasable at such price upon exercise, setting forth in reasonable detail the method of calculation
and the facts upon which such calculation is based. Such calculation shall be certified by the Chief Financial Officer of the Company.

 

(f)Minimum Adjustment of Exercise Price. No adjustment
of the Exercise Price shall be made in an amount of less than 1% of the Exercise Price in effect at the time such adjustment is
otherwise required to be made, but any such lesser adjustment shall be carried forward and shall be made at the time and together
with the next subsequent adjustment which, together with any adjustments so carried forward, shall amount to not less than 1% of
such Exercise Price.

 

(g)No Fractional Shares. No fractional shares
of Common Stock are to be issued upon the exercise of this Warrant, but the Company shall round up the number of shares to the
issued.

 

(h)Other Notices. In case at any time:

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	 	(v)	the Company shall declare any dividend upon the Common Stock payable in shares of stock of any class or make any other distribution (including dividends or distributions payable in cash out of retained earnings) to the holders of the Common Stock;
	 	 	 
	 	(vi)	the Company shall offer for subscription pro rata to the holders of the Common Stock any additional shares of stock of any class or other rights;
	 	 	 
	 	(vii)	there shall be any capital reorganization of the Company, or reclassification of the Common Stock, or consolidation or merger of the Company with or into, or sale of all or substantially all its assets to, another corporation or entity; or
	 	 	 
	 	(viii)	there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company;

 

then, in each such case, the Company shall
give to the holder of this Warrant (a) notice of the date on which the books of the Company shall close or a record shall be taken
for determining the holders of Common Stock entitled to receive any such dividend, distribution, or subscription rights or for
determining the holders of Common Stock entitled to vote in respect of any such reorganization, reclassification, consolidation,
merger, sale, dissolution, liquidation or winding-up and (b) in the case of any such reorganization, reclassification, consolidation,
merger, sale, dissolution, liquidation or winding-up, notice of the date (or, if not then known, a reasonable approximation thereof
by the Company) when the same shall take place. Such notice shall also specify the date on which the holders of Common Stock shall
be entitled to receive such dividend, distribution, or subscription rights or to exchange their Common Stock for stock or other
securities or property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation,
or winding-up, as the case may be. Such notice shall be given at least 30 days prior to the record date or the date on which the
Company’s books are closed in respect thereto. Failure to give any such notice or any defect therein shall not affect the
validity of the proceedings referred to in clauses (i), (ii), (iii) and (iv) above.

 

(i)Certain Events. If any event occurs of the
type contemplated by the adjustment provisions of this Paragraph 4 but not expressly provided for by such provisions, the Company
will give notice of such event as provided in Paragraph 4(g) hereof, and the Company’s Board of Directors will make an appropriate
adjustment in the Exercise Price and the number of shares of Common Stock acquirable upon exercise of this Warrant so that the
rights of the holder shall be neither enhanced nor diminished by such event.

 

		23.	Redemption.

 

As long as (i) there is then in effect a
registration statement with respect to the Shares, and (ii) the Market Price of the common stock of the Company is no less than
equal to 150% of the Exercise Price as adjusted from time to time, the Company shall have the right upon thirty days’ prior
written notice to the Holder (the “Redemption Notice”), to redeem this Warrant at $0.01 per share (the “Redemption
Price”). The Holder shall have the right to exercise this Warrant until the Redemption Date. As used herein the term
“Market Price” means the Closing Price of the Common Stock for the ten consecutive trading days ending on the
day immediately prior to the date the Redemption Notice is sent to the Holder. The date that this Warrant is redeemed by the Company
and the Redemption Price is paid to the Holder is herein referred to as the “Redemption Date.” The “Closing
Price” means the closing price of the Common Stock in the market where the Common Stock is then traded or quoted as reported
by a reliable reporting service.

 

		24.	Fractional Shares.

 

In lieu of issuance of a fractional share
upon any exercise hereunder, the Company will issue an additional whole share in lieu of that fractional share, calculated on the
basis of the Exercise Price.

 

		25.	Legends.

 

Prior to issuance of the shares of Common
Stock underlying this Warrant, all such certificates representing such shares shall bear a restrictive legend to the effect that
the Shares represented by such certificate have not been registered under the Securities Act, and that the Shares may not be sold
or transferred in the absence of such registration or an exemption therefrom, such legend to be substantially in the form of the
bold-face language appearing at the top of Page 1 of this Warrant.

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		26.	Disposition of Warrants or Shares; Legal Opinions.

 

(a)The Holder of this Warrant, each transferee hereof
and any holder and transferee of any Shares, by his or its acceptance thereof, agrees that no public distribution of Warrants or
Shares will be made in violation of the provisions of the Securities Act. Furthermore, it shall be a condition to the transfer
of this Warrant that any transferee thereof deliver to the Company his or its written agreement to accept and be bound by all of
the terms and conditions contained in this Warrant.

 

(b)In the event the holder of the Shares wishes to transfer
its Shares and such proposed transfer is in compliance with applicable exemptions from registration under the Securities Act and
other applicable laws, the Company will promptly instruct its legal counsel to issue, at the Company’s expense, a legal opinion
permitting such transfer without restrictive legend; provided however, that the holder delivers reasonably requested representations
in support of such opinion.

 

		27.	Merger or Consolidation.

 

The Company will not merge or consolidate
with or into any other corporation, or sell or otherwise transfer its property, assets and business substantially as an entirety
to another corporation, unless the corporation resulting from such merger or consolidation (if not the Company), or such transferee
corporation, as the case may be, shall expressly assume, by supplemental agreement reasonably satisfactory in form and substance
to the Holder, the due and punctual performance and observance of each and every covenant and condition of this Warrant to be performed
and observed by the Company.

 

		28.	Notices.

 

Except as otherwise specified herein to
the contrary, all notices, requests, demands and other communications required or desired to be given hereunder shall only be effective
if given in writing by certified or registered U.S. mail with return receipt requested and postage prepaid; by private overnight
delivery service (e.g. Federal Express); by facsimile transmission (if no original documents or instruments must accompany the
notice); or by personal delivery. Any such notice shall be deemed to have been given (a) on the business day immediately following
the mailing thereof, if mailed by certified or registered U.S. mail as specified above; (b) on the business day immediately following
deposit with a private overnight delivery service if sent by said service; (c) upon receipt of confirmation of transmission if
sent by facsimile transmission; or (d) upon personal delivery of the notice. All such notices shall be sent to the following addresses
(or to such other address or addresses as a party may have advised the other in the manner provided in this Section 10):

 

	 	If to the Company:	 
	 	 	 
	 	NDB Energy, Inc.	 
	 	10777 Westheimer Rd.	 
	 	Suite 1100	 
	 	Houston, Texas 77042	 
	 	Attention: James Cerna, Jr.,	 
	 	President and Chief Executive Officer	 
	 	Facsimile: []	 
	 	 	 
	 	If to the Holder:	 
	 	 	 
	 	________________________	 
	 	________________________	 
	 	________________________	 
	 	________________________	 

 

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Notwithstanding the time of effectiveness
of notices set forth in this Section 10, a Notice of Exercise shall not be deemed effectively given until it has been duly completed
and submitted to the Company together with this original Warrant and payment of the Exercise Price in a manner set forth in this
Section 10.

 

		29.	Limitation on Exercise.

 

Notwithstanding anything to the contrary
contained herein, the number of shares of Common Stock that may be acquired by the Holder upon any exercise of this Warrant (or
otherwise in respect hereof) shall be limited to the extent necessary to insure that, following such exercise (or other issuance),
the total number of shares of Common Stock then beneficially owned by such Holder and its affiliates and any other persons whose
beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of the Exchange
Act, does not exceed 4.99% of the total number of issued and outstanding shares of Common Stock (including for such purpose the
shares of Common Stock issuable upon such exercise). For such purposes, beneficial ownership shall be determined in accordance
with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. The holder may waive the restriction
in whole or in part upon and effective after 61 days prior written notice to the Company to change the beneficial ownership to
9.99%, but not in excess thereof. This provision shall not restrict the number of shares of Common Stock which a Holder may receive
or beneficially own in order to determine the amount of securities or other consideration that such Holder may receive in the event
of a merger or other business combination or reclassification involving the Company.

 

Holder hereby acknowledges and agrees that,
notwithstanding anything herein to the contrary, this Warrant may not be exercised unless and until the Holder receives notice
from the Company, following delivery of a Notice of Exercise by the Holder, that the aggregate number of shares of Common Stock
issuable upon exercise of all of the Company stock purchase warrants designated as Series C Warrants (the “Series C Warrants”)
and all other warrants issued by the Company pursuant to the SEA (whether or not such other warrants are being exercised), together
with the shares of Common Stock issued by the Company as part of the Merger Consideration pursuant to the share exchange agreement
entered into between the Company, Armada and the stockholders of Armada. will not constitute more than 49.90% of the Company’s
total number of shares of Common Stock issued and outstanding at the time of exercise (the “Exercise Limitation”).
For purposes of this subsection, the percentage shall be calculated in accordance with Rule 13d-3 under the Securities Exchange
Act of 1934, as amended. The determination whether or not the Exercise Limitation applies shall be made at the sole discretion
of the Company.

 

Notwithstanding anything herein to the contrary,
in the event Holder is unable to exercise this Warrant because of the Exercise Limitation, any right of redemption the Company
otherwise has pursuant to this Warrant shall be suspended until such time as the Holder may fully exercise the Warrant.

 

		30.	Governing Law.

 

This Agreement shall be governed by and
construed solely and exclusively in accordance with and pursuant to the internal laws of the State of Nevada without regard to
the conflicts of laws principles thereof. The parties hereto hereby expressly and irrevocably agree that any suit or proceeding
arising directly and/or indirectly pursuant to or under this Agreement shall be brought solely in a federal or state court located
in the City of Las Vegas. By its execution hereof, the parties hereby covenant and irrevocably submit to the in personam jurisdiction
of the federal and state courts located in the City of Las Vegas, Nevada and agree that any process in any such action may be served
upon any of them personally, or by certified mail or registered mail upon them or their agent, return receipt requested, with the
same full force and effect as if personally served upon them in Las Vegas. The parties hereto expressly and irrevocably waive any
claim that any such jurisdiction is not a convenient forum for any such suit or proceeding and any defense or lack of in personam
jurisdiction with respect thereto. In the event of any such action or proceeding, the party prevailing therein shall be entitled
to payment from the other party hereto of all of its reasonable counsel fees and disbursements.

 

		31.	Successors and Assigns.

 

This Warrant shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and assigns.

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		32.	Headings.

 

The headings of various sections of this
Warrant have been inserted for reference only and shall not affect the meaning or construction of any of the provisions hereof.

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		33.	
Severability.

 

If any provision of this Warrant is held
to be unenforceable under applicable law, such provision shall be excluded from this Warrant, and the balance hereof shall be interpreted
as if such provision were so excluded.

 

		34.	Modification and Waiver.

 

This Warrant and any provision hereof may
be amended, waived, discharged or terminated only by an instrument in writing signed by the Company and the Holder.

 

		35.	Specific Enforcement.

 

The Company and the Holder acknowledge and
agree that irreparable damage would occur in the event that any of the provisions of this Warrant were not performed in accordance
with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction
or injunctions to prevent or cure breaches of the provisions of this Warrant and to enforce specifically the terms and provisions
hereof, this being in addition to any other remedy to which either of them may be entitled by law or equity.

 

		36.	Assignment.

 

This Warrant may be transferred or assigned,
in whole or in part, at any time and from time to time by the then Holder by submitting this Warrant to the Company together with
a duly executed Assignment in substantially the form and substance of the Form of Assignment which accompanies this Warrant as
Exhibit B hereto, and, upon the Company’s receipt thereof, and in any event, within five (5) business days thereafter, the
Company shall issue a Warrant to the Holder to evidence that portion of this Warrant, if any as shall not have been so transferred
or assigned.

 

(Signature Page Immediately Follows)

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IN WITNESS WHEREOF, the Company has
caused this Warrant to be duly executed, manually or by facsimile, by one of its officers thereunto duly authorized.

 

Date: __________________, 2012

 

NDB ENERGY, INC.

 

By: ______________________

Name:

Title:EXECUTION VERSION

 

LOAN AND SECURITY AGREEMENT

 

THIS LOAN AND SECURITY
AGREEMENT, dated as of March 30, 2012 (as amended, restated, supplemented or otherwise modified from time to time,
this “Agreement”) is among General Electric Capital Corporation
(“GECC”), in its capacity as agent for Lenders (as defined below) (together with its successors and assigns
in such capacity, “Agent”), the financial institutions who are or hereafter become parties to this Agreement
as lenders (together with GECC, collectively the “Lenders”, and each individually, a “Lender”),
PHARMATHENE, INC., a Delaware corporation (“Borrower”), and the other entities or persons, if any, who are or
hereafter become parties to this Agreement as guarantors (each a “Guarantor” and collectively, the “Guarantors”,
and together with Borrower, each a “Loan Party” and collectively, “Loan Parties”).

 

RECITALS

 

Borrower wishes to
borrow funds from time to time from Lenders, and Lenders desire to make loans, advances and other extensions of credit, severally,
but not jointly, to Borrower from time to time pursuant to the terms and conditions of this Agreement.

 

AGREEMENT

 

Loan Parties, Agent
and Lenders agree as follows:

 

		1.	DEFINITIONS.

 

As used in this Agreement,
all capitalized terms shall have the definitions as provided herein. Any accounting term used but not defined herein shall be construed
in accordance with generally accepted accounting principles in the United States of America, as in effect from time to time (“GAAP”)
and all calculations shall be made in accordance with GAAP. The term “financial statements” shall include the accompanying
notes and schedules. All other terms used but not defined herein shall have the meaning given to such terms in the Uniform Commercial
Code as adopted in the State of New York, as amended and supplemented from time to time (the “UCC”).

 

		2.	LOANS AND TERMS OF PAYMENT.

 

2.1             
Promise to Pay. Borrower promises to pay Agent, for the ratable accounts of Lenders, when due pursuant
to the terms hereof, the aggregate unpaid principal amount of all loans, advances and other extensions of credit made severally
by the Lenders to Borrower under this Agreement, together with interest on the unpaid principal amount of such loans, advances
and other extensions of credit at the interest rates set forth herein.

 

		2.2	Loans.

 

		(a)	Revolving Loans.

 

(i)                
Revolving Loan Commitment. Subject to the terms and conditions hereof, each Lender, severally, but not jointly,
agrees to make available to Borrower from time to time on any Business Day (as defined below) during the period from the Closing
Date (as defined below) until the Revolving Loan Commitment Termination Date (as defined below) its Pro Rata Share (as defined
below) of advances (each such advance, a “Revolving Loan” and, collectively, the “Revolving Loans”);
provided that immediately after each such Revolving Loan is made the aggregate outstanding principal amount of all Revolving
Loans shall not exceed the lesser of:

 

    	 

    	 

    
 

 

(A)             
the Total Revolving Loan Commitment Amount (as defined in Schedule A hereto) in effect at such time,
and

 

(B)             
the Borrowing Base (as defined in Schedule C hereto) at such time,

 

in each case ((A) and (B) above),
less Reserves (as defined in Schedule C hereto) imposed from time to time by Agent in its reasonable credit
judgment. Agent, in its sole credit judgment, may further adjust the Borrowing Base by applying percentages (known as “liquidity
factors”) to Qualified Accounts (as such term is defined in Schedule C) by payor class based upon Borrower’s
actual recent collection history for each such payor class in a manner consistent with Agent’s underwriting practices and
procedures. Such liquidity factors may be adjusted by Agent from time to time as warranted by Agent’s underwriting practices
and procedures and using its sole credit judgment. The Pro Rata Share of the aggregate principal amount of Revolving Loans of any
Lender shall not at any time exceed such Lender’s revolving loan commitment as identified on Schedule A hereto
(such revolving loan commitment of each Lender as it may be amended to reflect assignments made in accordance with this Agreement
or terminated or reduced in accordance with this Agreement, its “Revolving Loan Commitment”, and the aggregate
of all such commitments, the “Revolving Loan Commitments”). Until the Revolving Loan Commitment Termination
Date, and subject to the conditions specified in this Section 2.2(a), Borrower may from time to time borrow, repay and reborrow
under this Section 2.2(a). As used herein, “Revolving Loan Commitment Termination Date” means the earliest
of (a) the Scheduled Maturity Date, (b) the date of termination of Lenders’ obligations to make Revolving Loans
or permit existing Revolving Loans or Term Loans to remain outstanding pursuant to Section 8.2, and (c) the date of indefeasible
prepayment in full by Borrower of the Revolving Loans and the Term Loans, and the permanent reduction of the Commitments to zero
dollars ($0).

 

(ii)              
Method of Borrowing. When Borrower desires a Revolving Loan, Borrower will notify Agent (which notice shall
be irrevocable) by 12:00 noon (New York time) on or before the date that is two (2) Business Days prior to the day the Revolving
Loan is to be made. Each such notice (a ”Notice of Revolving Loan Advance”) must be given in writing (by
telecopy, e-mail or overnight courier) substantially in the form of Exhibit A or in a writing in any other form acceptable
to Agent, and shall include the information required in Exhibit A and such other information as may be required by
Agent. Each Notice of Revolving Loan Advance must also include a duly executed and completed Borrowing Base Certificate in the
form of Exhibit B hereto (a “Borrowing Base Certificate”). Agent and Lenders may act without liability
upon the basis of any Notice of Revolving Loan Advance believed by Agent to be from any authorized officer of Borrower. Agent and
Lenders shall have no duty to verify the authenticity of the signature appearing on any Notice of Revolving Loan Advance.

 

(iii)            
Funding of Revolving Loans. Promptly after receiving a Notice of Revolving Loan Advance, Agent shall notify
each Lender of the contents of such notice and such Lender’s Pro Rata Share of the requested Revolving Loan. Upon the terms
and subject to the conditions set forth herein, each Lender, severally and not jointly, shall make available to Agent its Pro Rata
Share of the requested Revolving Loan, in lawful money of the United States of America in immediately available funds, to the Collection
Account (as defined below) prior to 11:00 a.m. (New York time) on the specified date. Agent shall, unless it shall have determined
that one of the conditions set forth in Section 4.1 or 4.2, as applicable, has not been satisfied, by 4:00 p.m. (New
York time) on such day, credit the amounts received by it in like funds to Borrower by wire transfer to the following deposit account
of Borrower (or such other deposit account as specified in writing by an authorized officer of Borrower and acceptable to Agent)
(the “Designated Deposit Account”):

 

    	2

    	 

    
  

		Bank Name:	Silicon Valley Bank

		Bank Address:	3003 Tasman Drive, Santa Clara, CA 95054

		ABA#:	121140399

		Account #:	3300523360

		Account Name:	PharmAthene, Inc.

 

 

(iv)            
Notes. The Revolving Loans of each Lender shall be evidenced by this Agreement, and if requested by a Lender,
a promissory note substantially in a form acceptable to Lender (each a “Revolving Note” and, collectively, the
“Revolving Notes”), and Borrower shall execute and deliver a Revolving Note to each Lender that requests a Revolving
Note.

 

		(b)	Term Loans.

 

(i)                
Commitment. Subject to the terms and conditions hereof, each Lender, severally, but not jointly, agrees to
make term loans (each a “Term Loan” and collectively, the “Term Loans”; the Revolving Loans
and the Term Loans each a “Loan” and, collectively, the “Loans”) to Borrower on the Closing
Date in an aggregate principal amount not to exceed such Lender’s commitment as identified on Schedule A hereto (such
commitment of each Lender as it may be amended to reflect assignments made in accordance with this Agreement or terminated or reduced
in accordance with this Agreement, its “Term Loan Commitment”, and the aggregate of all such commitments, the
“Term Loan Commitments”; the Revolving Loan Commitments and the Term Loan Commitments, each a “Commitment”
and, collectively, the “Commitments”). Notwithstanding the foregoing, the aggregate principal amount of the
Term Loans made hereunder shall not exceed $2,500,000.00 (the “Total Term Loan Commitment Amount”). Each Lender’s
obligation to fund the Term Loan shall be limited to such Lender’s Pro Rata Share (as defined below) of such Term Loan.

 

(ii)              
Reserved.

 

(iii)            
Funding of Term Loans. Upon the terms and subject to the conditions set forth herein, each Lender, severally
and not jointly, shall make available to Agent its Pro Rata Share of the requested Term Loan, in lawful money of the United States
of America in immediately available funds, to the Collection Account (as defined below) prior to 11:00 a.m. (New York time)
on the Closing Date. Agent shall, unless it shall have determined that one of the conditions set forth in Section 4.1 has
not been satisfied, by 4:00 p.m. (New York time) on such day, credit the amounts received by it in like funds (net of any
amounts due and payable to Agent) to Borrower by wire transfer to, unless otherwise specified in a Disbursement Letter (as defined
below), the Designated Deposit Account.

 

    	3

    	 

    
  

(iv)            
Notes. The Term Loans made by each Lender shall be evidenced by this Agreement, and if requested by a Lender,
a promissory note substantially in a form acceptable to Lender (each a “Term Note” and, collectively, the “Term
Notes”; the Revolving Notes and the Term Notes each a “Note” and, collectively, the “Notes”).

 

(c)               
Agent May Assume Funding. Unless Agent shall have received notice from a Lender prior to the date of any particular
Revolving Loan or Term Loan that such Lender will not make available to Agent such Lender’s Pro Rata Share of such Revolving
Loan or Term Loan, Agent may assume that such Lender has made such amount available to it on the date of such Revolving Loan or
Term Loan in accordance with either Section 2.2(a)(iii) or 2.2(b)(iii), as applicable, and may (but shall not be obligated
to), in reliance upon such assumption, make available a corresponding amount for the account of Borrower on such date. If and to
the extent that such Lender shall not have so made such amount available to Agent, such Lender and Borrower severally agree to
repay to Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the day such amount
is made available to Borrower until the day such amount is repaid to Agent, at (i) in the case of Borrower, a rate per annum
equal to the interest rate applicable thereto pursuant to Section 2.3(a), and (ii) in the case of such Lender, a floating
rate per annum equal to, for each day from the day such amount is made available to Borrower until such amount is reimbursed to
Agent, the weighted average of the rates on overnight federal funds transactions among members of the Federal Reserve System, as
determined by Agent in its sole discretion (the “Federal Funds Rate”) for the first Business Day and thereafter,
at the interest rate applicable to such Revolving Loan or Term Loan. If such Lender shall repay such corresponding amount to Agent,
the amount so repaid shall constitute such Lender’s loan included in such Revolving Loan or Term Loan for purposes of this
Agreement.

 

		2.3	Interest and Repayment.

 

		(a)	Interest.

 

(i)                
Revolving Loans. The Revolving Loans shall bear interest on the outstanding principal amount thereof from
the date of the applicable Revolving Loan until fully repaid at a rate per annum equal to the Reference Rate (as defined below)
plus 5.0%.

 

As used herein, “Reference
Rate” means, for each day during an Interest Period, a floating rate of interest determined by Agent equal to:

 

(A)             
the higher of (1) 1.5% per annum and (2) the offered rate for deposits in United States Dollars for a term
of three (3) calendar months that appears on Reuters Screen LIBOR01 Page as of 11:00 a.m. (London time), on the second full
Business Day on which banks in the City of London, England are generally open for interbank or foreign exchange transactions (such
Business Day a “LIBOR Business Day”) immediately prior to the first day of such Interest Period; divided
by

 

(B)             
a number equal to 1.0 minus the aggregate (but without duplication) of the rates (expressed as a decimal fraction)
of reserve requirements in effect on the day that is two (2) LIBOR Business Days prior the first day of such Interest Period (including
basic, supplemental, marginal and emergency reserves under any regulations of the Federal Reserve Board or other applicable governmental
authority having jurisdiction with respect thereto, as now and from time to time in effect) for Eurocurrency funding (currently
referred to as “Eurocurrency Liabilities” in Regulation D of the Federal Reserve Board) that are required to be
maintained by a member bank of the Federal Reserve System.

 

    	4

    	 

    
  

As used herein, the term “Interest
Period” means, as applicable, (x) the period commencing on the Closing Date and ending on the day immediately preceding
the first Business Day of the next succeeding calendar month, or (y) subsequent to the period described in subpart (x),
the period commencing on the first Business Day of the calendar month and ending on the day immediately preceding the first Business
Day of the next succeeding calendar month.

 

If such LIBOR interest rates shall
cease to be available from Reuters, LIBOR shall be the rate of interest per annum, as determined by Agent at which deposits of
Dollars in immediately available funds are offered at 11:00 A.M. (London, England time) two (2) Business Days prior to the
date of determination by major financial institutions reasonably satisfactory to Agent in the London interbank market for a term
of three (3) calendar months for the applicable principal amount on such date of determination.

 

(ii)              
Term Loans. The Initial Term Loan shall accrue interest in arrears from the date made until such Term Loan
is fully repaid at a fixed per annum rate of interest equal to 10.14%.

 

(iii)            
All Loans. With respect to all Loans and Obligations hereunder, all computations of interest and fees calculated
on a per annum basis shall be made by Agent on the basis of a 360-day year, in each case for the actual number of days occurring
in the period for which such interest and fees are payable. Such method of calculation will result in an effective rate which exceeds
the rates stated in this Section. Each determination of an interest rate or the amount of a fee hereunder shall be made by Agent
and shall be conclusive, binding and final for all purposes, absent manifest error.

 

		(b)	Payments of Principal and Interest.

 

(i)                
Revolving Loans. For each Revolving Loan, Borrower shall pay interest to Agent, for the ratable benefit of
the Lenders, at the rate of interest for such Revolving Loan determined in accordance with Section 2.3(a) in arrears on the
first day of each calendar month (each, a “Scheduled Payment Date”) commencing on the first day of May, 2012.
The entire unpaid principal balance and all accrued but unpaid interest of the Revolving Loans shall be immediately due and payable
in full in immediately available funds on the Revolving Loan Commitment Termination Date.

 

		(ii)	Term Loans.

 

(A)             
Interest Payments. For each Term Loan, Borrower shall pay interest to Agent, for the ratable benefit of the
Lenders, at the rate of interest for such Term Loan determined in accordance with Section 2.3(a) in arrears on each Scheduled
Payment Date, commencing on the first day of May, 2012.

    	5

    	 

    
 

 

(B)             
Principal Payments. For the Term Loan, Borrower shall pay principal to Agent, for the ratable benefit of the
Lenders, in equal consecutive payments of $75,758.00 on each Scheduled Payment Date, commencing on February 1, 2013 (and on February
1, 2013, two principal payments of $75,758.00 shall be due, subject to the following proviso); provided that if (x) Agent reasonably
determines, based on the Compliance Certificate delivered not later than January 30, 2013, that as of December 31, 2012, Borrower
and its Subsidiaries on a consolidated basis have unrestricted cash and Cash Equivalents (as defined below) in one or more deposit
accounts or securities accounts subject to an Account Control Agreement as shown on the consolidated financial statements of Borrower
and its Subsidiaries in an amount equal to or greater than the product of (A) negative six (-6) multiplied by (B) the Cash
Burn Amount (as defined below), and (y) no Default or Event of Default has occurred and is continuing, then principal payments
shall be in equal consecutive payments of $83,333.00 on each Scheduled Payment Date, commencing on April 1, 2013, and one final
payment, regardless of the date principal payments commence and the outstanding principal balance at such time, in an amount equal
to the entire remaining principal balance of the Term Loan on September 29, 2015 (the “Scheduled Maturity Date”).
As used herein, the term “Cash Burn Amount” means, based on the financial statements most recently delivered to Agent
and the Lenders in accordance with this Agreement, with respect to Borrower and its Subsidiaries on a consolidated basis:

 

(1)(i) the sum of, without duplication,
(A) net income (loss), plus (B) depreciation and amortization, plus (C) non-cash employee compensation paid in the form of Borrower
stock, plus (D) the change in market value of derivative or hedge investment holdings, minus (E) non-financed capital expenditures,
in each case of clauses (A), (B), (C), (D), and (E) for the immediately preceding (6) month period on a trailing basis, divided
by (ii) six (6),

 

minus

 

(2)(i) the current portion of
interest bearing liabilities due and payable n the immediately succeeding six (6) months divided by (ii) six (6).

 

(C)             
Payments Generally. Notwithstanding the foregoing provisions of this Section 2.3(b), all unpaid principal
and accrued interest and other outstanding Obligations are due and payable in full to Agent, for the ratable benefit of Lenders,
on the earlier of (1) the Scheduled Maturity Date or (2) the date that such Loan otherwise becomes due and payable hereunder,
whether by acceleration of the Obligations pursuant to Section 8.2 or otherwise (the earlier of (1) or (2), the “Term
Loan Maturity Date”). Each scheduled payment of interest or principal hereunder on a Scheduled Payment Date is referred
to herein as a “Scheduled Payment.”

 

(c)               
No Reborrowing of Term Loans. Once the Term Loan is repaid or prepaid, it cannot be reborrowed.

 

    	6

    	 

    
 

 

(d)              
Payments. All payments (including prepayments) to be made by any Loan Party under any Debt Document shall
be made by wire transfer or ACH transfer in immediately available funds (which shall be the exclusive means of payment hereunder)
in U.S. dollars, without setoff or counterclaim to the Collection Account (as defined below) before 11:00 a.m. (New York time)
on the date when due. All payments received by Agent after 11:00 a.m. (New York time) on any Business Day or at any time
on a day that is not a Business Day may, in Agent’s sole discretion, be deemed to be received on the next Business Day. Whenever
any payment required under this Agreement would otherwise be due on a date that is not a Business Day, such payment shall instead
be due on the next Business Day, and additional fees or interest, as the case may be, shall accrue and be payable for the period
of such extension. All Scheduled Payments due to Agent and Lenders under Section 2.3(b) shall be effected
by wire transfer of immediately available funds to the Collection Account. As used herein, the term “Collection
Account” means the following account of Agent (or such other account as Agent shall identify to Borrower in writing):

 

Bank Name: __________

Bank Address: ____________

ABA Number: ____________

Account Number: ____________

Account Name: ___________

Ref: ___________

 

(e)               
Withholdings and Increased Costs. All payments shall be made free and clear of any taxes, withholdings, duties,
impositions or other charges (other than taxes on the overall net income of any Lender and comparable taxes), such that Agent and
Lenders will receive the entire amount of any Obligations (as defined below), regardless of source of payment. If Agent or any
Lender shall have determined that the introduction of or any change in, after the date hereof, any law, treaty, governmental (or
quasi-governmental) rule, regulation, guideline or order reduces the rate of return on Agent or such Lender’s capital as
a consequence of its obligations hereunder or increases the cost to Agent or such Lender of agreeing to make or making, funding
or maintaining any Loan, then Borrower shall from time to time upon demand by Agent or such Lender (with a copy of such demand
to Agent) promptly pay to Agent for its own account or for the account of such Lender, as the case may be, additional amounts sufficient
to compensate Agent or such Lender for such reduction or for such increased cost. A certificate as to the amount of such reduction
or such increased cost submitted by Agent or such Lender (with a copy to Agent) to Borrower shall be conclusive and binding on
Borrower, absent manifest error, provided that, neither Agent nor any Lender shall be entitled to payment of any amounts under
this Section 2.3(e) unless it has delivered such certificate to Borrower within 180 days after the occurrence of the
changes or events giving rise to the increased costs to, or reduction in the amounts received by, Agent or such Lender; provided
further that, such 180 day limitation shall not apply to any increased costs or reductions in the amounts received by Agent
or any Lender arising from (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act or any and all requests, rules,
guidelines or directives thereunder or issued in connection therewith or (b) any requests, rules, guidelines or directives
promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar
authority) or the United States or foreign regulatory authorities, in each case of this clause (b) pursuant to Basel III,
and such Act and any such requests, rules, guidelines or directives shall be deemed to be introduced or changed after the date
hereof, regardless of the date enacted, adopted or issued. This provision shall survive the termination of this Agreement.

 

    	7

    	 

    
  

(f)               
Loan Records. Each Lender shall maintain in accordance with its usual practice accounts evidencing the Obligations
of Borrower to such Lender resulting from such Lender’s Pro Rata Share of each Loan, including the amounts of principal and
interest payable and paid to such Lender from time to time under this Agreement. Agent shall maintain
in accordance with its usual practice a loan account on its books to record the Loans and any other extensions of credit made by
Lenders hereunder, and all payments thereon made by Borrower. The entries made in such accounts shall, to the extent permitted
by applicable law, be prima facie evidence of the existence and amounts of the Obligations recorded therein; provided, however,
that no error in such account and no failure of any Lender or Agent to maintain any such account shall affect the obligations of
Borrower to repay the Obligations in accordance with their terms.

 

(g)               
Application of Payments. Each Scheduled Payment with respect to the Term Loan, when paid, shall be applied
first to the payment of accrued and unpaid interest on the Term Loan and then to unpaid principal balance of such Term Loan. Each
Scheduled Payment of interest with respect to a Revolving Loan, when paid, shall be applied to the payment of accrued and unpaid
interest on the Revolving Loans. So long as no Event of Default (as defined below) has occurred and is continuing, payments consisting
of proceeds of Accounts (as such term is defined in Schedule C) received in the ordinary course of business shall be
applied to the Revolving Loans. All payments and prepayments applied to a particular Loan shall be applied ratably to the portion
thereof held by each Lender as determined by its Pro Rata Share. As to all payments made when an Event of Default has occurred
and is continuing or following the Revolving Loan Commitment Termination Date or Term Loan Maturity Date, Borrower hereby irrevocably
waives the right to direct the application of any and all payments received from or on behalf of Borrower, and Borrower hereby
irrevocably agrees that Agent shall have the continuing exclusive right (in accordance with Section 8.3) to apply any and all such
payments against the Obligations as Agent may deem advisable notwithstanding any previous entry by Agent in the Loan Account or
any other books and records.

 

(h)              
Payment of Expenses and other Obligations. Agent is authorized to, and at its sole election may, charge to
the Revolving Loan balance on behalf of Borrower and cause to be paid all Obligations owing by Borrower under this Agreement or
any of the other Debt Documents if and to the extent Borrower fails to promptly pay any such amounts as and when due, even if the
amount of such charges would exceed borrowing availability under the Revolving Loan facility set forth in Section 2.2(a) at
such time or would cause the balance of the Revolving Loans to Borrower to exceed the Borrowing Base after giving effect to such
charges or would cause the aggregate balance of all Revolving Loans to exceed the Total Revolving Loan Commitment Amount at such
time. At Agent’s option and to the extent permitted by law, any charges so made shall constitute part of the Revolving Loans.

 

		2.4	Prepayments.

 

(a)               
Voluntary Prepayment. Borrower may terminate (but not reduce) the Revolving Loan Commitments at any time upon
at least 10 days prior written notice to the Agent; provided that upon such termination all Revolving Loans, all Term Loans
and all other Obligations hereunder shall be immediately due and payable in full. Upon any such prepayment of the Revolving Loans
and Term Loans and termination of the Revolving Loan Commitments, Borrower’s right to request Revolving Loans shall simultaneously
be terminated.

 

(b)              
Mandatory Prepayment. If at any time the outstanding balances of the Revolving Loans exceed the lesser of
(A) the Total Revolving Loan Commitment Amount and (B) the Borrowing Base at such time (less, in each of case (A) and
(B), Reserves at such time), Borrower shall immediately repay the aggregate outstanding Revolving Loans to the extent required
to eliminate such excess. If Borrower has not complied with the requirements of Section 7.10 with respect to the Sweep Account
and Sweep Account Agreement as of April 29, 2012, Borrower shall immediately repay the aggregate outstanding Revolving Loans.

 

    	8

    	 

    
  

(c)               
Term Loan. Borrower may voluntarily prepay, upon five (5) Business Days’ prior written notice to Agent,
the Term Loan in full, but not in part. Upon the date of (a) any voluntary prepayment of the Term Loan in accordance with
the immediately preceding sentence or (b) any mandatory prepayment of the Term Loan required under this Agreement (whether
by acceleration of the Obligations pursuant to Section 8.2, mandatory prepayment of the Term Loan in connection with a termination
of the Revolving Credit Facility under Section 2.4(a) or otherwise), Borrower shall pay to Agent, for the ratable benefit
of the Lenders, a sum equal to (i) all outstanding principal plus accrued interest with respect to the Term Loan, plus
(ii) the Final Payment Fee (as such term is defined in Section 2.7(c)) for the Term Loan, and plus (iii) a prepayment
premium (as yield maintenance for the loss of a bargain and not as a penalty) equal to: (A) 3.0% of the principal amount of
the Term Loan being prepaid, if such prepayment is made on or before the two year anniversary of the Term Loan, and (B) 2.0
% of the principal amount of the Term Loan being prepaid, if such prepayment is made after the two year anniversary
of the Term Loan but before the Scheduled Maturity Date.

 

2.5             
Late Fees. If Agent does not receive any Scheduled Payment or other payment under any Debt Document from
any Loan Party within three (3) Business Days after its due date, then, at Agent’s election, such Loan Party agrees to pay
to Agent for the ratable benefit of all Lenders, a late fee equal to (a) 2.0% of the amount of such unpaid payment or (b) such
lesser amount that, if paid, would not cause the interest and fees paid by such Loan Party under this Agreement to exceed the Maximum
Lawful Rate (as defined below) (the “Late Fee”).

 

2.6             
Default Rate. All Loans and other Obligations shall bear interest, at the election of Agent or the Requisite
Lenders (as defined below) (or automatically while any Event of Default (as defined below) under Section 8.1(g) exists), from
and after the occurrence and during the continuation of an Event of Default, at a rate equal to the lesser of (a) 5.0% above
the rate of interest applicable to such Obligations as set forth in Section 2.3(a) immediately prior to the occurrence of
the Event of Default and (b) the Maximum Lawful Rate (the “Default Rate”). The application of the Default
Rate shall not be interpreted or deemed to extend any cure period or waive any Default or Event of Default or otherwise limit Agent’s
or any Lender’s right or remedies hereunder. All interest payable at the Default Rate shall be payable on demand.

 

2.7             
Lender Fees.

 

(a)               
Closing Fee. On the Closing Date, Borrower shall pay to Agent, for the benefit of Lenders in accordance with
their Pro Rata Shares, a non-refundable closing fee in an amount equal to $75,000, which fee shall be fully earned when paid.

 

(b)              
Revolving Loan Unused Line Fee. On each Scheduled Payment Date and on the Revolving Loan Commitment
Termination Date, Borrower shall pay to Agent, for the benefit of Lenders based on their Pro Rata Share of the Revolving Loan Commitments,
in arrears, a fee for Borrower’s non-use of the Revolving Loan Commitments in an amount equal to 0.75% per annum (calculated
on the basis of a 360 day year for actual days elapsed) multiplied by the difference between (x) the Total Revolving
Loan Commitment Amount and (y) the average of the daily closing balances of the Revolving Loans outstanding during the period
for which such fee is due.

 

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(c)               
Final Payment Fee. On the date upon which the outstanding principal amount of any Term Loan is repaid
in full, or if earlier, is required to be repaid in full (whether by scheduled payment, voluntary prepayment, acceleration of the
Obligations pursuant to Section 8.2 or otherwise), Borrower shall pay to Agent, for the ratable accounts of Lenders, a fee
equal to 3% of the original principal amount of such Term Loan (the “Final Payment Fee”), which Final Payment
Fee shall be deemed to be fully-earned on the date such Term Loan is made.

 

(d)              
Revolving Loan Management Fee. On the Closing Date and on each calendar year anniversary thereof, Borrower
shall pay to the Agent, for its own account, a management fee equal to $20,000 per year, which fee shall be fully earned, due and
payable in advance on such dates.

 

2.8             
Maximum Lawful Rate. Anything herein,
any Note or any other Debt Document (as defined below) to the contrary notwithstanding, the obligations of Loan Parties hereunder
and thereunder shall be subject to the limitation that payments of interest shall not be required, for any period for which interest
is computed hereunder, to the extent (but only to the extent) that contracting for or receiving such payment by Agent and Lenders
would be contrary to the provisions of any law applicable to Agent and Lenders limiting the highest rate of interest which may
be lawfully contracted for, charged or received by Agent and Lenders, and in such event Loan Parties shall pay Agent and Lenders
interest at the highest rate permitted by applicable law (“Maximum Lawful Rate”); provided, however,
that if at any time thereafter the rate of interest payable hereunder or thereunder is less than the Maximum Lawful Rate, Loan
Parties shall continue to pay interest hereunder at the Maximum Lawful Rate until such time as the total interest received by Agent
and Lenders is equal to the total interest that would have been received had the interest payable hereunder been (but for the operation
of this paragraph) the interest rate payable since the Closing Date as otherwise provided in this Agreement, any Note or any other
Debt Document.

 

2.9             
Authorization and Issuance of the Warrants. Borrower has duly authorized
the issuance to Lenders (or their respective affiliates or designees) of stock purchase warrants substantially in the form of the
warrant attached hereto as Exhibit F (collectively, the “Warrants”) evidencing Lenders’ (or
their respective affiliates or designees) right to acquire their respective Pro Rata Share of up to 46,584 shares of Common Stock
of Borrower at an exercise price of $1.61 per share. The exercise period shall expire ten (10) years from the date such
Warrants are issued.

 

		3.	CREATION OF SECURITY INTEREST.

 

3.1             
Grant of Security Interest. As security for the prompt payment and performance, whether at the stated
maturity, by acceleration or otherwise, of all Term Loans and other debt, obligations and liabilities of any kind whatsoever of
Borrower to Agent and Lenders under the Debt Documents (whether for principal, interest, fees, expenses, prepayment premiums, indemnities,
reimbursements or other sums, and whether or not such amounts accrue after the filing of any petition in bankruptcy or after the
commencement of any insolvency, reorganization or similar proceeding, and whether or not allowed in such case or proceeding), absolute
or contingent, now existing or arising in the future, including but not limited to the payment and performance of any outstanding
Notes, and any renewals, extensions and modifications of such Term Loans (such indebtedness under the Notes, Term Loans and other
debt, obligations and liabilities in connection with the Debt Documents are collectively called the “Obligations”),
and as security for the prompt payment and performance by each Guarantor of the Guaranteed Obligations as defined in the Guaranty
(as defined below), each Loan Party does hereby grant to Agent, for the benefit of Agent and Lenders, a security interest in the
property listed below (all hereinafter collectively called the “Collateral”):

 

    	10

    	 

    
  

All of such Loan Party’s
personal property of every kind and nature (except for Intellectual Property, as defined in, and to the extent excluded pursuant
to, Section 3.3) whether now owned or hereafter acquired by, or arising in favor of, such Loan Party, and regardless of where
located, including, without limitation, all accounts, chattel paper (whether tangible or electronic), commercial tort claims, including
but not limited to, the possible claim against Fisher BioServices Inc. arising out of the vendor’s failure to properly store
materials, and the claim against Siga Technologties Inc. (CA2627 in the Delaware Chancery Court related to the payment of net profits
from the sale of ST-246 and related products), deposit accounts, documents, equipment, financial assets, fixtures, goods, instruments,
investment property (including, without limitation, all securities accounts), inventory, letter-of-credit rights, letters of credit,
securities, supporting obligations, cash, cash equivalents, any other contract rights (including, without limitation, rights under
any license agreements), or rights to the payment of money, and general intangibles, and all books and records of such Loan Party
relating thereto, and in and against all additions, attachments, accessories and accessions to such property, all substitutions,
replacements or exchanges therefor, all proceeds, insurance claims, products, profits and other rights to payments not otherwise
included in the foregoing (with each of the foregoing terms that are defined in the UCC having the meaning set forth in the UCC).

 

Each Loan Party hereby
represents and covenants that such security interest constitutes a valid, first priority security interest in the presently existing
Collateral, and will constitute a valid, first priority security interest in Collateral acquired after the date hereof. Each Loan
Party hereby covenants that it shall give written notice to Agent promptly upon the acquisition by such Loan Party or creation
in favor of such Loan Party of any commercial tort claim after the Closing Date.

 

3.2             
Financing Statements. Each Loan Party hereby authorizes Agent to file UCC financing statements with all
appropriate jurisdictions to perfect Agent’s security interest (for the benefit of itself and the Lenders) granted hereby.

 

3.3             
Grant of Security Interest in Proceeds of Intellectual Property. The Collateral shall not include any
intellectual property of any Loan Party, which shall be defined as any and all copyright, trademark, servicemark, patent, design
right, software and trade secrets of a Loan Party and any applications, registrations, amendments, renewals, extensions and improvements
with respect thereto (collectively, “Intellectual Property”) now owned or hereafter acquired; provided
however, that the Collateral shall include all cash, royalty fees, claims, products, awards, judgments, insurance claims,
other proceeds, accounts and general intangibles that consist of rights of a Loan Party to receive payment with respect to the
Intellectual Property and all income, royalties and proceeds at any time due or payable to a Loan Party with respect to the Intellectual
Property and any of the foregoing, including, without limitation, (i) all rights of any Loan Party to sue and recover at law
or in equity for any past, present and future infringement, misappropriation, dilution, violation or other impairment thereof and
(ii) any claims for damages that any Loan Party has the right to assert with respect to any past, present or future infringement
of any Intellectual Property, together with all accessions and additions thereto, proceeds and products thereof (including, without
limitation, any proceeds resulting under insurance policies of any Loan Party) or proceeds from the sale, licensing or other disposition
of all or any part of, or rights in, the Intellectual Property by or on behalf of a Loan Party (“Rights to Payment”).
Notwithstanding the foregoing, to the extent it is necessary under applicable law to have a security interest in the underlying
Intellectual Property in order for Agent to have (i) a security interest in the Rights to Payment and (ii) a security
interest in any payments with respect to Rights to Payment that are received after the commencement of a bankruptcy or insolvency
proceeding, then the Collateral shall automatically, and effective as of the date hereof, include the Intellectual Property to
the extent necessary to permit attachment and perfection of Agent’s security interest (on behalf of itself and Lenders) in
the Rights to Payment and any payments in respect thereof that are received after the commencement of any bankruptcy or insolvency
proceeding.

 

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		4.	CONDITIONS OF CREDIT EXTENSIONS

 

4.1             
Conditions Precedent to the Initial Loans. No Lender shall be obligated to make its Pro Rata Share of
the Term Loan or the initial Revolving Loan, or to take, fulfill, or perform any other action hereunder, until the following have
been delivered to Agent (the date on which the Lenders make the Term Loan and the initial Revolving Loan after all such conditions
shall have been satisfied in a manner satisfactory to Agent and the Lenders or waived in accordance with this Agreement, the “Closing
Date”):

 

(a)               
a counterpart of this Agreement duly executed by each Loan Party, each Lender and Agent;

 

(b)              
a certificate executed by the Secretary of each Loan Party, the form of which is attached hereto as Exhibit C
(each and collectively, the “Secretary’s Certificate”), providing verification of incumbency and attaching
(i) such Loan Party’s board resolutions approving the transactions contemplated by this Agreement and the other Debt
Documents and (ii) such Loan Party’s governing documents;

 

(c)               
Notes duly executed by Borrower in favor of each Lender that has requested a Note;

 

(d)              
filed copies of UCC financing statements, collateral assignments, and termination statements, with respect to the
Collateral, as Agent shall request;

 

(e)               
certificates of insurance evidencing the insurance coverage, and satisfactory additional insured and lender loss
payable endorsements, in each case as required pursuant to Section 6.4 herein;

 

(f)               
current UCC lien, judgment, bankruptcy and tax lien search results demonstrating that there are no other Liens (as
defined below) on the Collateral, other than Permitted Liens (as defined below);

 

(g)               
a Warrant in favor of each Lender (or its affiliate or designee);

 

(h)              
a certificate of status/good standing of each Loan Party from the jurisdiction of such Loan Party’s organization
and a certificate of foreign qualification from each jurisdiction where such Loan Party’s failure to be so qualified could
reasonably be expected to have a Material Adverse Effect (as defined below), in each case as of a recent date acceptable to Agent;

 

(i)                
a landlord consent and/or bailee letter in favor of Agent executed by the applicable landlord or bailee (the forms
of which are attached hereto as Exhibit D-1 and Exhibit D-2, as applicable (each an “Access Agreement”)),
for any third party location where any of the following are located: (a) any Loan Party’s principal place of business,
(b) any Loan Party’s books or records or (c) Collateral with an aggregate value in excess of $25,000;

 

(j)                
a legal opinion of Loan Parties’ from SNR Denton US LLP, in form and substance satisfactory to Agent;

 

(k)              
Intentionally Omitted;

 

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(l)                
a completed perfection certificate from each Loan Party, duly executed by such Loan Party (each and collectively,
the “Perfection Certificate”), a form of which Agent previously delivered to Borrower;

 

(m)            
the Sweep Account Agreement (as defined in Schedule E hereto) and one or more Account Control Agreements (as defined
below), in form and substance reasonably acceptable to Agent, duly executed by the applicable Loan Parties and the applicable depository
or financial institution, for the Sweep Account (as such term is defined in Schedule E) and each other deposit and securities account
to the extent required pursuant to Section 7.10;

 

(n)              
duly executed originals of an initial Borrowing Base Certificate from Borrower, dated the Closing Date, reflecting
information concerning Qualified Accounts (as such term is defined in Schedule C) of Borrower as of a date not more
than one (1) month prior to the Closing Date;

 

(o)              
duly executed originals of a Notice of Revolving Credit Advance, dated the Closing Date, with respect to the initial
Revolving Loan to be requested by Borrower on the Closing Date;

 

(p)              
a disbursement instruction letter, in form and substance satisfactory to Agent and the Lenders, executed by each
Loan Party, Agent and each Lender (the “Disbursement Letter”);

 

(q)              
a pledge agreement, in form and substance satisfactory to Agent, executed by each Loan Party and pledging to Agent,
for the benefit of itself and the Lenders, a security interest in 65% of the shares of the outstanding voting capital stock and
100% of the shares of the outstanding non-voting capital stock of PharmAthene UK (as defined below), and a security interest in
65% of the shares of the outstanding voting capital stock of PharmAthene Canada (as defined below) (the “Pledge Agreement”)

 

(r)                
all other documents and instruments as Agent or any Lender may reasonably deem necessary or appropriate to effectuate
the intent and purpose of this Agreement (together with the Agreement, the Notes, the Warrants, the Account Control Agreements,
the Sweep Account Agreement, all Assignment of Rights Contracts, the Access Agreements, the Perfection Certificate, the Pledge
Agreement, the Secretary’s Certificate  and the Disbursement Letter, all Compliance Certificates, all Borrowing Base
Certificates, all Notices of Revolving Loan Advances, and all other agreements, instruments, documents and certificates executed
and/or delivered to or in favor of Agent from time to time in connection with this Agreement or the transactions contemplated hereby,
the “Debt Documents”); and

 

(s)               
Agent and Lenders shall have received the fees required to be paid by Borrower, and Borrower shall have reimbursed
Agent and Lenders for all fees, costs and expenses of closing presented as of the date of this Agreement.

 

4.2             
Conditions Precedent to All Loans. No Lender shall be obligated to make its Pro Rata Share of the Term
Loan, and any Revolving Loan, including the initial Revolving Loan made on the Closing Date, unless the following additional conditions
have been satisfied:

 

(a)               
all representations and warranties in Section 5 below shall be true as of the date of such Loan;

 

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(b)              
no Event of Default or any other event, which with the giving of notice or the passage of time, or both, would constitute
an Event of Default (such event, a “Default”), has occurred and is continuing or will result from the making
of any Loan;

 

(c)               
If a Revolving Loan, Borrower shall have satisfied all of the conditions set forth in Section 2.2(a) with respect
to Borrower’s request of a Revolving Loan;

 

(d)              
Agent shall have received a certificate from a authorized officer of each Loan Party confirming each of the foregoing;
and

 

(e)               
Agent shall have received such other documents, agreements, instruments or information as Agent shall reasonably
request.

 

The request by the
Borrower and acceptance by the Borrower of the proceeds of any Loan shall be deemed to constitute, as of the date thereof, (i) a
representation and warranty by the Borrower that the conditions in Section 4.2 have been satisfied and (ii) a reaffirmation
by Borrower and each Loan Party of the granting and continuance of Agent’s Liens, on behalf of itself and the Lenders.

 

		5.	REPRESENTATIONS AND WARRANTIES OF LOAN PARTIES.

 

Each Loan Party, jointly
and severally, represents, warrants and covenants to Agent and each Lender that:

 

5.1             
Due Organization and Authorization. Each Loan Party’s exact legal name is as set forth in the Perfection
Certificate and each Loan Party is, and will remain, duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization as specified in the Perfection Certificate, has its chief executive office at the location specified
in the Perfection Certificate, and is, and will remain, duly qualified and licensed in every jurisdiction wherever necessary to
carry on its business and operations, except where the failure to be so qualified and licensed could not reasonably be expected
to have a Material Adverse Effect. This Agreement and the other Debt Documents have been duly authorized, executed and delivered
by each Loan Party and constitute legal, valid and binding agreements enforceable in accordance with their terms. Each Loan Party
has all requisite power and authority to own its assets, carry on its business and execute, deliver and perform its obligations
under the Debt Documents to which it is a party.

 

5.2             
Required Consents. No filing, registration, qualification with, or approval, consent or withholding of
objections from, any governmental authority or instrumentality or any other entity or person is required with respect to the entry
into, or performance by any Loan Party of, any of the Debt Documents, except any obtained on or before the Closing Date.

 

5.3             
No Conflicts. The entry into, and performance by each Loan Party of, the Debt Documents will not (a) violate
any of the organizational documents of such Loan Party, (b) violate any law, rule, regulation, order, award or judgment applicable
to such Loan Party, or (c) result in any breach of or constitute a default under, or result in the creation of any lien, security
interest, mortgage, pledge, claim or encumbrance of any kind (any of the foregoing, a “Lien”) on any of such
Loan Party’s property (except for Liens in favor of Agent, on behalf of itself and Lenders) pursuant to, any indenture, mortgage,
deed of trust, bank loan, credit agreement, or other Material Agreement (as defined below) to which such Loan Party is a party.
As used herein, “Material Agreement” means (i) any agreement or contract to which such Loan Party is a
party and involving the receipt or payment of amounts in the aggregate exceeding $100,000 per year and (ii) any agreement
or contract to which such Loan Party is a party of which the breach, nonperformance, termination or failure to renew could reasonably
be expected to have a Material Adverse Effect. A description of all Material Agreements as of the Closing Date is set forth on
Schedule B hereto.

 

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5.4             
Litigation. There are no actions, suits, proceedings or investigations pending against or affecting any
Loan Party before any court, federal, state, provincial, municipal or other governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign, or any basis thereof, which involves the possibility of any judgment or liability
that could reasonably be expected to have a Material Adverse Effect, or which questions the validity of the Debt Documents, or
the other documents required thereby or any action to be taken pursuant to any of the foregoing, nor does any Loan Party have reason
to believe that any such actions, suits, proceedings or investigations are threatened. As used in this Agreement, the term “Material
Adverse Effect” means a material adverse effect on any of (a) the operations, business, assets, properties, or condition
(financial or otherwise) of Borrower, individually, or the Loan Parties, collectively, (b) the ability of a Loan Party to
perform any of its obligations under any Debt Document to which it is a party, (c) the legality, validity or enforceability
of any Debt Document, (d) the rights and remedies of Agent or Lenders under any Debt Document or (e) the validity, perfection
or priority of any Lien in favor of Agent, on behalf of itself and Lenders, on any of the Collateral.

 

5.5             
Financial Statements. All financial statements delivered to Agent and Lenders pursuant to Section 6.3
have been prepared in accordance with GAAP (subject, in the case of unaudited financial statements, to the absence of footnotes
and normal year end audit adjustments), and since the date of the most recent audited financial statements, no event has occurred
which has had or could reasonably be expected to have a Material Adverse Effect. There has been no material adverse deviation from
the most recent annual operating plan of Borrower delivered to Agent and Lenders in accordance with Section 6.3.

 

5.6             
Use of Proceeds; Margin Stock. The proceeds of the Term Loans shall be used for working capital and general
corporate purposes. No Loan Party and no Subsidiary of any Loan Party is engaged in the business of purchasing or selling margin
stock (within the meaning of Regulations T, U and X of the Board of Governors of the Federal Reserve System) (“Margin
Stock”) or extending credit for the purpose of purchasing Margin Stock. As of the Closing Date, except as set forth on
Schedule B, no Loan Party and no Subsidiary of any Loan Party owns any Margin Stock.

 

5.7             
Collateral. Each Loan Party is, and will remain, the sole and lawful owner, and in possession of, the
Collateral, and has the sole right and lawful authority to grant the security interest described in this Agreement. The Collateral
is, and will remain, free and clear of all Liens, except for (a) Liens in favor of Agent, on behalf of itself and Lenders,
to secure the Obligations, (b) Liens (i) with respect to the payment of taxes, assessments or other governmental charges
or (ii) of suppliers, carriers, materialmen, warehousemen, workmen or mechanics and other similar Liens, in each case imposed
by law and arising in the ordinary course of business, and securing amounts that are not yet due or that are being contested in
good faith by appropriate proceedings diligently conducted and with respect to which adequate reserves or other appropriate provisions
are maintained on the books of the applicable Loan Party in accordance with GAAP and which do not involve, in the judgment of Agent,
any risk of the sale, forfeiture or loss of any of the Collateral (a “Permitted Contest”),
(c) Liens existing on the date hereof and set forth on Schedule B hereto, (d) Liens securing Indebtedness
(as defined in Section 7.2 below) permitted under Section 7.2(c) below, provided that (i) such Liens exist prior
to the acquisition of, or attach substantially simultaneous with, or within 20 days after the, acquisition, repair, improvement
or construction of, such property financed by such Indebtedness and (ii) such Liens do not extend to any property of a Loan
Party other than the property (and proceeds thereof) acquired or built, or the improvements or repairs, financed by such Indebtedness,
and (e) licenses described in Section 7.3(c) below (all of such Liens described in the foregoing clauses (a) through
(e) are called “Permitted Liens”).

 

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		5.8	Compliance with Laws.

 

(a)               
Each Loan Party is and will remain in compliance in all material respects with all laws, statutes, ordinances, rules
and regulations applicable to it.

 

(b)              
Without limiting the generality of the immediately preceding clause (a), each Loan Party further agrees that it and
each of its Subsidiaries is and will remain in compliance in all material respects with all U.S. economic sanctions laws, Executive
Orders and implementing regulations as promulgated by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”),
and all applicable anti-money laundering and counter-terrorism financing provisions of the Bank Secrecy Act and all regulations
issued pursuant to it. No Loan Party nor any of its Subsidiaries, Affiliates or joint ventures (i) is a person or entity designated
by the U.S. Government on the list of the Specially Designated Nationals and Blocked Persons (the “SDN List”)
with which a U.S. person or entity cannot deal with or otherwise engage in business transactions, (ii) is a person or entity
who is otherwise the target of U.S. economic sanctions laws such that a U.S. person or entity cannot deal or otherwise engage in
business transactions with such person or entity, or (iii) is controlled by (including without limitation by virtue of such
person being a director or owning voting shares or interests), or acts, directly or indirectly, for or on behalf of, any person
or entity on the SDN List or a foreign government that is the target of U.S. economic sanctions prohibitions such that the entry
into, or performance under, this Agreement or any other Debt Document would be prohibited under U.S. law.

 

(c)               
Each Loan Party and each of its Subsidiaries is in compliance with (i) the Trading with the Enemy Act of 1917,
Ch. 106, 40 Stat. 411, as amended, and each of the foreign assets control regulations of the United States Treasury Department
(31 CFR, Subtitle B Chapter V, as amended) and any other enabling legislation or executive order relating thereto,
(ii) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001, P.L. 107-56, as amended (the “Patriot Act”), and (iii) other federal or state laws relating to
“know your customer” and anti-money laundering rules and regulations. No part of the proceeds of any Loan will be used
directly or indirectly for any payments to any government official or employee, political party, official of a political party,
candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or
obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977.

 

(d)              
Each Loan Party has met the minimum funding requirements of the United States Employee Retirement Income Security
Act of 1974 (as amended, “ERISA”) with respect to any employee benefit plans subject to ERISA. No Loan Party
is an “investment company” or a company “controlled” by an “investment company” within the
meaning of the Investment Company Act of 1940.

 

5.9             
Intellectual Property. The Intellectual Property is and will remain free and clear of all Liens, except
for Permitted Liens described in clauses (b)(i) and (e) of Section 5.7. No Loan Party has nor will it enter into any agreement
or financing arrangement in which a negative pledge in such Loan Party’s Intellectual Property is granted to any party (other
than the negative pledge granted herein to Agent and the Lenders). As of the Closing Date and each date a Loan is advanced to Borrower,
no Loan Party has any interest in, or title to any Intellectual Property except as disclosed in the Perfection Certificate. Each
Loan Party owns or has rights to use all Intellectual Property material to the conduct of its business as now or heretofore conducted
by it or proposed to be conducted by it, without any actual or claimed infringement upon the rights of third parties.

 

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5.10         
Solvency. Both before and after giving effect to each Loan, the transactions contemplated herein, and
the payment and accrual of all transaction costs in connection with the foregoing, each Loan Party is and will be Solvent. As used
herein, “Solvent” means, with respect to a Loan Party on a particular date, that on such date (a) the fair
value of the property of such Loan Party is greater than the total amount of liabilities, including contingent liabilities, of
such Loan Party; (b) the present fair salable value of the assets of such Loan Party is not less than the amount that will
be required to pay the probable liability of such Loan Party on its debts as they become absolute and matured; (c) such Loan
Party does not intend to, and does not believe that it will, incur debts or liabilities beyond such Loan Party’s ability
to pay as such debts and liabilities mature; (d) such Loan Party is not engaged in a business or transaction, and is not about
to engage in a business or transaction, for which such Loan Party’s property would constitute an unreasonably small capital;
and (e) such Loan Party is not “insolvent” within the meaning of Section 101(32) of the United States Bankruptcy
Code (11 U.S.C. § 101, et seq.), as amended from time to time. The amount of contingent liabilities (such as
litigation, guaranties and pension plan liabilities) at any time shall be computed as the amount that, in light of all the facts
and circumstances existing at the time, represents the amount that can be reasonably be expected to become an actual or matured
liability.

 

5.11         
Taxes; Pension. All tax returns, reports and statements, including information returns, required by any
governmental authority to be filed by each Loan Party and its Subsidiaries have been filed on a timely basis with the appropriate
governmental authority and all taxes, levies, assessments and similar charges have been paid prior to the date on which any fine,
penalty, interest or late charge may be added thereto for nonpayment thereof (or any such fine, penalty, interest, late charge
or loss has been paid), excluding taxes, levies, assessments and similar charges or other amounts which are the subject of a Permitted
Contest. Proper and accurate amounts have been withheld by each Loan Party from its respective employees for all periods in compliance
with applicable laws and such withholdings have been timely paid to the respective governmental authorities. Each Loan Party has
paid all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their
terms, and no Loan Party has withdrawn from participation in, or has permitted partial or complete
termination of, or permitted the occurrence of any other event with respect to, any such plan which could reasonably be expected
to result in any liability of a Loan Party, including any liability to the Pension Benefit Guaranty
Corporation or its successors or any other governmental authority.

 

5.12         
Full Disclosure. Loan Parties hereby confirm that all of the information disclosed on the Perfection Certificate
is true, correct and complete as of the date of this Agreement and as of the date of each Loan. No representation, warranty or
other statement made by or on behalf of a Loan Party to Agent or Lenders (including in any certificate, instrument, agreement or
document delivered pursuant to this Agreement or any other Debt Document) contains any untrue statement of a material fact or omits
to state a material fact necessary to make the statements contained therein not misleading, it being recognized by Agent and Lenders
that the projections and forecasts provided by Loan Parties in good faith and based upon reasonable and stated assumptions are
not to be viewed as facts and that actual results during the period or periods covered by any such projections and forecasts may
differ from the projected or forecasted results.

 

5.13         
Accounts. Agent may rely, in determining which Accounts are Qualified Accounts, on all statements and
representations made by Borrower with respect to any Account or Accounts. Unless otherwise indicated in writing to Agent, with
respect to each Qualified Account, Borrower represents that:

 

(a)               
the Account satisfies all criteria for inclusion as a Qualified Account;

 

(b)              
the Account is genuine and in all respects what it purports to be, and is not evidenced by a judgment;

 

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(c)               
the Account arises out of a completed, bona fide sale and delivery of goods or rendition of services by Borrower
in the ordinary course of its business and in accordance with the terms and conditions of all purchase orders, contracts, certification,
participation, permit, or other documents relating thereto and forming a part of the contract between Borrower and the account
debtor with respect thereto;

 

(d)              
the Account is for a liquidated amount maturing as stated in a duplicate claim or invoice covering such sale or rendition
of services, a copy of which has been furnished or is available to Agent;

 

(e)               
the Account, and Agent’s security interest in such Account, is not, and will not (by voluntary act or omission
by Borrower), be in the future, subject to any offset, lien, deduction, defense, dispute, counterclaim, recoupment or any other
adverse condition, and each such Account is absolutely owing to Borrower and is not contingent in any respect or for any reason;

 

(f)               
there are no facts, events or occurrences which in any way impair the validity or enforceability of any Accounts
or tend to reduce the amount payable thereunder from the face amount of the claim or invoice and statements delivered to Agent
with respect thereto;

 

(g)               
to Borrower’s knowledge, (i) the account debtor under the Account had the capacity to contract at the
time any contract or other document giving rise to the Account was executed, and (ii) such account debtor is solvent;

 

(h)              
to Borrower’s knowledge, there are no proceedings or actions which are pending or threatened against any account
debtor under the Account which might result in any material adverse change in such account debtor’s financial condition or
the collectability of such Account;

 

(i)                
the Account has been billed and forwarded to the applicable account debtor for payment in accordance with applicable
laws and compliance and conformance with any and all requisite procedures, requirements and regulations governing payment by such
account debtor with respect to such Account;

 

(j)                
Agent has a perfected, first-priority security interest in such Accounts to secure the Obligations;

 

(k)              
Borrower has not made, and will not make, any agreement with any account debtor for any extension of the time for
payment of the Account, any compromise or settlement for less than the full amount thereof, any release of any account debtor from
liability therefor, or any deduction therefrom except a discount or allowance for prompt or early payment allowed by Borrower in
the ordinary course of its business consistent with its historical practices and as previously disclosed to Agent in writing; and

 

(l)                
Borrower has obtained all licenses, permits and authorizations that are necessary in the generation of such Accounts.

 

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		5.14	Regulatory Compliance.

 

(a)               
Each Loan Party has, and it and its products are in conformance with, all registrations, authorizations, approvals,
licenses, permits, clearances, certificates, and exemptions issued or allowed by the U.S. Food and Drug Administration or any successor
thereto (“FDA”) or any comparable governmental authority (including but not limited to new drug applications,
abbreviated new drug applications, biologics license applications, investigational new drug applications, over-the-counter drug
monograph, device pre-market approval applications, device pre-market notifications, investigational device exemptions, product
recertifications, manufacturing approvals and authorizations, CE Marks, pricing and reimbursement approvals, labeling approvals
or their foreign equivalent, controlled substance registrations, and wholesale distributor permits) (hereinafter “Registrations”)
that are required to conduct its business as currently conducted, or as proposed to be conducted. To the knowledge of each Loan
Party, neither the FDA nor any comparable governmental authority is considering limiting, suspending, or revoking such Registrations
or changing the marketing classification or labeling or other significant parameter affecting the products of the Loan Parties.
To the knowledge of each Loan Party, there is no false or misleading information or significant omission in any product application
or other submission to the FDA or any comparable governmental authority. The Loan Parties have fulfilled and performed their obligations
under each Registration, and no event has occurred or condition or state of facts exists which would constitute a breach or default
under, or would cause revocation or termination of, any such Registration. To the knowledge of each Loan Party, no event has occurred
or condition or state of facts exists which would present potential product liability related, in whole or in part, to any Loan
Party’s activities or products that are subject to Public Health Laws. To the knowledge of each Loan Party, any third party
that is a manufacturer or contractor for the Loan Parties is in compliance with all Registrations required by the FDA or comparable
governmental authority and all Public Health Laws insofar as they reasonably pertain to the manufacture of product components or
products regulated as medical devices and marketed or distributed by the Loan Parties. “Public
Health Laws” means all applicable Requirements of Law (as defined below) relating to the procurement, development, manufacture,
production, analysis, distribution, dispensing, importation, exportation, use, handling, quality, sale, or promotion of any drug,
medical device, food, dietary supplement, or other product (including, without limitation, any ingredient or component of the foregoing
products) subject to regulation under the Federal Food, Drug, and Cosmetic Act (21 U.S.C. et seq.) and similar state
laws, controlled substances laws, pharmacy laws, or consumer product safety laws.

 

(b)              
All products designed, developed, investigated, manufactured, prepared, assembled, packaged, tested, labeled, distributed,
sold or marketed by or on behalf of the Loan Parties that are subject to the jurisdiction of the FDA or a comparable governmental
authority, have been and are being designed, developed, investigated, manufactured, prepared, assembled, packaged, tested, labeled,
distributed, sold and marketed in compliance with the Public Health Laws and all other applicable laws, statutes, ordinances, rules
and regulations (each a “Requirement of Law”), including, without limitation, clinical and non-clinical evaluation,
product approval or clearance, premarketing notification, good manufacturing practices, labeling, advertising and promotion, record-keeping,
establishment registration and device listing, reporting of recalls, and adverse event reporting.

 

(c)               
No Loan Party is subject to any obligation arising under an administrative or regulatory action, proceeding,
investigation or inspection by or on behalf of a governmental authority (including, without limitation, the FDA), warning letter,
notice of violation letter, consent decree, request for information or other notice, response or commitment made to or with the
FDA or any comparable governmental authority, and no such obligation has been threatened. There is no, and there is no act, omission,
event, or circumstance of which any Loan Party has knowledge that would reasonably be expected to give rise to or lead to any civil,
criminal or administrative action, suit, demand, claim, complaint, hearing, investigation, demand letter, warning letter, proceeding
or request for information pending against any Loan Party and, to each Loan Party’s knowledge, no Loan Party has any liability
(whether actual or contingent) for failure to comply with any Public Health Laws. There has not been any violation of any Public
Health Laws by any Loan Party in its product development efforts, submissions, record keeping
and reports to the FDA or any other comparable governmental authority that could reasonably be expected to require or lead to investigation,
corrective action or enforcement, regulatory or administrative action that could reasonably be expected to have a Material Adverse
Effect. To the knowledge of each Loan Party, there are no civil or criminal proceedings relating to any Loan Party or any officer,
director or employee of any Loan Party that involve a matter within or related to the FDA’s any other comparable governmental
authority’s jurisdiction.

 

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(d)              
As of the Closing Date, no Loan Party is undergoing any inspection related to any activities or products of the Loan
Parties that are subject to Public Health Laws, or any other governmental authority investigation.

 

(e)               
During the period of six calendar years immediately preceding the Closing Date, no Loan Party has introduced into
commercial distribution any products manufactured by or on behalf of any Loan Party or distributed any products on behalf of another
manufacturer that were upon their shipment by any Loan Party adulterated or misbranded in violation of 21 U.S.C. § 331.
The Loan Parties have not received any notice or communication from the FDA or comparable governmental authority alleging material
noncompliance with any Requirement of Law. No product has been seized, withdrawn, recalled, detained, or subject to a suspension
(other than in the ordinary course of business) of research, manufacturing, distribution or commercialization activity, and there
are no facts or circumstances reasonably likely to cause (i) the seizure, denial, withdrawal, recall, detention, public health
notification, safety alert or suspension of manufacturing or other activity relating to any product; (ii) a change in the
labeling of any product suggesting a compliance issue or risk; or (iii) a termination, seizure or suspension of manufacturing,
researching, distributing or marketing of any product. No proceedings in the United States or any other jurisdiction seeking the
withdrawal, recall, revocation, suspension, import detention, or seizure of any product are pending or threatened against any Loan
Party.

 

(f)               
No Loan Party nor any of its respective officers, directors, employees, agents or contractors (i) have
been excluded or debarred from any federal healthcare program (including without limitation Medicare or Medicaid) or any other
federal program or (ii) have received notice from the FDA or any other comparable governmental authority with respect to debarment
or disqualification of any person that could reasonably be expected to have a Material Adverse Effect. No Loan Party nor any of
its respective officers, directors, employees, agents or contractors have been convicted of any crime or engaged in any conduct
for which (x) debarment is mandated or permitted by 21 U.S.C. § 335a or (y) such person or entity could
be excluded from participating in the federal health care programs under Section 1128 of the Social Security Act or any similar
law. No officer and to the knowledge of each Loan Party, no employee or agent of any Loan Party, has (aa) made any untrue
statement of material fact or fraudulent statement to the FDA or any other comparable governmental authority; (bb) failed
to disclose a material fact required to be disclosed to the FDA or any other comparable governmental authority; or (cc) committed
an act, made a statement, or failed to make a statement that would reasonably be expected to provide the basis for the FDA or any
other comparable governmental authority to invoke its policy respecting “Fraud, Untrue Statements of Material Facts, Bribery,
and Illegal Gratuities,” as set forth in 56 Fed. Reg. 46191 (September 10, 1991).

 

(g)               
Except as set forth on Schedule 5 hereto, no Loan Party has granted rights to design, develop, manufacture,
produce, assemble, distribute, license, prepare, package, label, market or sell its products to any other person nor is it bound
by any agreement that affects any Loan Party’s exclusive right to design, develop, manufacture, produce, assemble, distribute,
license, prepare, package, label, market or sell its products.

 

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5.15         
Foreign Subsidiaries. With respect to any foreign Subsidiaries of the Borrower, except as set forth on
Schedule 5 hereto no such Subsidiary owns or possesses any material assets, and no such Subsidiary conducts any material
business activities.

 

		6.	AFFIRMATIVE COVENANTS.

 

6.1             
Good Standing. Each Loan Party shall maintain its and each of its Subsidiaries’ existence and good
standing in its jurisdiction of organization and maintain qualification in each jurisdiction in which the failure to so qualify
could reasonably be expected to have a Material Adverse Effect. Each Loan Party shall maintain, and shall cause each of its Subsidiaries
to maintain, in full force all licenses, approvals and agreements, the loss of which could reasonably be expected to have a Material
Adverse Effect. “Subsidiary” means, with respect to a Loan Party, any entity the management of which is, directly
or indirectly controlled by, or of which an aggregate of more than 50% of the outstanding voting capital stock (or other voting
equity interest) is, at the time, owned or controlled, directly or indirectly by, such Loan Party or one or more Subsidiaries of
such Loan Party, and, unless the context otherwise requires each reference to a Subsidiary herein shall be a reference to a Subsidiary
of Borrower.

 

6.2             
Notice to Agent and the Lenders. Loan Parties shall provide Agent with (a) notice of any change in
the accuracy of the Perfection Certificate or any of the representations and warranties provided in Section 5 above, promptly
(but in any event within three (3) Business Days) upon the occurrence of any such change, (b) notice of the occurrence of
any Default or Event of Default, promptly (but in any event within three (3) Business Days) after the date on which any officer
of a Loan Party obtains knowledge of the occurrence of any such event, (c) copies of all statements, reports and notices made
available generally by any Loan Party to its security holders and notice of filing of any documents filed with the Securities and
Exchange Commission (“SEC”) or any securities exchange or governmental authority exercising a similar function
(provided that sending Agent an e-mail with electronic links to such documents that have been filed with the SEC Electronic Data
Gathering Analysis, and Retrieval System shall constitute delivery hereunder), promptly (but in any event within three (3) Business
Days) after delivering or receiving such information to or from such persons, (d) a report of any legal actions pending or
threatened against any Loan Party or any Subsidiary that could result in damages or costs to any Loan Party or any Subsidiary of
$150,000 or more, promptly (but in any event within three (3) Business Days) after receipt of notice thereof, including without
limitation any such legal actions alleging potential or actual violations of any Public Health Law, (e) together with the
delivery of each Compliance Certificate, a list of new applications or registrations that any Loan Party has made or filed in respect
of any Intellectual Property or any change in status of any outstanding application or registration, (f) notice of any amendments
to, and copies of all statements, reports and notices (other than non-material statements, reports and notices delivered in the
ordinary course of business) delivered to or by a Loan Party in connection with, any Material Agreement or notice of any Loan Party
entering into any Material Contract or any termination or breach thereof, promptly (but in any event within three (3) Business
Days) after the execution or receipt thereof or the termination or breach thereof, (g) any notice that the FDA or comparable
governmental authority is limiting, suspending or revoking any Registration, changing the market classification, distribution pathway
or parameters or labeling of the products of the Loan Parties, or considering any of the foregoing, promptly (but in any event
within three (3) Business Days) after receipt thereof, (h) notice that any Loan Party has become subject to any administrative
or regulatory action, FDA or comparable governmental authority inspection, Form FDA 483 observation, warning letter, notice
of violation letter, or other enforcement action, notice, response or commitment made to or with the FDA or any comparable governmental
authority, or notice that any product of any Loan Party has been seized, withdrawn, recalled, detained, or subject to a suspension
of manufacturing, or the commencement of any proceedings in the United States or any other jurisdiction seeking the withdrawal,
recall, suspension, import detention, or seizure of any product are pending or threatened against any Loan Party, promptly (but
in any event within three (3) days) after receipt thereof, and (i) no later than thirty (30) days after the end of each fiscal
quarter, a certificate of the chief financial officer of Borrower setting forth in reasonable detail any Margin Stock owned by
any Loan Party as of the last day of such fiscal quarter.

 

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		6.3	Financial Statements.

 

(a)               
Borrower shall deliver to Agent and Lenders (x) unaudited consolidated and, if available, consolidating balance
sheets, statements of operations and cash flow statements within thirty (30) days of each month end, in a form acceptable to Agent
and certified by Borrower’s president, chief executive officer or chief financial officer, and (y) quarterly unaudited
consolidated and, if available, consolidating balance sheets, statements of operations and cash flow statements and (z) annual
audited consolidated and, if available, consolidating balance sheets, statements of operations and cash flow statements, certified
by a recognized firm of certified public accountants, and in the case of clauses (y) and (z), within five (5) days after the statements
are required to be provided to the SEC; provided that sending Agent an e-mail with electronic links to such documents that have
been filed with the SEC Electronic Data Gathering Analysis, and Retrieval System shall constitute delivery hereunder. All audited
financial statements delivered pursuant to this Section 6.3 shall be accompanied by the report of an independent certified
public accounting firm acceptable to Agent which report shall (i) contain an unqualified opinion, stating that such consolidated
financial statements present fairly in all material respects the financial position for the periods indicated in conformity with
GAAP applied on a basis consistent with prior years and (ii) not include any explanatory paragraph expressing substantial
doubt as to going concern status. All such statements are to be prepared using GAAP (subject, in the case of unaudited financial
statements, to the absence of footnotes and normal year end audit adjustments) and, if Borrower is a publicly held company, are
to be in compliance with applicable SEC requirements. All financial statements delivered pursuant to this Section 6.3 shall
be accompanied by a compliance certificate, signed by the chief financial officer of Borrower, in the form attached hereto as Exhibit E
(each a “Compliance Certificate”), and, in the case of quarterly and annual financial statements, a management
discussion and analysis that includes a comparison to budget for the respective fiscal period and a comparison of performance for
such fiscal period to the corresponding period in the prior year. Borrower shall deliver to Agent and Lenders (i) as soon
as available and in any event not later than seventy-five (75) days after the end of each fiscal year of Borrower, an annual operating
plan for Borrower, on a consolidated and, if available, consolidating basis, approved by the Board of Directors of Borrower, for
the current fiscal year, in form and substance satisfactory to Agent and (ii) such budgets, sales projections, or other business,
financial, corporate affairs and other information as Agent or any Lender may reasonably request from time to time.

 

(b)              
Collateral Reports. Borrower shall deliver to Agent and each Lender the Collateral Reports (including Borrowing
Base Certificates) at the times and in the manner set forth in Schedule D hereto.

 

6.4             
Insurance. Each Loan Party, at its
expense, shall maintain, and shall cause each Subsidiary to maintain, insurance (including, without limitation, comprehensive general
liability, hazard, and business interruption insurance) with respect to all of its properties and businesses (including, the Collateral),
in such amounts and covering such risks as is carried generally in accordance with sound business practice by companies in similar
businesses similarly situated and in any event with deductible amounts, insurers and policies that shall
be reasonably acceptable to Agent. Borrower shall deliver to Agent certificates of insurance evidencing such coverage, together
with endorsements to such policies naming Agent as a lender loss payee or additional insured, as appropriate, in form and substance
satisfactory to Agent. Each policy shall provide that insurer will endeavor to provide thirty (30) days prior written notice to
Agent prior to any cancellation or alteration of the coverage by the insurer and shall not be subject to co-insurance. Each Loan
Party appoints Agent as its attorney-in-fact to make, settle and adjust all claims under and decisions with respect to such Loan
Party’s policies of insurance, and to receive payment of and execute or endorse all documents, checks or drafts in connection
with insurance payments. Agent shall not act as such Loan Party’s attorney-in-fact unless an Event of Default has occurred
and is continuing. The appointment of Agent as any Loan Party’s attorney in fact is a power coupled with an interest and
is irrevocable until all of the Obligations are indefeasibly paid in full. Proceeds of insurance shall be applied, at the option
of Agent, to repair or replace the Collateral or to reduce any of the Obligations.

 

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6.5             
Taxes. Each Loan Party shall, and shall cause each Subsidiary to, timely file all tax reports and pay
and discharge all taxes, assessments and governmental charges or levies imposed upon it, or its income or profits or upon its properties
or any part thereof, before the same shall be in default and before the date on which penalties attach thereto, except to the extent
such taxes, assessments and governmental charges or levies are the subject of a Permitted Contest.

 

6.6             
Agreement with Landlord/Bailee. Unless otherwise agreed to by Agent in writing, each Loan Party shall
obtain and maintain such Access Agreement(s) with respect to any real property on which (a) a Loan Party’s principal
place of business, (b) a Loan Party’s books or records or (c) Collateral with an aggregate value in excess of $25,000
is located (other than real property owned by such Loan Party) as Agent may require. If Agent agrees in writing that a Loan Party
shall not be required to obtain and maintain an Access Agreement with respect to any real property described in the immediately
preceding sentence, then within ten (10) Business Days after the due date for any rental payments with respect to such real property,
the Borrower shall deliver to Agent (1) evidence in form reasonably satisfactory to Agent that such rental payment was made
and (2) a certification that no default or event of default exists under any such lease. Notwithstanding any other provisions
in this Agreement, Borrower shall use commercially reasonable efforts to obtain and maintain an Access Agreement with respect to
its principal place of business in Annapolis, Maryland, in form and substance reasonably acceptable to Agent, within thirty (30)
days of the Closing Date.

 

6.7             
Protection of Intellectual Property. Each Loan Party shall take all necessary actions to: (a) protect,
defend and maintain the validity and enforceability of its Intellectual Property to the extent material to the conduct of its business,
(b) promptly advise Agent in writing of material infringements of its Intellectual Property and, should the Intellectual Property
be material to such Loan Party’s business, take all appropriate actions to enforce its rights in its Intellectual Property
against infringement, misappropriation or dilution and to recover any and all damages for such infringement, misappropriation or
dilution, (c) not allow any Intellectual Property material to such Loan Party’s business to be abandoned, forfeited
or dedicated to the public without Agent’s written consent, and (d) notify Agent promptly, but in any event within three
(3) Business Days, if it knows or has reason to know that any application or registration relating to any patent, trademark or
copyright (now or hereafter existing) material to its business may become abandoned or dedicated, or if any adverse determination
or development (including the institution of, or any such determination or development in, any proceeding in the United States
Patent and Trademark Office, the United States Copyright Office or any court) regarding such Loan Party’s ownership of any
Intellectual Property material to its business, its right to register the same, or to keep and maintain the same. Each Loan Party
shall remain liable under each of its Intellectual Property licenses pursuant to which it is a licensee (“Licenses”)
to observe and perform all of the conditions and obligations to be observed and performed by it thereunder. None of Agent or any
Lender shall have any obligation or liability under any such License by reason of or arising out of this Agreement, the granting
of a Lien, if any, in such License or the receipt by Agent (on behalf of itself and Lenders) of any payment relating to any such
License. None of Agent or any Lender shall be required or obligated in any manner to perform or fulfill any of the obligations
of any Loan Party under or pursuant to any License, or to make any payment, or to make any inquiry as to the nature or the sufficiency
of any payment received by it or the sufficiency of any performance by any party under any License, or to present or file any claims,
or to take any action to collect or enforce any performance or the payment of any amounts which may have been assigned to it or
which it may be entitled at any time or times.

 

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		6.8	Special Collateral Covenants.

 

(a)               
Each Loan Party shall remain in possession of its respective Collateral consisting of tangible personal property
solely at (1) the location(s) specified on the Perfection Certificate and (2) other locations where portable goods of
a de minimis value (such as laptops, phones and other similar equipment) may be located in the ordinary course of business; except
that Agent, on behalf of itself and Lenders, shall have the right to possess (i) any chattel paper or instrument that constitutes
a part of the Collateral, (ii) any other Collateral in which Agent’s security interest (on behalf of itself and Lenders)
may be perfected only by possession and (iii) any Collateral after the occurrence of an Event of Default in accordance with
this Agreement and the other Debt Documents.

 

(b)              
Each Loan Party shall (i) use the Collateral only in its trade or business, (ii) maintain all of the tangible
personal property included in the Collateral in good operating order and repair, normal wear and tear excepted, and (iii) use
and maintain the tangible personal property included in the Collateral only in compliance with manufacturers’ recommendations
and all applicable laws.

 

(c)               
Agent and Lenders do not authorize and each Loan Party agrees it shall not (i) part with possession of any of
the Collateral (except to Agent (on behalf of itself and Lenders), for maintenance and repair, or for a Permitted Disposition),
or (ii) remove any of the Collateral from, or maintain any of the Collateral outside of, the continental United States.

 

(d)              
Each Loan Party shall pay promptly when due all taxes, license fees, assessments and public and private charges levied
or assessed on any of the Collateral, on its use, or on this Agreement or any of the other Debt Documents. At its option, Agent
may discharge taxes, Liens, security interests or other encumbrances at any time levied or placed on the Collateral and may pay
for the maintenance, insurance and preservation of the Collateral and effect compliance with the terms of this Agreement or any
of the other Debt Documents. Each Loan Party agrees to reimburse Agent, on demand, all costs and expenses incurred by Agent in
connection with such payment or performance and agrees that such reimbursement obligation shall constitute Obligations.

 

(e)               
Each Loan Party shall, at all times, keep accurate and complete records of the Collateral.

 

(f)               
Each Loan Party agrees and acknowledges that any third person who may at any time possess all or any portion of the
Collateral shall be deemed to hold, and shall hold, the Collateral as the agent of, and as pledge holder for, Agent (on behalf
of itself and Lenders). Agent may at any time give notice to any third person described in the preceding sentence that such third
person is holding the Collateral as the agent of, and as pledge holder for, Agent (on behalf of itself and Lenders).

 

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(g)               
Each Loan Party shall, during normal business hours, and in the absence of a Default or an Event of Default, upon
one (3) Business Day’s prior notice, as frequently as Agent determines to be appropriate: (i) provide Agent (who may
be accompanied by representatives of any Lender) and any of its officers, employees and agents access to the properties, facilities,
advisors and employees (including officers) of each Loan Party and to the Collateral, (ii) permit Agent (who may be accompanied
by representatives of any Lender), and any of its officers, employees and agents, to inspect, audit and make extracts from any
Loan Party’s books and records (or at the request of Agent, deliver true and correct copies of such books and records to
Agent), and (iii) permit Agent (who may be accompanied by representatives of any Lender), and its officers, employees and
agents, to inspect, audit, appraise, review, evaluate and make test verifications and counts of the Collateral of any Loan Party.
Upon Agent’s request, each Loan Party will promptly notify Agent in writing of the location of any Collateral. If a Default
or Event of Default has occurred and is continuing or if access is necessary to preserve or protect the Collateral as determined
by Agent, each such Loan Party shall provide such access to Agent and to each Lender at all times and without advance notice. Each
Loan Party shall make available to Agent and its auditors or counsel, as quickly as is possible under the circumstances, originals
or copies of all books and records that Agent may reasonably request.

 

6.9             
Further Assurances. Each Loan Party shall, upon request of Agent, furnish to Agent such further information,
execute and deliver to Agent such documents and instruments (including, without limitation, UCC financing statements) and shall
do such other acts and things as Agent may at any time reasonably request relating to the perfection or protection of the security
interest created by this Agreement or for the purpose of carrying out the intent of this Agreement and the other Debt Documents.

 

6.10         
Compliance with Law. Each Loan Party shall comply with all applicable statutes, rules, regulations, standards,
guidelines, policies and orders administered or issued by any governmental authority having jurisdiction over it, its business
or its products, except where the failure to comply would not reasonably be expected to have, either individually or in the aggregate,
a Material Adverse Effect. Without limiting the generality of the foregoing, each Loan Party shall comply with all Public Health
Laws and their implementation by any applicable governmental authority and all lawful requests of any governmental authority applicable
to its products. All products developed, manufactured, tested, distributed or marketed by or on behalf of any Loan Party that are
subject to the jurisdiction of the FDA or comparable governmental authority shall be developed, tested, manufactured, distributed
and marketed in compliance with the Public Health Laws and any other Requirements of Law, including, without limitation, product
approval or premarket notification, good manufacturing practices, labeling, advertising, record-keeping, and adverse event reporting,
and have been and are being tested, investigated, distributed, marketed, and sold in compliance with Public Health Laws and all
other Requirements of Law.

 

6.11         
Government Accounts. With respect to each Account described in subsection (p) of the definition of Qualified
Accounts in Schedule C for which the applicable Loan Party must comply with the Federal Assignment of Claims Act of 1940,
the applicable Loan Party shall deliver an Assignment of Rights Contract, in form and substance acceptable to Agent, acknowledged
by the appropriate disbursing officer for the Department of the Unites States Government who is a party to the contract giving
rise to such Account, within thirty (30) days of the Closing Date if such Account exists on the Closing Date, and for all such
Accounts arising thereafter, within thirty (30) days of the date the first invoice is issued with respect to such Account debtor.

 

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		7.	NEGATIVE COVENANTS

 

7.1             
Liens. No Loan Party shall, and no Loan Party shall permit any of its Subsidiaries to, create, incur,
assume or permit to exist any Lien on any Collateral or Intellectual Property (other than Permitted Liens), or grant any negative
pledges on any Collateral or Intellectual Property.

 

7.2             
Indebtedness. No Loan Party shall,
and no Loan Party shall permit any of its Subsidiaries to, directly or indirectly create, incur, assume, permit to exist, guarantee
or otherwise become or remain directly or indirectly liable with respect to, any Indebtedness (as hereinafter defined), except
for (a) the Obligations, (b) Indebtedness existing on the date hereof and set forth on Schedule B to this
Agreement, and (c) Indebtedness consisting of capitalized lease obligations and purchase money Indebtedness, in each case
incurred by Borrower or any of its Subsidiaries to finance the acquisition, repair, improvement or construction of fixed or capital
assets of such person, provided that (i) the aggregate outstanding principal amount of all such Indebtedness does not exceed
$500,000 at any time and (ii) the principal amount of such Indebtedness does not exceed the lower of the cost or fair market
value of the property so acquired or built or of such repairs or improvements financed with such Indebtedness (each measured at
the time of such acquisition, repair, improvement or construction is made). The term “Indebtedness” means, with
respect to any person, at any date, without duplication, (i) all obligations of such person for borrowed money, (ii) all
obligations of such person evidenced by bonds, debentures, notes or other similar instruments, or upon which interest payments
are customarily made, (iii) all obligations of such person to pay the deferred purchase price of property or services, but
excluding obligations to trade creditors incurred in the ordinary course of business and not past due by more than ninety (90)
days, (iv) all capital lease obligations of such person, (v) the principal balance outstanding under any synthetic lease,
tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing product, (vi) all obligations
of such person to purchase securities (or other property) which arise out of or in connection with the issuance or sale of the
same or substantially similar securities (or property), (vii) all contingent or non-contingent obligations of such person
to reimburse any bank or other person in respect of amounts paid under a letter of credit or similar instrument, (viii) all
equity securities of such person subject to repurchase or redemption otherwise than at the sole option of such person, (ix) all
“earnouts” and similar payment obligations of such person, (x) all indebtedness secured by a Lien on any asset
of such person, whether or not such indebtedness is otherwise an obligation of such person, (xi) all obligations of such person
under any foreign exchange contract, currency swap agreement, interest rate swap, cap or collar agreement or other similar agreement
or arrangement designed to alter the risks of that person arising from fluctuations in currency values or interest rates, in each
case whether contingent or matured, and (xii) all obligations or liabilities of others guaranteed by such person.

 

7.3             
Dispositions. No Loan Party shall, and no Loan Party shall permit any of its Subsidiaries to, convey,
sell, rent, lease, sublease, mortgage, license, transfer or otherwise dispose of (collectively, “Transfer”)
any of the Collateral or any Intellectual Property, except for the following (collectively, “Permitted Dispositions”):
(a) sales of inventory in the ordinary course of business, (b) dispositions by a Loan Party or any of its Subsidiaries
of tangible assets that are no longer used or useful in the business of such Loan Party or Subsidiary for cash and fair value so
long as (i) no Default or Event of Default exists at the time of such disposition or would be caused after giving effect thereto
and (ii) the fair market value of all such assets disposed of does not exceed $100,000 in any calendar year, and (c) non-exclusive
licenses and licenses that could not result in a legal transfer of title of the licensed property but that may be exclusive in
respects other than territory and that may be exclusive as to territory only as to discreet geographical areas outside of the United
States, in each case for the use of any Loan Party’s Intellectual Property in the ordinary course of business, so long as,
with respect to each such license, (i) no Default or Event of Default has occurred and is continuing at the time of such Transfer,
(ii) the license constitutes an arms-length transaction in the ordinary course of business (and in the case of an exclusive
license, made in connection with a bona fide corporate collaboration in the ordinary course of business and approved by the board
of directors of the applicable Loan Party) and the terms of which, on their face, do not provide for a sale or assignment of any
Intellectual Property and do not restrict such Loan Party’s ability to pledge, grant a security interest in or Lien on, or
assign or otherwise Transfer any Intellectual Property, (iii) the applicable Loan Party delivers fifteen (15) days prior written
notice and a brief summary of the terms of the license to Agent, (iv) the applicable Loan Party delivers to Agent copies of
the final executed licensing documents in connection with the license promptly upon consummation of the license and (v) all
royalties, milestone payments or other proceeds arising from the licensing agreement are paid to a deposit account that is governed
by an Account Control Agreement.

 

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7.4             
Change in Name, Location or Executive Office; Change in Business; Change in Fiscal Year. No Loan Party
shall, and no Loan Party shall permit any of its Subsidiaries to, (a) change its legal name, its jurisdiction of organization,
its organizational structure or type or any organizational identification number (if any) assigned by its jurisdiction of organization,
(b) relocate its chief executive office without thirty (30) days prior written notification to Agent, (c) engage in any
business other than or reasonably related or incidental to the businesses currently engaged in by such Loan Party or Subsidiary,
(d) cease to conduct business substantially in the manner conducted by such Loan Party or Subsidiary as of the date of this
Agreement, provided, however, that Borrower may cause the Subsidiaries PharmAthene Canada, Inc. (“PharmAthene Canada”),
and PharmAthene UK Limited (“PharmAthene UK”) to cease operations, and terminate and wind-up such entities,
or (e) change its fiscal year end.

 

7.5             
Mergers or Acquisitions. No Loan Party shall merge or consolidate, and no Loan Party shall permit any
of its Subsidiaries to merge or consolidate, with or into any other person or entity (other than mergers of a Subsidiary into Borrower
in which Borrower is the surviving entity) or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of
the capital stock or property of another person or entity or all or substantially all of the assets constituting any line of business,
division, branch, operating division or other unit operation of another person or entity, provided that any Subsidiary of Borrower
existing on the date hereof may be merged with or into a Loan Party, or be liquidated, wound up or dissolved, or all or any part
of its business, property or assets may be conveyed, sold, leased, transferred or otherwise disposed of, in one transaction or
a series of transactions, to Borrower or any other Loan Party, provided, in the case of such a merger, a Loan Party shall be the
continuing or surviving Person.

 

7.6             
Restricted Payments. No Loan Party shall, and no Loan Party shall permit any of its Subsidiaries to, (a) declare
or pay any dividends or make any other distribution or payment on account of or redeem, retire, defease or purchase any capital
stock (other than the payment of dividends to Borrower), (b) purchase, redeem, defease or prepay any principal of, premium,
if any, interest or other amount payable in respect of any Indebtedness (other than with respect to the Obligations as described
in Section 2.3) prior to its scheduled maturity, (c)  make any payment in respect of management fees or consulting fees
(or similar fees) to any Affiliate of a Loan Party, or (d) be a party to or bound by an agreement that restricts a Subsidiary
from paying dividends or otherwise distributing property to Borrower.

 

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7.7             
Investments. No Loan Party shall, and no Loan Party shall permit any of its Subsidiaries to, directly
or indirectly (a) acquire or own, or make any loan, advance or capital contribution (an “Investment”) in
or to any person or entity, (b) acquire or create any Subsidiary, or (c) engage in any joint venture or partnership with
any other person or entity, other than: (i) Investments existing on the date hereof and set forth on Schedule B
to this Agreement, (ii) Investments in cash and Cash Equivalents (as defined below), (iii) loans or advances to employees
of Borrower or any of its Subsidiaries to finance travel, entertainment and relocation expenses and other ordinary business purposes
in the ordinary course of business as presently conducted, provided that the aggregate outstanding principal amount of all loans
and advances permitted pursuant to this clause (iii) shall not exceed $100,000 at any time, (iv) Wilmington Prime Money Market
Fund, (v) joint ventures or strategic alliances in the ordinary course of business consisting of the non-exclusive licensing of
technology, the development of technology or the providing of technical support, but in no event consisting of Investments of cash,
Cash Equivalents or tangible assets, (vi) loans or advances to PharmAthene Canada not to exceed $75,000 per year, provided that
if the value of cash and Cash Equivalents in PharmAthene Canada accounts exceeds $50,000 for more than ten (10) Business Days,
Borrower shall immediately cause PharmAthene Canada to transfer such excess amounts to Borrower, or (vii) loans or advances to
PharmAthene UK not to exceed $250,000 per year, provided that if the value of cash and Cash Equivalents in PharmAthene UK accounts
exceeds $100,000 for more than ten (10) Business Days, Borrower shall immediately cause PharmAthene UK to transfer such excess
amounts to Borrower (collectively, the “Permitted Investments”). The term “Cash Equivalents”
means (v) any readily-marketable securities (i) issued by, or directly, unconditionally and fully guaranteed or insured
by the United States federal government or (ii) issued by any agency of the United States federal government the obligations
of which are fully backed by the full faith and credit of the United States federal government, (w) any readily-marketable
direct obligations issued by any other agency of the United States federal government, any state of the United States or any political
subdivision of any such state or any public instrumentality thereof, in each case having a rating of at least “A-1”
from S&P or at least “P-1” from Moody’s, (x) any commercial paper rated at least “A-1”
by S&P or “P-1” by Moody’s and issued by any entity organized under the laws of any state of the United
States, (y) any U.S. dollar-denominated time deposit, insured certificate of deposit, overnight bank deposit or bankers’
acceptance issued or accepted by (i) Agent or (ii) any commercial bank that is (A) organized under the laws of the
United States, any state thereof or the District of Columbia, (B) “adequately capitalized” (as defined in the
regulations of its primary federal banking regulators) and (C) has Tier 1 capital (as defined in such regulations) in
excess of $250,000,000 or (z) shares of any United States money market fund that (i) has substantially all of its assets
invested continuously in the types of investments referred to in clause (v), (w), (x) or (y) above
with maturities as set forth in the proviso below, (ii) has net assets in excess of $500,000,000 and (iii) has obtained from
either S&P or Moody’s the highest rating obtainable for money market funds in the United States; provided, however,
that the maturities of all obligations specified in any of clauses (v), (w), (x) and (y)
above shall not exceed 365 days. For the avoidance of doubt, “Cash Equivalents” does not include (and each Loan
Party is prohibited from purchasing or purchasing participations in) any auction rate securities or other corporate or municipal
bonds with a long-term nominal maturity for which the interest rate is reset through a Dutch auction.

 

7.8             
Transactions with Affiliates. No Loan Party shall, and no Loan Party shall permit any of its Subsidiaries
to, directly or indirectly enter into or permit to exist any transaction with any Affiliate (as defined below) of a Loan Party
or any Subsidiary of a Loan Party except for transactions that are in the ordinary course of such Loan Party’s or such Subsidiary’s
business, upon fair and reasonable terms that are no more favorable to such Affiliate than would be obtained in an arm’s
length transaction. As used herein, “Affiliate” means, with respect to a Loan Party or any Subsidiary of a Loan
Party, (a) each person that, directly or indirectly, owns or controls 5.0% or more of the stock or membership interests having
ordinary voting power in the election of directors or managers of such Loan Party or such Subsidiary, and (b) each person
that controls, is controlled by or is under common control with such Loan Party or such Subsidiary.

 

7.9             
Compliance. No Loan Party shall, and no Loan Party shall permit any of its Subsidiaries to, (a) fail to
comply with the laws and regulations described in clauses (b) or (c) of Section 5.8 herein, (b) use any portion
of the Term Loans to purchase, become engaged in the business of purchasing or selling, or extend credit for the purpose of purchasing
or carrying Margin Stock or (c) fail to comply in any material respect with, or violate in any material respect any other
law or regulation (including without limitation any Public Health Law) applicable to it.

 

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7.10         
Deposit Accounts and Securities Accounts. The Loan Parties will establish and all times maintain the cash
management system described on Schedule E hereto (the “Cash Management System”) and comply in all
respects with the provisions thereof, including, without limitation, deposit and require all account debtors to directly deposit
all proceeds of all Accounts into the Sweep Account. To the extent that any Loan Party receives proceeds of Accounts that are not
deposited directly into the Sweep Account, such Loan Party shall hold all proceeds in trust for Agent and shall promptly arrange
for the deposit of such proceeds into the Sweep Account (as such term is defined in Schedule E) in accordance with the Cash Management
System. No Loan Party shall directly or indirectly maintain or establish any deposit account or securities account, unless Agent,
the applicable Loan Party or Loan Parties and the depository institution or securities intermediary at which the account is or
will be maintained enter into an Account Control Agreement (as defined in Schedule E) (which agreement shall provide,
among other things, that (i) such depository institution or securities intermediary has no rights of setoff or recoupment
or any other claim against such deposit or securities account (except as agreed to by Agent), other than for payment of its service
fees and other charges directly related to the administration of such account and for returned checks or other items of payment,
and (ii) such depository institution or securities intermediary shall comply with all instructions of Agent without further
consent of such Loan Party or Loan Parties, as applicable, including, without limitation, an instruction by Agent to comply exclusively
with instructions of Agent with respect to such account (such notice, a “Notice of Exclusive Control”)), prior
to or concurrently with the establishment of such deposit account or securities account (or in the case of any such deposit account
or securities account maintained as of the date hereof, on or before the Closing Date). Agent may only give a Notice of Exclusive
Control with respect to any deposit account or securities account at any time at which a Default or Event of Default has occurred
and is continuing. At the request of Agent, Borrower shall create or designate a dedicated deposit account or accounts to be used
exclusively for payroll or withholding tax purposes. Notwithstanding any other provisions in this Agreement, Borrower shall (i)
obtain an Account Control Agreement with respect to the securities accounts held with M&T Bank and Silicon Valley Bank no later
than April 29, 2012; and (ii) establish the Sweep Account (as defined in Schedule E hereto) and deliver the Sweep Account
Agreement (as defined in Schedule E hereto), duly executed by the applicable Loan Parties and Silicon Valley Bank no
later than the earlier of April 29, 2012, or the date any Notice of Revolving Loan Advance is delivered to Agent.

 

7.11         
Amendments to Other Agreements. No Loan Party shall amend, modify or waive any provision of (a) any
Material Agreement (unless the net effect of such amendment, modification or waiver is not adverse to any Loan Party, Agent or
Lenders), or (b) any of such Loan Party’s organizational documents.

 

7.12         
Financial Covenants.

 

(a)               
DSO Covenant. Borrower shall not allow its Days Sales Outstanding to exceed one hundred thirty-five (135)
days for any calendar month. “Days Sales Outstanding” means (i) the gross Accounts (excluding Unbilled
Acounts) of Borrower divided by (ii) the quotient of the gross sales of Borrower for the last six (6) months divided by 180.
Days Sales Outstanding shall be measured in accordance with GAAP, on a consolidated basis and at the end of each calendar month.

 

7.13         
Foreign Subsidiaries. Except as set forth on Schedule 5 hereto, Borrower shall not allow or permit any
foreign Subsidiary of Borrower to own or possess any material assets or to conduct any material business activities.

 

		8.	DEFAULT AND REMEDIES.

 

8.1             
Events of Default. Loan Parties shall be in default under this Agreement and each of the other Debt Documents
if (each of the following, an “Event of Default”):

 

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(a)               
Borrower shall fail to pay (i) any principal when due, or (ii) any interest, fees or other Obligations
(other than as specified in clause (i)) within a period of three (3) Business Days after the due date thereof (other than
on the Term Loan Maturity Date or the Revolving Loan Commitment Termination Date);

 

(b)              
any Loan Party breaches any of its obligations under Section 6.1 (solely as it relates to maintaining its existence),
Section 6.2, Section 6.3, Section 6.4, or Article 7;

 

(c)               
any Loan Party breaches any of its other obligations under any of the Debt Documents and fails to cure such breach
within thirty (30) days after the earlier of (i) the date on which an officer of such Loan Party becomes aware, or through
the exercise of reasonable diligence should have become aware, of such failure and (ii) the date on which notice shall have
been given to Borrower from Agent;

 

(d)              
any warranty, representation or statement made or deemed made by or on behalf of any Loan Party in any of the Debt
Documents or otherwise in connection with any of the Obligations, or any information provided by a Loan Party in a Debt Document,
shall be false or misleading in any material respect at the time such warranty, representation or statement was made or deemed
to be made;

 

(e)               
any of the Collateral with a value exceeding $100,000 in the aggregate per proceeding, is subjected to attachment,
execution, levy, seizure or confiscation in any legal proceeding or otherwise, or if any legal or administrative proceeding is
commenced against any Loan Party or any of the Collateral, which in the good faith judgment of Agent subjects any of the Collateral
to a material risk of attachment, execution, levy, seizure or confiscation and no bond is posted or protective order obtained to
negate such risk;

 

(f)               
one or more judgments, orders or decrees shall be rendered against any Loan Party or any Subsidiary of a Loan Party
that exceeds by more than $50,000 any insurance coverage applicable thereto (to the extent the relevant insurer has been notified
of such claim and has not denied coverage therefor) or one or more non-monetary judgments, orders or decrees shall be rendered
against any Loan Party or any Subsidiary of a Loan Party that could reasonably be expected to result in a Material Adverse Effect,
and in either case (i) enforcement proceedings shall have been commenced by any creditor upon any such judgment, order or
decree or (ii) such judgment, order or decree shall not have been vacated or discharged for a period of ten (10) consecutive
days and there shall not be in effect (by reason of a pending appeal or otherwise) any stay of enforcement thereof;

 

(g)               
(i) any Loan Party or any Subsidiary of a Loan Party shall generally not pay its debts as such debts become
due, shall admit in writing its inability to pay its debts generally, shall make a general assignment for the benefit of creditors,
or shall cease doing business as a going concern, (ii) any proceeding shall be instituted by or against any Loan Party or
any Subsidiary of a Loan Party seeking to adjudicate it a bankrupt or insolvent or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, composition of it or its debts or any similar order, in each case under any law relating
to bankruptcy, insolvency or reorganization or relief of debtors or seeking the entry of an order for relief or the appointment
of a custodian, receiver, trustee, conservator, liquidating agent, liquidator, other similar official or other official with similar
powers, in each case for it or for any substantial part of its property and, in the case of any such proceedings instituted against
(but not by or with the consent of) such Loan Party or such Subsidiary, either such proceedings shall remain undismissed or unstayed
for a period of sixty (60) days or more or any action sought in such proceedings shall occur or (iii) any Loan Party
or any Subsidiary of a Loan Party shall take any corporate or similar action or any other action to authorize any action described
in clause (i) or (ii) above;

 

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(h)              
an event or development occurs which could reasonably be expected to have a Material Adverse Effect; 

 

(i)                
any provision of any Debt Document shall fail to be valid and binding on, or enforceable against, a Loan Party that
is a party thereto, or (ii) any Debt Document purporting to grant a security interest to secure any Obligation shall fail
to create a valid and enforceable security interest on any Collateral purported to be covered thereby or such security interest
shall fail or cease to be a perfected Lien with the priority required in the relevant Debt Document, or any Loan Party shall state
in writing that any of the events described in clause (i) or (ii) above shall have occurred;

 

(j)                
any Loan Party or any Subsidiary of a Loan Party defaults under any Material Agreement (after any applicable grace
period contained therein), (ii) (A) any Loan Party or any Subsidiary of a Loan Party fails to make (after any applicable
grace period) any payment when due (whether due because of scheduled maturity, required prepayment provisions, acceleration, demand
or otherwise) on any Indebtedness (other than the Obligations) of such Loan Party or such Subsidiary having an aggregate principal
amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than $100,000 (“Material Indebtedness”), (B) any other event shall occur or
condition shall exist under any contractual obligation relating to any such Material Indebtedness, if the effect of such event
or condition is to accelerate, or to permit the acceleration of (without regard to any subordination terms with respect thereto),
the maturity of such Material Indebtedness or (C) any such Material Indebtedness shall become or be declared to be due and
payable, or be required to be prepaid, redeemed, defeased or repurchased (other than by a regularly scheduled required prepayment),
prior to the stated maturity thereof, or (iii) any Loan Party defaults (beyond any applicable grace period) under any obligation
for payments due or otherwise under any lease agreement that meets the criteria for the requirement of an Access Agreement under
Section 6.6 and, as a result thereof, the landlord thereunder has the right to terminate such lease agreement;

 

(k)              
(i) either of the chief executive officer or the chief financial officer of Borrower as of the date hereof shall
cease to be involved in the day to day operations (including research development) or management of the business of Borrower, unless
a successor of such officer is appointed by the board of directors of the Borrower within ninety (90) days of such cessation of
involvement, and such successor is in compliance with OFAC, money-laundering, anti-terrorism, SEC, drug/device laws and regulations,
and other similar regulations (in each case, to the extent applicable to a natural Person), (ii)) the acquisition, directly
or indirectly, by any person or group (as such term is used in Section 13(d)(3) of the Securities Exchange Act of 1934) ,
other than the Permitted Holders, of more than thirty-five percent (35%) of the voting power of the voting stock of Borrower by
way of merger or consolidation or otherwise, (iii) during any period of twelve consecutive calendar months, individuals who
at the beginning of such period constituted the board of directors of Borrower (together with any new directors whose election
by the board of directors of Borrower or whose nomination for election by the stockholders of Borrower was approved by a vote of
at least two-thirds of the directors then still in office who either were directors at the beginning of such period or whose election
or nomination for election was previously so approved) cease for any reason other than death or disability to constitute a majority
of the directors then in office, or (iv) Borrower ceases to own and control, directly or indirectly, all of the economic and
voting rights associated with the outstanding voting capital stock (or other voting equity interest) of each of its Subsidiaries
(provided that any terminations of Subsidiaries allowed under Section 7.4 shall not constitute a breach of this Section);

 

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(l)                
Any event occurs, whether or not insured or insurable, as a result of which revenue-producing activities cease or
are substantially curtailed at facilities of any Loan Party generating more than 25% of such Loan Party’s consolidated revenues
for the fiscal year preceding such event and such cessation or curtailment continues for more than thirty (30) days; or

 

(m)            
(i) The FDA or any other governmental authority initiates enforcement action against any Loan Party or any supplier
of a Loan Party that causes any Loan Party to recall, withdraw, remove or discontinue marketing any of its products; (ii) the
FDA or any other governmental authority issues a warning letter to any Loan Party with respect to any of its activities or products
which could reasonably be expected to have a Material Adverse Effect; (iii) any Loan Party conducts a mandated or voluntary
recall which could reasonably be expected to result in liability and expense to the Loan Parties of $100,000 or more; or (iv) any
Loan Party enters into a settlement agreement with the FDA or any other governmental authority that results in aggregate liability
as to any single or related series of transactions, incidents or conditions, of $250,000 or more, or that could reasonably be expected
to have a Material Adverse Effect.

 

8.2             
Lender Remedies. Upon the occurrence and during the continuance of any Event of Default, Agent may, and
at the written request of the Requisite Lenders shall, terminate the Commitments and declare any or all of the Obligations to be
immediately due and payable, without demand or notice to any Loan Party and the accelerated Obligations shall bear interest at
the Default Rate pursuant to Section 2.5, provided that, upon the occurrence of any Event of Default specified in Section 8.1(g)
above, the Obligations shall be automatically accelerated. After the occurrence and during the continuance of an Event of Default,
Agent shall have (on behalf of itself and Lenders) all of the rights and remedies of a secured party under the UCC, and under any
other applicable law. Without limiting the foregoing, Agent shall have the right to, and at the written request of the Requisite
Lenders shall, (a) notify any account debtor of any Loan Party or any obligor on any instrument which constitutes part of
the Collateral to make payments to Agent (for the benefit of itself and Lenders), (b) with or without legal process, enter
any premises where the Collateral may be and take possession of and remove the Collateral from the premises or store it on the
premises, (c) sell the Collateral at public or private sale, in whole or in part, and have the right to bid and purchase at
such sale, or (d) lease or otherwise dispose of all or part of the Collateral, applying proceeds from such disposition to
the Obligations in accordance with Section 8.3. If requested by Agent, Loan Parties shall promptly assemble the Collateral
and make it available to Agent at a place to be designated by Agent. Agent may also render any or all of the Collateral unusable
at a Loan Party’s premises and may dispose of such Collateral on such premises without liability for rent or costs. Any notice
that Agent is required to give to a Loan Party under the UCC of the time and place of any public sale or the time after which any
private sale or other intended disposition of the Collateral is to be made shall be deemed to constitute reasonable notice if such
notice is given in accordance with this Agreement at least five (5) days prior to such action. Effective only upon the occurrence
and during the continuance of an Event of Default, each Loan Party hereby irrevocably appoints Agent (and any of Agent’s
designated officers or employees) as such Loan Party’s true and lawful attorney to: (i) take any of the actions specified
above in this paragraph; (ii) endorse such Loan Party’s name on any checks or other forms of payment or security that
may come into Agent’s possession; (iii) settle and adjust disputes and claims respecting the accounts directly with
account debtors, for amounts and upon terms which Agent determines to be reasonable; and (iv) do such other and further acts
and deeds in the name of such Loan Party that Agent may deem necessary or desirable to enforce its rights in or to any of the Collateral
or to perfect or better perfect Agent’s security interest (on behalf of itself and Lenders) in any of the Collateral. For
the purpose of enabling Agent to exercise rights and remedies under this Section 8.2 at such time as Agent shall be lawfully
entitled to exercise such rights and remedies, each Loan Party hereby grants to Agent (on behalf of itself and Lenders), (A) an
irrevocable, nonexclusive, worldwide license (exercisable without payment of royalty or other compensation to such Loan Party),
to use or sublicense any Intellectual Property now owned or hereafter acquired by such Loan Party and including in such license
access to all media in which any of the licensed items may be recorded or stored and to all computer software and programs used
for the compilation or printout thereof and (B) an irrevocable license (without payment of rent or other compensation to such
Loan Party) to use, operate and occupy all real property owned, operated, leased, subleased or otherwise occupied by such Loan
Party. The appointment of Agent as each Loan Party’s attorney in fact is a power coupled with an interest and is irrevocable
until the date on which all of the Obligations are indefeasibly paid in full in cash, all of the Commitments hereunder are terminated,
and this Agreement shall have been terminated (the “Termination Date”).

 

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8.3             
Application of Proceeds. Proceeds from any Transfer of the Collateral , or from any Transfer of the Intellectual
Property (other than Permitted Dispositions) and all payments made to or proceeds of Collateral or Intellectual Property received
by Agent during the continuance of an Event of Default may be applied to the Obligations in Agent’s sole and absolute discretion.
Borrower shall remain fully liable for any deficiency.

 

		9.	THE AGENT.

 

		9.1	Appointment of Agent.

 

(a)               
Each Lender hereby appoints GECC (together with any successor Agent pursuant to Section 9.6) as Agent under
the Debt Documents and authorizes Agent to (a) execute and deliver the Debt Documents and accept delivery thereof on its behalf
from Loan Parties, (b) take such action on its behalf and to exercise all rights, powers and remedies and perform the duties
as are expressly delegated to Agent under such Debt Documents and (c) exercise such powers as are reasonably incidental thereto.
The provisions of this Article 9 are solely for the benefit of Agent and Lenders and none of Loan Parties nor any other person
shall have any rights as a third party beneficiary of any of the provisions hereof. In performing its functions and duties under
this Agreement and the other Debt Documents, Agent shall act solely as an agent of Lenders and does not assume and shall not be
deemed to have assumed any obligation toward or relationship of agency or trust with or for any Loan Party or any other person.
Agent shall have no duties or responsibilities except for those expressly set forth in this Agreement and the other Debt Documents.
The duties of Agent shall be mechanical and administrative in nature and Agent shall not have, or be deemed to have, by reason
of this Agreement, any other Debt Document or otherwise a fiduciary or trustee relationship in respect of any Lender. Except as
expressly set forth in this Agreement and the other Debt Documents, Agent shall not have any duty to disclose, and shall not be
liable for failure to disclose, any information relating to Borrower or any of its Subsidiaries that is communicated to or obtained
by GECC or any of its affiliates in any capacity.

 

(b)              
Without limiting the generality of Section 9.1(a) above, Agent shall have the sole and exclusive right and authority
(to the exclusion of the Lenders), and is hereby authorized, to (i) act as the disbursing and collecting agent for the Lenders
with respect to all payments and collections arising in connection with the Debt Documents (including in any other bankruptcy,
insolvency or similar proceeding), and each person making any payment in connection with any Debt Document to any Lender is hereby
authorized to make such payment to Agent, (ii) file and prove claims and file other documents necessary or desirable to allow
the claims of Agent and Lenders with respect to any Obligation in any proceeding described in any bankruptcy, insolvency or similar
proceeding (but not to vote, consent or otherwise act on behalf of such Lender), (iii) act as collateral agent for Agent and
each Lender for purposes of the perfection of all Liens created by the Debt Documents and all other purposes stated therein, (iv) manage,
supervise and otherwise deal with the Collateral, (v) take such other action as is necessary or desirable to maintain the
perfection and priority of the Liens created or purported to be created by the Debt Documents, (vi) except as may be otherwise
specified in any Debt Document, exercise all remedies given to Agent and the other Lenders with respect to the Collateral, whether
under the Debt Documents, applicable law or otherwise and (vii) execute any amendment, consent or waiver under the Debt Documents
on behalf of any Lender that has consented in writing to such amendment, consent or waiver; provided, however, that
Agent hereby appoints, authorizes and directs each Lender to act as collateral sub-agent for Agent and the Lenders for purposes
of the perfection of all Liens with respect to the Collateral, including any deposit account maintained by a Loan Party with, and
cash and cash equivalents held by, such Lender, and may further authorize and direct the Lenders to take further actions as collateral
sub-agents for purposes of enforcing such Liens or otherwise to transfer the Collateral subject thereto to Agent, and each Lender
hereby agrees to take such further actions to the extent, and only to the extent, so authorized and directed. Agent may, upon any
term or condition it specifies, delegate or exercise any of its rights, powers and remedies under, and delegate or perform any
of its duties or any other action with respect to, any Debt Document by or through any trustee, co-agent, employee, attorney-in-fact
and any other person (including any Lender). Any such person shall benefit from this Article 9 to the extent provided by Agent.

 

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(c)               
If Agent shall request instructions from Requisite Lenders or all affected Lenders with respect to any act or action
(including failure to act) in connection with this Agreement or any other Debt Document, then Agent shall be entitled to refrain
from such act or taking such action unless and until Agent shall have received instructions from Requisite Lenders or all affected
Lenders, as the case may be, and Agent shall not incur liability to any person by reason of so refraining. Agent shall be fully
justified in failing or refusing to take any action hereunder or under any other Debt Document (a) if such action would, in
the opinion of Agent, be contrary to law or any Debt Document, (b) if such action would, in the opinion of Agent, expose Agent
to any potential liability under any law, statute or regulation or (c) if Agent shall not first be indemnified to its satisfaction
against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action.
Without limiting the foregoing, no Lender shall have any right of action whatsoever against Agent as a result of Agent acting or
refraining from acting hereunder or under any other Debt Document in accordance with the instructions of Requisite Lenders or all
affected Lenders, as applicable.

 

9.2             
Agent’s Reliance, Etc. Neither Agent nor any of its affiliates nor any of their respective directors,
officers, agents, employees or representatives shall be liable for any action taken or omitted to be taken by it or them hereunder
or under any other Debt Documents, or in connection herewith or therewith, except for damages caused by its or their own gross
negligence or willful misconduct as finally determined by a court of competent jurisdiction. Without limiting the generality of
the foregoing, Agent: (a) may treat the payee of any Note as the holder thereof until such Note has been assigned in accordance
with Section 10.1; (b) may consult with legal counsel, independent public accountants and other experts, whether or not
selected by it, and shall not be liable for any action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts; (c) shall not be responsible or otherwise incur liability for any action or
omission taken in reliance upon the instructions of the Requisite Lenders, (d) makes no warranty or representation to any
Lender and shall not be responsible to any Lender for any statements, warranties or representations made in or in connection with
this Agreement or the other Debt Documents; (e) shall not have any duty to inspect the Collateral (including the books and
records) or to ascertain or to inquire as to the performance or observance of any provision of any Debt Document, whether any condition
set forth in any Debt Document is satisfied or waived, as to the financial condition of any Loan Party or as to the existence or
continuation or possible occurrence or continuation of any Default or Event of Default and shall not be deemed to have notice or
knowledge of such occurrence or continuation unless it has received a notice from Borrower or any Lender describing such Default
or Event of Default clearly labeled “notice of default”; (f) shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, effectiveness, genuineness, sufficiency or value of, or the attachment, perfection
or priority of any Lien created or purported to be created under or in connection with, any Debt Document or any other instrument
or document furnished pursuant hereto or thereto; and (g) shall incur no liability under or in respect of this Agreement or
the other Debt Documents by acting upon any notice, consent, certificate or other instrument or writing (which may be by telecopy,
telegram, cable or telex) believed by it to be genuine and signed or sent or otherwise authenticated by the proper party or parties.

 

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9.3             
GECC and Affiliates. GECC shall have the same rights and powers under this Agreement and the other Debt
Documents as any other Lender and may exercise the same as though it were not Agent; and the term “Lender” or “Lenders”
shall, unless otherwise expressly indicated, include GECC in its individual capacity. GECC and its affiliates may lend money to,
invest in, and generally engage in any kind of business with, Borrower, any of Borrower’s Subsidiaries, any of their Affiliates
and any person who may do business with or own securities of Borrower, any of Borrower’s Subsidiaries or any such Affiliate,
all as if GECC were not Agent and without any duty to account therefor to Lenders. GECC and its affiliates may accept fees and
other consideration from Borrower for services in connection with this Agreement or otherwise without having to account for the
same to Lenders. Each Lender acknowledges the potential conflict of interest between GECC as a Lender holding disproportionate
interests in the Loans and GECC as Agent, and expressly consents to, and waives, any claim based upon, such conflict of interest.

 

9.4             
Lender Credit Decision. Each Lender acknowledges that it has, independently and without reliance upon
Agent or any other Lender and based on the financial statements referred to in Section 6.3 and such other documents and information
as it has deemed appropriate, made its own credit and financial analysis of each Loan Party and its own decision to enter into
this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon Agent or any other Lender and
based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement. Each Lender acknowledges the potential conflict of interest of each other Lender
as a result of Lenders holding disproportionate interests in the Loans, and expressly consents to, and waives, any claim based
upon, such conflict of interest.

 

9.5             
Indemnification. Lenders shall and do hereby indemnify Agent (to the extent not reimbursed by Loan Parties
and without limiting the obligations of Loan Parties hereunder), ratably according to their respective Pro Rata Shares from and
against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever that may be imposed on, incurred by, or asserted against Agent in any way relating to or arising
out of this Agreement or any other Debt Document or any action taken or omitted to be taken by Agent in connection therewith; provided
that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from Agent’s gross negligence or willful misconduct as finally determined
by a court of competent jurisdiction. Without limiting the foregoing, each Lender agrees to reimburse Agent promptly upon demand
for its Pro Rata Share of any out-of-pocket expenses (including reasonable counsel fees) incurred by Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings
or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement and each other Debt Document,
to the extent that Agent is not reimbursed for such expenses by Loan Parties. The provisions of this Section 9.5 shall survive
the termination of this Agreement.

 

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9.6             
Successor Agent. Agent may resign at any time by delivering notice of such resignation to the Lenders
and the Borrower, effective on the date set forth in such notice. Upon any such resignation, the Requisite Lenders shall have the
right to appoint a successor Agent. If no successor Agent shall have been so appointed by the Requisite Lenders and shall have
accepted such appointment within thirty (30) days after the resigning Agent’s giving notice of resignation, then the resigning
Agent may, on behalf of Lenders, appoint a successor Agent, which shall be a Lender, if a Lender is willing to accept such appointment,
or otherwise shall be a commercial bank or financial institution or a subsidiary of a commercial bank or financial institution
if such commercial bank or financial institution is organized under the laws of the United States of America or of any State thereof.
If no successor Agent has been appointed pursuant to the foregoing, within thirty (30) days after the date such notice of resignation
was given by the resigning Agent, the Requisite Lenders shall thereafter perform all the duties of Agent hereunder until such time,
if any, as the Requisite Lenders appoint a successor Agent as provided above. Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall succeed to and become vested with all the rights, powers, privileges and duties
of the resigning Agent. Upon the earlier of the acceptance of any appointment as Agent hereunder by a successor Agent or the effective
date of the resigning Agent’s resignation, the resigning Agent shall be discharged from its duties and obligations under
this Agreement and the other Debt Documents, except that any indemnity rights or other rights in favor of such resigning Agent
shall continue. After any resigning Agent’s resignation hereunder, the provisions of this Section 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was acting as Agent under this Agreement and the other Debt
Documents.

 

9.7             
Setoff and Sharing of Payments. In addition to any rights now or hereafter granted under applicable law
and not by way of limitation of any such rights, upon the occurrence and during the continuance of any Event of Default and subject
to Section 9.8(e), each Lender is hereby authorized at any time or from time to time upon the direction of Agent, without
notice to Borrower or any other person, any such notice being hereby expressly waived, to offset and to appropriate and to apply
any and all balances held by it at any of its offices for the account of Borrower (regardless of whether such balances are then
due to Borrower) and any other properties or assets at any time held or owing by that Lender or that holder to or for the credit
or for the account of Borrower against and on account of any of the Obligations that are not paid when due. Any Lender exercising
a right of setoff or otherwise receiving any payment on account of the Obligations in excess of its Pro Rata Share thereof shall
purchase for cash (and the other Lenders or holders shall sell) such participations in each such other Lender’s or holder’s
Pro Rata Share of the Obligations as would be necessary to cause such Lender to share the amount so offset or otherwise received
with each other Lender or holder in accordance with their respective Pro Rata Shares of the Obligations. Borrower agrees, to the
fullest extent permitted by law, that (a) any Lender may exercise its right to offset with respect to amounts in excess of
its Pro Rata Share of the Obligations and may sell participations in such amounts so offset to other Lenders and holders and (b) any
Lender so purchasing a participation in the Term Loans made or other Obligations held by other Lenders or holders may exercise
all rights of offset, bankers’ lien, counterclaim or similar rights with respect to such participation as fully as if such
Lender or holder were a direct holder of the Term Loans and the other Obligations in the amount of such participation. Notwithstanding
the foregoing, if all or any portion of the offset amount or payment otherwise received is thereafter recovered from the Lender
that has exercised the right of offset, the purchase of participations by that Lender shall be rescinded and the purchase price
restored without interest. The term “Pro Rata Share” means, with respect to any Lender at any time, (1) with
respect to the Revolving Loans, the percentage obtained by dividing (x) the Revolving Loan Commitment of such Lender then
in effect (or, if such Revolving Loan Commitment is terminated, the aggregate outstanding principal amount of the Revolving Loans
owing to such Lender) by (y) the Total Revolving Loan Commitment Amount then in effect (or, if the Revolving Loan Commitments
are terminated, the outstanding principal amount of the Revolving Loans owing to all Lenders), (2) with respect to the Term
Loans, the percentage obtained by dividing (x) the Term Loan Commitment of such Lender then in effect (or, if such Term Loan
Commitment is terminated, the aggregate outstanding principal amount of the Term Loans owing to such Lender) by (y) the Total
Term Loan Commitment Amount then in effect (or, if the Term Loan Commitments are terminated, the outstanding principal amount of
the Term Loans owing to all Lenders), and (3) with respect to all Loans, the percentage obtained by dividing (x) the
Commitment of such Lender then in effect (or, if such Commitment is terminated, the aggregate outstanding principal amount of all
Loans owing to such Lender) by (y) the aggregate Commitments of all Lenders then in effect (or, if the Commitments of all
Lenders are terminated, the outstanding principal amount of Loans owing to all Lenders).

 

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		9.8	Advances; Payments; Non-Funding Lenders; Information;
Actions in Concert.

 

		(a)	Advances; Payments.

 

(i)                
Term Loans. If Agent receives any payment with respect to the Term Loan for the account of Lenders on or prior
to 11:00 a.m. (New York time) on any Business Day, Agent shall pay to each applicable Lender such Lender’s Pro Rata
Share of such payment on such Business Day. If Agent receives any payment with respect to the Term Loan for the account of Lenders
after 11:00 a.m. (New York time) on any Business Day, Agent shall pay to each applicable Lender such Lender’s Pro Rata
Share of such payment on the next Business Day. To the extent that any Lender has failed to fund any such payments and Loans (a
“Non-Funding Lender”), Agent shall be entitled to set off the funding short-fall against that Non-Funding Lender’s
Pro Rata Share of all payments received from Borrower.

 

(ii)              
Revolving Loans. At least once during each calendar week or more frequently at Agent’s election (each,
a “Settlement Date”), Agent shall advise each Revolving Lender by telephone or telecopy of the amount of such
Lender’s Pro Rata Share of principal, interest and fees paid for the benefit of Revolving Lenders with respect to each applicable
Revolving Loan. Agent shall pay to each Revolving Lender (other than a Non-Funding Lender) such Revolving Lender’s Pro Rata
Share of principal, interest and fees paid by Borrower since the previous Settlement Date for the benefit of such Revolving Lender
on the Revolving Loans held by it. To the extent that any Non-Funding Lender has failed to fund any such payments and Revolving
Loans, Agent shall be entitled to set off the funding short-fall against that Non-Funding Lender’s Pro Rata Share of all
payments received from Borrower with respect to the Revolving Loans.

 

		(b)	Return of Payments.

 

(i)                
If Agent pays an amount to a Lender under this Agreement in the belief or expectation that a related payment has
been or will be received by Agent from a Loan Party and such related payment is not received by Agent, then Agent will be entitled
to recover such amount (including interest accruing on such amount at the Federal Funds Rate for the first Business Day and thereafter,
at the rate otherwise applicable to such Obligation) from such Lender on demand without setoff, counterclaim or deduction of any
kind.

 

(ii)              
If Agent determines at any time that any amount received by Agent under this Agreement must be returned to a Loan
Party or paid to any other person pursuant to any insolvency law or otherwise, then, notwithstanding any other term or condition
of this Agreement or any other Debt Document, Agent will not be required to distribute any portion thereof to any Lender. In addition,
each Lender will repay to Agent on demand any portion of such amount that Agent has distributed to such Lender, together with interest
at such rate, if any, as Agent is required to pay to a Loan Party or such other person, without setoff, counterclaim or deduction
of any kind.

 

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(c)               
Non-Funding Lenders. The failure of any Non-Funding Lender to make any Loan or any payment required by it
hereunder shall not relieve any other Lender (each such other Lender, an “Other Lender”) of its obligations
to make such Loan, but neither any Other Lender nor Agent shall be responsible for the failure of any Non-Funding Lender to make
a Loan or make any other payment required hereunder. Notwithstanding anything set forth herein to the contrary, a Non-Funding Lender
shall not have any voting or consent rights under or with respect to any Debt Document or constitute a “Lender” (or
be included in the calculation of “Requisite Lender” hereunder) for any voting or consent rights under or with respect
to any Debt Document. At Borrower’s request, Agent or a person reasonably acceptable to Agent shall have the right with Agent’s
consent and in Agent’s sole discretion (but shall have no obligation) to purchase from any Non-Funding Lender, and each Non-Funding
Lender agrees that it shall, at Agent’s request, sell and assign to Agent or such person, all of the Commitments and all
of the outstanding Loans of that Non-Funding Lender for an amount equal to the principal balance of all Loans held by such Non-Funding
Lender and all accrued interest and fees with respect thereto through the date of sale, such purchase and sale to be consummated
pursuant to an executed Assignment Agreement (as defined below).

 

(d)              
Dissemination of Information. Agent shall use reasonable efforts to provide Lenders with any notice of Default
or Event of Default received by Agent from, or delivered by Agent to Borrower, with notice of any Event of Default of which Agent
has actually become aware and with notice of any action taken by Agent following any Event of Default; provided that Agent
shall not be liable to any Lender for any failure to do so, except to the extent that such failure is attributable to Agent’s
gross negligence or willful misconduct as finally determined by a court of competent jurisdiction. Lenders acknowledge that Borrower
is required to provide financial statements to Lenders in accordance with Section 6.3 hereto and agree that Agent shall
have no duty to provide the same to Lenders.

 

(e)               
Actions in Concert. Anything in this Agreement to the contrary notwithstanding, each Lender hereby agrees
with each other Lender that no Lender shall take any action to protect or enforce its rights arising out of this Agreement, the
Notes or any other Debt Documents (including exercising any rights of setoff) without first obtaining the prior written consent
of Agent and Requisite Lenders, it being the intent of Lenders that any such action to protect or enforce rights under this Agreement
and the Notes shall be taken in concert and at the direction or with the consent of Agent and Requisite Lenders.

 

		10.	MISCELLANEOUS.

 

		10.1	Assignment.

 

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(a)               
Subject to the terms of this Section 10.1, each Lender shall have the right to sell, transfer or assign, at
any time or times, all or a portion of its rights and obligations hereunder and under the other Debt Documents, its Commitment,
its Term Loans or any portion thereof or interest therein, including any Lender’s rights, title, interests, remedies, powers
or duties thereunder; provided, however, that unless Agent otherwise agrees, a Lender may only assign an equal proportion
of its Revolving Loans and Term Loans and its Revolving Loan Commitment and Term Loan Commitment. Any such sale, transfer or assignment
shall: (i) except in the case of a sale, transfer or assignment to a Qualified Assignee (as defined below), require the prior
written consent of Agent and the Requisite Lenders (which consent shall not be unreasonably withheld, conditioned or delayed);
(ii) require the execution of an assignment agreement in form and substance reasonably satisfactory to, and acknowledged by,
Agent (an “Assignment Agreement”); (iii) be conditioned on such assignee Lender representing to the assigning
Lender and Agent that it is purchasing the applicable Commitment and/or Loans to be assigned to it for its own account, for investment
purposes and not with a view to the distribution thereof; (iv) be in an aggregate amount of not less than $1,000,000, unless
such assignment is made to an existing Lender or an affiliate of an existing Lender or is of the assignor’s (together with
its affiliates’) entire interest of the Loans or is made with the prior written consent of Agent; and (v) include a
payment to Agent of an assignment fee of $3,500 (unless otherwise agreed by Agent). In the case of an assignment by a Lender under
this Section 10.1(a), the assignee shall have, to the extent of such assignment, the same rights, benefits and obligations
as all other Lenders hereunder. The assigning Lender shall be relieved of its obligations hereunder with respect to its Commitment
and Loans, as applicable, or assigned portion thereof from and after the date of such assignment. Borrower hereby acknowledges
and agrees that any assignment shall give rise to a direct obligation of Borrower to the assignee and that the assignee shall be
considered to be a “Lender”. In the event any Lender assigns or otherwise transfers all or any part of the Commitments
and Obligations, Borrower shall, upon the assignee’s or the assignor’s request, execute new Notes in exchange for the
Notes, if any, being assigned. Agent may amend Schedule A to this Agreement to reflect assignments made in accordance with
this Section.

 

(b)              
As used herein, “Qualified Assignee” means (a) any Lender and any affiliate of any Lender and
(b) any commercial bank, savings and loan association or savings bank or any other entity which is an “accredited investor”
(as defined in Regulation D under the Securities Act) which extends credit or buys loans as one of its businesses, including insurance
companies, mutual funds, lease financing companies and commercial finance companies, in each case, which has a rating of BBB or
higher from S&P and a rating of Baa2 or higher from Moody’s at the date that it becomes a Lender and in each case of
clauses (a) and (b), which, through its applicable lending office, is capable of lending to Borrower without the imposition of
any withholding or similar taxes; provided that no person proposed to become a Lender after the Closing Date and determined
by Agent to be acting in the capacity of a vulture fund or distressed debt purchaser shall be a Qualified Assignee, and no person
or Affiliate of such person proposed to become a Lender after the Closing Date and that holds any subordinated debt or stock issued
by any Loan Party or its Affiliates shall be a Qualified Assignee.

 

In addition to the other rights
provided in this Section 10.1, each Lender may, without notice to or consent from Agent or any Loan Party, sell participations
to one or more persons or entities in or to all or a portion of its rights and obligations under the Debt Documents (including
all of its rights and obligations with respect to the Loans); provided, however, that, whether as a result of any term of
any Debt Document or of such participation, (i) no such participant shall have a commitment, or be deemed to have made an
offer to commit, to make any Loan hereunder, and, no such participant shall be liable for any obligation of such Lender hereunder,
(ii) such Lender’s rights and obligations, and the rights and obligations of the Loan Parties and Agent and other Lenders
towards such Lender, under any Debt Document shall remain unchanged and each other party hereto shall continue to deal solely with
such Lender, which shall remain the holder of the Obligations, and in no case shall a participant have the right to enforce any
of the terms of any Debt Document, and (iii) the consent of such participant shall not be required (either directly, as a
restraint on such Lender’s ability to consent hereunder or otherwise) for any amendments, waivers or consents with respect
to any Debt Document or to exercise or refrain from exercising any powers or rights such Lender may have under or in respect of
the Debt Documents (including the right to enforce or direct enforcement of the Obligations), except for those described in clauses (ii),
(iii) and (viii) of subsection 10.8(c) hereof.

 

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		10.2	Notices.

 

(a)               
All notices, requests or other communications given in connection with this Agreement shall be in writing, shall
be addressed to the parties at their respective addresses set forth on the signature pages hereto below such parties’ name
or in the most recent Assignment Agreement executed by any Lender (unless and until a different address may be specified in a written
notice to the other party or delivered in accordance with this Section 10.2), and shall be deemed given (a) on the date
of receipt if delivered by hand, (b) on the date of sender’s receipt of confirmation of proper transmission if sent
by facsimile transmission, (c) on the next Business Day after being sent by a nationally-recognized overnight courier, and
(d) on the fourth Business Day after being sent by registered or certified mail, postage prepaid.

 

As used herein, the term “Business
Day” means and includes any day other than Saturdays, Sundays, or other days on which commercial banks in New York, New
York are required or authorized to be closed.

 

10.3         
Correction of Debt Documents. Agent may correct patent errors and fill in all blanks in this Agreement
or the Debt Documents consistent with the agreement of the parties.

 

10.4         
Performance. Time is of the essence of this Agreement. This Agreement shall be binding, jointly and severally,
upon all parties described as the “Borrower” and their respective successors and assigns, and shall inure to the benefit
of Agent, Lenders, and their respective successors and permitted assigns.

 

10.5         
Payment of Fees and Expenses. Loan Parties agree, jointly and severally, to pay or reimburse upon demand
for all reasonable fees, costs and expenses incurred by Agent and Lenders in connection with (a) the investigation, preparation,
negotiation, execution, administration of, or any amendment, modification, waiver or termination of, this Agreement or any other
Debt Document, (b) any legal advice relating to Agent’s rights or responsibilities under any Debt Document, (c) the
administration of the Loans and the facilities hereunder and any other transaction contemplated hereby or under the Debt Documents
and (d) the enforcement, assertion, defense or preservation of Agent’s and Lenders’ rights and remedies under
this Agreement or any other Debt Document, in each case of clauses (a) through (d), including, without limitation, reasonable
attorneys’ fees and expenses, the allocated cost of in-house legal counsel, reasonable fees and expenses of consultants,
auditors (including internal auditors) and appraisers and UCC and other corporate search and filing fees and wire transfer fees.
Borrower further agrees that such fees, costs and expenses shall constitute Obligations. This provision shall survive the termination
of this Agreement. The $20,000 payment made by Borrower to Agent pursuant to the February 6, 2012 Proposal Letter between Borrower
and Agent shall be applied to offset and reduce the Loan Parties’ reimbursement obligations on the Closing Date.

 

10.6         
Indemnity. Each Loan Party shall and does hereby jointly and severally indemnify and defend Agent, Lenders,
and their respective successors and assigns, and their respective directors, officers, employees, consultants, attorneys, agents
and affiliates (each an “Indemnitee”) from and against all liabilities, losses, damages, expenses, penalties,
claims, actions and suits (including, without limitation, related reasonable attorneys’ fees and the allocated costs of in-house
legal counsel) of any kind whatsoever arising, directly or indirectly, which may be imposed on, incurred by or asserted against
such Indemnitee as a result of or in connection with this Agreement, the other Debt Documents or any of the transactions contemplated
hereby or thereby (the “Indemnified Liabilities”); provided that, no Loan Party shall have any obligation
to any Indemnitee with respect to any Indemnified Liabilities to the extent such Indemnified Liabilities arise from the gross negligence
or willful misconduct of such Indemnitee as determined by a final non-appealable judgment of a court of competent jurisdiction.
In no event shall any Indemnitee be liable on any theory of liability for any special, indirect, consequential or punitive damages
(including, without limitation, any loss of profits, business or anticipated savings). Each Loan Party waives, releases and agrees
(and shall cause each other Loan Party to waive, release and agree) not to sue upon any such claim for any special, indirect, consequential
or punitive damages, whether or not accrued and whether or not known or suspected to exist in its favor. This provision shall survive
the termination of this Agreement.

 

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10.7         
Rights Cumulative. Agent’s and Lenders’ rights and remedies under this Agreement or otherwise
arising are cumulative and may be exercised singularly or concurrently. Neither the failure nor any delay on the part of Agent
or any Lender to exercise any right, power or privilege under this Agreement shall operate as a waiver, nor shall any single or
partial exercise of any right, power or privilege preclude any other or further exercise of that or any other right, power or privilege.
NONE OF AGENT OR ANY LENDER SHALL BE DEEMED TO HAVE WAIVED ANY OF ITS RESPECTIVE RIGHTS UNDER THIS AGREEMENT OR UNDER ANY OTHER
AGREEMENT, INSTRUMENT OR PAPER SIGNED BY BORROWER UNLESS SUCH WAIVER IS EXPRESSED IN WRITING AND SIGNED BY AGENT, REQUISITE LENDERS
OR ALL LENDERS, AS APPLICABLE. A waiver on any one occasion shall not be construed as a bar to or waiver of any right or remedy
on any future occasion.

 

		10.8	Entire Agreement; Amendments, Waivers.

 

(a)               
This Agreement and the other Debt Documents constitute the entire agreement between the parties with respect to the
subject matter hereof and thereof and supersede all prior understandings (whether written, verbal or implied) with respect to such
subject matter. Section headings contained in this Agreement have been included for convenience only, and shall not affect the
construction or interpretation of this Agreement.

 

(b)              
Except for actions expressly permitted to be taken by Agent, no amendment, modification, termination or waiver of
any provision of this Agreement or any other Debt Document, or any consent to any departure by a Loan Party therefrom, shall in
any event be effective unless the same shall be in writing and signed by Agent, Borrower, and Lenders having more than (x) 50%
of the aggregate Commitments of all Lenders or (y) if such Commitments have expired or been terminated, 50% of the
aggregate outstanding principal amount of the Term Loans (the “Requisite Lenders”). Except as set forth in clause (c)
below, all such amendments, modifications, terminations or waivers requiring the consent of any Lenders shall require the written
consent of Requisite Lenders.

 

(c)               
No amendment, modification, termination or waiver of any provision of this Agreement or any other Debt Document shall,
unless in writing and signed by Agent and each Lender directly affected thereby: (i) increase or decrease any Commitment of
any Lender or increase or decrease the Total Revolving Loan Commitment Amount or Total Term Loan Commitment Amount (which shall
be deemed to affect all Lenders), (ii) reduce the principal of or rate of interest on any Obligation or the amount of any
fees payable hereunder (other than waiving the imposition of the Default Rate), (iii) postpone the date fixed for or waive
any payment of principal of or interest on any Loan, or any fees hereunder, (iv) release all or substantially all of the Collateral,
except as otherwise expressly permitted in the Debt Documents (which shall be deemed to affect all Lenders), (v) subordinate
the Lien on all or substantially all of the Collateral granted in favor of Agent securing the Obligations (which shall be deemed
to affect all Lenders), (vi) release a Loan Party from, or consent to a Loan Party’s assignment or delegation
of, such Loan Party’s obligations hereunder and under the other Debt Documents or any Guarantor from its guaranty
of the Obligations (which shall be deemed to affect all Lenders), (vii) amend, modify, terminate or waive Section 8.3,
9.7 or 10.8(b) or (c), or (viii) amend or modify the definition of “Requisite Lenders”.

 

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(d)              
Notwithstanding any provision in this Section 10.8 to the contrary, no amendment, modification, termination
or waiver affecting or modifying the rights or obligations of Agent hereunder shall be effective unless signed by Borrower, Agent
and Requisite Lenders.

 

(e)               
Each Lender hereby consents to the release by Agent of any Lien held by Agent for the benefit of itself and the Lenders
in any or all of the Collateral to secure the Obligations upon (i) the occurrence of any Permitted Disposition pursuant to
Section 7.3 and (ii) the termination of the Commitments and the payment and satisfaction in full of the Obligations.

 

10.9         
Binding Effect. This Agreement shall continue in full force and effect until the Termination Date;
provided, however, that the provisions of this Section and Sections 2.3(d), 9.5, 10.5 and 10.6 and the other indemnities
contained in the Debt Documents shall survive the Termination Date. The surrender, upon payment or otherwise, of any Note or any
of the other Debt Documents evidencing any of the Obligations shall not affect the right of Agent to retain the Collateral for
such other Obligations as may then exist or as it may be reasonably contemplated will exist in the future. This Agreement and the
grant of the security interest in the Collateral pursuant to Section 3.1 shall automatically be reinstated if Agent or any
Lender is ever required to return or restore the payment of all or any portion of the Obligations (all as though such payment had
never been made).

 

10.10     
Use of Logo. Each Loan Party authorizes Agent to use its name, logo and/or trademark without notice to
or consent by such Loan Party, in connection with certain promotional materials that Agent may disseminate to the public. The promotional
materials may include, but are not limited to, brochures, video tape, internet website, press releases, tombstones, advertising
in newspaper and/or other periodicals, lucites, and any other materials relating the fact that Agent has a financing relationship
with Borrower and such materials may be developed, disseminated and used without Loan Parties’ review. Nothing herein obligates
Agent to use a Loan Party’s name, logo and/or trademark, in any promotional materials of Agent. Loan Parties shall not, and
shall not permit any of its respective Affiliates to, issue any press release or other public disclosure (other than any document
filed with any governmental authority relating to a public offering of the securities of Borrower or other disclosures required
to be filed with the SEC) using the name, logo or otherwise referring to General Electric Capital Corporation, GE Healthcare Financial
Services, Inc. or of any of their affiliates, the Debt Documents or any transaction contemplated herein or therein without at least
two (2) Business Days prior written notice to and the prior written consent of Agent unless, and only to the extent that, Loan
Parties or such Affiliate is required to do so under applicable law and then, only after consulting with Agent prior thereto.

 

10.11     
Waiver of Jury Trial. EACH OF LOAN PARTIES, AGENT AND LENDERS UNCONDITIONALLY WAIVE ANY AND ALL RIGHT
TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, ANY OF THE OTHER DEBT DOCUMENTS, ANY
OF THE INDEBTEDNESS SECURED HEREBY, ANY DEALINGS AMONG LOAN PARTIES, AGENT AND/OR LENDERS RELATING TO THE SUBJECT MATTER OF THIS
TRANSACTION OR ANY RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED AMONG LOAN PARTIES, AGENT AND/OR LENDERS.
THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT. THIS WAIVER
IS IRREVOCABLE. THIS WAIVER MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING. THE WAIVER ALSO SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT, ANY OTHER DEBT DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING
TO THIS TRANSACTION OR ANY RELATED TRANSACTION. THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

 

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		10.12	Governing Law and Jurisdiction.

 

(a)               
GOVERNING LAW. THIS AGREEMENT, THE OTHER DEBT DOCUMENTS (EXCLUDING THOSE DEBT DOCUMENTS THAT BY THEIR OWN
TERMS ARE EXPRESSLY GOVERNED BY THE LAWS OF ANOTHER JURISDICTION) AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD
TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, REGARDLESS
OF THE LOCATION OF THE COLLATERAL, PROVIDED, HOWEVER, THAT IF THE LAWS OF ANY JURISDICTION OTHER THAN NEW YORK SHALL
GOVERN IN REGARD TO THE VALIDITY, PERFECTION OR EFFECT OF PERFECTION OF ANY LIEN OR IN REGARD TO PROCEDURAL MATTERS AFFECTING ENFORCEMENT
OF ANY LIENS IN COLLATERAL, SUCH LAWS OF SUCH OTHER JURISDICTIONS SHALL CONTINUE TO APPLY TO THAT EXTENT.

 

(b)              
SUBMISSION TO JURISDICTION. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT SHALL BE BROUGHT
EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK LOCATED IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, OR OF THE UNITED STATES
OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH LOAN PARTY EXECUTING THIS
AGREEMENT HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS. NOTWITHSTANDING THE FOREGOING, THE AGENT AND OTHER LENDERS SHALL HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST
ANY LOAN PARTY (OR ANY PROPERTY OF SUCH LOAN PARTY) IN THE COURT OF ANY OTHER JURISDICTION THE AGENT OR THE LENDERS DEEM NECESSARY
OR APPROPRIATE IN ORDER TO REALIZE ON THE COLLATERAL OR OTHER SECURITY FOR THE OBLIGATIONS. THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVE ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, THAT
ANY OF THEM MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH JURISDICTIONS.

 

(c)               
NON-EXCLUSIVE JURISDICTION. NOTHING CONTAINED IN THIS SECTION 10.12 SHALL AFFECT THE RIGHT OF
AGENT OR THE LENDERS TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE REQUIREMENTS OF LAW OR COMMENCE LEGAL PROCEEDINGS
OR OTHERWISE PROCEED AGAINST ANY LOAN PARTY IN ANY OTHER JURISDICTION.

 

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10.13     
Confidentiality. Each Lender and Agent agrees to maintain the confidentiality of information obtained
by it pursuant to any Debt Document and designated in writing by any Loan Party as confidential using the same standard of care
as it uses to protect its own confidential information of a similar nature, except that such information may be disclosed (a) with
the Borrower’s prior written consent, (b) to such Lender’s or Agent’s Related Persons (as defined below),
as the case may be, that are advised of the confidential nature of such information and are instructed and agree to keep such information
confidential in accordance with the terms hereof, (c) to the extent such information presently is or hereafter becomes (i) publicly
available other than as a result of a breach of this Section 10.13 or (ii) available to such Lender or Agent or any of
their Related Persons, as the case may be, from a source (other than any Loan Party) not known by them to be subject to disclosure
restrictions, (d) to the extent disclosure is required by any applicable law, rule, regulation, court decree, subpoena or
other legal, administrative, governmental or regulatory request, order or proceeding or otherwise requested or demanded by any
governmental authority, (e) to the extent necessary or customary for inclusion in league table measurements, (f) (i) to
the National Association of Insurance Commissioners or any similar organization, any examiner or any nationally recognized rating
agency or (ii) otherwise to the extent consisting of general portfolio information that does not identify Loan Parties, (g) to
current or prospective assignees or participants and to their respective Related Persons, in each case to the extent such assignees,
participants or Related Persons agree to be bound by provisions substantially similar to the provisions of this Section 10.13
(and such persons or entities may disclose information to their respective Related Persons in accordance with clause (b) above),
(h) to any other party hereto, and (i) in connection with the exercise or enforcement of any right or remedy under any
Debt Document, in connection with any litigation or other proceeding to which such Lender or Agent or any of their Related Persons
is a party or bound, or to the extent necessary to respond to public statements or disclosures by Loan Parties or their Related
Persons referring to a Lender or Agent or any of their Related Persons. In the event of any conflict between the terms of this
Section 10.13 and those of any other contractual obligation entered into with any Loan Party (whether or not a Debt Document),
the terms of this Section 10.13 shall govern. “Related Persons” means, with respect to any person or entity, each
affiliate of such person or entity and each director, officer, employee, agent, trustee, representative, attorney, accountant and
each insurance, environmental, legal, financial and other advisor and other consultants and agents of or to such person or entity
or any of its affiliates.

 

10.14     
USA Patriot Act. Each Lender that is subject to the Patriot Act hereby notifies the Loan Parties that
pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies each Loan
Party, which information includes the name and address of each Loan Party and other information that will allow such Lender to
identify each Loan Party in accordance with the Patriot Act.

 

10.15     
Counterparts. This Agreement may be
executed in any number of counterparts and by different parties in separate counterparts, each of which when so executed shall
be deemed to be an original and all of which when taken together shall constitute one and the same agreement. Delivery of an executed
signature page of this Agreement by facsimile transmission or electronic transmission shall be as effective as delivery of a manually
executed counterpart hereof.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF,
each Loan Party, Agent and Lenders, intending to be legally bound hereby, have duly executed this Agreement in one or more counterparts,
each of which shall be deemed to be an original, as of the day and year first aforesaid.

 

BORROWER:

 

PHARMATHENE, INC.

 

	By:	/s/ Linda L. Chang
		Name: 	Linda L. Chang
		Title: 	SVP, CFO

 

 

Address For Notices For All Loan Parties:

 

c/o PharmAthene, Inc.

______________________

______________________

Attention: _____________

Phone:________________

Facsimile:_____________

 

    	 

    	 

    
  

AGENT AND LENDER:

 

GENERAL ELECTRIC CAPITAL CORPORATION

 

	By:	/s/ Alan M. Silbert
		Name: 	Alan M. Silbert
		Title: Duly Authorized Signatory

 

Address For Notices:

 

General Electric Capital Corporation

c/o GE Healthcare Financial Services, Inc.

Two Bethesda Metro Center, Suite 600

Bethesda, Maryland 20814

Attention: Senior Vice President of Risk – Life Science
Finance

Phone: (301) 961-1640

Facsimile: (301) 664-9855

 

With a copy to:

 

General Electric Capital Corporation

c/o GE Healthcare Financial Services, Inc.

Two Bethesda Metro Center, Suite 600

Bethesda, Maryland 20814

Attention: General Counsel

Phone: (301) 961-1640

Facsimile: (301) 664-9866

 

    	 

    	 

    
  

SCHEDULE A

 

COMMITMENTS

 

	Name of Lender	Total Revolving Loan 

Commitment of such Lender	Pro Rata Share
	General Electric Capital Corporation	$5,000,000.00	100%
	 	 	 
	TOTAL REVOLVING LOAN COMMITMENT AMOUNT	$5,000,000.00	100%

 

 

 

	Name of Lender	Term Loan Commitment of 

such Lender	Pro Rata Share
	General Electric Capital Corporation	$2,500,000.00	100%
	 	 	 
	TOTAL TERM LOAN COMMITMENT AMOUNT	$2,500,000.00	100%

 

 

    	 

    	 

    
 

SCHEDULE C

 

BORROWING BASE

 

“Account” has the meaning
given to such term in the UCC and includes Unbilled Accounts.

 

“Borrowing Base” means,
on any date, a dollar amount equal to (i) 85% of the aggregate Outstanding Balance of the Borrower’s Qualified Accounts which
are not Unbilled Accounts, plus (ii) 80% of the aggregate Outstanding Balance of the Borrower’s Qualified Accounts which
are Unbilled Accounts.

 

“Outstanding Balance”
means, with respect to any Account, and as of any date of determination thereof, the amount equal to the book value of such Account
minus (without duplication) (a) all cash collections and other proceeds of such Account received thereunder and (b) all
discounts or other modifications that reduce the amount due on such Account, all as determined by Agent in its good faith credit
judgment consistent with its underwriting practices and procedures.

 

“Qualified Account”
means an Account of Borrower, or portion thereof, that Agent, in its reasonable credit judgment, deems to be qualified for inclusion
in the Borrowing Base. Without limiting the generality of the foregoing, no Account shall be a Qualified Account if:

 

		(a)	the Account does not arise from the sale of goods or the performance
of services by Borrower in the ordinary course of its business, including without limitation, sales of equipment and bulk sales
and Accounts that arise from personal injury claims or from services performed or undertaken in violation of any applicable law;

 

		(b)	with respect to Accounts that are not Unbilled Accounts, the Account
remains unpaid more than ninety (90) days following its original invoice date;

 

		(c)	with respect to Unbilled Accounts, the Account has been an Unbilled
Account for more than thirty (30) days;

 

		(d)	the Account is subject to any defense, set-off, recoupment, counterclaim,
contra account, credit balance, deduction, discount, credit, chargeback, freight claim, allowance, or adjustment of any kind, but
only to the extent of such defense, set-off, recoupment, counterclaim, contra account, credit balance, deduction, discount, credit,
chargeback, freight claim, allowance, or adjustment;

 

		(e)	Accounts to the extent any Loan Party is liable for goods sold or
services rendered by the applicable account debtor to any Loan Party but only to the extent of the potential offset;

 

		(f)	if the Account arises from the sale of goods by Borrower, (i) the
sale was not an absolute sale, (ii) the sale was made on consignment or on approval or on a sale-or-return or bill-and-hold
basis, (iii) the sale was made subject to any other repurchase or return agreement, (iv) the goods sold and giving rise
the Account have not been shipped to the account debtor with respect to such Account or its designee, or (v) any part of any
goods sold and giving rise to the Account has been returned, rejected, lost, or damaged, but only to the extent of the actual offset
or defense arising from such returned, rejected, lost or damaged goods;

 

		(g)	the Account is subject to any Lien other than Agent’s Lien,
or Agent’s Lien in such Account is not perfected; 

 

    	 

    	 

    
  

		(h)	any Account where the account debtor has suspended business, made
a general assignment for the benefit of creditors or failed to pay its debts generally as they come due, or a petition is filed
by or against any account debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including
any provincial) receivership, insolvency relief or other law or laws for the relief of debtors;

 

		(i)	the Account is evidenced by chattel paper or an instrument of any
kind, or has been reduced to judgment;

 

		(j)	the Account is an Account of an account debtor having its principal
place of business or executive office outside the United States or is payable in other than U.S. dollars;

 

		(k)	the account debtor with respect to such Account is an Affiliate of
a Loan Party, or any Account that arises from a sale to any director, officer, other employee, or to any entity that has any common
officer or director with any Loan Party;

 

		(l)	fifty percent (50%) or more of the aggregate unpaid Accounts from
the account debtor with respect to that Account are not deemed Qualified Accounts under this Agreement;

 

		(m)	any covenant, representation or warranty set forth in the Agreement
or any other Debt Documents and pertaining to such Account has been breached or is untrue;

 

		(n)	Accounts (i) as to which a Loan Party is not able to bring suit
or otherwise enforce its remedies against the account debtor through judicial process, or (ii) if the Account represents a
progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the account
debtor’s obligation to pay that invoice is subject to a Loan Party’s completion of further performance under such contract
or is subject to the equitable lien of a surety bond issuer;

 

		(o)	Accounts that arise with respect to goods that are delivered on a
bill-and-hold basis or cash-on-delivery basis;

 

		(p)	Accounts that are the obligation of an account debtor that is the
United States government or a political subdivision thereof, or any state, county or municipality or department, agency or instrumentality
thereof unless Agent, in its sole discretion, has agreed to the contrary in writing, or the applicable Loan Party has complied
with respect to such obligation with the Federal Assignment of Claims Act of 1940, or any applicable state, county or municipal
law restricting the assignment thereof with respect to such obligation; provided that, from the Closing Date through April 29,
2012, such Accounts will be Qualified Accounts notwithstanding non-compliance with the Federal Assignment of Claims Act of 1940;

 

		(q)	Accounts that are not true and correct statements of bona fide indebtedness
incurred in the amount of such Account for merchandise sold to or services rendered and accepted by the applicable account debtor;
or

 

		(r)	the Account fails to meet such other specifications and requirements
which may from time to time be established by Agent in its reasonable credit judgment.

 

“Reserves” means reserves
established by Agent in its reasonable credit judgment from time to time pursuant to Section 2.2(a) with respect to known
or anticipated liabilities, offsets, or liquidity needs of Borrower. Without limiting the generality of the foregoing, Reserves
established to ensure the payment of accrued interest, fees, expenses and other liabilities (including without limitation rent
reserves with respect to any leased locations) shall be deemed to be an exercise of Agent’s good faith credit judgment. Reserves
may be established against the Borrowing Base and the Total Revolving Loan Commitment Amount as determined to be appropriate by
Agent in the exercise of its reasonable credit judgment.

 

“Unbilled Accounts”
means any account that has not been billed and invoiced, but is reflected on Borrower’s books and records as an account receivable.

 

    	 

    	 

    
  

SCHEDULE D

 

COLLATERAL REPORTS

 

Borrower shall deliver to Agent and Lenders,
as required, the various reports (including Borrowing Base Certificates) (collectively, the “Collateral Reports”)
at the times and in the manner set forth below:

 

		(a)	To Agent and Lenders, upon Agent’s request, and in any event
no less frequently than twelve (12) Business Days after the end of each fiscal month (together with a copy of all or any part of
the following reports requested by the Agent in writing after the Closing Date), each of the following reports, each of which shall
be prepared by the Borrower as of the last day of the immediately preceding fiscal month or the date two (2) days prior to the
date of any such request:

 

		(i)	a Borrowing Base Certificate accompanied by such supporting detail
and documentation as shall be requested by Agent in its reasonable discretion;

 

		(ii)	a monthly trial balance showing Accounts outstanding aged from invoice
date as follows: 1 to 30 days; 31 to 60 days; 61 to 90 days, 91 to 120 days and 121 days or more, accompanied by such supporting
detail and documentation as shall be requested by Agent in its reasonable discretion;

 

		(b)	To Agent and Lenders, at the time of delivery of each of the annual
financial statements delivered pursuant to Section 6.3(a) (or, if the Borrower is a publicly held company, within 120 days
after the last day of each calendar year), a listing of government contracts of the Borrower subject to the Federal Assignment
of Claims Act of 1940;

 

		(c)	To Agent and Lenders, within 10 days after the end of each calendar
month, evidence that the Borrower has paid all payroll taxes for the immediately preceding calendar month; and 

 

		(d)	Such other reports, statements and reconciliations with respect to
the Borrowing Base, Collateral or Obligations of the Borrower as Agent shall from time to time request in its reasonable discretion.

 

    	 

    	 

    
 

SCHEDULE E

 

CASH MANAGEMENT SYSTEM

 

		(a)	The following terms shall have the meanings set forth below:

 

“Account Control Agreement”
shall mean, with respect to any deposit account (including any Sweep Account (as defined below), securities account, commodity
account, securities entitlement or commodity contract, an agreement, in form and substance satisfactory to Agent, among Agent,
the financial institution or other person at which such account is maintained or with which such entitlement or contract is carried
and the Loan Party maintaining such account, effective to grant “control” (within the meaning of Articles 8 and
9 under the applicable UCC) over such account to Agent and, in the case of any such account into which proceeds of Accounts are
being deposited, shall grant and provide Agent with irrevocable full cash dominion over such account with standing sweep instructions
directing such depository to sweep amounts deposited therein on daily basis to another deposit account of the Loan Parties subject
to an Account Control Agreement in favor of the Agent or to the Agent directly (determination of where such account will sweep
shall be determined by Agent prior to execution of such agreement).

 

		(b)	(b) The Loan Parties’ depository institutions, securities
                                                                                                                                                                 intermediaries or commodities intermediaries shall be acceptable to Agent in its reasonable discretion. Each Loan Party shall
                                                                                                                                                                 enter into, and cause each such depository institution, securities intermediary or commodities intermediary to enter into,
                                                                                                                                                                 Account Control Agreements with respect to each of its deposit, securities, commodity or similar accounts maintained by such
                                                                                                                                                                 person (other than any payroll account so long as such payroll account is a zero balance account, any withholding tax
                                                                                                                                                                 account, and any fiduciary account as of or after the Closing Date.

 

		(c)	To the extent any Person remits payments to an incorrect deposit
account or otherwise makes payments not in accordance with the provisions of the Agreement or this Schedule E or an
applicable Loan Party’s payment direction, such Loan Party shall contact such Person and use its commercially reasonable
efforts to redirect payment from such Person in accordance with the terms hereof.

 

		(d)	At the request of Agent, Borrower shall create or designate a dedicated
deposit account or accounts to be used exclusively for payroll or withholding tax purposes.

 

		(e)	Borrower shall cause all proceeds of Accounts to be deposited into
a deposit account that is subject to an Account Control Agreement (this specific account shall be known as the “Sweep
Account,” and this specific Account Control Agreement shall be known as the “Sweep Account Agreement”).
To the extent that Borrower receives any payments with respect to Accounts by any payment method other than electronic payment,
Borrower shall maintain a lockbox (a “Lockbox”) with the depository institution where the Sweep Account is maintained
(the “Sweep Bank”). Borrower shall ensure that all collections of Accounts paid directly from account debtors
into the Lockbox are deposit into the Sweep Account and Borrower shall direct (which direction may be included in the applicable
Sweep Account Agreement for any deposit account) Sweep Bank to deposit all proceeds of such Accounts directly into the Sweep Account.
All Sweep Accounts shall be subject to a Sweep Account Agreement.

 

    	 

    	 

    
  

		(f)	Agent shall apply, on a daily basis, all funds transferred into the
Collection Account to reduce the outstanding principal amount of the Revolving Loans. To the extent that any collections of Accounts
or other proceeds of the Accounts are not sent directly to the Lockbox or electronically into a Sweep Account but are received
by a Loan Party, such collections shall be held in trust for the benefit of Agent and immediately remitted, in the form received,
to the applicable deposit account for transfer to the Collection Account immediately upon receipt by any Loan Party, all in accordance
with the terms of this Schedule E.

 

		(g)	For purposes of calculating interest, all payments applied to reduce
the outstanding principal balance of Revolving Loans shall be subject to a three (3) Business Day clearance period, which amount
shall be for the Agent’s sole account. If a credit balance exists with respect to the Collection Account, such credit balance
shall not accrue interest in favor of Borrower, but shall be available to Borrower at any time or times for so long as no Default
or Event of Default exists.

 

		(h)	The failure to comply with any provision of this Schedule E
shall constitute an immediate Event of Default.

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