Document:

Exhibit 10.1

     

   
  

  

  
    IN THE UNITED STATES DISTRICT COURT

      FOR THE NORTHERN DISTRICT OF ILLINOIS, EASTERN DIVISION

    

    

    	
             

             

             

            

             

            

            In re Akorn, Inc. Data Integrity Securities Litigation

             

          	
             

             

            STIPULATION AND AGREEMENT

              OF SETTLEMENT

             

            Civil No. 1:18-cv-01713

             

            Hon. Matthew F. Kennelly

             

             

          

    

    

    

    

    

    

    

    

    
      
        

    

    

    

  

  
    TABLE OF CONTENTS

  

  

  

  
    

    

    	 	 	 	 
	
            I.

          	
            Definitions

          	
            7

          
	 	 	 	 
	
            II.

          	
            Preliminary Approval of Settlement

          	
            26

          
	 	 	 	 
	
            III.

          	
            Release of Claims

          	
            27

          
	 	 	 	 
	
            IV.

          	
            The Settlement Consideration

          	
            28

          
	 	
            A.

          	
            Cash Settlement Amount

          	
            29

          
	 	
            B.

          	
            Settlement Shares

          	
            31

          
	 	
            C.

          	
            Settlement CVRs

          	
            38

          
	 	
            D.

          	
            Administration of the Settlement Consideration

          	
            43

          
	 	 	 	 
	
            V.

          	
            Use of Settlement Fund

          	
            44

          
	 	
            A.

          	
            Attorneys’ Fees & Litigation Expenses

          	
            44

          
	 	
            B.

          	
            Administration Expenses

          	
            46

          
	 	
            C.

          	
            Use & Tax Treatment

          	
            47

          
	 	 	 	 
	
            VI.

          	
            Notice And Settlement Administration

          	
            49

          
	 	
            A.

          	
            Claims Administrator & Defendants’ Obligations

          	
            49

          
	 	
            B.

          	
            Notice, Submission of Proof of Claim Forms & the Plan of Allocation

          	
            49

          
	 	
            C.

          	
            Determination of Authorized Claimants

          	
            50

          
	 	
            D.

          	
            Distribution of the Settlement Fund

          	
            54

          
	 	
            E.

          	
            Request For Exclusion From the Settlement Class

          	
            56

          
	 	 	 	 
	
            VII.

          	
            Final Approval of Settlement

          	
            57

          
	 	 	 	 
	
            VIII.

          	
            Effective Date of Settlement

          	
            57

          
	 	 	 	 
	
            IX.

          	
            Termination

          	
            58

          
	 	 	 	 
	
            X.

          	
            Miscellaneous Provisions

          	
            63

          
	 	
            A.

          	
            Entire Agreement

          	
            63

          
	 	
            B.

          	
            Final & Complete Resolution

          	
            63

          
	 	
            C.

          	
            Publicity

          	
            64

          
	 	
            D.

          	
            Contributions

          	
            65

          
	 	
            E.

          	
            Preservation of Documents

          	
            65

          
	 	
            F.

          	
            No Admission of Wrongdoing

          	
            65

          
	 	
            G.

          	
            Amendment, Modification & Waiver

          	
            67

          
	 	
            H.

          	
            Headings

          	
            67

          
	 	
            I.

          	
            Jurisdiction of the Court

          	
            67

          
	 	
            J.

          	
            Choice of Law

          	
            68

          
	 	
            K.

          	
            Venue & Multi District Litigation

          	
            68

          
	 	
            L.

          	
            Execution

          	
            68

          
	 	
            M.

          	
            Notice

          	
            69

          
	 	
            N.

          	
            Authority of Counsel

          	
            70

          
	 	 	 	 

  

  

  

  

  

  

  

  
    
      

  

  
   

  

  
    STIPULATION AND AGREEMENT OF SETTLEMENT

    This Stipulation and Agreement of Settlement, dated as of August 9, 2019, is entered into between (a) Lead Plaintiffs Gabelli & Co. Investment Advisors, Inc. and Gabelli
      Funds, LLC, individually and on behalf of the Settlement Class; and (b) Defendants Akorn, Inc., Rajat Rai (“Rai”), Duane Portwood (“Portwood”), Alan Weinstein (“Weinstein”), Brian Tambi (“Tambi”) and Ronald Johnson (“Johnson”), and embodies the terms
      and conditions of the Settling Parties’ settlement of the claims against the Defendants in the Action.1  Subject to the approval of the Court and the terms and
      conditions expressly provided herein, this Stipulation is intended to fully, finally and forever compromise, settle, release, resolve and dismiss with prejudice all claims asserted in the Action against the Defendants.

    WHEREAS,

    A.            The Action was commenced in the Court on March 8, 2018, by plaintiff Joshi Living Trust through the
      filing of a class action complaint alleging violations by Akorn, Rai, Portwood and Randall Pollard of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder, captioned Joshi Living Trust
        v. Akorn, Inc., et al., No. 1:18-cv-01713-MFK (N.D. Ill.);

    B.            By order dated May 31, 2018, the Court appointed Gabelli Funds as lead plaintiffs in this Action,
      Entwistle & Cappucci LLP as lead counsel for the proposed class and Bernstein Litowitz Berger & Grossmann LLP as local liaison counsel for the proposed class;

    

    

    

    

    

    

    

    1 All words or terms used herein that are capitalized and not otherwise defined shall have the meanings ascribed to those words or terms
      as set forth in Section I hereof, entitled “Definitions”.

    

    
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    C.          On September 5, 2018, Lead Plaintiffs filed an amended consolidated complaint, naming as defendants the
      Defendants, Mark Silverberg (“Silverberg”), John Kapoor (“Kapoor”), Kenneth Abramowitz (“Abramowitz”), Adrienne Graves (“Graves”), Steven Meyer (“Meyer”) and Terry Rappuhn (“Rappuhn”), and asserting (i) on behalf of persons who purchased or otherwise
      acquired the common stock of Akorn during the period from November 3, 2016, through April 20, 2018, inclusive, claims against Defendants and Silverberg under Sections 10(b) and 20(a) of the Exchange Act, and (ii) on behalf of Akorn shareholders of
      record as of June 9, 2017, claims against Akorn, Rai, Kapoor, Weinstein, Abramowitz, Graves, Johnson, Meyer, Rappuhn and Tambi, under Sections 14(a) and 20(a) of the Exchange Act (the “Proxy Claims”);

    D.             On October 29, 2018, the parties filed a stipulation and joint motion providing for the dismissal of certain claims and
      defendants;

    E.            On October 30, 2018, the Court granted the parties’ motion, dismissing all of the Proxy Claims without
      prejudice, dismissing defendants Kapoor, Abramowitz, Graves, Meyer and Rappuhn without prejudice and dismissing defendant Silverberg with prejudice;

    F.              On December 19, 2018, the Defendants filed an answer to the amended consolidated complaint;

    G.           On February 21, 2019, plaintiff Johnny Wickstrom filed a class action complaint in the United States District Court for the
      Northern District of Illinois (the “Northern District of Illinois”), alleging violations of Sections 10(b) and 20(a) of the Exchange Act during a class period from August 1, 2018 through January 8, 2019, inclusive, and naming as defendants

    
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    Akorn, Rai and Portwood.  The case was captioned Wickstrom v. Akorn, Inc., et al., No. 1:19-cv-01299 (the “Wickstrom Action”);

    H.            On March 27, 2019, the Court made a finding that the Wickstrom
      Action was related to this Action and ordered the Wickstrom Action to be transferred to the Court pursuant to Local Rule 40.4 of the Local Rules of the Northern District of Illinois (each a “Local Rule”);

    I.            On April 22, 2019, plaintiff Vicente Juan filed a class action complaint in the Northern District of
      Illinois, alleging violations of Sections 10(b) and 20(a) of the Exchange Act during a class period from May 2, 2018 through January 8, 2019, inclusive, and naming as defendants Akorn, Rai and Portwood.  The case was captioned Juan v. Akorn, Inc., et al., No. 1:19-cv-02720 (the “Juan Action”);

    J.            On April 22, 2019, Lead Plaintiffs, by and through their attorneys, filed the Second Amended Complaint,
      alleging claims on behalf of persons or entities who purchased or otherwise acquired the common stock of Akorn during the Class Period against Defendants pursuant to Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder;

    K.           Also on April 22, 2019, Gabelli Funds and plaintiff Vicente Juan filed motions in the Wickstrom Action to be appointed as lead plaintiffs in that action;

    L.            On April 23, 2019, the Court found that the Juan Action was
      related to this Action and ordered the Juan Action to be transferred to the Court pursuant to Local Rule 40.4;

    M.           On April 29, 2019, plaintiff Vicente Juan filed a notice of withdrawal of his motion for lead plaintiff
      status in the Wickstrom Action;

    
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    N.            On May 3, 2019, the Litigation Parties and their counsel commenced mediation before former United States
      District Judge Layn R. Phillips (“Judge Phillips”);

    O.            On May 9, 2019, the Court consolidated both the Wickstrom
      Action and the Juan Action into this Action for all purposes;

    P.          On May 31, 2019, plaintiffs Twin Master Fund, Ltd., Twin Opportunities Fund, LP and Twin Securities, Inc.
      filed a complaint against Defendants in the Northern District of Illinois, alleging violations of Sections 10(b), 18 and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder, as well as one count of common law fraud (the “Twin Funds Action”);

    Q.            On June 11, 2019, the Court found that the Twin Funds Action
      was related to this Action and ordered the Twin Funds Action to be transferred to the Court pursuant to Local Rule 40.4;

    R.            On July 5, 2019, Lead Plaintiffs filed a motion in this Action seeking certification of a proposed class
      of all persons or entities that purchased or otherwise acquired Akorn’s common stock during the Class Period and were damaged thereby;

    S.            On July 11, 2019, plaintiffs Manikay Master Fund, LP and Manikay Merger Fund, LP filed a complaint
      against Defendants in the Northern District of Illinois, alleging violations of Sections 10(b), 18 and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder, as well as one count of common law fraud (the “Manikay

        Funds Action”);

    T.            On July 25, 2019, after extensive arm’s-length negotiations facilitated by Judge Phillips, acting as
      mediator, the Litigation Parties reached an agreement in principle as to

    
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    the economic elements of a settlement and agreed to settle this Action and all issues in dispute therein on the terms set forth in this Stipulation;

    U.            On July 30, 2019, in connection with the agreement in principle reached between them, the Litigation
      Parties jointly moved the Court to enter the Stay Order;

    V.            Also on July 30, 2019, the Court found that the Manikay Funds
      Action was related to this Action and ordered the Manikay Funds Action to be transferred to the Court pursuant to Local Rule 40.4;

    W.            Also on July 30, 2019, the Court entered the Stay Order through at least August 26, 2019;

    X.            Based upon their investigation and prosecution of this case and review of materials and presentations
      regarding Akorn’s financial condition and ability to pay, Lead Plaintiffs and Lead Counsel have concluded that the terms and conditions of this Stipulation are fair, reasonable and adequate to Plaintiffs and in their best interests.  Based upon Lead
      Plaintiffs’ direct oversight of the prosecution of this matter and with the advice of their counsel, Lead Plaintiffs, individually and on behalf of the Settlement Class, have agreed to settle and release all claims raised in the Action against
      Defendants pursuant to the terms and provisions of this Stipulation, after considering, among other things:  (a) the substantial financial benefit that Plaintiffs will receive under the proposed Settlement; (b) Akorn’s ability to pay and financial
      condition—including risks attendant to the renegotiation of Akorn’s outstanding debt and other ongoing litigation; and (c) the significant risks and costs of continued litigation and trial against Defendants;

    
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    Y.            Defendants have denied and continue to deny all allegations of wrongdoing, fault, liability or damage to
      Plaintiffs; deny that they are or have engaged in any wrongdoing or violation of law; deny that they improperly or misleadingly disclosed (or improperly failed to disclose) the status of Akorn’s compliance with FDA rules and regulations concerning
      cGMP; and maintain that they acted properly at all times, including complying with all legal duties and public disclosure obligations.  Defendants believe that further conduct of this Action could be protracted and expensive, and that it is desirable
      that this Action be fully and finally settled in the manner and upon the terms and conditions set forth in this Stipulation to limit further expense, inconvenience and distraction, to dispose of the burden of protracted litigation, and to permit the
      operation of Akorn’s business without further distraction and diversion of Akorn’s executives and other personnel with respect to the matters at issue in this Action.  Defendants have also taken into account the uncertainty and risks inherent in any
      litigation.  Defendants state that they are entering into this Settlement solely in order to eliminate the burden, expense, uncertainty and risk of further litigation, and to avoid the business disruptions associated therewith;

    Z.            This Stipulation, whether or not consummated, together with any proceedings related to any settlement, or
      any terms of any settlement, whether or not consummated, shall in no event be construed as or deemed to be evidence supporting, or an admission or concession on the part of any Defendant with respect to any claim or of any fault or liability or
      wrongdoing or damage whatsoever, or any infirmity in any of the defenses that Defendants have or could have asserted;

    
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    AA.            Each of the Litigation Parties recognizes and acknowledges, however, that the Action has been prosecuted
      by Lead Plaintiffs in good faith and defended by Defendants in good faith, and that the Action is being voluntarily settled by the Litigation Parties with the advice of counsel; and

    BB.            This Stipulation (together with the exhibits hereto) reflects the final and binding agreement between
      the Settling Parties, subject to approval by the Court, and constitutes a compromise of all Settled Claims between the Settling Parties.

    NOW, THEREFORE, it is hereby STIPULATED
          AND AGREED, by and among Lead Plaintiffs (individually and on behalf of the Settlement Class) and Defendants, by and through their respective undersigned attorneys and subject to the approval of the Court pursuant to Rule 23(e) of the
        Federal Rules of Civil Procedure, that, in consideration of the benefits flowing to the Settling Parties hereto from the Settlement, that all Settled Claims as against all Released Persons shall be compromised, settled, released and dismissed
        fully, finally and with prejudice, upon and subject to the terms and conditions set forth below:

    

    

    
      
        	I.	
                DEFINITIONS

                 

                

              

      

    

    1.            As used in this Stipulation and any exhibits attached hereto
      and made a part hereof, the following capitalized terms shall have the following meanings:

    1.1.        “Action” means the consolidated
      securities class action filed in the Northern District of Illinois, Eastern Division, captioned In re Akorn, Inc. Data Integrity Securities Litigation, No. 1:18-cv-01713-MFK, and includes all actions
      consolidated therein,

    
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    including, but not limited to, Wickstrom v. Akorn, Inc. et al., No. 19-cv-01299 (N.D. Ill.), and Juan

        v. Akorn, Inc. et al., No. 19-cv-02720 (N.D. Ill.).

    1.2.            “Additional Derivative Actions”
      means any action brought after the date hereof by an Akorn shareholder asserting derivatively on behalf of Akorn any claims arising out of, relating to or in connection with the allegations, facts, matters, events, transactions, acts, occurrences,
      statements, representations, misrepresentations or omissions or failures to act that were alleged or could have been alleged in the Derivative Actions.

    1.3.            “Additional Securities Actions”
      means any action brought after the date hereof by a purchaser of Akorn’s common stock asserting either individually or on behalf of a class of purchasers any claims arising out of, relating to or in connection with (i) the allegations, facts,
      matters, events, transactions, acts, occurrences, statements, representations, misrepresentations, or omissions or failures to act that were alleged or could have been alleged in the Action; or (ii) any disclosures, non-disclosures or public
      statements made in connection with any of the foregoing.

    1.4.            “Akorn” means Akorn, Inc. and,
      where applicable, any successor entity.

    1.5.            “Akorn Compensation Plan” means any
      plan implemented and maintained by Akorn for the compensation of its employees, management or directors, including, but not limited to, the Akorn, Inc. 2014 Stock Option Plan and the Akorn, Inc. 2017 Omnibus Incentive Compensation Plan.

    1.6.            “Applicable Insurance Policies”
      means the following insurance policies of

    
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    Akorn:  US00075683DO17A, issued by XL Specialty Insurance Company; 0307-5817, issued by Allied World National Assurance Company; and DOX10007587102, issued by Endurance
      American Insurance Company.

    1.7.            “Applicable Procedures” means, with
      respect to any transfer or exchange of or for the beneficial interest(s) in any Settlement Shares or Settlement CVRs, the rules and procedures of the DTC, the Escrow Agent, the Transfer Agent or the Trustee and/or other applicable rules and
      procedures (including the rules and procedures of the Escrow Agent, the Transfer Agent and the Trustee with respect to certificated or book-entry securities) that apply to such transfer or exchange.

    1.8.            “Authorized Claimant” means a
      Settlement Class Member who timely submits a valid Proof of Claim Form to the Claims Administrator.

    1.9.            “Available Settlement Shares” means
      such Settlement Shares that are available to be issued and delivered in full compliance with applicable laws and in accordance with paragraphs 12 through 15 herein, which shall be, in all cases, (i) duly and validly issued, fully paid, non-assessable
      and free from all liens and encumbrances; (ii) exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10); (iii) registered on a Form 8-A or other Exchange Act registration statement that has been filed with the
      Commission and has become effective in accordance with the provisions of the Exchange Act; (iv) free from and not underlying or otherwise encumbered by any unexpired options or other equity-based awards previously granted pursuant to any Akorn
      Compensation Plan or reserved for issuance thereunder; and (v) approved for listing on The NASDAQ Global Select Market (or any such other stock

    
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    exchange or market on which the shares of Akorn’s common stock shall then be authorized for listing) such that the Available Settlement Shares shall constitute “covered
      securities” within the meaning of Section 18(b) of the Securities Act.

    1.10.            “Cash Settlement Amount” means the
      D&O Coverage Amount remaining as of the date hereof, less any erosion (not to exceed the Reimbursement Cap) due to Reimbursable Defense Costs.

    1.11.            “Cash Escrow Fund” means the
      Initial Cash Escrow Amount, together with the excess, if any, of the Reimbursement Cap over the Reimbursable Defense Costs deposited into the Escrow Account pursuant to paragraph 10 herein following the date on which the Order and Final Judgment
      becomes Final.

    1.12.            “Change in Control” means the
      acquisition of ownership, directly or indirectly, beneficially or of record, by any person or entity (or group of persons or entities) of equity interests representing more than fifty percent (50%) of the aggregate ordinary voting power represented
      by the issued and outstanding equity interest of Akorn.

    1.13.            “Claimant” means a person or
      entity that submits a Proof of Claim Form to the Claims Administrator seeking to share in the proceeds of the Settlement of this Action.

    1.14.            “Claims” means any and all manner
      of claims, debts, demands, controversies, obligations, losses, costs, interest, penalties, fees, expenses, rights, duties, judgments, sums of money, suits, contracts, agreements, promises, damages, actions, causes of action and liabilities, of every
      nature and description in law or equity (including, but not limited to, any claims for damages, whether compensatory, special, incidental,

    
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    consequential, punitive, exemplary or otherwise, injunctive relief, declaratory relief, rescission or rescissionary damages, interest, attorneys’ fees, expert or consulting
      fees, costs, or expenses), accrued or unaccrued, known or unknown, arising under federal, state, common, administrative, or foreign law, or any other law, rule, or regulation.

    1.15.            “Claims Administrator” means the
      entity or firm, to be retained by Lead Counsel, subject to Court approval, which shall send the Notice to the Settlement Class Members, arrange for publication of the Publication Notice, process Proof of Claim Forms received by Claimants, administer
      the disbursements from and the distribution of the Net Settlement Fund to Authorized Claimants, and perform such other administrative functions required under this Stipulation.

    1.16.            “Class Distribution Order” means
      an order of the Court approving the Claims Administrator’s administrative determinations concerning the acceptance and rejection of the Claims submitted herein and approving any Notice and Administration Expenses not previously applied for, including
      the fees and expenses of the Claims Administrator, and, if the Effective Date has occurred, directing distribution of the Net Settlement Fund to Authorized Claimants.

    1.17.            “Class Period” means, for the
      purposes of this Settlement only, the period from November 3, 2016 through January 8, 2019, inclusive.

    1.18.            “Class Settlement Shares” means
      the Settlement Shares, less any Settlement Shares awarded to Plaintiffs’ Counsel pursuant to paragraphs 20 through 25 herein, as attorneys’ fees or to pay for Litigation Expenses.

    
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    1.19.            “Commission” means the United
      States Securities and Exchange Commission.

    1.20.            “Court” means the United States
      District Court for the Northern District of Illinois, Eastern Division, the Honorable Matthew F. Kennelly presiding.

    1.21.            “CVR Agreement” means the
      Contingent Value Rights Agreement that shall be executed by Akorn and the Trustee on the date on which the Order and Final Judgment becomes Final in or substantially in the form attached hereto as Exhibit C with such modifications as may be necessary
      to reflect the operational and administrative agency requirements and other reasonable requests of the Trustee, in consideration of the release and final disposition of the Settled Claims by the Releasing Persons.

    1.22.            “D&O Coverage Amount” means
      the total coverage amount available pursuant to the Applicable Insurance Policies, which amount is equal to Thirty Million Dollars ($30,000,000.00).

    1.23.          “D&O Insurers” means XL
      Specialty Insurance Company, Allied World National Assurance Company and Endurance American Insurance Company, the insurance companies that issued or are otherwise responsible for the insurance policies that comprise the Applicable Insurance
      Policies.

    1.24.            “Defendants” means Akorn, Rai,
      Portwood, Weinstein, Johnson and Tambi.

    1.25.            “Defendants’ Counsel” means the
      law firms of Cravath, Swaine & Moore LLP and Figliulo & Silverman, P.C.

    1.26.            “Derivative Actions” means the
      actions captioned Kogut v. Akorn, Inc. et

    
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    al., No. 646,174 (La. 19th Dist. Ct.) and In re Akorn, Inc. S’holder Deriv. Litig., No. 18-cv-7374 (N.D. Ill.).

    1.27.            “DTC” means the Depository Trust
      Company, a New York corporation.

    1.28.            “Effective Date” means the first
      date by which all the events and conditions specified in paragraph 47 herein have been met and have occurred.

    1.29.            “Escrow Account” means the escrow
      account, to be established by Lead Counsel at a federally-insured banking institution approved by Defendants and to be administered by the Escrow Agent, into which the Settlement Consideration shall be deposited and held in escrow in accordance with
      the terms hereof.  The Cash Escrow Fund held in the Escrow Account shall be held in an interest-bearing account.  With the sole exception of depositing the Settlement Consideration into the Escrow Account as provided for in paragraphs 9 through 17
      herein, Defendants shall have no responsibility or liability relating to the Escrow Account or the Settlement Fund maintained in the Escrow Account including, without limitation, responsibility or liability related to any interest (of any kind and at
      any time), fees, Taxes and Tax Expenses, investment decisions, maintenance, supervision and distributions of any portions of the Settlement Consideration.  Lead Counsel’s failure to establish the Escrow Account shall not impair the enforceability of
      the Settlement.

    1.30.            “Escrow Agent” means such party as
      may be chosen by Akorn, in consultation with Lead Counsel, to act as escrow agent hereunder.

    1.31.            “Escrow Agreement” means the
      escrow agreement between (i) Akorn;

    
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    (ii) Lead Counsel, on behalf of Lead Plaintiffs and the Settlement Class, and (iii) the Escrow Agent.  The Escrow Agreement shall provide that the delivery of the Settlement
      Consideration into the Escrow Account shall satisfy all of Defendant’s payment and delivery obligations hereunder and thereunder, and that Defendants and Defendants’ Counsel shall have neither authority over nor responsibility or liability of any
      kind for the Escrow Account or the treatment or disposition of the Settlement Fund therein.

    1.32.            “Exchange Act” means the
      Securities Exchange Act of 1934, as amended, codified at 15 U.S.C. § 78a et seq.

    1.33.            “Final,” with respect to the Order
      and Final Judgment, means:  (i) if no appeal is filed, the expiration of the time for filing or noticing any appeal from the Court’s entry of the Order and Final Judgment in or substantially in the form of Exhibit B to this Stipulation, i.e., thirty (30) days after entry of the Order and Final Judgment; or (ii) if there is an appeal, the date of final dismissal of any appeal from the Order and Final Judgment, or the final dismissal of any
      proceeding on certiorari to review the Order and Final Judgment; or (iii) the date of final affirmance on an appeal, if any, of the Order and Final Judgment, the expiration of the time to file a petition for a writ of certiorari, or the denial of a
      writ of certiorari to review the Order and Final Judgment, or, if certiorari is granted, the date of final affirmance of the Order and Final Judgment following review pursuant to such grant.  Any proceeding or order, or any appeal or petition for a
      writ of certiorari pertaining solely to any plan of allocation and/or application for attorneys’ fees, costs or expenses, shall not in any way delay or preclude the Order and Final Judgment from

    
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    becoming Final.

    1.34.            “Individual Defendants” means Rai,
      Portwood, Weinstein, Johnson and Tambi.

    1.35.            “Initial Cash Escrow Amount” means
      the D&O Coverage Amount remaining as of the date hereof, less the Reimbursement Cap.  Defendants estimate the Initial Cash Escrow Amount to be approximately Twenty-Eight Million Dollars ($28,000,000.00) as of the date hereof.  In the event that
      the Court declines to extend the Stay Order for the duration of the proceedings related to this Settlement, the Initial Cash Escrow Amount will be approximately Twenty-Seven Million, Five Hundred Thousand Dollars ($27,500,00.00).

    1.36.            “Lead Counsel” means the law firm
      of Entwistle & Cappucci LLP.

    1.37.            “Lead Plaintiffs” or “Gabelli
      Funds” mean Gabelli & Co. Investment Advisors, Inc. and Gabelli Funds, LLC.

    1.38.            “Liaison Counsel” means the law
      firm of Bernstein Litowitz Berger & Grossmann LLP acting as local counsel.

    1.39.            “Litigation Expenses” means
      reasonable and documented out-of-pocket costs and expenses incurred by Lead Plaintiffs and Lead Counsel in connection with commencing, prosecuting and settling the Action (which may include the costs and expenses of Lead Plaintiffs directly related
      to their representation of the Settlement Class), for which Lead Counsel intends to apply to the Court for reimbursement to be paid from (and out of) the Settlement Fund.  Litigation Expenses does not include attorneys’ fees

    
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    incurred in connection with commencing, prosecuting and settling the Action.

    1.40.            “Litigation Parties” means
      Defendants and Lead Plaintiffs, individually and on behalf of the Settlement Class.

    1.41.            “Net Settlement Fund” means the
      Settlement Fund less (i) Court-awarded attorneys’ fees and Litigation Expenses; (ii) Notice and Administration Expenses; (iii) any required payments of Taxes or Tax Expenses; and (iv) any other fees or expenses approved by the Court.

    1.42.            “Notice” means the Notice of:  (I)
      Pendency of Class Action and Proposed Settlement; (II) Settlement Fairness Hearing; and (III) Motion for and Award of Attorneys’ Fees and Reimbursement of Litigation Expenses, which is to be sent to Settlement Class Members in, or substantially in,
      the form attached hereto as Exhibit A-1 to Exhibit A (the Preliminary Approval Order).

    1.43.            “Notice and Administration
      Expenses” means all expenses incurred by either the Claims Administrator or Lead Counsel in connection with the preparation, printing and mailing of the Notice to the Settlement Class, publication of the Publication Notice, and all expenses of
      settlement administration.

    1.44.            “Order and Final Judgment” means
      the Order and Final Judgment Approving Class Action Settlement to be entered by the Court, in or substantially in the form attached hereto as Exhibit B.

    
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    1.45.            “Opt-Outs” means putative
      Settlement Class Members who validly exclude themselves from the Settlement Class by timely filing a request for exclusion in accordance with the requirements set forth in the Notice, as contemplated by paragraph 44 herein.

    1.46.            “Plaintiffs” means Lead Plaintiffs
      and the Settlement Class.

    1.47.            “Plaintiffs’ Counsel” means Lead
      Counsel and all other legal counsel who, at the direction and under the supervision of Lead Counsel, have performed services on behalf of Lead Plaintiffs and/or the Settlement Class in connection with the Action.

    1.48.            “Plan of Allocation” means the
      plan and procedures for allocating the Net Settlement Fund to be distributed to Authorized Claimants following approval of the same by the Court.

    1.49.            “Preliminary Approval Order” means
      the Order Preliminarily Approving Settlement, Approving Form of Class Notice, and Setting Hearing Date for Final Approval of Settlement, to be entered by the Court, in or substantially in the form attached as Exhibit A to this Stipulation.

    1.50.            “Proof of Claim Form” or “Proof of
      Claim Forms” mean the proof of claim and release form in or substantially in the form attached as Exhibit A-2 to Exhibit A, which each Claimant must complete and submit should that Claimant seek to share in a distribution of the Net Settlement Fund.

    1.51.            “Publication Notice” means the
      Summary Notice of (I) Pendency of Class Action and Proposed Settlement; (II) Settlement Fairness Hearing; and (III) Motion for an Award of Attorneys’ Fees and Reimbursement of Litigation Expenses, in or substantially

    
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    in the form attached as Exhibit A-3 to Exhibit A.

    1.52.            “Reimbursable Defense Costs” means the defense fees and
      costs incurred by Defendants, up to and not exceeding the Reimbursement Cap, for which they may seek reimbursement under the Applicable Insurance Policies during the pendency of the Stay Order and proceedings related to this Settlement.  Such fees
      and costs include any defense fees and costs arising from or related to (i) the Action, including fees and costs arising from or related to this Stipulation or the Settlement; (ii) the Twin Funds Action;
      (iii) the Manikay Funds Action; (iv) the Derivative Actions; (v) any Additional Derivative Actions; and/or (vi) any Additional Securities Actions.  Such fees and costs do not include any defense fees and
      costs that are covered by insurance policies of Akorn or the Individual Defendants other than the Applicable Insurance Policies.

    1.53.            “Reimbursement Cap” means (i) Two Million Dollars
      ($2,000,000.00) while the Stay Order is in effect; and (ii) Two Million, Five Hundred Thousand Dollars ($2,500,00.00) if either the Stay Order is lifted while proceedings relating to this Settlement are ongoing or if any Additional Securities Action
      is filed that is not stayed.

    1.54.            “Released Persons” refers jointly and severally,
      individually and collectively to all current or former Defendants in the Action and their current and former directors, officers, shareholders, employees, servants, partners, agents, affiliates, subsidiaries, parents, joint ventures, successors or
      assigns, and any representatives, trustees, executors, heirs, assigns or transferees, attorneys, accountants, investment bankers, commercial bankers, advisors or insurers of any of the foregoing, as well as all

    
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    counsel representing such persons or entities in connection with the Action or any transaction from which the Action arises.  As used in this paragraph, “affiliates” means entities controlling,
      controlled by or under common control with any of the Released Persons. All Released Persons are express third-party beneficiaries of this Stipulation.

    1.55.            “Releasing Persons” means Lead Plaintiffs, Settlement Class
      Members and, to the extent acting as such, Lead Plaintiffs’ or any Settlement Class Members’ current and former directors, officers, shareholders, employees, servants, partners, agents, affiliates, subsidiaries, parents, joint ventures, successors or
      assigns, and any representatives, trustees, executors, heirs, assigns or transferees, attorneys, accountants, investment bankers, commercial bankers, advisors or insurers of any of the foregoing, jointly and severally, individually and collectively,
      whether in an individual, class, representative, legal, equitable or any other type or in any other capacity.  As used in this paragraph, “affiliates” means entities controlling, controlled by or under common control with any Releasing Person.

    1.56.            “Second Amended Complaint” means the Second Consolidated
      Amended Class Action Complaint for Violations of the Federal Securities Laws, filed by Lead Plaintiffs in this Action on April 22, 2019.

    1.57.            “Section 3(a)(10)” means Section 3(a)(10) of the Securities
      Act, codified at 15 U.S.C. § 77c(a)(10).

    1.58.            “Securities Act” means the Securities Act of 1933, as
      amended, codified at 15 U.S.C. § 77a et seq.

    
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    1.59.            “Settled Claims” means any and all Claims (including any
      Claim that this Stipulation was fraudulently induced), demands, rights, actions or causes of action, whether the Claims are known or Unknown Claims, contingent or absolute, suspected or unsuspected, disclosed or undisclosed, hidden or concealed,
      matured or unmatured, accrued or unaccrued, that have been, could have been, or in the future can or might be asserted in the Action or in any court, tribunal or proceeding, including, but not limited to, any claims arising under federal or state
      statutory or common law or relating to alleged fraud, misrepresentation (negligent, reckless, intentional or otherwise, and including misrepresentations through omission(s)), breach of any duty, negligence, violations of federal or state securities
      laws or any other claim under any theory by or on behalf of the Lead Plaintiffs and/or any and all Settlement Class Members that any of the Releasing Persons ever had, now has, or hereafter can, shall or may have against the Released Persons by
      reason of, arising out of, relating to or in connection with (i) the allegations, facts, matters, events, transactions, acts, occurrences, statements, representations, misrepresentations, or omissions or failures to act that were alleged or could
      have been alleged in the Action; (ii) any disclosures, non-disclosures or public statements made in connection with any of the foregoing; and (iii) the Stipulation and the Settlement. For the avoidance of doubt, the Settled Claims do not include
      (x) any claim by or on behalf of any Defendant against any insurance carrier; (y) any claim to enforce the Settlement, if approved by the Court, or the Stipulation; or (z) any claim of or against any Opt-Outs.

    1.60.            “Settlement” means the settlement contemplated by this
      Stipulation.

    
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    1.61.            “Settlement Consideration” means the sum of:  (i) the Cash
      Settlement Amount; (ii) the Settlement Shares; and (iii) the Settlement CVRs, which aggregate amount shall include all attorneys’ fees and Litigation Expenses, and all costs related to Notice and Administration Expenses.

    1.62.            “Settlement Class”, “Settlement Class Member” and
      “Settlement Class Members” mean, for the purposes of this Settlement only, all persons or entities that purchased or otherwise acquired shares of Akorn’s common stock during the Class Period and were damaged thereby, including any and all of their
      respective successors in interest, predecessors, representatives, trustees, executors, administrators, heirs, assigns or transferees, immediate and remote, and any person or entity acting for or on behalf of, or claiming under, any of them.  Excluded
      from the Settlement Class are (i) Defendants; (ii) any person who was an officer, director or managing agent of Akorn or any of its subsidiaries or affiliates at any point during the Class Period; (iii) members of the immediate family of any of the
      foregoing individuals (including all trusts and other entities related to, owned or controlled by such individuals); (iv) any affiliate of Akorn; (v) any entity in which any Defendant has or had a controlling interest; (vi) any Opt-Outs; and
      (vii) the legal representatives, heirs, predecessors, successors or assigns of any of the foregoing.

    1.63.            “Settlement CVRs” means the contingent value rights to be
      issued and delivered by Akorn pursuant to the terms of this Stipulation and the CVR Agreement.  Such contingent value rights shall be, in all cases, (i) valid and binding obligations of Akorn;

    
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    (ii) exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10); and (iii) registered on a Form 8-A or other Exchange Act registration statement that has been filed
      with the Commission and has become effective in accordance with the provisions of the Exchange Act.

    1.64.            “Settlement Hearing” means the hearing held to determine
      whether the proposed Settlement embodied by this Stipulation is fair, reasonable and adequate to the Settlement Class, and whether the Court should enter the Order and Final Judgment approving the Settlement.

    1.65.            “Settlement Fund” means the Cash Escrow Fund, together with
      the Settlement Shares and Settlement CVRs, maintained in the Escrow Account.

    1.66.            “Settlement Shares” means the shares of Akorn common stock,
      no par value per share, that either (i) are available, authorized, unissued and uncommitted as of the date hereof (which number is approximately 6,486,375, in total, as of the date hereof) or (ii) are released during the calendar years of 2019
      through 2024, inclusive, by the expiration of unexercised out-of-the-money options granted prior to the date hereof pursuant to an Akorn Compensation Plan (which number is approximately 2,249,330, in total, as of the date hereof), in each case to be
      issued and delivered by Akorn pursuant to the terms of this Stipulation at such time as such Settlement Shares become Available Settlement Shares in accordance with paragraphs 12 through 15 herein in consideration of the release and final disposition
      of the Settled Claims by the Releasing Persons.  The total number of Settlement Shares to be issued pursuant to this Stipulation shall not exceed the available, authorized,

    
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    unissued and uncommitted shares as of the date hereof and the shares that are released by the expiration of unexercised out-of-the-money options outstanding as of the date hereof.  For the avoidance
      of doubt, Settlement Shares shall not include shares of Akorn’s common stock that are released by any expiration of unexercised out-of-the-money options in connection with a Change in Control.

    1.67.            “Settling Parties” means Releasing Persons and Released
      Persons.

    1.68.            “Stay Order” means any order or orders that, individually or
      in the aggregate, have the effect of:  (i) staying all proceedings in the Action and any action as to which the Court has entered a finding of relatedness pursuant to Local Rule 40.4, including, but not limited to, the Wickstrom Action, the Juan Action, the Twin Funds Action, the Manikay Funds Action and any other action;
      and (ii) transfering to the Court’s docket as a related case pursuant to Local Rule 40.4 any Additional Securities Action commenced in or transferred to the Northern District of Illinois, and staying such action.

    1.69.            “Stipulation” means this Stipulation and Agreement of
      Settlement, dated as of August 9, 2019, entered into between (a) Lead Plaintiffs, individually and on behalf of the Settlement Class; and (b) Defendants.

    1.70.            “Taxes” means any taxes (including any estimated taxes,
      interest or penalties) arising with respect to any income earned by the Settlement Fund, including any taxes or tax detriments to which Defendants may possibly be subject (as computed on a “first-dollar” basis) with respect to (i) any income earned
      by the Settlement Fund for any period during which the Settlement Fund is not treated, or does not qualify, as a “qualified

    
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    settlement fund” for federal or state income tax purposes; and (ii) the payment or reimbursement by the Settlement Fund of any taxes or tax detriments described in clause (i) of this paragraph.

    1.71.            “Tax Expenses” means expenses and costs incurred in
      connection with the operation and implementation of paragraph 27 herein (including expenses of tax attorneys and/or accountants and mailing and distribution costs and expenses relating to filing, or failing to file, the returns described in
      paragraph 27 herein).

    1.72.            “Termination Notice” means a written notice delivered by
      either Defendants or Lead Plaintiffs indicating their intent to terminate the Settlement and this Stipulation pursuant to the terms set forth in paragraphs 48 through 52 herein.

    1.73.            “Transfer Agent” means Akorn’s transfer agent, Computershare
      Trust Company, N.A., or such other party as is Akorn’s transfer agent from time to time.

    1.74.            “Trustee” means such party as may be chosen by Akorn, in
      consultation with Lead Counsel, to act as trustee with respect to the Settlement CVRs.

    1.75.            “Unknown Claims” means any and all Claims that Defendants,
      Lead Plaintiffs, for themselves, the Settlement Class, and any or all other persons and entities whose claims are being released, do not know or suspect to exist, which, if known by him, her or it, might affect his, her or its agreement to release
      the Settling Parties or the Settled Claims, or might affect his, her or its decision to object to or not object to the Settlement.  With respect to any and all Settled Claims, the Litigation Parties stipulate and agree that upon the Effective Date,
      the Plaintiffs and Defendants shall expressly waive, and each

    
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    Released Person and Releasing Person shall be deemed to have waived, and by operation of the Order and Final Judgment shall have expressly waived, any and all provisions, rights and benefits of or
      conferred by any law of any state or territory of the United States or by any law of any other country, or principle of common law, which is or is similar, comparable, or equivalent to Cal. Civ. Code § 1542, which provides:

    A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH

     THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS

     OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE,

     WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY

     AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

    Plaintiffs or Defendants may hereafter discover facts in addition to or different from those which he, she or it now knows or believes to be true with respect to the subject matter of the Settled
      Claims, but hereby stipulates and agrees that Lead Plaintiffs and each other Releasing Person shall be deemed to settle and release, and upon the Effective Date and by operation of the Order and Final Judgment shall have settled and released, fully,
      finally, and forever, all Settled Claims against Released Persons, known or unknown, suspected or unsuspected, contingent or non-contingent, whether or not concealed or hidden, which now exist, or which heretofore existed upon any theory of law or
      equity now existing or coming into existence in the future, including, but not limited to, conduct that is negligent or intentional and with or without malice, or a breach of any duty, law, or rule, without regard to the subsequent discovery or
      existence of such different or additional facts.

    
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        	II.	
                PRELIMINARY APPROVAL OF SETTLEMENT

              

      

    

    2.            Promptly after this Stipulation has been fully executed, Lead Counsel and
      Defendants’ Counsel shall jointly apply to the Court for entry of a Preliminary Approval Order, substantially in the form attached hereto as Exhibit A (with annexes).  During the period from execution of this Stipulation to the Effective Date, which
      shall include the period following entry of the Preliminary Approval Order, each of the Settling Parties, and their respective heirs, executors, administrators, successors and assigns and all persons acting in concert with any such person or entity,
      agree not to institute, maintain or prosecute any or all Settled Claims against any or all of the Settling Parties.

    3.            Solely for purposes of this Settlement and for no other purpose, the Lead
      Plaintiffs and Defendants agree to the certification of the Action as a class action.  Solely for purposes of this Settlement and for no other purpose, the Defendants agree not to contest:  (a) certification of the Action as a class action pursuant
      to Rules 23(a) and 23(b)(3) of the Federal Rules of Civil Procedure on behalf of the Settlement Class; (b) certification of Lead Plaintiffs as class representatives for the Settlement Class; and (c) appointment of Lead Counsel as class counsel for
      the Settlement Class pursuant to Rule 23(g) of the Federal Rules of Civil Procedure.  In the event that this Settlement is terminated pursuant to the terms of this Stipulation, the certification of the Settlement Class in connection with this
      Settlement shall become null and void.  In such case, the Defendants shall have the right to continue to oppose the certification of a class.

    
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        	III.	
                RELEASE OF CLAIMS

              

      

    

    4.            The obligations incurred pursuant to this Stipulation are in consideration
      of:  (i) the agreement by Akorn to use its best efforts to make available to the Settlement Class the Cash Settlement Amount; (ii) the delivery of the Settlement Shares and Settlement CVRs by Akorn for the benefit of the Settlement Class; (iii) the
      full and final disposition of the Action as against all Defendants; and (iv) the releases provided for herein, including the release and final disposition of any and all Settled Claims.

    5.            (a)  By operation of the Order and Final Judgment, upon the Effective Date, each
      and all of the Releasing Persons, on behalf of themselves and their respective heirs, executors, administrators, successors and assigns and all persons acting in concert with any such person shall, with respect to each and every Settled Claim, waive,
      release, forever discharge and dismiss, with prejudice, and agree not to institute, maintain or prosecute any or all Settled Claims against any or all of the Released Persons, and shall be permanently and finally enjoined without the necessity of
      posting a bond from commencing or prosecuting any actions or other proceedings asserting any of the Settled Claims either directly, indirectly, representatively, derivatively or in any other capacity against any of the Released Persons.  This
      injunction expressly extends to all claims covered by this Stipulation and all Releasing Persons defined herein.

    (b)  By operation of the Order and Final Judgment, upon the Effective Date, each of the Released Persons, on behalf of themselves and their respective heirs, executors,
      administrators, successors and assigns and all persons acting in concert with any such person, shall have, fully, finally, and forever released, relinquished, and discharged Lead Plaintiffs, Plaintiffs’ Counsel and the Settlement Class (except any
      Opt-Outs) from all Claims (including Unknown

    
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    Claims) arising out of, relating to, or in connection with, the institution, prosecution, assertion, Settlement, or resolution of the Action or the
        Settled Claims except to enforce the releases and other terms and conditions contained in this Stipulation or any Court order (including, but not limited to, the Order and Final Judgment) entered pursuant
        thereto.

     

      

    
      
        	IV.	
                THE SETTLEMENT CONSIDERATION

                 

                

              

      

    

    6.            In consideration of the agreements of Defendants contained herein, Lead Plaintiffs
      shall cooperate and use their reasonable best efforts to bring about the settlement or dismissal with prejudice of the Derivative Actions as promptly as practicable.

    7.            In consideration of the settlement of the Settled Claims against the Released
      Persons and Lead Plaintiffs’ obligations as described in paragraph 6 herein, Akorn shall (i) use its best efforts to make available to the Settlement Class the Cash Settlement Amount as set forth in paragraphs 9 through 11 herein, and (ii) deliver
      the Settlement Shares and the Settlement CVRs for the benefit of the Settlement Class as set forth in paragraphs 12 through 15 and 16 through 17, respectively.

    8.            Any sums required to be held in escrow hereunder shall be held by the Escrow Agent
      for the benefit of the Plaintiffs and the Settlement Class until the Effective Date.   The Escrow Agent shall not disburse or distribute the Settlement Fund, or any portion thereof, except as provided in this Stipulation, upon order of the Court or
      with the prior written agreement of Defendants’ Counsel and Lead Counsel.  Subject to further order and/or direction as may be made by the Court or at the direction of Lead Counsel, the Escrow Agent is authorized to execute such transactions on
      behalf of the Settlement Class as are consistent with the terms of this

    
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    Stipulation.  All funds held by the Escrow Agent shall be deemed to be in the custody of the Court, and shall remain subject to the jurisdiction of the Court, until such time as such funds shall be distributed to
      Authorized Claimants pursuant to this Stipulation and/or further order of the Court, or returned to the entity or entities that deposited the Settlement Consideration into the Escrow Account on Defendants’ behalf in the event that this Stipulation is
      not consummated or is terminated pursuant to Section IX herein.

    A.      CASH SETTLEMENT AMOUNT

    9.            Akorn shall use its best efforts to cause the D&O Insurers to pay, via check
      or wire transfer, the Initial Cash Escrow Amount into the Escrow Account as soon as practicable after the later of (i) entry by the Court of the Preliminary Approval Order and (ii) delivery by Lead Counsel to Defendants’ Counsel of an IRS Form W-9
      and complete wiring instructions for the Escrow Account.  The Escrow Agent shall hold the Initial Cash Escrow Amount as fiduciary for the benefit of the Settlement Class.

    10.            Akorn shall use its best efforts to cause the D&O Insurers to pay, via check
      or wire transfer, into the Escrow Account, not later than ten (10) business days after the date on which the Order and Final Judgment becomes Final:  (i) the Initial Cash Escrow Amount, to the extent that the D&O Insurers have not already
      deposited the Initial Cash Escrow Amount as set forth in paragraph 9 herein; and (ii) the excess, if any, of the Reimbursement Cap over Reimbursable Defense Costs as of such date (inclusive of any Reimbursable Defense Costs incurred, but for which
      Defendants have not yet received an invoice).

    11.            The payment of the Cash Settlement Amount shall be subject to the following terms
      and conditions:

    
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    (a)  Akorn shall use its best efforts to enable pursuit of insurance proceeds by the Settlement Class in the event of non-payment of the Cash Settlement Amount by any D&O
      Insurer, including, if necessary, assigning to Lead Plaintiffs, on behalf of the Settlement Class, Akorn’s rights pursuant to the Applicable Insurance Policies; provided, however, such assignment will not be made if, in Lead Counsel’s judgment, it
      will impair coverage under the Applicable Insurance Policies or applicable law.

    (b)  Defendants agree to use their reasonable best efforts to avoid any unnecessary depletion of the D&O Coverage Amount while (i) the Stay Order is in effect and (ii)
      proceedings relating to this Settlement are ongoing.

    (c)  Defendants agree not to seek reimbursement from the Applicable Insurance Policies for an amount in excess of the Reimbursement Cap while proceedings relating to this
      Settlement are ongoing.  For the avoidance of doubt, other than payment of Reimbursable Defense Costs up to the Reimbursement Cap, Defendants agree not to use the proceeds of the Applicable Insurance Policies for any purpose other than the payment of
      the Cash Settlement Amount.

    (d)  The Cash Settlement Amount shall be distributed to Authorized Claimants according to the terms set forth in paragraphs 38 through 40 herein.

    (e)  For the avoidance of doubt, the Cash Settlement Amount shall be funded solely from the proceeds of the Applicable Insurance Policies.

    
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    B.                  SETTLEMENT SHARES

    12.            As soon as practicable after the entry by the Court of the Preliminary Approval
      Order, Akorn shall use its best efforts to issue and deliver to the Escrow Agent pursuant to Section 3(a)(10), as fiduciary for the benefit of the Settlement Class, all shares constituting Available Settlement Shares as of the date of entry of the
      Preliminary Approval Order, which shares shall be held by the Escrow Agent as fiduciary for the benefit of the Settlement Class.  Notwithstanding the foregoing, it is understood and agreed between the Litigation Parties that the Settlement Shares are
      to be issued pursuant to the registration exemption set forth in Section 3(a)(10), and nothing herein shall require Akorn to undertake any steps toward issuance of Available Settlement Shares other than seeking entry of the Order and Final Judgment
      prior to satisfaction of the requirements of Section 3(a)(10).

    13.            No later than ten (10) business days after the date on which the Order and Final
      Judgment becomes Final, Akorn shall issue and deliver to the Escrow Agent pursuant to Section 3(a)(10), as fiduciary for the benefit of the Settlement Class, all shares constituting Available Settlement Shares as of the date on which the Order and
      Final Judgment becomes Final that were not already issued and delivered to the Escrow Agent pursuant to paragraph 12 herein.

    14.            No later than ninety (90) days after the date on which any Settlement Shares not
      yet issued and delivered pursuant to paragraphs 12 and 13 herein shall become Available Settlement Shares through the expiration of unexercised out-of-the-money options outstanding as of the date hereof, Akorn will issue and deliver to the Escrow
      Agent pursuant to Section 3(a)(10), as fiduciary for the benefit of the Settlement Class, any such Available Settlement Shares; provided, however, that, for the avoidance of doubt and consistent with the definition of

    
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    “Settlement Shares”, Akorn shall be under no obligation to issue any shares under this Stipulation on account of options that expire on or after January 1, 2025.

    15.            The issuance and delivery of the Settlement Shares shall be subject to the
      following terms and conditions:

    (a)  In order to qualify the Settlement Shares for the exemption from the registration requirements of the Securities Act provided by Section 3(a)(10), the Litigation Parties and
      their counsel will cooperate so that each of the following conditions will be satisfied:  (i) Settlement Class Members shall be given adequate notice of the Settlement Hearing; (ii) the Settlement Hearing shall be open to all Settlement Class
      Members; (iii) there shall be no improper impediments to the appearance of any Settlement Class Member at the Settlement Hearing; (iv) the Court shall be advised before the Settlement Hearing that Akorn will rely on the Section 3(a)(10) registration
      exemption based on the Court’s approval of the issuance of the Settlement Shares as part of the consideration provided in exchange for the settlement and release of the Settled Claims; (v) the Settlement Hearing shall include consideration of the
      fairness of the terms and conditions of the issuance of the Settlement Shares in exchange for the settlement and release of the Settled Claims; (vi) the Order and Final Judgment shall approve the fairness of the terms and conditions of the issuance
      of the Settlement Shares in exchange for the settlement and release of the Settled Claims; (vii) the Order and Final Judgment shall state that the Settlement Shares are freely tradable, and exempt from registration under Section 3(a)(10) and any
      analogous provisions of applicable state securities laws, and that Akorn may choose to distribute the Settlement Shares without registration and compliance with the prospectus delivery requirements of the U.S. securities laws or any analogous state
      securities laws based on the Court’s findings; and (viii) Lead

    
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    Counsel will not request (and Plaintiffs’ Counsel will not accept) more than 25% of the Settlement Shares in connection with an award of attorneys’ fees, as set forth in paragraph 21 herein.

    (b)  All Settlement Shares, including any Settlement Shares awarded to Plaintiffs’ Counsel as attorneys’ fees, may only be issued when such Settlement Shares have become
      Available Settlement Shares, subject to notice of issuance (which such notice Akorn will provide promptly after issuance).  The Settlement Shares shall be issued by Akorn only in certificate-less (book entry) form.  Akorn shall not issue or otherwise
      provide any physical certificates for the Settlement Shares or any portion thereof.

    (c)  Upon delivery of the Settlement Shares to the Escrow Agent, the Escrow Agent shall hold the Settlement Shares as fiduciary for the benefit of the Settlement Class and, as
      applicable, as Court awarded attorneys’ fees and/or Litigation Expenses in accordance with paragraphs 20 through 25 herein.  None of the Settlement Class Members nor any of Defendants shall have any claim against Lead Plaintiffs, Plaintiffs’ Counsel,
      or any of their agents, relating to distributions of the Settlement Shares made in accordance with this Stipulation and the plan of allocation approved by the Court.  The Releasing Persons hereby release any and all Claims against the Released
      Persons that arise out of, relate to, or are based on the issuance or transfer of the Settlement Shares made in accordance with this Stipulation or distributions of the Settlement Shares by Lead Plaintiffs, Lead Counsel, the Escrow Agent, or any of
      their agents, and shall forever be barred and enjoined from prosecuting any and all such claims against any of the Released Persons, provided, however, that the foregoing shall not alter Akorn’s obligations under this Stipulation with respect to the
      issuance or delivery of the Settlement Shares or the payment of

    
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    costs associated therewith to the extent required by paragraph 15(e) herein.
    (d)  After the Effective Date, Lead Counsel may direct the Escrow Agent to sell any amount of Class Settlement Shares for the benefit of the Settlement Class.  The Escrow Agent
      shall deposit the proceeds from such sale(s) into the Escrow Account.  Such proceeds shall be distributed to Authorized Claimants in the same manner as the Cash Settlement Amount, according to the terms set forth in paragraphs 38 through 40 herein
      and Lead Counsel shall have no liability to the Settlement Class for any decisions made with respect to the sale or transfer of the Class Settlement Shares in accordance with the terms of this Stipulation.

    (e)  With respect to any Class Settlement Shares that are not sold by the Escrow Agent, Lead Counsel (through its broker) shall direct the Escrow Agent to transfer such
      Settlement Shares in accordance with the Applicable Procedures, to the accounts of Authorized Claimants, all in accordance with the written instructions to be provided by Lead Counsel or the Claims Administrator at the time of this transfer in
      accordance with paragraph 15(h) herein.  Akorn shall be responsible for the payment of all costs associated with the issuance and delivery of the Settlement Shares, including without limitation, (i) all costs related to the transfer of the Settlement
      Shares to the Escrow Account and (ii) all costs associated with listing the Settlement Shares on The NASDAQ Global Select Market (or any other stock exchange or market on which Akorn’s common stock is then listed or quoted).  However, all costs
      associated with distributing the Settlement Shares to Authorized Claimants (including any costs incurred by the Transfer Agent) will be paid from the Escrow Account and will constitute Notice and Administration Expenses.  The Escrow Agent shall
      maintain a cash reserve sufficient to cover the anticipated Notice and

    
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    Administration Expenses associated with distributions of Settlement Shares.

    (f)  Class Settlement Shares shall not be distributed by the Escrow Agent until Akorn’s General Counsel receives instructions from Lead Counsel as to the distribution of such
      Settlement Shares. Such instructions will include, but are not limited to, transferring the Settlement Shares in accordance with the Applicable Procedures, to the accounts of Authorized Claimants in the amounts directed by the Claims Administrator. 
      Akorn shall authorize the Escrow Agent to distribute the Settlement Shares in accordance with such instructions.

    (g)  Akorn shall direct the Transfer Agent to provide Lead Counsel with instructions as to all information the Transfer Agent requires, as well as all formatting requirements, to
      enable the transfer of the Settlement Shares electronically in accordance with the Applicable Procedures, to the accounts of Authorized Claimants.  Such instructions shall include, but are not limited to, any requirements necessary to satisfy the
      guidelines of the Securities Transfer Association, Inc. so that the Proof of Claim Forms to be sent to potential Settlement Class Members capture all such information in the appropriate format, as well as the physical or electronic medium for the
      delivery of such information that the Transfer Agent requires.  Akorn shall direct the Transfer Agent to provide such instructions and review and provide comments, if any, on the Proof of Claim Form within five (5) calendar days of the filing of the
      motion for entry of the Preliminary Approval Order.  Any changes made to the Proof of Claim Form at the request of the Transfer Agent shall not be deemed material changes to the Proof of Claim Form.

    (h)  Lead Counsel shall have sole responsibility, on behalf of the Settlement Class, for directing Akorn to instruct the Escrow Agent to transfer in accordance with the
      Applicable

    
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    Procedures, to the accounts of Authorized Claimants the Settlement Shares allocable to those claimants.  Any such directions (the “Settlement Shares Instructions”) given to Akorn or the Escrow
      Agent by Lead Counsel shall be set forth in a writing signed by Lead Counsel and accompanied by such information, and in such physical or electronic medium as specified by the Transfer Agent as set forth in paragraph 15(g) herein, to permit the
      Settlement Shares to be immediately transferred electronically in accordance with the Applicable Procedures, to the accounts of Authorized Claimants, in such amounts as are appropriate.  Lead Counsel, Akorn, the Escrow Agent, the Claims
      Administrator, and all entities under the direction of Lead Counsel shall cooperate with the Transfer Agent to provide such information as is required for the Settlement Shares Instructions.  Each of Lead Counsel and the Claims Administrator has the
      right to rely on the instructions provided by the Transfer Agent as to the information it requires, as well as the formatting requirements to enable the transfer of the Settlement Shares electronically in accordance with the Applicable Procedures, to
      the accounts of Authorized Claimants.  The Transfer Agent, in its sole discretion, may request additional information or reformatting in order to effect the transfer of the Settlement Shares in accordance with the Applicable Procedures, to the
      accounts of the Authorized Claimants.  Each of Akorn, the Escrow Agent and the Transfer Agent has the right to rely on the accuracy and completeness of the information provided by Lead Counsel or Authorized Claimants with respect to the issuance and
      distribution of the Settlement Shares.  None of the Defendants, the Escrow Agent or the Transfer Agent shall have any responsibility or liability regarding the accuracy or completeness of any information provided by Lead Counsel or any Authorized
      Claimant in respect to the issuance or distribution of the Settlement Shares, or any losses incurred in connection therewith; however, as discussed in this paragraph and in

    
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    paragraph 15(g) herein, Akorn and the Transfer Agent are responsible for providing complete and accurate instructions to Lead Counsel and the Claims Administrator with respect to the information
      and formatting required in respect to the issuance or distribution of the Settlement Shares.  Lead Counsel shall provide Defendants’ Counsel with notice of the Settlement Shares Instructions at the same time such Settlement Shares Instructions are
      delivered to Akorn.  Lead Counsel shall not issue the Settlement Shares Instructions to Akorn with respect to the Settlement Shares allocable to Authorized Claimants prior to the entry of the Class Distribution Order authorizing the distribution of
      the Settlement Shares, in whole or part, to Authorized Claimants.

    (i)  As of the date the Settlement Shares are issued to the Escrow Agent, as fiduciary for the Settlement Class, the Lead Plaintiffs and the Settlement Class Members shall retain
      the benefit of any increase in the value of Akorn’s common stock and assume the risk of any decrease in the value of Akorn’s common stock.

    (j)  During the period between the initial issuance of the Settlement Shares and the distribution of Class Settlement Shares to Authorized Claimants, on any matter or at any
      meeting at which shareholders of Akorn are entitled to vote, any such Settlement Shares not yet sold or distributed to Authorized Claimants shall be deemed voted (and Lead Counsel shall and shall cause the voting of the Settlement Shares) in the same
      manner in which the majority of the outstanding shares of Akorn’s common stock (exclusive of the Settlement Shares) are actually voted.

    (k)  Akorn shall not:  (i) from the date hereof through December 31, 2024, inclusive, reset the strike price of any options outstanding as of the date hereof that are
      out-of-the-money as of the date hereof and issued heretofore pursuant to any Akorn Compensation Plan; or

    
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    (ii) issue, sell, grant or otherwise dispose of any of the Settlement Shares other than as set forth in this Stipulation, including, but not limited to, as set forth in paragraphs 12 through 15
      herein.

    C.   SETTLEMENT CVRs 

    16.            No later than ten (10) business days after the date on which the Order and Final
      Judgment becomes Final, Akorn shall issue and deliver to the Escrow Agent pursuant to Section 3(a)(10), as fiduciary for the benefit of the Settlement Class, the Settlement CVRs.

    17.            The issuance and delivery of the Settlement CVRs shall be subject to the
      following terms and conditions:

    (a)  In order to qualify the Settlement CVRs for the exemption from the registration requirements of the Securities Act provided by Section 3(a)(10), the Litigation Parties and
      their counsel will cooperate so that each of the following conditions will be satisfied:  (i) Settlement Class Members shall be given adequate notice of the Settlement Hearing; (ii) the Settlement Hearing shall be open to all Settlement Class
      Members; (iii) there shall be no improper impediments to the appearance of any Settlement Class Member at the Settlement Hearing; (iv) the Court shall be advised before the Settlement Hearing that Akorn will rely on the Section 3(a)(10) registration
      exemption based on the Court’s approval of the issuance of the Settlement CVRs as part of the consideration provided in exchange for the settlement and release of the Settled Claims; (v) the Settlement Hearing shall include consideration of the
      fairness of the terms and conditions of the issuance of the Settlement CVRs in exchange for the settlement and release of

    
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    the Settled Claims; (vi) the Order and Final Judgment shall approve the fairness of the terms and conditions of the issuance of the Settlement CVRs in exchange for the settlement and release of the
      Settled Claims; (vii) the Order and Final Judgment shall state that the Settlement CVRs are freely tradable, and exempt from registration under Section 3(a)(10) and any analogous provisions of applicable state securities laws, and that Akorn may
      choose to distribute the Settlement CVRs without registration and compliance with the prospectus delivery requirements of the U.S. securities laws or any analogous state securities laws based on the Court’s findings; and (viii) Lead Counsel will not
      request (and Plaintiffs’ Counsel will not accept) more than 25% of the Settlement CVRs in connection with an award of attorneys’ fees, as set forth in paragraph 21 herein.

    (b)  The Settlement CVRs shall be issued in or substantially in the form set forth in the CVR Agreement.  The Settlement CVRs shall be issued by Akorn only in certificate-less
      (book entry) form.  Akorn shall not issue or otherwise provide any physical certificates for the Settlement CVRs or any portion thereof, except as provided by the CVR Agreement.

    (c)  All Settlement CVRs, including any Settlement CVRs awarded to Plaintiffs’ Counsel as attorneys’ fees, shall be:  (i) valid and binding obligations of Akorn; and (ii) exempt
      from the registration requirements of the Securities Act pursuant to Section 3(a)(10).

    (d)  Upon delivery of the Settlement CVRs to the Escrow Agent, the Escrow Agent shall hold the Settlement CVRs as fiduciary for the benefit of the Settlement Class and, as
      applicable, as Court awarded attorneys’ fees and/or Litigation Expenses in accordance with paragraphs 20 through 25 herein.  None of the Settlement Class Members nor any of Defendants shall have any claim against Lead Plaintiffs, Plaintiffs’ Counsel,
      or any of their agents, relating to the distributions of the Settlement CVRs made in accordance with this Stipulation and the Plan of Allocation approved by the Court.  The Releasing Persons hereby release any and all Claims

    
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    against the Released Persons that arise out of, relate to, or are based on the issuance or transfer of the Settlement CVRs made in accordance with this Stipulation and the CVR Agreement or
      distributions of the Settlement CVRs by Lead Plaintiffs, Lead Counsel, the Escrow Agent, or any of their agents, and shall forever be barred and enjoined from prosecuting any and all such claims against any of the Released Persons, provided, however,
      that the foregoing shall not alter Akorn’s obligations under this Stipulation with respect to the issuance or delivery of the Settlement CVRs or the payment of costs associated therewith to the extent required by paragraph 17(e) herein.

    (e)  Akorn shall be responsible for the payment of all costs associated with the issuance and delivery of the Settlement CVRs, including without limitation, (i) all costs related
      to the transfer of the Settlement CVRs to the Escrow Account and (ii) all costs associated with listing the Settlement CVRs on The NASDAQ Global Market (or any other such national securities exchange); provided, however, that Lead Counsel and Lead
      Plaintiffs shall cooperate reasonably and in good faith with Akorn as to any listing of such Settlement CVRs for trading on The NASDAQ Global Market (or any other such national securities exchange).  However, all costs associated with distributing
      the Settlement CVRs to Authorized Claimants (including any costs incurred by the Trustee) will be paid from the Escrow Account and will constitute Notice and Administration Expenses.

    (f)  After the Effective Date, Lead Counsel may direct the Escrow Agent to sell any amount of Settlement CVRs for the benefit of the Settlement Class.  The Escrow Agent shall
      deposit the proceeds from such sale(s) into the Escrow Account.  Such proceeds shall be distributed to Authorized Claimants in the same manner as the Cash Settlement Amount, according to the

    
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    terms set forth in paragraphs 38 through 40 herein.  Lead Counsel shall have no liability to the Settlement Class for any actions taken with respect to the transfer or sale of the Settlement CVRs
      in accordance with the terms of this Stipulation.

    (g)  Settlement CVRs shall not be distributed by the Escrow Agent until Akorn’s General Counsel receives instructions from Lead Counsel as to the distribution of such Settlement
      CVRs. Such instructions will include, but are not limited to, transferring the Settlement CVRs in accordance with the CVR Agreement and the Applicable Procedures, to the accounts of Authorized Claimants in the amounts directed by the Claims
      Administrator.  Akorn shall authorize the Escrow Agent to distribute the Settlement CVRs in accordance with such instructions.

    (h)  Akorn shall direct the Trustee to provide Lead Counsel with instructions as to all information the Trustee requires, as well as all formatting requirements, to enable the
      transfer of the Settlement CVRs electronically in accordance with the CVR Agreement and the Applicable Procedures, to the accounts of Authorized Claimants.  Such instructions shall include, but are not limited to, any requirements necessary to
      satisfy the guidelines of the Securities Transfer Association, Inc. so that the Proof of Claim Forms to be sent to potential Settlement Class Members capture all such information in the appropriate format, as well as the physical or electronic medium
      for the delivery of such information that the Trustee requires.  Akorn shall direct the Trustee to provide such instructions and review and provide comments, if any, on the Proof of Claim Form within five (5) calendar days of the filing of the motion
      for entry of the Preliminary Approval Order. Any changes made to the Proof of Claim Form at the request of the Trustee shall not be deemed material changes to the Proof of Claim Form.

    
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    (i)  Lead Counsel shall have sole responsibility, on behalf of the Settlement Class, for directing Akorn to instruct the Escrow Agent to transfer in accordance with the CVR
      Agreement and the Applicable Procedures, to the accounts of Authorized Claimants the Settlement CVRs allocable to those claimants.  Any such directions (the “Settlement CVRs Instructions”) given to Akorn or the Escrow Agent by Lead Counsel shall be
      set forth in a writing signed by Lead Counsel and accompanied by such information, and in such physical or electronic medium as specified by the Trustee as set forth in paragraph 17(g) herein, to permit the Settlement CVRs to be immediately
      transferred electronically in accordance with the CVR Agreement and the Applicable Procedures, to the accounts of Authorized Claimants, in such amounts as are appropriate.  Lead Counsel, Akorn, the Escrow Agent, the Claims Administrator, and all
      entities under the direction of Lead Counsel shall cooperate with the Trustee to provide such information as is required for the Settlement CVRs Instructions.  Each of Lead Counsel and the Claims Administrator has the right to rely on the
      instructions provided by the Trustee as to the information it requires, as well as the formatting requirements to enable the transfer of the Settlement CVRs electronically in accordance with the CVR Agreement and the Applicable Procedures, to the
      accounts of Authorized Claimants.  The Trustee, in its sole discretion, may request additional information or reformatting in order to effect the transfer of the Settlement CVRs in accordance with the CVR Agreement and the Applicable Procedures, to
      the accounts of the Authorized Claimants.  Each of Akorn, the Escrow Agent and the Trustee has the right to rely on the accuracy and completeness of the information provided by Lead Counsel or Authorized Claimants with respect to the issuance and
      distribution of the Settlement CVRs.  None of the Defendants, the Escrow Agent or the Trustee shall have any responsibility or liability regarding the accuracy or

    
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    completeness of any information provided by Lead Counsel or any Authorized Claimant in respect to the issuance or distribution of the Settlement CVRs, or any losses incurred in connection
      therewith; however, as discussed in this paragraph and in paragraph 17(g) herein, Akorn and the Trustee are responsible for providing complete and accurate instructions to Lead Counsel and the Claims Administrator with respect to the information and
      formatting required in respect to the issuance or distribution of the Settlement CVRs.  Lead Counsel shall provide Defendants’ Counsel with notice of the Settlement CVRs Instructions at the same time such Settlement CVRs Instructions are delivered to
      Akorn.  Lead Counsel shall not issue the Settlement CVRs Instructions to Akorn with respect to the Settlement CVRs allocable to Authorized Claimants prior to the entry of the Class Distribution Order authorizing the distribution of the Settlement
      CVRs, in whole or part, to Authorized Claimants.

    D.      ADMINISTRATION OF THE SETTLEMENT CONSIDERATION

    18.            In no event shall Defendants have any responsibility, financial obligation, or
      liability whatsoever with respect to the operation, management or disbursement of the Settlement Fund as may be held in the Escrow Account, once established.  Defendants shall likewise have no responsibility whatsoever for the allocation or
      distribution of the Settlement Fund and shall not be responsible or otherwise liable, including to or with Lead Plaintiffs, Lead Counsel, any Settling Parties, the Escrow Agent or the Claims Administrator for any disputes relating to the amount,
      allocation, or distribution of any fees, costs, or awards of any kind.  After the delivery of the Settlement Shares and Settlement CVRs in accordance with paragraphs 12 through 17 herein, Defendants shall not be liable for any additional payments of
      any kind to any Settling Parties or to

    
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    any other person or entity with respect to this Settlement or Stipulation.  However, for the avoidance of doubt, nothing in this paragraph shall relieve Akorn from its obligations pursuant to paragraphs 9 through 11.

    19.            Akorn shall be solely responsible for the delivery of the Settlement Shares and
      the Settlement CVRs, and the D&O Insurers shall be solely responsible for the payment of the Cash Settlement Amount.  In no event shall the Individual Defendants be liable for the payment or delivery of any element of the Settlement
      Consideration.  In no event shall Defendants or their insurers (including, but not limited to, the D&O Insurers) be liable for or required to pay any amounts of any kind to Plaintiffs or Plaintiffs’ Counsel except as expressly set forth herein. 
      For the avoidance of doubt, neither Defendants nor their insurers (including, but not limited to, the D&O Insurers) shall be liable for or required to pay any interest on the Settlement Consideration of any kind and relating to any time period
      (including prior to the transfer of the Settlement Consideration into the Escrow Account) or any amount to Lead Plaintiffs’ or Plaintiffs’ Counsel on account of attorneys’ fees, Litigation Expenses or reimbursement of any other fees or expenses.

     

    

    
      
        	V.	
                USE OF SETTLEMENT FUND

                 

                

              

      

    

    A.      ATTORNEYS’ FEES & LITIGATION EXPENSES

    20.            Lead Counsel will apply to the Court for a collective award of attorneys’ fees to
      Plaintiffs’ Counsel to be paid from (and out of) the Settlement Fund.  Lead Counsel will also apply to the Court for reimbursement of Litigation Expenses.  Lead Counsel’s application for an award of attorneys’ fees and Litigation Expenses is not the
      subject of any agreement between the Litigation Parties other than what is set forth in this Stipulation, and Defendants take no position with respect to Lead Counsel’s request for such fees and expenses.  Defendants shall have

    
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    no responsibility for or liability whatsoever for any notice sent to Settlement Class Members concerning Lead Counsel’s application for an award of attorneys’ fees and Litigation Expenses.

    21.            Lead Counsel shall not request (and Plaintiffs’ Counsel shall not accept) as an
      award of attorneys’ fees more than 25% of each of the Cash Settlement Amount, Settlement Shares (upfront and as they become available), and Settlement CVRs.

    22.            Any attorneys’ fees and/or Litigation Expenses awarded by the Court shall be paid
      to Plaintiffs’ Counsel from any amounts available in the Settlement Fund within fifteen (15) business days of the date on which the Order and Final Judgment is entered, subject to Plaintiffs’ Counsel’s joint and several obligation to make appropriate
      refunds or repayments to the Settlement Fund of the awarded attorneys’ fees and/or Litigation Expenses, plus accrued interest at the same net rate as is earned by the Cash Escrow Fund, if, as a result of any further proceedings, successful collateral
      attack, or otherwise modified by court order, the award of attorneys’ fees and/or Litigation Expenses is reduced or reversed; provided, however, that no Settlement Shares or Settlement CVRs may be sold or distributed by the Escrow Agent prior to the
      Effective Date.  In such case, Plaintiffs’ Counsel shall make the appropriate refund or repayment in full to the Settlement Fund within ten (10) business days after any order reducing or reversing the award of attorneys’ fees and/or Litigation
      Expenses that has become Final.

    23.            Neither Plaintiffs nor Plaintiffs’ Counsel may cancel or terminate the Settlement
      or this Stipulation based on the Court’s or any appellate court’s ruling with respect to attorneys’ fees and/or Litigation Expenses.

    24.            In no event will any Defendant or any of Defendants’ insurers (including, but not
      limited to, the D&O Insurers beyond their obligations under the Applicable Insurance

    
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    Policies) be requested or required to pay, or be liable in any way for, any Plaintiffs’ attorneys’ fees, Litigation Expenses or any other costs, fees or expenses of any kind.

    25.            Lead Counsel shall allocate the attorneys’ fees awarded by the Court among
      Plaintiffs’ Counsel in a manner that it, in good faith, believes reflects the contribution of such counsel to the institution, prosecution and settlement of the Action against the Defendants.  Defendants shall have no responsibility for or liability
      whatsoever with respect to the allocation or award of attorneys’ fees or Litigation Expenses.  The attorneys’ fees and Litigation Expenses that are awarded to Plaintiffs’ Counsel shall be payable solely from the Settlement Fund.

    B.           ADMINISTRATION EXPENSES

    26.            All reasonable Notice and Administration Expenses shall be paid from the
      Settlement Fund when incurred, except that prior to the Effective Date, the Claims Administrator and/or Lead Counsel, as applicable, may only draw on the Settlement Fund in an amount not exceeding $250,000.00 to pay Notice and Administration Expenses
      incurred.  In addition, Taxes, Tax Expenses and fees related to the administration and maintenance of the Escrow Account and investment of the Settlement Fund may be paid from the Settlement Fund as incurred, without further approval of the
      Defendants, their insurers (including, but not limited to, the D&O Insurers) or further order of the Court.  Should there be insufficient Settlement Funds in the Escrow Account to cover Notice and Administration Expenses, Taxes, Tax Expenses or
      fees related to the administration of the Escrow Account, Lead Counsel shall pay any such expenses.  Lead Counsel may subsequently seek reimbursement of any such expenses as Litigation Expenses hereunder.  After the Effective Date, without approval
      of the Defendants, their insurers (including, but not

    
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    limited to, the D&O Insurers) or further order of the Court, Notice and Administration Expenses may be paid from the Settlement Fund as incurred.

    C.           USE & TAX TREATMENT

    27.            (a)    The Litigation Parties agree that the Settlement Fund is intended to be,
      and shall be treated as being, a “qualified settlement fund” within the meaning of Treasury Regulation § 1.468B-1.  Lead Counsel shall administer the Settlement Fund and shall be the administrator within the meaning of Treasury Regulation
      § 1.468B-2(k)(3) (the “Administrator”).

    (b)  Lead Counsel as Administrator shall be solely responsible for filing or causing to be filed all information and other tax returns as may be necessary or appropriate
      (including, without limitation, the returns described in Treasury Regulation § 1.468B-2(k)) for the Settlement Fund.  Lead Counsel as Administrator shall also be responsible for causing payment to be made from the Settlement Fund of any Taxes owed
      with respect to the Settlement Fund.  The Released Persons shall not have any liability or responsibility for any such Taxes.  Upon written request, the Defendants will work with Lead Counsel to produce a combined statement described in Treasury
      Regulation § 1.468B-3(e).

    (c)  Lead Counsel as Administrator shall timely make such elections as are necessary or advisable to carry out this paragraph, including, as necessary, making a “relation back
      election”, as described in Treasury Regulation § 1.468B-1, to cause the qualified settlement fund to come into existence at the earliest allowable date, and shall take or cause to be taken all actions as may be necessary or appropriate in connection
      therewith.

    (d)  All Taxes shall be paid out of the Settlement Fund, and shall be timely paid, by

    
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    the Escrow Agent pursuant to the distribution instructions to be set forth in the Escrow Agreement, and without further order of the Court.  Any tax returns prepared for the Settlement Fund (as
      well as the election set forth therein) shall be consistent with this paragraph and in all events shall reflect that all Taxes on the income earned by the Settlement Fund shall be paid out of the Settlement Fund as provided herein.

    (e)  The Released Persons shall have no responsibility for or liability for the acts or omissions of Lead Counsel or their agents or the Escrow Agent with respect to the payment
      of Taxes as described herein.

    (f)  It is the sole responsibility of the Releasing Persons to pay Taxes or any other taxes, plus any penalties and interest, on any Settlement Consideration received pursuant to
      the Settlement and disbursement of the Settlement Fund that are construed to be income, and the Settlement Fund, Lead Plaintiffs, Plaintiffs’ Counsel, Defendants, their insurers, and Defendants’ Counsel shall have no liability for such taxes,
      penalties or interest.

    28.            This is not a claims-made settlement.  Upon the occurrence of the Effective Date,
      Defendants and/or such other persons or entities funding the Settlement Fund on the Defendants’ behalf, shall not have any right to the return of the Settlement Fund or any portion thereof for any reason.

    
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        	VI.	
                NOTICE AND SETTLEMENT ADMINISTRATION

                 

                

              

      

    

    A.     CLAIMS ADMINISTRATOR & DEFENDANTS’ OBLIGATIONS

    29.            As part of the Preliminary Approval Order, Lead Counsel shall seek appointment of
      the Claims Administrator.  The Claims Administrator shall administer the Settlement, including, but not limited to, the process of receiving, reviewing and approving or denying Claims, under Lead Counsel’s supervision and subject to the jurisdiction
      of the Court.

    30.            Other than Akorn’s obligations pursuant to paragraphs 9 through 17 and 31 herein,
      none of the Defendants, nor any other Released Person, shall have any involvement in, or any responsibility, authority or liability whatsoever for, and will not be requested to or required to pay any costs, fees or expenses in connection with: 
      (i) the administration of the Settlement, including the selection of the Claims Administrator; (ii) providing notice to the Settling Parties; (iii) the Plan of Allocation; (iv) the Class Distribution Order; (v) reviewing, challenging or otherwise
      making determinations concerning Proof of Claim Forms; or (vi) the allocation, disbursement and payment of the Settlement proceeds out of (and from) the Net Settlement Fund.  Defendants and all other Released Persons shall have no liability
      whatsoever to any person or entity, including, but not limited to, Lead Plaintiffs, any other Settlement Class Members or Plaintiffs’ Counsel, in connection with the foregoing.

    B.      NOTICE, SUBMISSION OF PROOF OF CLAIM FORMS & THE PLAN OF ALLOCATION

    31.            In accordance with the terms of the Preliminary Approval Order, Lead Counsel
      shall cause the Claims Administrator to mail the Notice and Proof of Claim Form to those Settlement Class Members as may be identified through reasonable effort.  Lead Counsel shall also cause the Claims Administrator to have the Publication Notice
      published in accordance with

    
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    the terms of the Preliminary Approval Order.  For the purposes of identifying and providing notice to the Settlement Class, Akorn shall cooperate to the extent reasonably necessary, including requesting that the Transfer Agent provide (at no cost to
    the Settlement Fund, Lead Counsel or the Claims Administrator) information in electronic searchable format from Akorn’s transfer records concerning the identity of the Settlement Class Members and their transactions in Akorn’s common stock during the
    Class Period.
    32.            The Claims Administrator shall receive Proof of Claim Forms and determine:  (i)
      whether the Claim is a valid Claim, in whole or in part, and (ii) each Authorized Claimant’s pro rata share of the Net Settlement Fund based upon the Plan of Allocation as approved by the Court.  No
      Defendant, nor any other Released Person, shall have any involvement with or liability, obligation or responsibility for the application of the Court-approved Plan of Allocation.

    33.            The Plan of Allocation to be proposed by Lead Counsel is not a necessary term of
      the Settlement or of this Stipulation and it is not a condition of the Settlement or of this Stipulation that any particular Plan of Allocation be approved by the Court.  Any decision by the Court concerning the Plan of Allocation shall not affect
      the validity of or finality of this Stipulation or Settlement.  Defendants and the other Released Persons shall not object in any way to the Plan of Allocation or any other plan of allocation in this Action.

    C.      DETERMINATION OF AUTHORIZED CLAIMANTS

    34.            For purposes of determining the extent, if any, to which a Settlement Class
      Member shall be entitled to be treated as an Authorized Claimant, the following conditions shall apply:

    
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    (a)  Each Settlement Class Member shall be required to timely submit a Proof of Claim Form, signed under penalty of perjury and supported by such documents as are designated
      therein, including proof of the Claimant’s loss, or such other documents or proof as the Claims Administrator or Lead Counsel, in their discretion, may deem acceptable;

    (b)  All Proof of Claim Forms must be submitted by the date set by the Court in the Preliminary Approval Order and specified in the Notice unless such period is extended by order
      of the Court.  Any Settlement Class Member who fails to submit a valid Proof of Claim Form by such date shall be forever barred from receiving any payment pursuant to this Stipulation and the Settlement (unless, by order of the Court, a later
      submitted Proof of Claim Form by such Settlement Class Member is approved), but shall in all other respects be bound by all of the terms of this Stipulation and the Settlement, including the terms of the Order and Final Judgment to be entered in the
      Action and the releases provided for herein and therein, and will be permanently barred and enjoined from bringing any action, claim or other proceeding of any kind against the Defendants or any other Released Persons concerning the Settled Claims. 
      Provided that it is received before preparation of the distribution of the Net Settlement Fund, a Proof of Claim Form shall be deemed to have been submitted when mailed, if received with a postmark indicated on the envelope and if mailed first-class
      postage prepaid and addressed in accordance with the instructions thereon.  In all other cases, the Proof of Claim Form shall be deemed to have been submitted when actually received by the Claims Administrator;

    (c)  Each Proof of Claim Form shall be submitted to and reviewed by the Claims Administrator, under the supervision of Lead Counsel, who shall determine in accordance with

    
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    this Stipulation and the Court approved plan of allocation, the extent to which, if any, each Claim shall be allowed, subject to review by the Court pursuant to paragraphs 34(d) and 34(e) herein as
      necessary;

    (d)  Proof of Claim Forms that do not meet the submission requirements may be rejected.  Prior to rejection of a Proof of Claim Form, the Claims Administrator shall communicate
      with the Claimant in writing in order to afford the Claimant the opportunity to remedy curable deficiencies in the Proof of Claim Form submitted.  The Claims Administrator, under the supervision of Lead Counsel, shall notify, in a timely fashion and
      in writing, all Claimants whose Claim it proposes to reject in whole or in part, setting forth the reasons therefore, and shall indicate in such notice that the Claimant whose Claim is to be rejected has the right to a review by the Court if the
      Claimant so desires and complies with the requirements of paragraph 34(e) herein; and

    (e)  If any Claimant whose Claim has been rejected in whole or in part desires to contest such rejection, the Claimant must, within twenty (20) calendar days after the date of
      mailing of the notice required in paragraph 34(d) herein, serve upon the Claims Administrator a notice and statement of reasons indicating the Claimant’s grounds for contesting the rejection, along with any supporting documentation, and requesting a
      review thereof by the Court.  If a dispute concerning a Claim cannot be otherwise resolved, Lead Counsel shall thereafter present the request for review to the Court.

    35.            Each Claimant shall be deemed to have submitted to the jurisdiction of the Court
      with respect to the Claimant’s Claim, and the Claim will be subject to investigation and

    
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    discovery under the Federal Rules of Civil Procedure, provided that such investigation and discovery shall be limited to that Claimant’s status as a Settlement Class Member and the validity and amount of the Claimant’s
      Claim.  No discovery shall be allowed on the merits of the Action or the Settlement, including from any Defendant, for any reason.

    36.            All proceedings with respect to the administration, processing and determination
      of Claims and the determination of all controversies relating thereto, including disputed questions of law and fact with respect to the validity of any Claims, shall be subject to the jurisdiction of the Court.  All Settling Parties expressly waive
      trial by jury (to the extent any such right may exist) and any right of appeal or review with respect to such determinations.

    37.            All Authorized Claimants shall, as part of the Proof of Claim Form, execute an
      individual release of the Released Persons upon the same terms as set forth herein, as a condition precedent to receipt of any part of any disbursement from the Settlement Fund, but the failure of any Authorized Claimant to execute such a release
      shall not in any way affect the validity of the releases provided by Releasing Persons in favor of Released Persons herein, and the Releasing Persons shall nonetheless be bound by the terms of those releases.  Further, the failure of any Releasing
      Person to make a claim on the Settlement Fund shall not affect the validity and effectiveness of the release provided herein in favor of Released Persons, as to that Releasing Person.  Lead Counsel and/or the Claims Administrator shall retain copies
      of the individual releases executed by Authorized Claimants referred to in this paragraph for at least three (3) years after the distribution of the Net Settlement Fund by the Claims Administrator and shall provide copies of individual releases to
      Defendants’ Counsel at no expense if requested to do so.

    
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    D.   DISTRIBUTION OF THE SETTLEMENT FUND

    38.            Lead Counsel will apply to the Court, on notice to Defendants’ Counsel, for a
      Class Distribution Order:  (i) approving the Claims Administrator’s administrative determinations concerning the acceptance and rejection of the Claims submitted; (ii) approving payment of any administration fees and expenses associated with the
      administration and disbursement of the Settlement Fund from the Escrow Account; and (iii) if the events listed in paragraph 39 herein have occurred, directing payment of the Net Settlement Fund to Authorized Claimants.

    39.            The Net Settlement Fund shall be distributed to Authorized Claimants by the
      Claims Administrator and the Transfer Agent, as appropriate, only after the Effective Date and after:  (i) all Proof of Claim Forms have been processed, and all Claimants whose Claims have been rejected or disallowed, in whole or in part, have been
      notified and provided the opportunity to be heard concerning such rejection or disallowance; (ii) all objections with respect to all rejected or disallowed Claims have been resolved by the Court, and all appeals therefrom have been resolved or the
      time therefore has expired; (iii) all matters with respect to attorneys’ fees, Litigation Expenses, costs, and disbursements have been resolved by the Court, all appeals therefrom have been resolved or the time therefore has expired; and (iv) all
      Notice and Administration Expenses, Taxes and Tax Expenses have been paid from the Settlement Fund.

    40.            Lead Counsel shall be solely responsible for supervising the administration of
      the Settlement and distribution of the Net Settlement Fund by the Claims Administrator, the Transfer Agent and the Trustee, as appropriate, subject to Court approval.  Lead Counsel shall

    
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    have the right, but not the obligation, to waive what they deem to be formal or technical defects in any Proof of Claim Forms submitted in the interests of achieving substantial justice.

    41.            Payment from the Settlement Fund pursuant to this Stipulation shall be deemed
      final and conclusive against all Settlement Class Members.  All Settlement Class Members whose Claims are not approved for payment shall be barred from participating in distributions from the Net Settlement Fund, but otherwise shall be bound by all
      of the terms of this Stipulation and the Settlement, including the terms of the Order and Final Judgment to be entered in the Action and the releases provided for herein and therein, and will be permanently barred and enjoined from bringing any
      action against the Released Persons with respect to any and all of the Settled Claims.

    42.            No person or entity shall have any claim against Lead Plaintiffs, Lead Counsel,
      the Claims Administrator or any other agent designated by Lead Counsel, or the Releasing Persons and/or their respective counsel, arising from distributions made from the Settlement Fund substantially in accordance with this Stipulation, the Court
      approved plan of allocation, the Class Distribution Order, or any other order of the Court.  Lead Plaintiffs and Defendants, and their respective counsel and all other Settling Parties, shall have no liability whatsoever for the sale or transfer of
      the Settlement Shares or Settlement CVRs, investment or distribution of the Settlement Fund or the Net Settlement Fund, the Plan of Allocation, or the determination, administration, calculation, or payment of any Claim by or non-performance of the
      Claims Administrator, the payment or withholding of Taxes and Tax Expenses (including interests and penalties) owed by the Settlement Fund, or any losses incurred therewith.

    43.            If the funds remaining in the Settlement Fund following pro rata distribution(s) to all Authorized Claimants are an amount that is not cost effective or efficient to

    
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    redistribute to Authorized Claimants, then such remaining funds, after payment of any further Notice and Administration Expenses, Taxes and Tax Expenses, shall be contributed to a non-sectarian, not-for profit
      organization recognized as tax-exempt under Internal Revenue Code § 501(c)(3) to be designated by the Court.

    E.   REQUEST FOR EXCLUSION FROM THE SETTLEMENT CLASS

    44.            Any Settlement Class Member wishing to become an Opt-Out must timely mail a
      signed, written request for exclusion from the Settling Parties to the Claims Administrator, within the time and in accordance with the criteria and containing the information set forth in the Preliminary Approval Order and in the Notice.  Unless
      amended by the Court, the Preliminary Approval Order, attached as Exhibit A hereto, shall provide that requests for exclusion shall be received no later than twenty-one (21) calendar days prior to the Settlement Hearing.  Opt-Outs shall not be bound
      by this Settlement and the releases described herein, shall have no entitlement to or claim upon all or any part of the Settlement Fund, and shall not receive any payment pursuant to the Settlement.

    45.            Lead Counsel, subject to review by the Court, shall be responsible for
      determining whether a request for exclusion is timely and valid, in accordance with the criteria specified in the Court’s Preliminary Approval Order and in the Notice.  To be valid, a request for exclusion must comply fully with the criteria
      specified in the Preliminary Approval Order and in the Notice, and contain all of the information specified in the Preliminary Approval Order and in the Notice.  If a request for exclusion is untimely, or is invalid because it does not otherwise
      comply with the criteria or contain all of the information specified in the Court’s Preliminary Approval Order and in the Notice, then it shall be void and of no effect, and that Settlement Class Member

    
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    shall remain part of the Settling Parties in this Action and shall be bound by all of the terms of this Stipulation and Settlement, including the terms of the Order and Final Judgment to be entered in the Action and
      the releases provided for herein, and will be barred and enjoined from bringing any action against the Released Persons concerning the Settled Claims.  Any disputes regarding whether or not a request for exclusion is timely and valid, and thus
      effective, shall be resolved by the Court.

     

    

    
      
        	VII.	
                FINAL APPROVAL OF SETTLEMENT

                 

                

              

      

    

    46.            At the Settlement Hearing, Lead Counsel and Defendants’ Counsel shall request
      that the Court enter an Order and Final Judgment in or substantially in the form attached hereto as Exhibit B (with annexes, if any) finding, pursuant to Rule 23(e) of the Federal Rules of Civil Procedure, the Settlement to be fair, reasonable and
      adequate to the class, and, with regard to the Settlement Shares and Settlement CVRs being issued as part of the Settlement Fund that:  (i) the terms and conditions of the proposed issuances are fair to all those who will receive such securities in
      the proposed exchange; and (ii) the terms and conditions of, and the procedures for, the proposed issuances are fair.  Pursuant to Section 3(a)(10), the Court’s judgment of the fairness of the Settlement shall serve as a substitute for the
      registration requirements of the Securities Act with regard to any Settlement Shares or Settlement CVRs.

    

    

    
      
        	VIII.	
                EFFECTIVE DATE OF SETTLEMENT

                 

                

              

      

    

    47.            The Effective Date of this Settlement shall be the earliest date upon which all
      of the following shall have occurred:

    (a)  the Preliminary Approval Order has been entered by the Court;

    
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    (b)  the Settlement Consideration (other than any Settlement Shares that are not Available Settlement Shares as of the date the Order and Final Judgment has become Final) has
      been transferred into the Escrow Account;

    (c)  the Court has approved the Settlement, following Notice to the Settlement Class and the Settlement Hearing, as prescribed by Rule 23 of the Federal Rules of Civil Procedure;
      and

    (d)  the Order and Final Judgment has been entered by the Court and has become Final.

     

    

    
      
        	IX.	
                TERMINATION

                 

                

              

      

    

    48.            Defendants or Lead Plaintiffs shall have the right to terminate the Settlement
      and this Stipulation by providing a Termination Notice to counsel for all other signatories hereto, within five (5) calendar days of:  (i) the Court’s refusal to certify the Settlement Class as agreed by the Litigation Parties in paragraph 3 herein,
      or any amendment by the Court of the scope of the Settlement Class; (ii) the Court’s refusal to enter the Preliminary Approval Order in any material respect; (iii) Defendants’ failure to comply with their obligations concerning payment of the
      Settlement Consideration pursuant to paragraphs 9 through 17 herein; (iv) the Court’s refusal to approve this Stipulation or any material part of it; (v) the Court’s refusal to enter an Order and Final Judgment in or substantially in the form
      attached hereto as Exhibit B; or (vi) any material modification, vacatur or reversal of the Order and Final Judgment by a United States Court of Appeals or the United States Supreme Court.  For the avoidance of doubt, no decision or proceeding,
      whether in this Court or any appellate court, with respect to an application for attorneys’ fees or reimbursement of Litigation Expenses or with respect to any plan of

    
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    allocation:  (i) shall be considered material to the Settlement, (ii) shall affect the finality of any Order and Final Judgment, if applicable, or (iii) shall be grounds for termination of the Settlement.
    49.            In addition to the grounds set forth in paragraph 48 herein, Defendants shall
      have the unilateral right to terminate the Settlement and this Stipulation, and render them null and void and of no further effect, in the event that Settlement Class Members who purchased or acquired, in aggregate, in excess of a certain number of
      shares of Akorn common stock during the Class Period (such number as agreed upon by the Litigation Parties) (the “Termination Threshold”), timely and validly request exclusion from the Settlement Class in accordance with the provisions of
      paragraphs 44 and 45 herein, within the time and in accordance with the criteria set forth in the Preliminary Approval Order and in the Notice.

    (a)  The Litigation Parties agree to maintain the confidentiality of the Termination Threshold, which is set forth in the Supplemental Agreement Regarding Requests for Exclusion
      (the “Supplemental Agreement”) that is simultaneously herewith being executed by Defendants’ Counsel and Lead Counsel.  The Supplemental Agreement shall not be filed with the Court and its terms shall not be disclosed in any other manner (other than
      the statements herein and in the Notice, to the extent necessary, or as otherwise provided in the Supplemental Agreement) unless and until the Court otherwise directs or a dispute arises between Lead Plaintiffs and the Defendants concerning the
      interpretation or application of the Supplemental Agreement, in which event the Litigation Parties shall submit the Supplemental Agreement to the Court in camera and request that the Court afford it confidential treatment.

    
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    (b)  With respect to this paragraph, no later than twenty-one (21) calendar days prior to the Settlement Hearing, the Claims Administrator shall provide Defendants’ Counsel with
      (i) copies of any and all requests for exclusion from the Settlement Class herein received by the Claims Administrator, (ii) a list of all persons or entities requesting exclusion, (iii) a list of shares of Akorn common stock purchased or acquired
      during the Class Period by each of those persons or entities (to the extent provided to the Claims Administrator), (iv) an accounting of the aggregate losses claimed to have been suffered by all persons or entities requesting exclusion, and (v) a
      report by Lead Counsel identifying which requests for exclusion Lead Counsel has determined to be timely and valid under the criteria specified in the Preliminary Approval Order and the Notice, and therefore which putative Settlement Class Members
      are deemed to be Opt-Outs.  With respect to this paragraph, no later than fourteen (14) calendar days prior to the Settlement Hearing, the Claims Administrator shall provide Defendants’ Counsel with a representation that all requests for exclusion
      received have been copied and provided to Defendants’ Counsel.

    (c)  Defendants shall be entitled to exercise the right referenced in this paragraph to terminate the Settlement and this Stipulation only if Defendants’ provide Lead Counsel
      with a Termination Notice and file that notice with the Court no later than 5:00 p.m. Eastern time on the third (3rd) business day prior to the Settlement Hearing.

    (d)  Lead Counsel may attempt to cause the retraction of any request for exclusion made by any Opt-Out prior to the Settlement Hearing.  If Lead Counsel succeeds in causing the
      retraction of sufficient requests for exclusion such that the remaining Opt-Outs do not satisfy the requirements of the Termination Threshold, then Defendants’ Termination Notice automatically

    
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    shall be deemed a nullity.  To retract a request for exclusion, an Opt-Out must, prior to the Settlement Hearing, file a written notice with the Court stating his, her, or its desire to retract the
      request for exclusion from the Settlement Class and to be bound by the Settlement, this Stipulation, and any Order and Final Judgment entered herein, provided, however, that the filing of such written notice of retraction may be effected by Lead
      Counsel.

    (e)  Any dispute among the Settling Parties concerning the interpretation or application of this paragraph and the Supplemental Agreement shall be presented to the Court for
      resolution upon the application of any party hereto.

    50.            If a right to terminate this Stipulation and Settlement arises under either of
      paragraphs 48 or 49 herein:  (i) neither the Defendants nor Lead Plaintiffs (as the case may be) will be required for any reason or under any circumstance to exercise that right; and (ii) any exercise of that right shall be made in good faith, but in
      the sole and unfettered discretion of the Defendants or Lead Plaintiffs, as applicable.

    51.            In the event that the Settlement is terminated or any of the requirements of the
      Effective Date specified in paragraph 47 herein are, for any reason, not satisfied, this Stipulation and Settlement shall be null and void, without prejudice, and none of its terms, including, but not limited to, the certification of the Settlement
      Class, the appointment of class representatives, and the appointment of class counsel, shall be effective or enforceable, except that paragraphs 51, 52 and 61 herein shall survive such termination; the Settling Parties shall be deemed to have
      reverted to their respective litigation positions in the Action immediately prior to the date of this Stipulation; the Settling Parties shall proceed in all respects as if this Stipulation

    
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    and any related orders had not been entered; neither Lead Plaintiffs nor any other putative Claimant may use the fact of execution of this Stipulation consenting to certification of a class solely for settlement
      purposes as a basis to argue that Defendants have in any way circumscribed, limited or waived their ability to oppose, for any reason, certification of a class other than for settlement purposes; and the fact and terms of the Settlement, this
      Stipulation and all settlement discussions shall not be admissible in any trial of this Action or any other proceeding, including, but not limited to, for the purposes of obtaining certification of a class other than for settlement purposes, and
      shall not be used by Lead Plaintiffs against or to the prejudice of the Defendants or by the Defendants against or to the prejudice of Lead Plaintiffs in any court filings, depositions, at trial, or otherwise.

    52.            In the event the Settlement is terminated or any of the requirements of the
      Effective Date specified in paragraph 47 herein are, for any reason, not satisfied, then the Settlement Consideration previously paid on behalf of or by the Defendants, together with any interest and earnings thereon and including repayment of any
      attorneys’ fees or Litigation Expenses disbursed pursuant to paragraphs 20 through 25 herein (together with interest thereon), less any Taxes and/or Tax Expenses paid or due, and less any Notice and Administration Expenses actually incurred and paid
      or payable from the Settlement Fund pursuant to paragraphs 26 and 27 herein, shall be returned to the entity or entities that deposited the Settlement Consideration into the Escrow Account on Defendants’ behalf, within ten (10) business days after
      written notification of such event.  For the avoidance of doubt, in the event that the Settlement is terminated, any Settlement Shares previously issued shall be returned to Akorn and such Settlement Shares shall become unissued shares.  At the
      request of Defendants, the Escrow Agent shall apply for any tax

    
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    refund owed on the amounts in the Escrow Account and pay the proceeds, after any deduction of any fees or expenses incurred in connection with such application(s), for refund to the applicable funder or as otherwise
      directed.

     

    

    
      
        	X.	
                MISCELLANEOUS PROVISIONS

                 

                

              

      

    

    A.   ENTIRE AGREEMENT

    53.            All of the exhibits attached hereto are hereby incorporated by reference as
      though fully set forth herein.  Notwithstanding the foregoing, in the event that there exists a conflict or inconsistency between the terms of this Stipulation and the terms of any exhibit attached hereto, the terms of the Stipulation shall prevail.

    54.            This Stipulation and its exhibits constitute the entire agreement among the
      Settling Parties concerning the Settlement of the Action, and no representation, warranties, or inducements have been made by any party hereto concerning this Stipulation and its exhibits other than those contained and memorialized in such documents.

    B.   FINAL & COMPLETE RESOLUTION

    55.            The Litigation Parties intend this Stipulation and the Settlement to be a final
      and complete resolution of all Settled Claims between the Settling Parties.  Accordingly, Plaintiffs and Plaintiffs’ Counsel and Defendants and Defendants’ Counsel agree not to assert in any forum that this Action was brought by, prosecuted in, or
      defended in bad faith or without a reasonable basis.  No Settling Party shall assert any claims of or make any application for sanctions for violation of Rule 11 of the Federal Rules of Civil Procedure or other court rule or statute with respect to
      any claims or defenses asserted in this action.

    
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    56.            The Stipulation shall be binding upon, and inure to the benefit of, the
      successors and assigns of the Settling Parties.

    C.   PUBLICITY

    57.            In no event shall Lead Plaintiffs, Plaintiffs’ Counsel, Defendants, or
      Defendants’ Counsel make any public statement that disparages the business or reputation of any of the other Settling Parties, their counsel, or Released Persons (including, without limitation, Akorn and its officers, directors, management and
      employees).  Nothing in this provision prevents Plaintiffs’ Counsel from (a) describing their role in this Action in conversations with Settlement Class Members in the course of giving legal advice regarding the terms of the Settlement, or (b) making
      statements about Defendants in proceedings before the Court or any court considering this Action.

    58.            Although Defendants retain their right to deny that the Claims asserted in the
      Action were meritorious, Defendants and Defendants’ Counsel will not assert to any media representative (whether or not for attribution) that the Action was commenced or prosecuted in bad faith, nor will they deny that the Action was commenced and
      prosecuted in good faith and is being settled voluntarily after consultation with competent legal counsel.  In all events, Plaintiffs and Plaintiffs’ Counsel and Defendants and Defendants’ Counsel shall not make any accusations of wrongful or
      actionable conduct by any Litigation Party concerning the prosecution, defense and resolution of the Action, and shall not otherwise suggest that the Settlement constitutes an admission of any Claim or defense alleged.

    
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    D.   CONTRIBUTIONS

    59.            This Stipulation shall not be construed more strictly against one party than
      another merely by virtue of the fact that it, or any part of it, may have been prepared initially by counsel for one of the Litigation Parties, it being recognized that it is the result of arm’s-length negotiations between the Litigation Parties and
      that all Litigation Parties have contributed substantially and materially to the preparation of this Stipulation.

    E.   PRESERVATION OF DOCUMENTS

    60.            Defendants will take reasonable steps to retain and preserve any documents,
      information (including electronically stored information) and other evidence potentially relevant to continuing litigation, if any, against the D&O Insurers.  For the avoidance of doubt, no Defendant shall have any obligation to provide any
      documents, information or other evidence:  (a) protected by the attorney-client privilege, joint defense privilege or other work product doctrine; or (b) reflecting legal advice provided to Defendants by Defendants’ Counsel concerning the allegations
      in the Action.

    F.   NO ADMISSION OF WRONGDOING

    61.            This Stipulation, whether or not consummated, and any proceedings taken pursuant
      to it:

    (a)  shall not be offered or received against any Defendant or Released Person as evidence of, or construed as or deemed to be evidence of, any presumption, concession, or
      admission by any Defendant or Released Person with respect to the truth of any fact alleged by any of the Plaintiffs or the validity of any Settled Claim that has been or could have been asserted

    
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    in the Action or in any litigation, or the deficiency of any defense that has been or could have been asserted in the Action or in any litigation, or of any liability, negligence, fault or wrongdoing of any Defendant or Released Person;
    (b)  shall not be offered or received against any Defendant or Released Person as evidence of a presumption, concession or admission of any fault, misrepresentation or omission
      with respect to any statement or written document approved or made by any Defendant or Released Person;

    (c)  shall not be offered or received against any Defendant or Released Person as evidence of a presumption, concession or admission with respect to any liability, negligence,
      fault or wrongdoing, or in any way referred to for any other reason as against any Defendant or Released Person, in any other civil, criminal or administrative action or proceeding, other than such proceedings as may be necessary to effectuate the
      provisions of this Stipulation; provided, however, that if this Stipulation is approved by the Court, the Settling Parties may refer to it to effectuate the liability protection granted them hereunder;

    (d)  shall not be construed against any Defendant or Released Person as an admission or concession that the consideration to be given hereunder represents the amount which could
      or would have been recovered after trial; and

    (e)  shall not be construed as or received in evidence as an admission, concession or presumption against Lead Plaintiffs or any of the Releasing Persons that any of their claims
      are without merit, or that any defenses asserted by any Defendants have any merit, or that damages recoverable under the Second Amended Complaint would not have exceeded the Settlement

    
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    Consideration or the Settlement Fund.

    G.   AMENDMENT, MODIFICATION & WAIVER

    62.            The terms of this Stipulation, as reflected in this Stipulation, may not be
      modified or amended, nor may any of its provisions be waived, except by a writing signed by both Lead Plaintiffs and each Defendant (or their successors-in-interest).

    63.            The waiver by any one signatory to this Stipulation of any breach of this
      Stipulation by any other party shall not be deemed a waiver of any other prior or subsequent breach of this Stipulation.  Any such waiver shall be made on behalf of the party waiving the breach, and will not constitute a waiver by any other party.

    H.   HEADINGS

    64.            The headings herein (including any and all subheadings) are used for the purpose
      of convenience only and are not meant to have legal effect.

    I.    JURISDICTION OF THE COURT

    65.            The administration and consummation of the Settlement as embodied in this
      Stipulation shall be under the authority of the Court, and the Court shall retain jurisdiction for the purpose of entering orders providing for awards of attorneys’ fees and Litigation Expenses to Plaintiffs’ Counsel and enforcing the terms of this
      Stipulation, including the Plan of Allocation (or such other plan of allocation as may be approved by the Court) and the distribution of the Net Settlement Fund to Settlement Class Members, except that the CVR Agreement and all suits, actions,
      proceedings, claims and causes of action (whether in contract or tort) based upon, arising

    
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    out of or relating to the CVR Agreement shall be subject to the exclusive jurisdiction of the court as stated therein.

     J.      CHOICE OF LAW

    66.            The construction, interpretation, operation, effect and validity of this
      Stipulation and all documents necessary to effectuate it, shall be governed by the internal laws of the State of New York without regard to conflicts of laws, except to the extent that federal law requires that federal law governs.

    K.     VENUE & MULTI DISTRICT LITIGATION

    67.            In the event that any Additional Securities Action shall be commenced in a court
      other than the Northern District of Illinois, Defendants shall promptly move pursuant to 28 U.S.C. § 1404 and/or § 1407 to transfer such Additional Securities Action to the Northern District of Illinois.

    68.            Upon transfer of such Additional Securities Action to the Northern District of
      Illinois, the Litigation Parties shall jointly request and take all steps necessary to effect the reassignment of such action to the Court’s docket pursuant to Local Rule 40.4 and the stay of such action pursuant to the Stay Order.

    L.     EXECUTION

    69.            This Stipulation may be executed in one or more counterparts, including by
      signature transmitted by facsimile or email.  All executed counterparts and each of them shall be deemed to be one and the same instrument.

    
      68

      
        

    

    M.     NOTICE

    70.            If any Settling Party is required to give notice to another Settling Party under
      this Stipulation, such notice shall be in writing and shall be deemed to have been duly given upon receipt of hand delivery or facsimile or email transmission, with confirmation of receipt.  Notice shall be provided as follows:

    

    

    	
            If to Lead Plaintiffs or Plaintiffs’ Counsel:   

          	
            Entwistle & Cappucci LLP

            Attn:  Andrew J. Entwistle, Esq.

            500 W. 2nd Street, Suite 1900-16

            Austin, TX  78701

            Tel.:  (512) 710-5960

            aentwistle@entwistle-law.com

             

            

          
	
            If to Defendants or Defendants’ Counsel:   

          	
            Cravath, Swaine & Moore LLP

            Attn:  Robert H. Baron, Esq.

            Worldwide Plaza

            825 Eighth Avenue

            New York, NY  10019

            Tel.:  (212) 474-1000

            rbaron@cravath.com

             

            

                       -and-

             

            

            Figliulo & Silverman, P.C.

            Attn:  James R. Figliulo

            10 S. LaSalle Street, Suite 3600

            Chicago, IL 60603

            Tel.:  (312) 251-4600

            jfigliulo@fslegal.com

          

    

    

    

    

    
      69

      
        

    

    N.      AUTHORITY OF COUNSEL

    71.            All counsel and any other person executing this Stipulation and any of the
      exhibits hereto, or any related settlement documents, warrant and represent that they have the full authority to do so and that they have the authority to take appropriate action required or permitted to be taken pursuant to this Stipulation to
      effectuate its terms.

     

    

    Dated:   August 9, 2019

    
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             Dated:  August 9, 2019.

          	
            CRAVATH, SWAINE & MOORE LLP

             

            

            /s/ Robert H. Baron                                                                              

            Robert H. Baron (admitted pro hac vice)

            Worldwide Plaza

            825 Eighth Avenue

            New York, NY  10019

            Tel.:  (212) 474-1000

            rbaron@cravath.com

             

            

            FIGLIULO & SILVERMAN, P.C.

            James R. Figliulo

            10 S. LaSalle Street, Suite 3600

            Chicago, IL 60603

            Tel.:  (312) 251-4600

            jfigliulo@fslegal.com

             

            

            Attorneys for Defendants

          

    

    

    

    

    
      1

      
        

    

    

    

    	
            Dated:  August 9, 2019.

          	
            ENTWISTLE & CAPPUCCI LLP

             

            

            /s/ Andrew J. Entwistle                                                                      

            Andrew J. Entwistle

            500 W. 2nd Street, Suite 1900-16

            Austin, TX  78701

            Tel.:  (512) 710-5960

            aentwistle@entwistle-law.com

             

            

            Joshua K. Porter (admitted pro hac vice)

            Brendan Brodeur (admitted pro hac vice)

            Andrew M. Sher (admitted pro hac vice)

            299 Park Avenue, 20th Floor

            New York, NY  10017

            Tel.:  (212) 894-7200

            jporter@entwistle-law.com

            bbrodeur@entwistle-law.com

            asher@entwistle-law.com

             

            

            Attorneys for Lead Plaintiffs

          

    

    

    
      2

      
        

    

    
    Exhibit A

    

    

    

    

    

    

    
      1

      
        

    

    Exhibit A

    

    

    UNITED STATES DISTRICT COURT

    NORTHERN DISTRICT OF ILLINOIS

      EASTERN DIVISION

    

    

    	
             

            

             

            

             

            

            IN RE AKORN, INC. DATA INTEGRITY SECURITIES LITIGATION

             

            

             

            

             

            

             

            

          	
                

             

            

             

            

                Civ. A. No. 1:18-cv-01713

             

            

            Hon. Matthew F. Kennelly

          

    

    

    [PROPOSED] ORDER PRELIMINARILY APPROVING SETTLEMENT, APPROVING

     FORM OF CLASS NOTICE, AND SETTING HEARING DATE FOR FINAL

     APPROVAL OF SETTLEMENT

    WHEREAS, a consolidated class action is pending before this Court entitled In re Akorn, Inc. Data Integrity Securities Litigation, Civ. A. No. 1:18-cv-01713 (the “Action”);

    WHEREAS, the parties to the Action consist of (a) lead plaintiffs Gabelli & Co. Investment Advisors, Inc. and Gabelli Funds, LLC (the “Lead Plaintiffs”), on behalf of themselves and the
      Settlement Class; and (b) defendants Akorn, Inc.,  (“Akorn”) and individual defendants Ronald M. Johnson, Duane A. Portwood, Rajat Rai, Brian Tambi and Alan Weinstein
        (collectively, the “Defendants” and, together with Lead Plaintiffs, the “Litigation Parties”), have determined to settle all claims asserted against Defendants in this Action with prejudice (the
        “Settlement”) on the terms and conditions set forth in the Stipulation and Agreement of Settlement filed with the Court on August 9, 2019 (the “Stipulation”),1 subject to approval of this Court;

    WHEREAS, On May 31, 2019, plaintiffs Twin Master Fund, Ltd., Twin Opportunities Fund, LP and Twin Securities, Inc. filed a complaint against Defendants in the Northern District

     

    

     

    

    

    

    

    1 All capitalized words or terms not otherwise defined in this Order shall have the meanings ascribed to those words or terms in the
      Stipulation.

     

    
      
        

    

    
    of Illinois, alleging violations of Sections 10(b), 18 and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder, as well as one count of common law fraud (the “Twin Funds
      Action”);

    WHEREAS, On July 11, 2019, plaintiffs Manikay Master Fund, LP and Manikay Merger Fund, LP filed a complaint against Defendants in the Northern District of Illinois, alleging violations of
      Sections 10(b), 18 and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder, as well as one count of common law fraud (the “Manikay Funds Action”);

    WHEREAS, both the Twin Funds Action and Manikay Funds Action have been found related to the Action and reassigned
      to the Hon. Matthew F. Kennelly;

    WHEREAS, Lead Plaintiffs have made an application, pursuant to Rule 23 of the Federal Rules of Civil Procedure, for an order preliminarily approving the Settlement in accordance with the Stipulation,
      certifying the Settlement Class for purpose of the Settlement only, and authorizing notice to Settlement Class Members as more fully described herein; and

    WHEREAS, the Court has read and considered: (a) Lead Plaintiffs’ Motion for Preliminary Approval of Settlement, Approval of Form of Class Notice, and a Hearing Date for Final Approval of Settlement
      and the Memorandum of Law in support thereof; and (b) the Stipulation and the exhibits attached thereto;

    NOW THEREFORE, IT IS HEREBY ORDERED:

    1.            Class Certification for Settlement Purposes – Pursuant to Rule 23 of the
      Federal Rules of Civil Procedure, the Court certifies, solely for purposes of effectuating the proposed Settlement, a class consisting of all persons and entities that purchased or otherwise acquired shares of Akorn’s common stock during the period
      from November 3, 2016 through January 8, 2019, inclusive (the “Class Period”), and were damaged thereby, including any and all of their respective successors in interest, predecessors, representatives, trustees, executors, administrators,

    
      2

      
        

    

    heirs, assigns or transferees, immediate and remote, and any person or entity acting for or on behalf of, or claiming under, any of them (the “Settlement Class” and its members the “Settlement Class Members”). 
      Excluded from the Settlement Class are: (i) Defendants; (ii) any person who was an officer, director or managing agent of Akorn or any of its subsidiaries or affiliates at any point during the Class Period; (iii) members of the immediate family of
      any of the foregoing individuals; (iv) any affiliate of Akorn; (v) any entity in which any Defendant has or had a controlling interest; and (vi) the legal representatives, heirs, predecessors, successors or assigns of any of the foregoing.  Also
      excluded from the Settlement Class are any persons and entities who validly exclude themselves from the Settlement Class by timely filing a request for exclusion in accordance with the requirements set forth in paragraph 14 herein and the Notice.

    2.            Class Findings – Pursuant to Rule 23(e)(1)(B)(ii) of the Federal Rules of
      Civil Procedure, the Court finds that, for purposes of the proposed Settlement only, it will likely be able to certify the Settlement Class.  Specifically, the Court finds that each element required for certification of the Settlement Class pursuant
      to Rule 23 of the Federal Rules of Civil Procedure has been met or will likely be met for purposes of the proposed Settlement only:  (a) the members of the Settlement Class are so numerous that their joinder in the Action would be impracticable;
      (b) there are questions of law and fact common to the Settlement Class which predominate over any individual questions; (c) the claims of Lead Plaintiffs in the Action are typical of the claims of the Settlement Class; (d) Lead Plaintiffs and Lead
      Counsel have and will fairly and adequately represent and protect the interests of the Settlement Class; and (e) a class action is superior to other available methods for the fair and efficient adjudication of the Action.

    3.            The Court hereby finds and concludes that pursuant to Rule 23 of the Federal Rules of Civil Procedure, and for the purposes
      of the Settlement only, Lead Plaintiffs Gabelli & Co.

    
      3

      
        

    

    Investment Advisors, Inc. and Gabelli Funds, LLC are adequate class representatives and certifies them as class representatives for the Settlement Class.  The Court also appoints Lead Counsel Entwistle & Cappucci
      LLP as class counsel for the Settlement Class, pursuant to Rule 23(g) of the Federal Rules of Civil Procedure.

    4.            Preliminary Approval of the Settlement – The Court hereby preliminarily
      approves the Settlement, as embodied in the Stipulation, and finds, pursuant to Rule 23(e)(1)(B)(i) of the Federal Rules of Civil Procedure, that it will likely be able to finally approve the Settlement under Rule 23(e)(2) as being fair, reasonable,
      and adequate to the Settlement Class, subject to further consideration at the Settlement Hearing to be conducted as described below.

    5.            Settlement Hearing – The Court will hold a settlement hearing (the
      “Settlement Hearing”) on ________, 2019 at ____ a.m. in Courtroom 2103, 219 South Dearborn Street, Chicago, Illinois, for the following purposes:

    (a)            to determine whether the proposed Settlement on the terms and conditions provided for in the Stipulation is fair,
      reasonable, and adequate to the Settlement Class, and should be granted final approval by the Court;

    (b)            to determine, for purposes of the Settlement only, whether: (i) the Settlement Class should be finally certified; (ii) Lead
      Plaintiffs should be finally certified as the Class Representatives for the Settlement Class; (iii) the law firm of Entwistle & Cappucci LLP should be finally appointed as Class Counsel for the Settlement Class;.

    (c)            to determine whether an Order and Final Judgment substantially in the form attached as Exhibit B to the Stipulation should
      be entered providing for the form of release set forth therein and dismissing the Action with prejudice;

    
      4

      
        

    

    (d)            to determine whether the terms and conditions of the issuance of the Settlement Shares pursuant to an exemption from
      registration requirements under Section 3(a)(10) of the Securities Act are fair to all persons and entities to whom the shares will be issued;

    (e)            to determine whether the proposed Plan of Allocation should be approved as fair and reasonable;

    (f)            to determine whether Lead Counsel’s anticipated application for an award of attorneys’ fees and reimbursement of expenses
      should be approved; and

    (g)            to consider any other matters that may properly be brought before the Court in connection with the Settlement.  Notice of
      the Settlement and the Settlement Hearing shall be given to Settlement Class Members as set forth in paragraph 8 of this Order.

    6.            The Court may adjourn the Settlement Hearing without further notice to the Settlement Class and may approve the proposed
      Settlement with such modifications as the Litigation Parties may agree to, if appropriate, without further notice to the Settlement Class.

    7.            CAFA Notice – At least seven (7) calendar days before the Settlement Hearing, Defendants shall cause to be served on Lead Counsel and filed with the Court proof, by affidavit or declaration, of compliance with 28 U.S.C. § 1715(b),
      requiring Defendants to serve within ten (10) calendar days following the filing of the Stipulation with the Court notice of the proposed Settlement on the appropriate State official of each state in which a class member resides and the appropriate
      federal official (“CAFA Notice”).  The Defendants shall be solely responsible for the costs and administration of the CAFA Notice.

    8.            Retention of Claims Administrator and Manner of Giving Notice – Lead Counsel
      is hereby authorized to retain JND Legal Administration as claims administrator to supervise and administer the notice procedure in connection with the proposed Settlement as well

    
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    as the processing of Claims for the proceeds of the Settlement, as more fully set forth below.  Notice of the Settlement and the Settlement Hearing shall be given by Lead Counsel as follows:

    (a)            within ten (10) business days of the date of entry of this Order, Akorn shall use its reasonable best efforts to provide or
      cause to be provided to the Claims Administrator in electronic format (at no cost to the Settlement Fund, Lead Counsel or the Claims Administrator) its security list (consisting of last known names and addresses) of the holders of Akorn common stock
      during the Class Period maintained by the Transfer Agent;

    (b)            not later than twenty (20) business days after the date of entry of this Order (the “Notice Date”), the Claims
      Administrator shall cause a copy of the Notice and the Proof of Claim Form, substantially in the forms attached hereto as Exhibits 1 and 2, respectively (the “Notice Packet”), to be mailed by first-class mail to all potential Settlement Class Members
      who could be identified through reasonable effort;

    (c)            contemporaneously with the mailing of the Notice Packet, the Claims Administrator shall cause copies of the Notice and
      Proof of Claim Form to be posted on a website to be developed for the Settlement, from which copies of the Notice and Proof of Claim Form can be downloaded;

    (d)            not later than ten (10) business days after the Notice Date, the Claims Administrator shall cause the Publication Notice,
      substantially in the form attached hereto as Exhibit 3, to be published once in Investor’s Business Daily and to be transmitted once over the PR Newswire; and

    (e)            not later than seven (7) calendar days prior to the Settlement Hearing, Lead Counsel shall serve on Defendants’ Counsel and
      file with the Court proof, by affidavit or declaration, of such mailing and publication.

    
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    9.            Approval of Form and Content of Notice – The Court: (a) approves, as to form
      and content, the Notice, Proof of Claim Form, and Publication Notice, attached hereto as Exhibits 1, 2, and 3, respectively; and (b) finds that the mailing and distribution of the Notice and Proof of Claim Form and the publication of the Publication
      Notice in the manner and form set forth in paragraph 8 of this Order (i) is the best notice practicable under the circumstances; (ii) constitutes notice that is reasonably calculated, under the circumstances, to apprise Settlement Class Members of
      the pendency of the Action, of the effect of the proposed Settlement (including the Releases to be provided thereunder), of their right to object to the Settlement, of their right to exclude themselves from the Settlement Class, and of their right to
      appear at the Settlement Hearing; (iii) constitutes due, adequate, and sufficient notice to all persons and entities entitled to receive notice of the proposed Settlement; and (iv) satisfies the notice requirements of Rule 23 of the Federal Rules of
      Civil Procedure, the United States Constitution (including the Due Process Clause), the Private Securities Litigation Reform Act of 1995, 15 U.S.C. § 78u-4, as amended, Section 3(a)(10) of the Securities Act, and all other applicable law and rules. 
      The date and time of the Settlement Hearing shall be included in the Notice and Publication Notice before they are mailed and published, respectively.

    10.            Nominee Procedures – Brokers and other nominees who purchased or otherwise
      acquired Akorn common stock during the Class Period for the benefit of another person or entity shall: (a) within seven (7) business days of receipt of the Notice, request from the Claims Administrator sufficient copies of the Notice Packet to
      forward to all such beneficial owners and within seven (7) business days of receipt of those Notice Packets forward them to all such beneficial owners; or (b) within seven (7) business days of receipt of the Notice, send a list of the names and
      addresses of all such beneficial owners to the Claims Administrator in which

    
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    event the Claims Administrator shall promptly mail the Notice Packet to such individuals or entities.  Upon full compliance with this Order, such nominees may seek reimbursement of their reasonable expenses actually
      incurred in complying with this Order by providing the Claims Administrator with proper documentation supporting the expenses for which reimbursement is sought.  Such properly documented expenses incurred by nominees in compliance with the terms of
      this Order shall be paid from the Settlement Fund, with any disputes as to the reasonableness or documentation of expenses incurred subject to review by the Court.

    11.            Participation in the Settlement – Settlement Class Members who wish to
      participate in the Settlement and to be eligible to receive a distribution from the Net Settlement Fund must complete and submit a Proof of Claim Form in accordance with the instructions contained therein.  Unless the Court orders otherwise, all
      Proof of Claim Forms must be postmarked no later than one hundred twenty (120) calendar days after the Notice Date.  Notwithstanding the foregoing, Lead Counsel may, at its discretion, accept for processing late Claims provided such acceptance does
      not delay the distribution of the Net Settlement Fund to the Settlement Class.  By submitting a Proof of Claim Form, a person or entity shall be deemed to have submitted to the jurisdiction of the Court with respect to his, her or its Claim and the
      subject matter of the Settlement.

    12.            Each Proof of Claim Form submitted must satisfy the following conditions: (a) it must be properly completed, signed and
      submitted in a timely manner in accordance with the provisions of the preceding paragraph; (b) it must be accompanied by adequate supporting documentation for the transactions and holdings reported therein, in the form of broker confirmation slips,
      broker account statements, an authorized statement from the broker containing the transactional and holding information found in a broker confirmation slip or account statement,

    
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    or such other documentation as is deemed adequate by Lead Counsel or the Claims Administrator; (c) if the person executing the Proof of Claim Form is acting in a representative capacity, a certification of his, her or
      its current authority to act on behalf of the Claimant must be included in the Proof of Claim Form to the satisfaction of Lead Counsel or the Claims Administrator; and (d) the Proof of Claim Form must be complete and contain no material deletions or
      modifications of any of the printed matter contained therein and must be signed under penalty of perjury.

    13.            Any Settlement Class Member that does not timely and validly submit a Proof of Claim Form:  (a) shall be deemed to have
      waived his, her, or its right to share in the Net Settlement Fund; (b) shall be forever barred from participating in any distributions therefrom; (c) shall be bound by the provisions of the Stipulation and the Settlement and all proceedings,
      determinations, orders, and judgments in the Action relating thereto, including, without limitation, the Order and Final Judgment, and the releases provided for therein, whether favorable or unfavorable to the Settlement Class; and (d) will be barred
      from commencing, maintaining, or prosecuting any of the Settled Claims against each and all of the Released Persons, as more fully described in the Stipulation and Notice.  Notwithstanding the foregoing, late Proof of Claim Forms may be accepted for
      processing as set forth in paragraph 11 above.

    14.            Exclusion From the Settlement Class – Any Settlement Class Member who wishes
      to exclude himself, herself, or itself from the Settlement Class must request exclusion in writing within the time and in the manner set forth in the Notice, which shall provide that:

    (a)            any such request for exclusion from the Settlement Class must be mailed or delivered such that it is received no later than
      twenty-one (21) calendar days prior to the Settlement Hearing, to:  Claims Administrator at In re Akorn, Inc. Data Integrity Securities Litigation c/o JND Legal Administration, PO Box 91207, Seattle, WA 
      98111-9307; and

    
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    (b)            each request for exclusion must:  (i) state the name, address, and telephone number of the person or entity requesting
      exclusion, and, in the case of entities, the name and telephone number of the appropriate contact person; (ii) state that such person or entity “requests exclusion from the Settlement Class in In re Akorn, Inc. Data
        Integrity Securities Litigation, Civ. A. No. 1:18-cv-01713”; (iii) state the number of Akorn common shares purchased/acquired and/or sold during the Class Period, as well as the dates, number of
      shares, and prices paid or proceeds received for each such purchase/acquisition and sale; and (iv) be signed by the person or entity requesting exclusion or an authorized representative.  A request for exclusion shall not be effective unless it
      provides all the required information and is received within the time stated above.

    15.            Any person or entity who or which timely and validly requests exclusion in compliance with the terms stated in this Order
      and is excluded from the Settlement Class shall not be a Settlement Class Member, shall not be bound by the terms of the Settlement or any orders or judgments in the Action relating to the Settlement, and shall not receive any payment out of the
      Settlement Fund.

    16.            Any Settlement Class Member that does not timely and validly request exclusion from the Settlement Class in the manner
      stated in this Order:  (a) shall be deemed to have waived his, her, or its right to be excluded from the Settlement Class; (b) shall be forever barred from requesting exclusion from the Settlement Class in this or any other proceeding; (c) shall be
      bound by the provisions of the Stipulation, the Settlement, and all proceedings, determinations, orders, and judgments in the Action relating to the Settlement, including, but not limited to, the Order and Final Judgment, and the releases provided
      for therein whether favorable or unfavorable to the Settlement Class; and (d) shall be barred from commencing, maintaining, or prosecuting any of

    
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    the Settled Claims against any of the Released Persons, as more fully described in the Stipulation and Notice.

    17.            Appearance and Objections at Settlement Hearing – Any Settlement Class
      Member who does not request exclusion from the Settlement Class may enter an appearance in the Action, at his, her, or its own expense, individually or through counsel of his, her, or its own choice, by filing with the Clerk of Court and delivering a
      notice of appearance to both Lead Counsel and Defendants’ Counsel, at the addresses set forth in ¶ 18 below, such that it is received no later than twenty-one (21) calendar days prior to the Settlement Hearing, or as the Court may otherwise direct. 
      Any Settlement Class Member who does not enter an appearance will be represented by Lead Counsel.

    18.            Any Settlement Class Member who does not request exclusion from the Settlement Class may file a written objection to the
      proposed Settlement, the proposed Plan of Allocation, and/or Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses and show cause, if he, she, or it has any cause, why the proposed Settlement, the proposed
      Plan of Allocation, and/or Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses should not be approved; provided, however, that no Settlement Class Member shall be
      heard or entitled to contest the approval of the terms and conditions of the proposed Settlement, the proposed Plan of Allocation, and/or Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses unless that
      person or entity has filed a written objection with the Court and served copies of such objection on Lead Counsel and Defendants’ Counsel at the addresses set forth below such that they are received no later than twenty-one (21) calendar days prior
      to the Settlement Hearing.

    
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            Lead Counsel

          	
             

             

            Defendants’ Counsel

          
	
             

            

            Entwistle & Cappucci LLP

              Andrew J. Entwistle, Esq.

            500 W. 2nd Street, Suite 1900-16

            Austin, Texas 78701

               

            Entwistle & Cappucci LLP

              Joshua K. Porter, Esq.

            299 Park Avenue, 20th Floor

            New York, New York 10171

          	
             

            

            Cravath, Swaine & Moore LLP

            Robert H. Baron, Esq.

            Worldwide Plaza

            825 Eighth Avenue

            New York, NY 10019-7475

             

          

    

    

    19.            Any objections, filings, and other submissions by the objecting Settlement Class Member:  (a) must state the name, address,
      and telephone number of the person or entity objecting and must be signed by the objector; (b) must contain a statement of the Settlement Class Member’s objection or objections, and the specific reasons for each objection, including any legal and
      evidentiary support the Settlement Class Member wishes to bring to the Court’s attention and whether the objection applies only to the objector, to a specific subset of the Settlement Class, or to the entire
        Settlement Class; and (c) must include documents sufficient to prove membership in the Settlement Class, including the number of shares of Akorn common stock that the objecting Settlement Class
      Member purchased/acquired and/or sold during the Class Period, as well as the dates, number of shares, and prices of each such purchase/acquisition and sale.  Objectors who enter an appearance and desire to present evidence at the Settlement Hearing
      in support of their objection must include in their written objection or notice of appearance the identity of any witnesses they may call to testify and any exhibits they intend to introduce into evidence at the hearing.

    20.            Any Settlement Class Member who or which does not make his, her, or its objection in the manner provided herein shall be
      deemed to have waived his, her, or its right to object to any

    
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    aspect of the proposed Settlement, the proposed Plan of Allocation, and Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses, and shall be forever barred and foreclosed from objecting to the fairness, reasonableness, or adequacy of the Settlement, the Plan of Allocation, or the requested attorneys’ fees and Litigation Expenses, or from otherwise being heard concerning the Settlement, the
        Plan of Allocation, or the requested attorneys’ fees and Litigation Expenses in this or any other proceeding.

    21.            Stay and Temporary Injunction – Until otherwise ordered by the Court, the
      Court stays all proceedings in the Action, the Twin Funds Action and the Manikay Funds Action, and any action subsequently filed in or reassigned to this Court that
      is based upon the same of substantially similar facts and circumstances as in the Action, other than proceedings necessary to carry out or enforce the terms and conditions of the Stipulation.  Pending final determination of whether the Settlement
      should be granted final approval, the Court bars and enjoins Lead Plaintiffs, plaintiffs in the Twin Funds Action, plaintiffs in the Manikay Funds Action, and all
      members of the Settlement Class, from commencing or prosecuting any and all of the Settled Claims against each and all of the Released Persons.

    22.            Settlement Administration Fees and Expenses – All reasonable costs incurred
      in identifying Settlement Class Members and notifying them of the Settlement as well as in administering the Settlement shall be paid as set forth in the Stipulation without further order of the Court.

    23.            Settlement Fund – The contents of the Settlement Fund held by the Escrow
      Agent shall be deemed and considered to be in custodia legis of the Court, and shall remain subject to the jurisdiction of the Court, until such time as they shall be distributed pursuant to the Stipulation
      and/or further order(s) of the Court.  No person who is not a Settlement Class Member or Lead

    
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    Counsel shall have any right to any portion of, or to any distribution of, the Net Settlement Fund unless ordered by the Court or otherwise provided in the Stipulation.

    24.            Neither Defendants, their counsel, nor any Released Person shall have any liability or responsibility for the Plan of
      Allocation or any application for attorneys’ fees or Litigation Expenses submitted by Lead Counsel or Lead Plaintiff, and such matters shall be considered separately from the fairness, reasonableness and adequacy of the Settlement.

    25.            Taxes – Lead Counsel is authorized and directed to prepare any tax returns
      and any other tax reporting form for or in respect to the Settlement Fund, to pay from the Settlement Fund any Taxes or Tax Expenses owed with respect to the Settlement Fund, and to otherwise perform all obligations with respect to Taxes and Tax
      Expenses and any reporting or filings in respect thereof without further order of the Court in a manner consistent with the provisions of the Stipulation.

    26.            Termination of Settlement – If the Settlement is terminated as provided in
      the Stipulation, the Settlement is not approved, or the Effective Date of the Settlement otherwise fails to occur, this Order (including the certification of the Settlement Class) shall be vacated, rendered null and void, and be of no further force
      and effect, except as otherwise provided by the Stipulation, and this Order shall be without prejudice to the rights of Lead Plaintiffs, the other Settlement Class Members, or Defendants, and the Settling Parties shall revert to their respective
      positions in the Action as of immediately prior to the execution of the Stipulation on August 9, 2019, as provided in the Stipulation.

    27.            Use of this Order – Except as necessary to effectuate the protections from
      liability granted thereunder or otherwise to enforce the terms of the Settlement, neither this Order, the Stipulation (whether or not consummated), including the exhibits thereto, the Plan of Allocation

    
      14

      
        

    

    contained therein (or any other plan of allocation that may be approved by the Court), the negotiations leading to the execution of the Stipulation, nor any proceedings taken pursuant to or in connection with the
      Stipulation and/or approval of the Settlement (including any arguments proffered in connection therewith):

    (a)            shall be offered or received against any Defendant or Released Person as evidence of, or construed as or deemed to be
      evidence of, any presumption, concession, or admission by any Defendant or Released Person with respect to the truth of any fact alleged by any of the Plaintiffs or the validity of any Settled Claim that has been or could have been asserted in the
      Action or in any litigation, or the deficiency of any defense that has been or could have been asserted in the Action or in any litigation, or of any liability, negligence, fault or wrongdoing of any Defendant or Released Person;

    (b)            shall be offered or received against any Defendant or Released Person as evidence of a presumption, concession or admission
      of any fault, misrepresentation or omission with respect to any statement or written document approved or made by any Defendant or Released Person;

    (c)            shall be offered or received against any Defendant or Released Person as evidence of a presumption, concession or admission
      with respect to any liability, negligence, fault or wrongdoing, or in any way referred to for any other reason as against any Defendant or Released Person, in any other civil, criminal or administrative action or proceeding, other than such
      proceedings as may be necessary to effectuate the provisions of this Stipulation;

    (d)            shall be construed against any Defendant or Released Person as an admission or concession that the consideration to be
      given hereunder represents the amount which could or would have been recovered after trial; or

    
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    (e)            shall be construed as or received in evidence as an admission, concession or presumption against Lead Plaintiffs or any of
      the Releasing Persons that any of their claims are without merit, or that any defenses asserted by any Defendants have any merit, or that damages recoverable under the Second Amended Complaint would not have exceeded the Settlement Consideration or
      the Settlement Fund.

    28.            Supporting Papers – Lead Counsel shall file and serve the opening papers in
      support of the proposed Settlement, the proposed Plan of Allocation and Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation Expenses no later than thirty-five (35) calendar days prior to the Settlement Hearing; and
      reply papers, if any, shall be filed and served no later than seven (7) calendar days prior to the Settlement Hearing.

    29.            The Court retains jurisdiction to consider all further applications arising out of or connected with the proposed
      Settlement.

    SO ORDERED this _______________ day of ___________________, 2019.

    

      	
               

            	
               

            	

            
	
               

            	
               

            	The Honorable Matthew F. Kennelly

            
	
               

            	
               

            	United States District Judge

      

    

    
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    Exhibit A-1

    [Notice of (I) Pendency of Class Action and Proposed Settlement; (II) Settlement Fairness Hearing; and (III) Motion for and Award of Attorneys’ Fees and Reimbursement of Litigation Expenses is Excluded from this Filing]

    

    

    

    

    
      
        

    

    Exhibit A-2

    [Proof of Claim and Release Form is Excluded from this Filing]

    

    

    

    

    
      
        

    

    Exhibit A-3

    [Summary Notice of (I) Pendency of Class Action and Proposed Settlement; (II) Settlement Fairness Hearing; and (III) Motion for an Award of Attorneys’ Fees and Reimbursement of
      Litigation Expenses is Excluded from this Filing]

    

    

    

    

    
      
        

    

    Exhibit B

    

    

    

    

    
      
        

    

    
       Exhibit B

       

      

       

      

      
        

        

         

        

        UNITED STATES DISTRICT COURT

          NORTHERN DISTRICT OF ILLINOIS

          EASTERN DIVISION

        

        

        	
                 

                

                 

                

                 

                

                 

                

                IN RE AKORN, INC. DATA INTEGRITY SECURITIES LITIGATION

                 

                

                 

                

                 

                

                 

                

                 

                

              	
                     Civ. A. No. 1:18-cv-01713

                 

                

                Hon. Matthew F. Kennelly

              

        

        

        [PROPOSED] ORDER AND FINAL JUDGMENT APPROVING

          CLASS ACTION SETTLEMENT

         

        

        WHEREAS, on August 9, 2019, Lead Plaintiffs Gabelli & Co. Investment Advisors, Inc. and Gabelli Funds, LLC, individually and on behalf of the Settlement Class,1  on the one hand, and Defendants Akorn, Inc., Rajat Rai, Duane Portwood, Alan Weinstein, Brian Tambi and Ronald Johnson, on the other hand, entered into the Stipulation to settle the
          above-captioned litigation;

        WHEREAS, on August 26, 2019, the Court held a preliminary approval hearing pursuant to Rule 23(e)(1) of the Federal Rules of Civil Procedure (the “Preliminary Approval Hearing”);

        WHEREAS, following the Preliminary Approval Hearing, on August 26, 2019, the Court entered the Preliminary Approval Order;

         WHEREAS, pursuant to the Preliminary Approval Order, the Court scheduled the Settlement Hearing for _________, 2019, at _________, for the purpose of, among other things, determining whether: 
          (i) the terms and conditions of the Settlement are fair, reasonable and 

        
          

          

          

          1 All capitalized words or terms not otherwise defined in this Order and Final Judgment shall have the meanings ascribed to those
            words or terms in the Stipulation and Agreement of Settlement (the “Stipulation”) filed with the Court on August 9, 2019.

           

          

        

        
          
            

        

        
        adequate to the Settlement Class, and should therefore be approved; (ii) a judgment as provided for in the Stipulation should be entered; and (iii) the terms and conditions of the issuance of the Settlement Shares
          and Settlement CVRs pursuant to the exemption from the registration requirements of the Securities Act provided by Section 3(a)(10) are fair to all persons and entities to whom the shares will be issued;

        WHEREAS, pursuant to the Preliminary Approval Order, the Court ordered that the Notice and a Proof of Claim Form, substantially in the forms attached to the Preliminary Approval Order as Exhibits
          A-1 and A-2, respectively, be mailed by first-class mail, postage prepaid, on or before twenty (20) business days after the date of entry of the Preliminary Approval Order (“Notice Date”) to all potential Settlement Class Members who could be
          identified through reasonable effort, and that the Publication Notice, substantially in the form attached to the Preliminary Approval Order as Exhibit A-3, be published in Investor’s Business Daily and
          transmitted over PR Newswire within ten (10) calendar days of the Notice Date;

        WHEREAS, the Notice and the Publication Notice advised potential Settlement Class Members of the date, time, place, and purpose of the Settlement Hearing.  The Notice further advised that any
          objections to the Settlement were required to be filed with the Court and served on counsel for the Litigation Parties such that they were received by _________, 2019;

        WHEREAS, the provisions of the Preliminary Approval Order as to notice were duly complied with;

        WHEREAS, on _________, 2019, Lead Plaintiff moved for final approval of the Settlement, as set forth in the Preliminary Approval Order.  The Settlement Hearing was duly held before this Court on
          ___________, 2019, at which time all interested persons and entities were afforded the opportunity to be heard;

        
          2

          
            

        

        [WHEREAS, no objections to the Settlement were received;] and

        WHEREAS, this Court has duly considered Lead Plaintiff’s motion, the affidavits, declarations, memoranda of law submitted in support thereof, the Stipulation, and all of the submissions and
          arguments presented with respect to the proposed Settlement;

        NOW, THEREFORE, after due deliberation, IT IS HEREBY ORDERED, ADJUDGED AND DECREED:

        Incorporation of Settlement Documents

        1.          This Order and Final Judgment incorporates and makes a part hereof as though set forth fully herein: (i) the Stipulation filed with the Court
          August 9, 2019; and (ii) the Notice, which was filed with the Court on August 9, 2019.

        Jurisdiction

        2.          This Court has jurisdiction over the subject matter of the Action and over all parties to the Action, including the Litigation Parties and
          all Settlement Class Members (collectively, the “Parties”).

        Class Certification for Settlement Purposes

        3.          The Court hereby affirms its determinations in the Preliminary Approval Order and finally certifies, for purposes of the Settlement only,
          pursuant to Rules 23(a) and (b)(3) of the Federal Rules of Civil Procedure, the Settlement Class of:  all persons or entities that purchased or otherwise acquired shares of Akorn common stock between November 3, 2016 and January 8, 2019,
          inclusive, and were damaged thereby.  Excluded from the Settlement Class are:  (i) Defendants; (ii) any person who was an officer, director or managing agent of Akorn or any of its subsidiaries or affiliates at any point during the Class Period;
          (iii) members of the immediate family of any of the foregoing individuals; (iv) any affiliate of Akorn; (v) any entity in which any

        
          3

          
            

        

         Defendant has or had a controlling interest; (vi) any Opt-Outs that are listed on the annexed Exhibit A as having submitted an exclusion request allowed by the Court (the “Authorized Opt-Outs”); and (vii) the
          legal representatives, heirs, predecessors, successors or assigns of any of the foregoing.

        Adequacy of Representation

        4.          Pursuant to Rule 23 of the Federal Rules of Civil Procedure, and for purposes of the Settlement only, the Court hereby reaffirms its
          determinations in the Preliminary Approval Order and finally certifies the Gabelli Funds as the Class Representatives for the Settlement Class; and finally appoints the law firm of Entwistle & Cappucci LLP as Class Counsel for the Settlement
          Class.  The law firm of Bernstein Litowitz Berger & Grossmann LLP will continue to act as Plaintiffs’ local Liaison Counsel.

        Notice

        5.          The Court finds that the mailing and publication of the Notice, Publication Notice, and Proof of Claim Form, as appropriate:

        (a)  complied with the Preliminary Approval Order;

        (b)  constituted the best notice practicable under the circumstances;

        (c)  constituted notice that was reasonably calculated to apprise Settlement Class Members of (i) the effect of the Settlement, (ii) the proposed Plan of Allocation, (iii)
          Lead Counsel’s request for an award of attorneys’ fees and payment of Litigation Expenses incurred in connection with the prosecution of the Action, (iv) their right to object or seek exclusion from the Settlement Class, and (v) their right to
          appear at the Settlement Hearing;

        (d)  constituted due, adequate, and sufficient notice to all persons or entities entitled to receive notice of the proposed Settlement;

        
          4

          
            

        

        (e)  satisfied the notice requirements of Rule 23 of the Federal Rules of Civil Procedure, the United States Constitution (including the Due Process Clause), and Section
          21D(a)(7) of the Exchange Act, 15 U.S.C. § 78u-4(a)(7), as amended by the Private Securities Litigation Reform Act of 1995 (the “PSLRA”); and

        (f)  constituted adequate notice pursuant to the requirements of Section 3(a)(10) of the Securities Act.

        Objections

        6.          [There have been no objections to the Settlement.] [The Court has considered all timely objections to the Settlement and granted each such
          objector an opportunity to be heard.]

        Final Settlement Approval and Dismissal of Claims

        7.          The Court hereby fully and finally approves the Settlement as set forth in the Stipulation in all respects, and finds that the Settlement is,
          in all respects, fair, reasonable and adequate, and in the best interests of Lead Plaintiffs and the Settlement Class.  In reaching this decision, the Court considered, among other thing:  (i) the benefits to the Settlement Class; (ii) the
          complexity, expense and possible duration of further litigation against Defendants; (iii) the strength of Plaintiffs’ case, including the risks of establishing liability and damages; (iv) the costs of continued litigation; (v) [the lack of any
          objections to the Settlement] [all timely objections to the Settlement] and (vi) the stage of proceedings and discovery completed as of the date hereof, including the fact that Defendants have already produced millions of documents, as well as
          extensive deposition and trial testimony from other court proceedings that relate to allegations in the Action, to Lead Counsel.  This Court further finds the Settlement set forth in the Stipulation is the result of arm’s-length negotiations
          between experienced counsel representing the interests of

        
          5

          
            

        

         Lead Plaintiffs, the Settlement Class, and Defendants. The Settlement shall be consummated in accordance with the terms and provisions of the Stipulation.

        8.          The Second Amended Complaint filed on April 22, 2019, is dismissed in its entirety, with prejudice, and without costs to any party, except as
          otherwise provided in the Stipulation.

        9.          The Parties are hereby directed to consummate the Stipulation and to perform its terms.

        Section 3(a)(10) Exemption

        10.        The Court, after holding the Settlement Hearing, hereby finds that:  (i) the Settlement Shares and Settlement CVRs are to be issued solely in
          exchange for bona fide outstanding claims; (ii) all person and entities to whom the Settlement Shares and Settlement CVRs will be issued had the right to appear at the Settlement Hearing; (iii) the Settlement Hearing was open to all persons and
          entities to whom the Settlement Shares and Settlement CVRs will be issued; (iv) adequate notice has been given to all persons and entities to whom the Settlement Shares and Settlement CVRs will be issued, and there have been no improper
          impediments to the appearance of such persons and entities at the Settlement Hearing; and (v) the terms and conditions of the issuance of the Settlement Shares and Settlement CVRs pursuant to the terms of the Stipulation are fair to all persons
          and entities to whom the Settlement Shares and Settlement CVRs will be issued.  The Court hereby acknowledges that it was advised prior to the Settlement Hearing that, following Court approval of the Settlement, Akorn intends to rely on the
          Section 3(a)(10) registration exemption when distributing the Settlement Shares and Settlement CVRs to the Settlement Class (and to Plaintiffs’ Counsel, as may be awarded by the Court, except that such award will not include more than 25% of
          either the (a) the total Settlement Shares or (b) the total

        
          6

          
            

        

         Settlement CVRs) pursuant to the terms of the Stipulation.  The Court hereby approves the terms and conditions of the issuance of the Settlement Shares and Settlement CVRs in exchange for the settlement and
          release of the Settled Claims by the Releasing Persons as fair both procedurally and substantively to all person and entities to whom the Settlement Shares and Settlement CVRs will be issued, and finds that the Settlement Shares and Settlement
          CVRs are freely tradable and exempt from the registration requirements of the Securities Act (or, where applicable, any analogous provisions of applicable state securities laws) pursuant to Section 3(a)(10).  Based upon the Court’s findings that
          the terms and conditions of the Settlement are fair both procedurally and substantively, Akorn may distribute the Settlement Shares and Settlement CVRs without registration or compliance with the prospectus delivery requirements of the U.S.
          securities laws (or, where applicable, any analogous state securities laws).

        11.        At any time after the Effective Date, Lead Counsel may, in accordance with the terms of the Stipulation, direct the Escrow Agent to sell all
          or any portion of the Class Settlement Shares or Settlement CVRs on behalf of the Settlement Class, pursuant to the exemption from registration requirements of the Securities Act provided by Section 3(a)(10), which exemption shall also remain
          applicable to and not otherwise limit or invalidate the initial issuance of and delivery of the Settlement Shares or Settlement CVRs to the Escrow Agent. To the extent that any sale of the Class Settlement Shares or Settlement CVRs occurs, the
          cash proceeds of such sale(s) shall be deposited in the Escrow Account and held in escrow under the control of the Escrow Agent as fiduciary for the benefit of the Settlement Class pending disbursement or distribution in accordance with the terms
          of the Stipulation.

        
          7

          
            

        

        Releases

        12.        Upon the Effective Date, each and all of the Releasing Persons, on behalf of themselves and each of their respective heirs, executors,
          trustees, administrators, predecessors, successors, assigns, and any other person or entity claiming (now or in the future) through or on behalf of them, regardless of whether any such person or entity ever seeks or obtains by any means,
          including, without limitation, by submitting a Proof of Claim Form, any distribution from the Settlement Fund, shall be deemed to have fully, finally, and forever waived, released, discharged, and dismissed each and every one of the Settled
          Claims against each and every one of the Released Persons and shall be deemed to have covenanted not to sue the Released Persons in respect to any such Settled Claims and shall forever be barred and enjoined from asserting, commencing,
          instituting, prosecuting, maintaining or in any way participating in the commencement or prosecution of any action or other proceeding, in any forum, asserting any or all of the Settled Claims against any or all of the Released Persons.

        13.         Upon the Effective Date, each of the Defendants and Released Persons, on behalf of themselves and their respective heirs, executors,
          administrators, successors and assigns and all persons acting in concert with any such person or entity, shall have, fully, finally, and forever released, relinquished, and discharged Lead Plaintiffs, Plaintiffs’ Counsel and the Settlement Class
          (except, for the avoidance of doubt, any Authorized Opt-Outs) from all Claims (including Unknown Claims) arising out of, relating to, or in connection with, the institution, prosecution, assertion, Settlement, or resolution of the Action or the
          Settled Claims except to enforce the releases and other terms and conditions contained in the Stipulation or any Court order (including, but not limited to, this Order and Final Judgment) entered pursuant thereto.

        
          8

          
            

        

        14.         Pursuant to the PSLRA, 15 U.S.C. § 78u-4(f)(7), upon the Effective Date, the Defendants are discharged from all claims for contribution that
          have been or may hereafter be brought by or on behalf of any person or entity, based upon, relating to, or arising out of the Action. Upon the Effective Date, any and all persons or entities are permanently BARRED, ENJOINED and RESTRAINED from
          commencing, prosecuting or asserting any and all claims for contribution based upon, relating to, or arising out of the Action, whether arising under state, federal or common law, as claims, cross-claims, counterclaims, or third-party claims, in
          this Action or as a separate action, in this Court, in any federal or state court, or in any other court, arbitration proceeding, administrative proceeding, or other forum (collectively, the “Barred Contribution Claims”) against the Defendants;
          and the Defendants are permanently BARRED, ENJOINED and RESTRAINED from commencing, prosecuting or asserting any and all Barred Contribution Claims against any person or entity, other than a person or entity whose liability to the Settlement
          Class has been extinguished pursuant to the Settlement and this Order and Final Judgment.

        15.         Pursuant to the PSLRA, 15 U.S.C. § 78u-4(f)(7), any final verdict or judgment obtained by or on behalf of Lead Plaintiff, the Settlement
          Class or any Settlement Class Member shall be reduced as provided therein.

        Binding Effect

        16.       Each Settlement Class Member (except for the Authorized Opt‐Outs), whether or not such Settlement Class Member executes and delivers a Proof of
          Claim Form, as well as the respective successors and assigns of each Settlement Class Member, is forever bound by this Order and Final Judgment, including, without limitation, the release of claims as set forth in the Stipulation.

        
          9

          
            

        

        No Admissions

        17.        This Order and Final Judgment and the Stipulation, whether or not consummated, and any discussions, negotiations, proceedings or agreements
          relating to the Stipulation, the Settlement, and any matters arising in connection with settlement discussions or negotiations, proceedings, or agreements, shall not be offered or received against or to the prejudice of the Parties or their
          respective counsel or advisors, for any purpose other than in an action to enforce the terms hereof, and in particular:

        (a)  do not constitute, and shall not be offered or received against or to the prejudice of Defendants as evidence of, or construed as, or deemed to be evidence of any
          presumption, concession, or admission by Defendants with respect to the truth of any allegation by Plaintiffs, or the validity of any claim that has been or could have been asserted in the Action or in any litigation, including but not limited to
          the Settled Claims, or of any liability, damages, negligence, fault or wrongdoing of Defendants or any person or entity whatsoever;

        (b)  do not constitute, and shall not be offered or received against or to the prejudice of Defendants as evidence of a presumption, concession, or admission of any fault,
          misrepresentation, or omission with respect to any statement or written document approved or made by Defendants, or against or to the prejudice of Lead Plaintiffs or the Settlement Class as evidence of any infirmity in the claims alleged by Lead
          Plaintiffs;

        (c)  do not constitute, and shall not be offered or received against or to the prejudice of Defendants, Plaintiffs or their respective counsel or advisors, as evidence of a
          presumption, concession, or admission with respect to any liability, damages, negligence, fault, infirmity, or wrongdoing, or in any way referred to for any other reason against or to the prejudice of any of the Defendants, Plaintiffs, or their
          respective counsel or advisors, in any other civil, criminal, or

        
          10

          
            

        

        administrative action or proceeding in this Court, in any federal or state court, or in any other court, arbitration proceeding, administrative proceeding, or other forum, other than such
          proceedings as may be necessary to effectuate the provisions of the Stipulation;

        (d)  do not constitute, and shall not be construed against Defendants or Plaintiffs as an admission or concession that the consideration to be given hereunder represents the
          amount that could be or would have been recovered after trial; and

        (e)  do not constitute, and shall not be construed as or received in evidence as an admission, concession, or presumption against Plaintiffs that any of their claims are
          without merit or infirm or that damages recoverable under the Second Amended Complaint would not have exceeded the Settlement Consideration.

        Rule 11 Findings

        18.         The Court finds that during the course of the Action, the Litigation Parties and their respective counsel at all times complied with the
          requirements of Rule 11 of the Federal Rules of Civil Procedure.

        Modification of the Agreement of Settlement

        19.        Without further approval from the Court, Lead Plaintiffs and Defendants are hereby authorized to agree to and adopt such amendments to or
          modifications of the Stipulation or any exhibits attached thereto to effectuate the Settlement that:  (i) are not materially inconsistent with this Order and Final Judgment; and (ii) do not materially limit the rights of the Settlement Class
          Members in connection with the Settlement.  Without further order of the Court, the Litigation Parties may agree to reasonable extensions of time to carry out any of the provisions of the Stipulation.

        
          11

          
            

        

        Retention of Jurisdiction

        20.        Without affecting the finality of this Order and Final Judgment in any way, this Court hereby retains continuing jurisdiction over:
          (i) administration of and implementation of the Settlement; (ii) the allowance, disallowance or adjustment of any Settlement Class Member’s claim on legal or equitable grounds and any award or distribution of the Settlement Fund; (iii)
          disposition of the Settlement Fund; (iv) any applications for attorneys’ fees, costs, interest and payment of expenses in the Action; (v) all Parties for the purpose of construing, enforcing and administering the Settlement and this Order and
          Final Judgment; and (vi) other matters related or ancillary to the foregoing.

        Termination of the Settlement

        21.         In the event that the Settlement does not become effective in accordance with the terms of the Stipulation, then this Order and Final
          Judgment shall be rendered null and void to the extent provided by and in accordance with the Stipulation and shall be vacated, and in such event, all orders entered and releases delivered in connection herewith shall be null and void to the
          extent provided by and in accordance with the Stipulation.

        Entry of Order and Final Judgment

        22.         There is no just reason for delay in the entry of this Order and Final Judgment.  Accordingly, the Clerk of Court is expressly directed to
          immediately enter this Order and Final Judgment.

        [Expiration of CAFA Notice Period

        23.         This Order and Final Judgment is effective on ______, 2019, the expiration date for the 90-day notice period provided in 28 U.S.C.
          § 1715(d).]

        
          12

          
            

        

        
        DATED this ___ day of ___________, 2019

         

        

        
          	 	
                  BY THE COURT:

                   

                   

                   

                
	 	
                  Honorable Matthew F. Kennelly

                    UNITED STATES DISTRICT JUDGE

                

        

        

        

      

      
        13

        
          

      

      
        
          Exhibit C

           

            

           

            

          
            
              

          

        

        

        

        
          CONTINGENT VALUE RIGHTS AGREEMENT

           

          

          by and between

           

          

          AKORN, INC.

          

          

          and

          

          

          [          ]

          

          

          Dated as of [          ], 2019

        

        
          
            

        

        
         

        

        
          	
                  TABLE OF CONTENTS

                
	 
	
                  ARTICLE 1

                
	
                  DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

                
	 	 
	
                  Section 1.1. Definitions

                	
                  1

                
	
                  Section 1.2. Certificates and Opinions

                	
                  7

                
	
                  Section 1.3. Form of Documents Delivered to Trustee

                	
                  7

                
	
                  Section 1.4. Acts of Holders

                	
                  8

                
	
                  Section 1.5. Notices, etc., to Trustee and Company

                	
                  8

                
	
                  Section 1.6. Notice to Holders; Waiver

                	
                  9

                
	
                  Section 1.7. Conflict with Trust Indenture Act

                	
                  9

                
	
                  Section 1.8. Effect of Headings and Table of Contents

                	
                  9

                
	
                  Section 1.9. Benefits of Agreement

                	
                  9

                
	
                  Section 1.10. Governing Law; Waiver of Jury Trial

                	
                  9

                
	
                  Section 1.11. Legal Holidays

                	
                  10

                
	
                  Section 1.12. Separability Clause

                	
                  10

                
	
                  Section 1.13. No Recourse Against Others

                	
                  10

                
	
                  Section 1.14. Counterparts

                	
                  10

                
	
                  Section 1.15. Acceptance of Trust

                	
                  10

                
	
                  Section 1.16. Termination

                	
                  11

                
	
                  Section 1.17. Certain Purchases and Sales

                	
                  11

                
	 	 
	
                  ARTICLE 2

                
	
                  SECURITY FORMS

                
	 	 
	
                  Section 2.1. Forms Generally

                	
                  11

                
	 	 
	
                  ARTICLE 3

                
	
                  THE SECURITIES

                
	 	 
	
                  Section 3.1. Title and Terms

                	
                  11

                
	
                  Section 3.2. Registrable Form

                	
                  13

                
	
                  Section 3.3. Execution, Authentication, Delivery and Dating

                	
                  13

                
	
                  Section 3.4. Registration, Registration of Transfer and Exchange

                	
                  13

                
	
                  Section 3.5. Mutilated, Destroyed, Lost and Stolen Securities

                	
                  15

                
	
                  Section 3.6. Payments with respect to CVRs

                	
                  16

                
	
                  Section 3.7. Persons Deemed Owners

                	
                  16

                
	
                  Section 3.8. Cancellation

                	
                  16

                
	
                  Section 3.9. CUSIP Numbers

                	
                  16

                
	 	 
	
                  ARTICLE 4

                
	
                  THE TRUSTEE

                
	 	 
	
                  Section 4.1. Certain Duties and Responsibilities

                	
                  16

                
	
                  Section 4.2. Certain Rights of Trustee

                	
                  17

                
	
                  Section 4.3. Notice of Default

                	
                  18

                
	
                  Section 4.4. Not Responsible for Recitals or Issuance of Securities

                	
                  18

                
	
                  Section 4.5. May Hold Securities

                	
                  18

                
	
                  Section 4.6. Money Held in Trust

                	
                  18

                
	
                  Section 4.7. Compensation and Reimbursement

                	
                  18

                
	
                  Section 4.8. Disqualification; Conflicting Interests

                	
                  19

                
	
                  Section 4.9. Corporate Trustee Required; Eligibility

                	
                  19

                
	
                  Section 4.10. Resignation and Removal; Appointment of Successor

                	
                  19

                
	
                  Section 4.11. Acceptance of Appointment of Successor

                	
                  20

                
	
                  Section 4.12. Merger, Conversion, Consolidation or Succession to Business

                	
                  20

                

          

          

          
            i

            
              

          

          

          

          	
                  Section 4.13. Preferential Collection of Claims Against Company

                	
                  21

                
	 	 
	
                  ARTICLE 5

                
	
                  HOLDERS’ LISTS AND REPORTS BY THE TRUSTEE AND COMPANY

                
	 	 
	
                  Section 5.1. Company to Furnish Trustee Names and Addresses of Holders

                	
                  21

                
	
                  Section 5.2. Preservation of Information; Communications to Holders

                	
                  21

                
	
                  Section 5.3. Reports by Trustee

                	
                  21

                
	
                  Section 5.4. Reports by Company

                	
                  21

                
	 	 
	
                  ARTICLE 6

                
	
                  AMENDMENTS

                
	 	 
	
                  Section 6.1. Amendments Without Consent of Holders

                	
                  22

                
	
                  Section 6.2. Amendments with Consent of Holders

                	
                  22

                
	
                  Section 6.3. Execution of Amendments

                	
                  23

                
	
                  Section 6.4. Effect of Amendments

                	
                  23

                
	
                  Section 6.5. Conformity with Trust Indenture Act

                	
                  23

                
	
                  Section 6.6. Reference in Securities to Amendments

                	
                  23

                
	 	 
	
                  ARTICLE 7

                
	
                  COVENANTS

                
	 	 
	
                  Section 7.1. Payment of Amounts, if any, to Holders

                	
                  23

                
	
                  Section 7.2. Maintenance of Office or Agency

                	
                  23

                
	
                  Section 7.3. Money for Security Payments to Be Held in Trust

                	
                  24

                
	
                  Section 7.4. Listing of CVRs

                	
                  24

                
	
                  Section 7.5. Non-Use of Name

                	
                  24

                
	 	 
	
                  ARTICLE 8

                
	
                  REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT

                
	 	 
	
                  Section 8.1. Event of Default Defined; Waiver of Default

                	
                  25

                
	
                  Section 8.2. Collection by the Trustee; the Trustee May Prove Payment Obligations

                	
                  25

                
	
                  Section 8.3. Application of Proceeds

                	
                  26

                
	
                  Section 8.4. Suits for Enforcement

                	
                  27

                
	
                  Section 8.5. Restoration of Rights on Abandonment of Proceedings

                	
                  27

                
	
                  Section 8.6. Limitations on Suits by Holders

                	
                  27

                
	
                  Section 8.7. Unconditional Right of Holders to Institute Certain Suits

                	
                  27

                
	
                  Section 8.8. Powers and Remedies Cumulative; Delay or Omission Not Waiver of Default

                	
                  27

                
	
                  Section 8.9. Control by Holders

                	
                  28

                
	
                  Section 8.10. Waiver of Past Defaults

                	
                  28

                
	
                  Section 8.11. The Trustee to Give Notice of Default, But May Withhold in Certain Circumstances

                	
                  28

                
	
                  Section 8.12. Right of Court to Require Filing of Undertaking to Pay Costs

                	
                  29

                
	 	 
	
                  ARTICLE 9

                
	
                  CONSOLIDATION OR MERGER

                
	 	 
	
                  Section 9.1. Company May Consolidate or Merge on Certain Terms

                	
                  29

                
	
                  Section 9.2. Successor Person Substituted

                	
                  29

                
	
                  Section 9.3. Officer’s Certificate to the Trustee

                	
                  29

                
	
                  Section 9.4. Successors and Assigns

                	
                  29

                

          

          

          
            ii

            
              

          

          

          

          	
                  ARTICLE 10

                
	
                  SUBORDINATION

                
	
                  Section 10.1. Agreement to Subordinate

                	
                  30

                
	
                  Section 10.2. Liquidation; Dissolution; Bankruptcy

                	
                  30

                
	
                  Section 10.3. Default on Senior Obligations

                	
                  30

                
	
                  Section 10.4. When Distribution Must Be Paid Over

                	
                  30

                
	
                  Section 10.5. Notice by Company

                	
                  31

                
	
                  Section 10.6. Subordination Effective Notwithstanding Deficiencies with Respect to Senior Obligations; Waiver of Right to Contest Senior Obligation; Reinstatement of
                    Subordination Provisions

                	
                  31

                
	
                  Section 10.7. Relative Rights

                	
                  31

                
	
                  Section 10.8. Subordination May Not Be Impaired by Company

                	
                  32

                
	
                  Section 10.9. Distribution or Notice to Representative

                	
                  32

                
	
                  Section 10.10. Rights of the Trustee

                	
                  32

                
	
                  Section 10.11. Authorization to Effect Subordination

                	
                  32

                

          

          

          

          

          Annex A          Example Calculations of EBITDA, Excess EBITDA and Annual Payment

          Annex B          Form of Global Security

          Note:  This table of contents shall not, for any purpose, be deemed to be a part of this CVR Agreement.

          

          
            
              iii

              
                

            

            
            

            

            Reconciliation and tie between Trust Indenture Act of 1939 and

            Contingent Value Rights Agreement, dated as of [          ], 2019

             

            	
                    Trust Indenture Act Section

                  	
                    Agreement Section

                  
	
                    Section 310

                  	
                    (a)(1)

                  	
                    4.9

                  
	 	
                    (a)(2)

                  	
                    4.9

                  
	 	
                    (a)(3)

                  	
                    Not Applicable

                  
	 	
                    (a)(4)

                  	
                    Not Applicable

                  
	 	
                    (a)(5)

                  	
                    4.9

                  
	 	
                    (b)

                  	
                    4.8, 4.10

                  
	 	
                    (c)

                  	
                    Not Applicable

                  
	
                    Section 311

                  	
                    (a)

                  	
                    4.13

                  
	 	
                    (b)

                  	
                    4.13

                  
	 	
                    (c)

                  	
                    Not Applicable

                  
	
                    Section 312

                  	
                    (a)

                  	
                    5.1, 5.2(a)

                  
	 	
                    (b)

                  	
                    5.2(b)

                  
	 	
                    (c)

                  	
                    5.2(c)

                  
	
                    Section 313

                  	
                    (a)

                  	
                    5.3(a)

                  
	 	
                    (b)

                  	
                    5.3(a)

                  
	 	
                    (c)

                  	
                    5.3(a), 8.11

                  
	 	
                    (d)

                  	
                    5.3(b)

                  
	
                    Section 314

                  	
                    (a)

                  	
                    5.4

                  
	 	
                    (b)

                  	
                    Not Applicable

                  
	 	
                    (c)(1)

                  	
                    1.2(a)

                  
	 	
                    (c)(2)

                  	
                    1.2(a)

                  
	 	
                    (c)(3)

                  	
                    Not Applicable

                  
	 	
                    (d)

                  	
                    Not Applicable

                  
	 	
                    (e)

                  	
                    1.2(b)

                  
	 	
                    (f)

                  	
                    Not Applicable

                  
	
                    Section 315

                  	
                    (a)

                  	
                    4.1(a), 4.1(b)

                  
	 	
                    (b)

                  	
                    8.11

                  
	 	
                    (c)

                  	
                    4.1(a)

                  
	 	
                    (d)

                  	
                    4.1(c)

                  
	 	
                    (d)(1)

                  	
                    4.1(a), 4.1(b)

                  
	 	
                    (d)(2)

                  	
                    4.1(c)(ii)

                  
	 	
                    (d)(3)

                  	
                    4.1(c)(iii)

                  
	 	
                    (e)

                  	
                    8.12

                  
	
                    Section 316

                  	
                    (a)(last sentence)

                  	
                    1.1 (Definition of “Outstanding”)

                  
	 	
                    (a)(1)(A)

                  	
                    8.9

                  
	 	
                    (a)(1)(B)

                  	
                    8.10

                  
	 	
                    (a)(2)

                  	
                    Not Applicable

                  
	 	
                    (b)

                  	
                    8.7

                  
	 	
                    (c)

                  	
                    1.4(a)

                  
	
                    Section 317

                  	
                    (a)(1)

                  	
                    8.2

                  
	 	
                    (a)(2)

                  	
                    8.2

                  
	 	
                    (b)

                  	
                    7.3

                  
	
                    Section 318

                  	
                    (a)

                  	
                    1.7

                  

            

            

            Note: This reconciliation and tie shall not, for any purpose, be deemed to be a part of this CVR Agreement.

            
              iv

              
                

            

            THIS CONTINGENT VALUE RIGHTS AGREEMENT, dated as of [          ], 2019 (this “CVR Agreement”), by and between Akorn, Inc., a Louisiana corporation (the “Company”), and [          ],
              a [            ], as trustee (the “Trustee”), in favor of each person who from time to time holds one or more Contingent
              Value Rights (the “Securities” or “CVRs”) to receive cash payments in the amounts and subject to the terms and conditions set forth herein.

             

            

            WITNESSETH:

             

            

            WHEREAS, this CVR Agreement is entered into in accordance with to the Stipulation and Agreement of Settlement, dated as of August 9, 2019 (as amended, supplemented or
              otherwise modified from time to time in accordance with the terms thereof, the “Settlement Stipulation”), by and among the Company, Gabelli & Co. Investment Advisors, Inc. and Gabelli Funds, LLC (together, the “Lead Plaintiffs”),

              on behalf of the Settlement Class (together with the Lead Plaintiffs, the “Plaintiffs”), and the Individual Defendants in the matter In re Akorn, Inc. Data Integrity Securities Litigation, C.A.
              No. 18-cv-173 (N.D. Ill.) (the “Securities Litigation”);

             

            

            WHEREAS, as part of the consideration for the Settlement and the release of the Settled Claims, the Company has agreed to issue to the Plaintiffs the CVRs, which shall be
              issued pursuant to the terms of this CVR Agreement and in accordance with the Settlement Stipulation; and

             

            

            WHEREAS, the CVRs shall be issued pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”),
              provided by Section 3(a)(10) of the Securities Act, which exemption was perfected in the Order and Final Judgment entered by the Court on [], 2019 in the Securities Litigation.

             

            

            NOW, THEREFORE, in consideration of the foregoing premises and the final resolution of the Settled Claims contemplated by the Settlement Stipulation, it is covenanted and
              agreed, for the equal and proportionate benefit of all Holders (as defined below) of the Securities, as follows:

          

          
             

            

            ARTICLE 1

              DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

            

            

            Section 1.1.  Definitions.  For all purposes of this CVR Agreement, except as otherwise expressly provided or unless the context otherwise
              requires:

             

            

            (a)  the terms defined in this Article 1 have the meanings assigned to them in
              this Article 1, and include the plural as well as the singular;

             

            

            (b)  all accounting terms used herein and not expressly defined herein shall, except as
              otherwise noted, have the meanings assigned to such terms in accordance with applicable Accounting Standards, where “Accounting Standards” means (A) GAAP (as defined below); or (B) to the extent that the Company adopts International
              Financial Reporting Standards (IFRS), then “Accounting Standards” means International Financial Reporting Standards (IFRS), in either case consistently applied;

             

            

            (c)  all capitalized terms used in this CVR Agreement without definition shall have the
              respective meanings ascribed to them in the Settlement Stipulation;

             

            

            (d)  all other terms used herein which are defined in the Trust Indenture Act (as defined
              herein), either directly or by reference therein, have the respective meanings assigned to them therein;

             

            

            (e)  the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this CVR Agreement as a whole and not to any particular Article, Section
              or other subdivision;

             

            

            (f)  whenever the words “include”, “includes” or “including” are used in this CVR Agreement, they shall be deemed to be followed by the words “without limitation”, whether or not they are in fact followed by those words or words of like import;

            
              
                

            

            
            (g)  references to a particular statute or regulation include all rules and regulations
              thereunder and any successor statute, rule or regulation, in each case as amended or otherwise modified from time to time; and

             

            

            (h)  all references to “$” or “dollar” refer to United States dollars.

            

            

            “Act” shall have the meaning set forth in Section 1.4(a).

            

            

            “Affiliate” of any specified Person means any other
              Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purpose of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or
              otherwise; and the terms “controlling” and “controlled” have meanings
              correlative to the foregoing.

            

            

            “Annual Payment” means, with respect to any Excess
              EBITDA Measuring Period for any CVR that is Outstanding as of the applicable Annual Payment Record Date, an amount equal to the lesser of (a) (i) thirty-three and one third percent (33.3%) of the Excess
                EBITDA for such Excess EBITDA Measuring Period divided by (ii) the Initial Settlement CVR Amount, and (b) the Annual Payment Cap; provided that if the making of such Annual Payment would cause the cumulative amount of Annual Payments commencing from the date of this CVR Agreement (inclusive
                of such Annual Payment) with respect to such Outstanding CVR to exceed the Total Payment Cap with respect to such Outstanding CVR, then such Annual Payment will be reduced by an amount equal to such excess amount.  Example calculations of
                Annual Payments are set forth on Annex A.

             

              

            “Annual Payment Cap” means, with respect to each CVR that is Outstanding as of the applicable Annual Payment Record Date, an amount equal to (a) twelve million
              dollars ($12,000,000) divided by (b) the Initial Settlement CVR Amount.

            

            

            “Annual Payment Date” means, with respect to any Annual
              Payment, the date that is selected by the Company, which date shall be no later than  sixty (60) days following the date on which the Company files its annual report on Form 10-K setting forth the line items comprising EBITDA for the
              applicable Excess EBITDA Measuring Period.

            

            

            “Annual Payment Record Date” shall have the meaning set
              forth in Section 3.1(c)(i).

            

            

            “Applicable Procedures” means, with respect to any transfer or exchange of or
              for beneficial interests in any Global Security, the rules and procedures of the Depositary that apply to such transfer or exchange.

            

            

            “Bankruptcy Claim” means, with respect to each CVR that is Outstanding as of the Bankruptcy Claim Date, a general unsecured claim on behalf of the Holder of such Outstanding CVR in an amount equal to (a)
              thirty million dollars ($30,000,000) divided by (b) the Initial Settlement CVR Amount, in any case commenced under the Bankruptcy Code (i) by the Company or (ii) involuntarily against the Company in which an order for relief has been
              entered by the bankruptcy court against the Company, which claim shall be expressly subordinated in such case to the claims of holders of Senior Obligations in accordance with Article 10 hereof.

            

            

            “Bankruptcy Claim Date” shall mean (a) in the case of a case commenced by the Company under the Bankruptcy Code, the date of the filing by the Company of a petition in respect thereof, and (b) in the
              case of a case commenced involuntarily against the Company, the date on which an order for relief has been entered in such case by the bankruptcy court against the Company.

            

            

            “Bankruptcy Code” means Title 11 of the United States Code (11 U.S.C. 101 et seq.).

            

            

            “Board of Directors” means the board of directors of the Company or any other
              body performing similar functions, or any duly authorized committee of that board.

            

            

            “Board Resolution” means a resolution duly adopted by the Board of Directors.

             

            

            
              2

              
                

            

            

            

            “Business Day” means any day (other than a Saturday or a Sunday) on which
              banking institutions in The City of New York, New York are not authorized or obligated by Law or executive order to close and, if the CVRs are listed on a national securities exchange, electronic trading network or other suitable trading
              platform, such exchange, electronic network or other trading platform is open for trading.

            

            

            “Change in Control” means the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person of equity interests representing more than fifty percent (50%) of the aggregate
              ordinary voting power represented by the issued and outstanding equity interests of the Company, other than any transaction, including any consolidation or merger, pursuant to which the voting stock of the Company outstanding immediately
              prior to such transaction is converted into or exchanged for voting stock of a transferee entity constituting more than fifty percent (50%) of such voting stock of such surviving or transferee entity (immediately after giving effect to such
              issuance).

            

            

            “Change in Control Payment” means, with respect to each CVR that is Outstanding as of the Change in Control Payment Record Date, an amount equal to (a) thirty million dollars ($30,000,000) divided by
              (b) the Initial Settlement CVR Amount; provided that the Company shall not make the Change in Control Payment with respect to any Outstanding CVR unless, after giving effect to all Change in Control Payments, the Senior Obligations
              and any other debt for borrowed money of the Company and its Subsidiaries (and accrued interest in respect thereof) shall have been satisfied in full in cash.

            

            

            “Change in Control Payment Date” means, with respect to the Change in
              Control Payment, the date that is selected by the Company or its successor in accordance with Article 9 hereof that is no later than sixty (60) days following the date of the consummation of the Change in Control.

            

            

            “Change in Control Payment Record Date” shall have the meaning set forth in
              Section 3.1(c)(ii).

            

            

            “Code” means the U.S. Internal Revenue Code of 1986, as amended.

            

            

            “Commission” means the Securities and Exchange Commission, as from time to
              time constituted, created under the Exchange Act, or if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing
              such duties at such time.

            

            

            “Company” means the Person named as the “Company” in the first paragraph of this CVR Agreement and its permitted successors and assigns. To the extent necessary to comply with the requirements of the provisions of Trust Indenture Act Sections 310
              through 317, inclusive, to the extent that they are applicable to the Company, the term “Company” shall include any other obligor with respect to the
              Securities for the purposes of complying with such provisions.

            

            

            “Company Request” or “Company Order” means a written request or order signed in the name of the Company by the chief executive officer, any president or vice president, the
              secretary or any assistant secretary or any other individual duly authorized to act on behalf of the Company for such purpose, and delivered to the Trustee.

            

            

            “Corporate Trust Office” means the office of the Trustee at which at any
              particular time its corporate trust business shall be principally administered, which office at the date of execution of this CVR Agreement is located at [          ].

            

            

            “CVRs” shall have the meaning set forth in the Preamble of this CVR
              Agreement.

            

            

            “CVR Agreement” means this instrument as originally executed and as it may
              from time to time be supplemented or amended pursuant to the applicable provisions hereof.

            

            

            “CVR Payment” means any Annual Payment and any Change in Control Payment.

            

            

            “Depositary” shall have the meaning set forth in Section 3.2.

            

            

            
              3

              
                

            

            

            

            “Direct Registration Securities” means Securities, the ownership of which is
              recorded on the Direct Registration System. The terms “deliver,” “execute,” “issue,” “register,” “surrender,” “transfer” or “cancel,” when used
              with respect to Direct Registration Securities, shall refer to an entry or entries or an electronic transfer or transfers in the Direct Registration System.

            

            

            “Direct Registration System” means the system for the uncertificated
              registration of ownership of securities established by the Security Registrar and utilized by the Security Registrar pursuant to which the Security Registrar may record the ownership of CVRs without the issuance of a certificate, which
              ownership shall be evidenced by periodic statements issued by the Security Registrar to the Holders entitled thereto.

            

            

            “EBITDA” means, with respect to any Excess EBITDA Measuring Period, the Company’s consolidated net income (loss) (a) plus interest expense, net (or minus interest income, net, to the
              extent applicable) (b) plus income tax provision (or minus income tax benefit, to the extent applicable) (c) plus depreciation expense (d) plus amortization expense, in each case as determined with respect to
              such Excess EBITDA Measuring Period and reported in the Company’s annual report on Form 10-K with respect to such Excess EBITDA Measuring Period.  Example calculations of EBITDA are set forth on Annex A.

            

            

            “Event of Default” shall have the meaning set forth in Section 8.1 of this CVR Agreement.

            

            

            “Excess EBITDA” means, with respect to any Excess EBITDA Measuring Period, an
              amount equal to the excess, if any, of (a) EBITDA for such Excess EBITDA Measuring Period over (b) (i) the sum of (x) Net Debt as of the last day of such Excess EBITDA Measuring Period and (y) one hundred million dollars ($100,000,000) divided

                by (ii) 3.0.  Example calculations of Excess EBITDA are set forth on Annex A.

            

            

            “Excess EBITDA Measuring Period” means the twelve (12) month period beginning on the first day of each fiscal year of the Company during the term of this CVR Agreement and ending on
              the last day of each fiscal year of the Company during the term of this CVR Agreement; provided that the first Excess EBITDA Measuring Period shall begin on January 1, 2019 and end on December 31, 2019.

            

            

            “Excess EBITDA Statement” means, with respect to each Excess EBITDA Measuring Period, the written statement of the Company setting forth the Annual Payments, if any, due with respect
              to each CVR that is Outstanding as of the applicable Annual Payment Record Date, if any, in respect of the applicable Excess EBITDA Measuring Period in accordance with this CVR Agreement.

            

            

            “Exchange Act” means the Securities Exchange Act of 1934, as amended.

            

            

            “GAAP” means generally accepted accounting principles in the United States as in effect from time to time.

            

            

            “Global Securities” means global securities in registered form, substantially
              in the form set forth in Annex B.

            

            

            “Governmental Entity” means the government of the United States, any other
              nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or
              administrative powers or functions of or pertaining to government.

            

            

            “Holder” means a Person in whose name a Security is registered in the
              Security Register.

            

            

            “Indirect Participant” means a Person who holds a beneficial interest in a
              Global Security through a Participant.

            

            

            “Initial Settlement CVR Amount” shall have the meaning set forth in Section 3.1(a).

            

            

            “Junior Obligations” shall have the meaning set forth in Section 10.1.

            

            

            
              4

              
                

            

            

            

            “Law” means any statute, law (including common law), treaty, rule,
              regulation, code, ordinance, order, decree, writ, judgment, injunction or determination of any arbitrator or court or other Governmental Entity.

            

            

            “Majority Holders” means, at the time of determination, Holders of at least a
              majority of the Outstanding CVRs.

            

            

            “Net Debt” means, with respect to any Excess EBITDA Measuring Period, an amount equal to (a) the Company’s total short-term and long-term debt plus (b) the Company’s deferred financing costs minus
              (c) the Company’s unrestricted cash and cash equivalents, in each case as of the last day of such Excess EBITDA Measuring Period and reported in the Company’s annual report on Form 10-K with respect to such Excess EBITDA Measuring Period.

            

            

            “Officer’s Certificate”, when used with respect to the Company, means a
              certificate signed by the chief executive officer, any president or vice president, the secretary or any assistant secretary or any other individual authorized to act on behalf of the Company delivered to the Trustee.

            

            

            “Opinion of Counsel” means a written opinion of counsel, which may be counsel
              for the Company.

            

            

            “Outstanding”, when used with respect to the Securities, means, as of the
              date of determination, all Securities theretofore authenticated and delivered under this CVR Agreement, except: (i) Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation and (ii) Securities in exchange
              for or in lieu of which other Securities have been authenticated and delivered pursuant to this CVR Agreement; provided, however, that in determining whether the Holders of the requisite Outstanding Securities have given any request, demand, direction, consent or waiver hereunder, Securities owned by the Company or any Affiliate of the
              Company, whether held as treasury securities or otherwise, shall be disregarded and deemed not to be Outstanding.

            

            

            “Participant” means, with respect to the Depositary, a Person who has an
              account with the Depositary.

            

            

            “Party” shall mean the Trustee and the Company, as applicable.

            

            

            “Paying Agent” means any Person authorized by the Company to pay the amount
              determined pursuant to Section 3.1, if any, on any Securities on behalf of the Company.

            

            

            “Payment Date” means any Annual Payment Date and the Change in Control Payment Date, if applicable.

            

            

            “Person” means any individual, corporation, partnership, joint venture,
              association, joint-stock company, trust, limited liability company, unincorporated organization or Governmental Entity, including, in each case, such Person’s permitted successors and assigns.

            

            

            “Responsible Officer”, when used with respect to the Trustee, means any
              officer assigned to the Corporate Trust Office and also means, with respect to any particular corporate trust matter, any other officer of the Trustee to whom such matter is referred because of his or her knowledge of and familiarity with the
              particular subject.

            

            

            “Securities” shall have the meaning set forth in the Preamble of this CVR
              Agreement.

            

            

            “Securities Act” shall have the meaning set forth in the Recitals of this CVR Agreement.

            

            

            “Security Register” shall have the meaning set forth in Section 3.4(a).

            

            

            “Security Registrar” shall have the meaning set forth in Section 3.4(a).

            

            

            “Senior Obligations” means any existing or future obligations of the Company
              and its Subsidiaries, including the principal of, premium (if any), interest (including any interest accruing subsequent to the filing of a petition of bankruptcy at the rate provided for in the documentation with respect thereto, whether or
              not such interest is an allowed claim under applicable Law) on, and all other amounts owing thereon, with respect to or as evidenced by (i) borrowed

             

            

            
              5

              
                

            

             money, (ii) notes, debentures, bonds or other similar debt instruments, (iii) the net obligations owed under interest rate swaps or similar agreements or currency exchange transactions, (iv)
              reimbursement obligations in respect of letters of credit and similar obligations, (v) the deferred purchase price of property or services and conditional sale agreements, (vi) capital leases or (vii) guarantees in respect of obligations
              referred to in clauses (i) through (vi) above; unless, in any case, the instrument creating or evidencing the same or pursuant to which the same is outstanding expressly provides that such obligations are pari

                passu to or subordinate in right of payment to the Securities. 

            

            

            Notwithstanding the foregoing, “Senior Obligations” shall not include:

            

            

            
              
                	

                      	(A)	
                        Junior Obligations;

                      

              

            

            

            

            
              
                	

                      	(B)	
                        trade debt incurred in the ordinary course of business;

                      

              

            

            

            

            
              
                	

                      	(C)	
                        any intercompany indebtedness between the Company and any of its Subsidiaries;

                      

              

            

            

            

            
              
                	

                      	(D)	
                        indebtedness or other obligations of the Company that by its terms ranks equal or junior in right of payment to the Junior Obligations;

                      

              

            

            

            

            
              
                	

                      	(E)	
                        indebtedness of the Company that, by operation of Law, is subordinate to any general unsecured obligations of the Company; or

                      

              

            

            

            

            
              
                	

                      	(F)	
                        indebtedness evidenced by any guarantee of indebtedness ranking equal or junior in right of payment to the Junior Obligations.

                      

              

            

            

            

            For the avoidance of doubt, all “Secured Obligations” under (and as defined in) that certain Loan Agreement, dated as of April 17, 2014, among the Company, the other loan parties party
              thereto, the other lenders party thereto and the administrative agent party thereto shall constitute “Senior Obligations” for the purposes hereof.

            

            

            “Series A Contingent Value Rights” shall have the meaning set forth in Section 3.1(b).

            

            

            “Settlement Stipulation” shall have the meaning set forth in the Recitals of
              this CVR Agreement.

            

            

            “Subsidiary” means, with respect to any Person, any corporation, limited
              liability company, association, partnership or other business entity of which more than fifty percent (50%) of the total voting power of shares of Voting Securities is at the time owned or controlled, directly or indirectly, by: (i) such
              Person; (ii) such Person and one or more Subsidiaries of such Person; or (iii) one or more Subsidiaries of such Person.

            

            

            “Tax” means any federal, state, local or foreign income, profits, gross
              receipts, license, payroll, employment, severance, stamp, occupation, premium, windfall profits, environmental, customs duty, capital stock, franchise, sales, social security, unemployment, disability, use, property, withholding, excise,
              transfer, registration, production, value added, alternative minimum, occupancy, estimated or any other tax of any kind whatsoever, together with any interest, penalty or addition thereto, imposed by any Governmental Entity responsible for
              the imposition of any such tax, whether disputed or not.

            

            

            “Tax Return” means any return, report, declaration, claim or other statement
              (including attached schedules) relating to Taxes.

            

            

            “Termination Date” shall have the meaning set forth in Section 1.16.

            

            

            “Total Payment Cap” means, with respect to each CVR, an amount equal to (a) sixty million dollars ($60,000,000) divided by (b) the Initial Settlement CVR Amount. 

            

            

            “Total Payment Cap Date” means the Payment Date on which the cumulative Annual Payments (inclusive of any Annual Payments to be made on such Payment Date) that the Company has paid, or caused to be paid
              or

             

            

            
              6

              
                

            

             

            

             deposited with, the Trustee in accordance with Section 3.1 with respect to each CVR Outstanding as of the applicable Annual Payment Record Date equals the Total Payment Cap.

             

            

            “Trust Indenture Act” means the Trust Indenture Act of 1939, as amended from
              time to time.

            

            

            “Trustee” means the Person named as the “Trustee” in the first paragraph of this CVR Agreement, until a successor Trustee shall have become such pursuant to the applicable provisions of this CVR Agreement, and thereafter “Trustee” shall mean such successor Trustee.

            

            

            “Voting Securities” means securities or other interests having voting power
              or the right to elect or appoint a majority of the directors, or any Persons performing similar functions, irrespective of whether or not stock or other interests of any other class or classes shall have or might have voting power or any
              right by reason of the happening of any contingency.

            

            

            Section 1.2.  Certificates and Opinions.

            

            

            (a)  Upon any application or request by the Company to the Trustee to take any action under any provision of this CVR Agreement, the Company shall
              furnish to the Trustee an Officer’s Certificate stating that, in the opinion of the signor, all conditions precedent, if any, provided for in this CVR Agreement relating to the proposed action have been satisfied, and an Opinion of Counsel
              stating, subject to customary exceptions, that in the opinion of such counsel, all such conditions precedent, if any, have been satisfied, except that, in the case of any such application or request as to which the furnishing of any one of
              such documents is specifically required by any provision of this CVR Agreement relating to such particular application or request, no additional certificate or opinion need be furnished.

            

            

            (b)  Every certificate or opinion with respect to satisfaction of a condition or compliance with a covenant provided for in this CVR Agreement shall
              include: (i) a statement that each individual signing such certificate or opinion has read such condition or covenant and the definitions herein relating thereto; (ii) a brief statement as to the nature and scope of the examination or
              investigation upon which the statements or opinions contained in such certificate or opinion are based; (iii) a statement that, in the opinion of each such individual, he or she has made such examination or investigation as is necessary to
              enable him or her to express an informed opinion as to whether or not such condition has been satisfied or covenant has been complied with; and (iv) a statement as to whether, in the opinion of each such individual, such condition or covenant
              has been complied with.

            

            

            Section 1.3.  Form of Documents Delivered to Trustee.

            

            

            (a)  In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that
              all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or
              more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.

            

            

            (b)  Any Officer’s Certificate may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by,
              counsel. Any Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company.

            

            

            (c)  Any certificate, statement or opinion of an officer of the Company or of counsel may be based, insofar as it relates to accounting matters,
              upon a certificate or opinion of or representations by an accountant or firm of accountants in the employ of the Company.

            

            

            (d)  Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other
              instruments under this CVR Agreement, they may, but need not, be consolidated and form one instrument.

            

            

            
              7

              
                

            

            

            

            Section 1.4.  Acts of Holders.

            

            

            (a)  Any request, demand, authorization, direction, notice, consent (including any consent obtained in connection with a tender offer or exchange
              for, or purchase of, the CVRs), waiver or other action provided by this CVR Agreement to be given or taken by Holders may be embodied in and evidenced by one or more instruments signed by such Holders in person or by an agent duly appointed
              in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly
              required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this CVR Agreement and
              (subject to Section 4.1) conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section 1.4. The Company
              may set a record date for purposes of determining the identity of Holders entitled to vote or consent to any action by vote or consent authorized or permitted under this CVR Agreement. If not previously set by the Company, (i) the record date
              for determining the Holders entitled to vote at a meeting of the Holders shall be the date preceding the date notice of such meeting is mailed or otherwise delivered to the Holders, or if notice is not given, on the day next preceding the day
              such meeting is held, and (ii) the record date for determining the Holders entitled to consent to any action in writing without a meeting shall be the first date on which a signed written consent setting forth the action taken or proposed to
              be taken is delivered to the Company. If a record date is fixed, those Persons who were Holders of the Securities at such record date (or their duly designated proxies), and only those Persons, shall be entitled to take such action by vote or
              consent or, except with respect to clause (d) below, to revoke any vote or consent previously given, whether or not such Persons continue to be Holders after such record date.

            

            

            (b)  The fact and date of the execution by any Person of any such instrument or writing may be proved in any reasonable manner that the Trustee
              deems sufficient.

            

            

            (c)  The ownership of Securities shall be proved by the Security Register. Neither the Company nor the Trustee nor any agent of the Company or the
              Trustee shall be affected by any notice to the contrary.

            

            

            (d)  At any time prior to (but not after) the evidencing to the Trustee, as provided in this Section 1.4,
              of the taking of any action by the Holders of the Securities specified in this CVR Agreement in connection with such action, any Holder of a Security the serial number of which is shown by the evidence to be included among the serial numbers
              of the Securities the Holders of which have consented to such action may, by filing written notice at the Corporate Trust Office and upon proof of holding as provided in this Section 1.4,
              revoke such action so far as concerns such Security. Any request, demand, authorization, direction, notice, consent (including any consent obtained in connection with a tender offer or exchange for, or purchase of, the CVRs), waiver or other
              action by the Holder of any Security shall bind every future Holder of the same Security or the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof, in respect of anything done,
              suffered or omitted to be done by the Trustee, any Paying Agent or the Company in reliance thereon, whether or not notation of such action is made upon such Security.

            

            

            Section 1.5.  Notices, etc., to Trustee and Company. Any request, demand, authorization, direction, notice, consent,
              waiver or Act of Holders or other document provided or permitted by this CVR Agreement to be made upon, given or furnished to, or filed with:

            

            

            (a)  the Trustee by any Holder or by the Company shall be sufficient for every purpose hereunder if made, given, furnished, filed or otherwise
              delivered, in writing, to or with the Trustee at its Corporate Trust Office; or

            

            

            (b)  the Company by the Trustee or by any Holder shall be sufficient for every purpose hereunder if in writing and mailed, first-class postage
              prepaid to the Company addressed to it at:

            
              

              

              
                8

                
                  

              

              

              

              
                	 	
                        Akorn, Inc.

                      
	 	
                        1925 West Field Court, Suite 300

                      
	 	
                        Lake Forest, Illinois 60045

                      
	 	
                        Attn:

                      	
                        Joseph Bonaccorsi, General Counsel

                      
	 	
                        Email:

                      	
                        joe.bonaccorsi@akorn.com

                      
	 	 	 
	 	
                        with copies to (which shall not constitute notice):

                      
	 	 	 
	 	
                        Cravath, Swaine & Moore LLP

                      
	 	
                        Worldwide Plaza

                      
	 	
                        825 Eighth Avenue

                      
	 	
                        New York, New York 10019

                      
	 	
                        Attn:

                      	
                        Paul H. Zumbro

                      
	 	 	
                        Nicholas A. Dorsey

                      
	 	
                        Email:

                      	
                        pzumbro@cravath.com

                      
	 	 	
                        ndorsey@cravath.com

                      

              

               

              

            

            or at any other address previously furnished in writing to the Trustee by the Company.

            

            

            Section 1.6.  Notice to Holders; Waiver.

            

            

            (a)  Except as otherwise expressly stated in this CVR Agreement, where this CVR Agreement provides for notice to Holders of any event, such notice
              shall be sufficiently given (unless otherwise herein expressly provided) if sent by electronic transmission in accordance with the Applicable Procedures or in writing and mailed, first-class postage prepaid, or otherwise delivered to each
              Holder affected by such event, at such Holder’s address as it appears in the Security Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of
              such notice. In any case where notice to Holders is given by mail or otherwise delivered, neither the failure to mail or otherwise deliver such notice, nor any defect in any notice so mailed or otherwise delivered, to any particular Holder
              shall affect the sufficiency of such notice with respect to other Holders. Where this CVR Agreement provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after
              the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such
              waiver.

            

            

            (b)  In case by reason of the suspension of regular mail service or by reason of any other cause, it shall be impracticable to mail or otherwise
              deliver notice of any event as required by any provision of this CVR Agreement, then any method of giving such notice as shall be satisfactory to the Trustee shall be deemed to be a sufficient giving of such notice.

            

            

            Section 1.7.  Conflict with Trust Indenture Act. If any provision hereof limits, qualifies or conflicts with another
              provision hereof which is required to be included in this CVR Agreement by any of the provisions of the Trust Indenture Act, such required provision shall control.

            

            

            Section 1.8.  Effect of Headings and Table of Contents. The Article and Section headings herein and the Table of
              Contents are for convenience only and shall not affect the construction hereof.

            

            

            Section 1.9.  Benefits of Agreement. Nothing in this CVR Agreement or in the Securities, express or implied, shall
              give to any Person (other than the Parties hereto and their successors hereunder, any Paying Agent and the Holders) any benefit or any legal or equitable right, remedy or claim under this CVR Agreement or under any covenant or provision
              herein contained, all such covenants and provisions being for the sole benefit of the Parties hereto and their successors, any Paying Agent and of the Holders.

            

            

            Section 1.10.  Governing Law; Waiver of Jury. (A)  THIS CVR AGREEMENT AND ALL SUITS, ACTIONS, PROCEEDINGS,
              CLAIMS AND CAUSES OF ACTION (WHETHER IN CONTRACT OR TORT) 

             

            

            
              9

              
                

            

             

            

             BASED UPON, ARISING OUT OF OR RELATING TO THIS CVR AGREEMENT, THE NEGOTIATION, EXECUTION OR PERFORMANCE OF THIS CVR AGREEMENT OR THE SECURITIES, SHALL BE GOVERNED BY AND CONSTRUED IN
              ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES THEREOF. EACH OF THE COMPANY, THE TRUSTEE AND, TO THE FULLEST
              EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE HOLDERS, BY THEIR ACCEPTANCE OF THE SECURITIES, HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE (EXCEPT AS SET FORTH IN THE FINAL SENTENCE OF THIS SECTION 1.10) JURISDICTION OF ANY NEW YORK
              STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION, PROCEEDING, CLAIM OR CAUSE OF ACTION (WHETHER IN CONTRACT
              OR TORT) BASED UPON, ARISING OUT OF OR RELATING TO THIS CVR AGREEMENT, THE NEGOTIATION, EXECUTION OR PERFORMANCE OF THIS CVR AGREEMENT OR THE SECURITIES, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
              UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. EACH OF THE COMPANY AND THE TRUSTEE AGREES THAT PROCESS MAY BE SERVED UPON THEM IN ANY MANNER AUTHORIZED BY THE LAWS OF THE STATE OF NEW YORK FOR SUCH PERSONS AND IRREVOCABLY WAIVES, TO
              THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE TO SUCH SERVICE OF PROCESS, THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM
              THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.  FOR THE AVOIDANCE OF DOUBT, AS PROVIDED IN PARAGRAPH 65 OF THE SETTLEMENT STIPULATION, THE UNITED STATES DISTRICT COURT FOR THE
              NORTHERN DISTRICT OF ILLINOIS SHALL RETAIN EXCLUSIVE JURISDICTION OVER DISPUTES ARISING OUT OF THE INITIAL DISTRIBUTION OF CVRS FROM THE NET SETTLEMENT FUND TO PLAINTIFFS AND ANY OTHER DISPUTES ARISING OUT OF THE PLAN OF ALLOCATION.

            

            

            (b)  EACH OF THE COMPANY, THE TRUSTEE AND, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE HOLDERS, BY THEIR ACCEPTANCE OF THE SECURITIES, HEREBY IRREVOCABLY WAIVE, TO THE FULLEST
              EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING BASED UPON, ARISING OUT OF OR RELATING TO THIS CVR AGREEMENT, THE NEGOTIATION, EXECUTION OR PERFORMANCE OF THIS CVR AGREEMENT OR THE SECURITIES.

            

            

            Section 1.11.  Legal Holidays. If a Payment Date shall not be a Business Day, then (notwithstanding any provision of
              this CVR Agreement or the Securities to the contrary) payment on the Securities need not be made on such date, but may be made, without the accrual of any interest thereon, on the next succeeding Business Day with the same force and effect as
              if made on such Payment Date.

            

            

            Section 1.12.  Separability Clause. If any provision in this CVR Agreement or in the CVRs shall be invalid, illegal or
              unenforceable, then the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

            

            

            Section 1.13.  No Recourse Against Others. A director, officer, employee, agent or representative of the Company or
              any Affiliate of the Company or the Trustee shall not have any liability for any obligations of the Company or the Trustee under the Securities or this CVR Agreement or for any claim based on, in respect of or by reason of such obligations or
              their creation. By accepting a Security each Holder waives and releases all such liability and all such claims. The waiver and release are part of the consideration for the issue of the Securities.

            

            

            Section 1.14.  Counterparts. This CVR Agreement shall be signed in any number of counterparts with the same effect as
              if the signatures to each counterpart were upon a single instrument, and all such counterparts together shall be deemed an original of this CVR Agreement.

            

            

            Section 1.15.  Acceptance of Trust. [          ], the Trustee named herein, hereby accepts the trusts in this CVR
              Agreement declared and provided, upon the terms and conditions set forth herein.

             

            

            
              10

              
                

            

            

            

            Section 1.16.  Termination. This CVR Agreement will, automatically and without any further action of any Party,
              terminate and be of no force or effect and shall be satisfied and discharged, and the Parties hereto shall have no liability or obligations hereunder, at the earliest to occur of (a) the consummation of a Change in Control; provided
              that, if a Change in Control Payment is due and payable pursuant to the terms of this CVR Agreement, then upon the making of such payment on the Change in Control Payment Date, (b) the Bankruptcy Claim Date (upon the receipt of the Bankruptcy
              Claim), (c) the Total Payment Cap Date and (d) the Annual Payment Date with respect to the Excess EBITDA Measuring Period ending on December 31, 2023; provided that, in the case of clause (d), if the cumulative Annual Payments that
              the Company has paid to, or caused to be paid or deposited with, the Trustee in accordance with Section 3.1 as of such Annual Payment Date (after giving effect to any Annual Payment to be made on such date) is less than the Total
              Payment Cap, then such date shall be extended to the Annual Payment Date with respect to the Excess EBITDA Measuring Period ending on December 31, 2025 (the earliest of such dates, the “Termination Date”); provided, however, that Sections 1.5 through 1.10, 1.12, 1.13, this Section 1.16, 4.7, 7.2, 7.5, 8.2, Article 10 and Section 1.1 (to the extent related to the foregoing) shall survive termination of this
              CVR Agreement in accordance with their terms.

            

            

            Section 1.17.  Certain Purchases and Sales. Nothing contained herein shall prohibit the Company or any of its
              Subsidiaries or Affiliates from acquiring in open market transactions, private transactions or otherwise, any Securities.

            

            

            ARTICLE 2

              SECURITY FORMS

            

            

            Section 2.1.  Forms Generally.

            

            

            (a)  (i)  The Global Securities and the Trustee’s certificate of authentication shall be in substantially
              the forms set forth in Annex B, attached hereto and incorporated herein by reference, with such appropriate insertions, omissions, substitutions and other variations as are required or
              permitted by this CVR Agreement and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may be required
              by Law or any rule or regulation pursuant thereto, all as may be determined by the officers executing such Global Securities, as evidenced by their execution of the Global Securities. Any portion of the text of any Global Security may be set
              forth on the reverse thereof, with an appropriate reference thereto on the face of the Global Security. 

            

            

            (ii)  The Global Securities shall be typewritten, printed, lithographed or engraved on steel engraved borders or produced by any combination of
              these methods or may be produced in any other manner permitted by the rules of any securities exchange on which the Securities may be listed, all as determined by the officers executing such Global Securities, as evidenced by their execution
              of such Global Securities. 

            

            

            (b)  The Direct Registration Securities shall be uncertificated and shall be evidenced by the Direct Registration System maintained by the Security
              Registrar.

            

            

            ARTICLE 3

              THE SECURITIES

            

            

            Section 3.1.  Title and Terms.

            

            

            (a)  The aggregate number of CVRs which may be authenticated, as applicable, and delivered under this CVR Agreement is limited to a number equal to
              [●]1 (such amount, the “Initial Settlement CVR Amount”), except for Securities authenticated, as applicable, and delivered upon registration of transfer
              of, 

            
              
                

                

                

                

                1 To equal the amount of CVRs determined in accordance with the Plan of Allocation.

                

                

                
                  11

                  
                    

                

              

            

            or in exchange for, or in lieu of, other Securities pursuant to Section 3.4, 3.5 or 6.6.

            

            

            (b)  The Securities shall be known and designated as the “Series A Contingent Value Rights” of the Company.

            

            

            (c)  Subject to the limitations set forth in Article 10:

            

            

            (i)  on each Annual Payment Date, the Company shall pay to the Trustee, by wire transfer to the account designated by the Trustee (so designated in
              writing at least two (2) Business Days prior to the applicable Annual Payment Date), an amount equal to the aggregate Annual Payment due, if any, in respect of the CVRs that are Outstanding as of the close of business in New York City, three
              (3) Business Days prior to such Annual Payment Date (the “Annual Payment Record Date”) for the Excess EBITDA Measuring Period ended immediately preceding such Annual Payment Date, and the Trustee shall pay to each Holder of record of
              the CVRs as of the Annual Payment Record Date an amount equal to the Annual Payment due, if any, in respect of such CVRs held by such Holder; provided that, the Company’s obligations to make any Annual Payment shall terminate in its
              entirety on the Termination Date;

            

            

            (ii)  on the Change in Control Payment Date, if any, the Company shall pay to the Trustee, by wire transfer to the account designated by the Trustee
              (so designated in writing at least two (2) Business Days prior to the Change in Control Payment Date), an amount equal to the aggregate Change in Control Payment due in respect of the CVRs that are Outstanding as of the close of business in
              New York City, three (3) Business Days prior to such Change in Control Payment Date (the “Change in Control Payment Record Date”), and the Trustee shall pay to each Holder of record of the CVRs as of the Change in Control Payment
              Record Date an amount equal to the Change in Control Payment due, if any, in respect of such CVRs held by such Holder; provided that, the Company’s obligations to make any Change in Control Payment shall terminate in its entirety on
              the Termination Date; and

            

            

            (iii)  on the Bankruptcy Claim Date, if any, each Holder as of such date shall receive a general unsecured claim in the Company’s bankruptcy in an
              amount equal to the Bankruptcy Claim in respect of each CVR held by such Holder as of the Bankruptcy Claim Date.

            

            

            (d)  The Holders of the CVRs, by acceptance thereof, agree that no joint venture, partnership or other fiduciary relationship is created hereby or
              by the Securities.

            

            

            (e)  Other than in the case of interest on amounts due and payable after the occurrence of an Event of Default, no interest or dividends shall
              accrue on any amounts payable in respect of the CVRs.

            

            

            (f)  The CVRs and any interest thereon may be sold, assigned, pledged encumbered or in any manner transferred or disposed of, in whole or in part,
              only in compliance with applicable United States federal and state securities Laws and, to the extent applicable, in accordance with Section 3.4.

            

            

            (g)  The Holder of any CVR is not, and shall not be, by virtue thereof, entitled to any rights of a holder of any Voting Securities or other equity
              security or other ownership interest of the Company or in any of its Affiliates, either at Law or in equity, and the rights of the Holders are limited to those contractual rights expressed in this CVR Agreement.

            

            

            (h)  Except as provided in this CVR Agreement, none of the Company or any of its Affiliates shall have any right to set-off any amounts owed or
              claimed to be owed by any Holder to any of them against such Holder’s Securities or any CVR Payment or other amount payable to such Holder in respect of such Securities.

            

            

            (i)  For the avoidance of doubt, (i) prior to the occurrence of the first Payment Date, if any, no amounts shall be owing to Holders pursuant to the
              terms of this CVR Agreement, (ii) from and after the

             

            

            
              12

              
                

            

             

            

            Bankruptcy Claim Date, the Holders shall have only Bankruptcy Claims and shall not have claims with respect to any CVR Payments, (iii) in no event shall the Holders be
              entitled to receive both a Change in Control Payment and a Bankruptcy Claim and (iv) in no event shall any further Annual Payments be required following the consummation of a Change in Control (and where a Change in Control Payment is due in
              accordance with the terms hereof, upon the payment of the Change in Control Payment) or Bankruptcy Claim Date (upon the receipt of the Bankruptcy Claim).

            

            

            Section 3.2.  Registrable Form. The Securities shall be issuable only in registered form. The CVRs shall be issued
              initially in the form of (a) one or more permanent Global Securities, deposited with the Trustee, as the custodian for The Depository Trust Company, its nominees and successors (the “Depositary”), or (b) one or more Direct Registration Securities. Each Global Security will represent such of the outstanding CVRs as will be specified
              therein and each shall provide that it represents the aggregate number of outstanding CVRs from time to time endorsed thereon and that the aggregate number of outstanding CVRs represented thereby may from time to time be reduced or increased,
              as appropriate, to reflect exchanges. 

            

            

            Section 3.3.  Execution, Authentication, Delivery and Dating.

            

            

            (a)  The Global Securities shall be executed on behalf of the Company by the Company’s chief executive officer, any president or vice president or
              any other individual duly authorized to act on behalf of the Company for such purpose, but need not be attested. The signature of any of these individuals on the Global Securities may be manual or facsimile.

            

            

            (b)  Global Securities bearing the manual or facsimile signatures of individuals who were, at the time of execution, the proper officers of the
              Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Global Securities or did not hold such offices at the date of such Global
              Securities.

            

            

            (c)  At any time and from time to time after the execution and delivery of this CVR Agreement, the Company may deliver a Company Order for the
              authentication, as applicable, and delivery of Securities, and the Trustee, in accordance with such Company Order, shall authenticate, as applicable, and deliver such Securities as provided in this CVR Agreement and not otherwise. In the case
              of Global Securities, such Company Order shall be accompanied by Global Securities executed by the Company and delivered to the Trustee for authentication in accordance with such Company Order.

            

            

            (d)  Each Global Security shall be dated the date of its authentication.

            

            

            (e)  No Global Security shall be entitled to any benefit under this CVR Agreement or be valid or obligatory for any purpose unless there appears on
              such Security a certificate of authentication substantially in the form provided for herein duly executed by the Trustee, by manual or facsimile signature of an authorized officer, and such certificate upon any Security shall be conclusive
              evidence, and the only evidence, that such Global Security has been duly authenticated and delivered hereunder and that the Holder is entitled to the benefits of this CVR Agreement.

            

            

            (f)  Direct Registration Securities need not be authenticated, and shall be valid and obligatory for all purposes and shall entitle each Holder
              thereof to all benefits of this CVR Agreement.

            

            

            Section 3.4.  Registration, Registration of Transfer and Exchange.

            

            

            (a)  The Company shall cause to be kept at the office of the Trustee a register (the register maintained in such office and in any other office or
              agency designated pursuant to Section 7.2 being herein sometimes referred to as the “Security Register”) in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities. The Trustee is hereby initially
              appointed “Security Registrar” for the purpose of registering Securities and transfers of Securities as
              herein provided.

             

            

            
              13

              
                

            

            

            

            (b)  (i)  A Global Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary, by a nominee of the
              Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary. All Global Securities will be exchanged by the Company for
              Direct Registration Securities if (A) the Company delivers to the Security Registrar notice from the Depositary that it is unwilling or unable to continue to act as Depositary or that it is no longer a clearing agency registered under the
              Exchange Act and, in either case, a successor Depositary is not appointed by the Company within one hundred twenty (120) days after the date of such notice from the Depositary, (B) the Company in its sole discretion determines that the Global
              Securities should be exchanged for Direct Registration Securities and delivers a written notice to such effect to the Security Registrar or (C) an Event of Default has occurred and is continuing and the Security Registrar has received a
              request from the Depositary to issue Direct Registration Securities. Upon the occurrence of either of the preceding events in (A) or (B) above, Direct Registration Securities shall be issued in such names as the Depositary shall instruct the
              Trustee. Global Securities also may be exchanged or replaced, in whole or in part, as provided in Section 3.5 hereof. Every Global Security authenticated and delivered in exchange for, or in
              lieu of, a Global Security or any portion thereof, pursuant to this Section 3.4 or Section 3.5 hereof, shall be authenticated and
              delivered in the form of, and shall be, a Global Security. A Global Security may not be exchanged for another Global Security other than as provided in this Section 3.4(b)(i); however,
              beneficial interests in a Global Security may be transferred and exchanged as provided in Sections 3.4(b)(ii) or (iii) hereof. 

            

            

            (ii)  The transfer and exchange of beneficial interests in the Global Securities will be effected through the Depositary, in accordance with the
              provisions of this CVR Agreement and the Applicable Procedures. Beneficial interests in any Global Security may be transferred to Persons who take delivery thereof in the form of a beneficial interest in Global Security. No written orders or
              instructions shall be required to be delivered to the Security Registrar to effect the transfers described in this Section 3.4(b)(ii).

            

            

            (iii)  If any holder of a beneficial interest in a Global Security proposes to exchange such beneficial interest for a Direct Registration Security
              or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Direct Registration Security, then the Security Registrar will cause the aggregate number of CVRs represented by the applicable Global Security to
              be reduced accordingly pursuant to Section 3.4(b)(vi) hereof, and the Security Registrar will deliver to the Person designated in the instructions a Direct Registration Security in the
              appropriate number of CVRs. Any Direct Registration Security issued in exchange for a beneficial interest pursuant to this Section 3.4(b)(iii) will be registered in such name or names and in
              such authorized denomination or denominations as the holder of such beneficial interest requests through instructions to the Security Registrar from or through the Depositary and the Participant or Indirect Participant.

            

            

            (iv)  A Holder of a Direct Registration Security may exchange such Direct Registration Security for a beneficial interest in a Global Security or
              transfer such Direct Registration Security to a Person who takes delivery thereof in the form of a beneficial interest in a Global Security at any time. Upon receipt of a request for such an exchange or transfer, the Security Registrar will
              cancel the applicable Direct Registration Security and increase or cause to be increased the aggregate number of CVRs represented by one of the Global Securities.

            

            

            (v)  Upon request by a Holder of Direct Registration Securities and such Holder’s compliance with the
              provisions of this Section 3.4(b)(v), the Security Registrar will register the transfer or exchange of Direct Registration Securities. Prior to such registration of transfer or exchange, the
              requesting Holder must present to the Security Registrar a written instruction of transfer in form satisfactory to the Security Registrar duly executed by such Holder or by its attorney, duly authorized in writing. A Holder of Direct
              Registration Securities may transfer such Direct Registration Securities to a Person who takes delivery thereof in the form of Direct Registration Securities. Upon receipt of a request to register such a transfer, the Security Registrar shall
              register the Direct Registration Securities pursuant to the instructions from the Holder thereof.

            

            

            
              14

              
                

            

            

            

            (vi)  At such time as all beneficial interests in a particular Global Security have been exchanged for Direct Registration Securities or a
              particular Global Security has been repurchased or canceled in whole and not in part, each such Global Security will be returned to or retained and canceled by the Security Registrar in accordance with Section

                  3.8 hereof. At any time prior to such cancellation, if any beneficial interest in a Global Security is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another
              Global Security or for Direct Registration Securities, the aggregate number of CVRs represented by such Global Security will be reduced accordingly and an endorsement will be made on such Global Security by the Security Registrar or by the
              Depositary at the direction of the Security Registrar to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the
              form of a beneficial interest in another Global Security, such other Global Security will be increased accordingly and an endorsement will be made on such Global Security by the Security Registrar or by the
                Depositary at the direction of the Security Registrar to reflect such increase. 

            

            

            (vii)  (A)  To permit registrations of transfers and exchanges, the Company will execute and the Trustee will authenticate Global Securities upon
              receipt of a Company Order in accordance with Section 3.3 hereof or at the Security Registrar’s request. 

            

            

            (B)  No service charge will be made to a Holder of a beneficial interest in a Global Security or to a Holder of a Direct Registration Security for
              any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith. 

            

            

            (C)  All Global Securities and Direct Registration Securities issued upon any registration of transfer or exchange of Global Securities or Direct
              Registration Securities will be the valid obligations of the Company, evidencing the same rights, and entitled to the same benefits under this CVR Agreement, as the Global Securities or Direct Registration Securities surrendered upon such
              registration of transfer or exchange.

            

            

            (D)   The Trustee will authenticate Global Securities in accordance with the provisions of Section 3.3
              hereof.

            

            

            Section 3.5.  Mutilated, Destroyed, Lost and Stolen Securities.

            

            

            (a)  If (i)  any mutilated Global Security is surrendered to the Trustee, or (ii) the Company and the Trustee receive evidence to their satisfaction
              of the destruction, loss or theft of any Global Security, and there is delivered to the Company and the Trustee such security or indemnity as may be required by them to hold each of them harmless, then, in the absence of notice to the Company
              or the Trustee that such Global Security has been acquired by a bona fide purchaser, the Company shall execute and, upon delivery of a Company Order, the Trustee shall authenticate, as applicable, and deliver, in exchange for any such
              mutilated Global Security or in lieu of any such destroyed, lost or stolen Global Security, a new CVR, in the form of either a Global Security or a Direct Registration Security, of like tenor and amount of CVRs, bearing a number not
              contemporaneously outstanding. 

            

            

            (b)  In case any such mutilated, destroyed, lost or stolen Global Security has become or is to become finally due and payable within fifteen (15)
              days, the Company in its discretion may, instead of issuing a new CVR, pay to the Holder of such Security on the applicable Payment Date all amounts due and payable with respect thereto.

            

            

            (c)  Every new Security issued pursuant to this Section 3.5 in lieu of any destroyed, lost or
              stolen Global Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Global Security shall be at any time enforceable by anyone, and shall be entitled to all
              benefits of this CVR Agreement equally and proportionately with any and all other Securities duly issued hereunder. 

            

            

            

            
              15

              
                

            

            

            

            (d)  The provisions of this Section 3.5 are exclusive and shall preclude (to the extent lawful)
              all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Global Securities.

            

            

            Section 3.6.  Payments with respect to CVRs. Payment of any CVR Payment pursuant to the CVR Agreement shall be made in
              such coin or currency of the United States of America as at the time is legal tender for the payment of public and private debts. The Company may, at its option, pay such amounts by wire transfer or check payable in such money. 

            

            

            Section 3.7.  Persons Deemed Owners. Prior to the time of due presentment for registration of transfer, the Company,
              the Trustee and any agent of the Company or the Trustee may treat the Person in whose name any Security is registered as the owner of such Security for the purpose of receiving payment on such Security and for all other purposes whatsoever,
              whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.

            

            

            Section 3.8.  Cancellation. All Securities surrendered for payment, registration of transfer or exchange shall, if
              surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly canceled by it. The Company may at any time deliver to the Trustee for cancellation any Global Securities previously authenticated and
              delivered hereunder which the Company may have acquired in any manner whatsoever, and all Global Securities so delivered shall be promptly canceled by the Trustee. No Securities shall be authenticated in lieu of or in exchange for any
              Securities canceled as provided in this Section, except as expressly permitted by this CVR Agreement. All cancelled Global Securities held by the Trustee shall be destroyed and a certificate of destruction shall be issued by the Trustee to
              the Company, unless otherwise directed by a Company Order.

            

            

            Section 3.9.  CUSIP Numbers. The Company in issuing the CVRs may use “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices to the Holders as a
              convenience to the Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the CVRs or as contained in any
              notices and that reliance may be placed only on the other identification numbers printed on the CVRs, and any such notice shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any
              change in the “CUSIP” numbers.

            

            

            ARTICLE 4

              THE TRUSTEE

            

            

            Section 4.1.  Certain Duties and Responsibilities.

            

            

            (a)  With respect to the Holders, the Trustee, prior to the occurrence of an Event of Default (as defined in Section

                  8.1) with respect to the Securities and after the curing or waiving of all Events of Default which may have occurred, undertakes to perform such duties and only such duties as are specifically set forth in this CVR Agreement
              and no implied covenants shall be read into this CVR Agreement against the Trustee. In case an Event of Default with respect to the Securities has occurred (which has not been cured or waived), the Trustee shall exercise such of the rights
              and powers vested in it by this CVR Agreement, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

            

            

            (b)  In the absence of bad faith on its part, prior to the occurrence of an Event of Default and after the curing or waiving of all such Events of
              Default which may have occurred, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee which conform to the
              requirements of this CVR Agreement; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to
              determine whether or not they conform to the requirements of this CVR Agreement.

            

            

            (c)  No provision of this CVR Agreement shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent
              failure to act, or its own willful misconduct, except that (i) this

             

            

            
              16

              
                

            

             

            

            Subsection (c) shall not be construed to limit the effect of Subsections (a) and (b) of this Section 4.1; (ii) the Trustee
              shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and (iii) the Trustee shall not be liable with respect to
              any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders pursuant to Section 8.9 relating to the time, method and place of conducting any
              proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this CVR Agreement. 

            

            

            (d)  Whether or not therein expressly so provided, every provision of this CVR Agreement relating to the conduct or affecting the liability of or
              affording protection to the Trustee shall be subject to the provisions of this Section 4.1.

            

            

            Section 4.2.  Certain Rights of Trustee. Subject to the provisions of Section
                  4.1, including the duty of care that the Trustee is required to exercise upon the occurrence of an Event of Default:

            

            

            (a)  the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument,
              opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties,
              and the Trustee need not investigate any fact or matter stated in the document;

            

            

            (b)  any request or direction or order of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any
              resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution and the Trustee shall not be liable for any action it takes or omits to take in good faith reliance thereon;

            

            

            (c)  whenever in the administration of this CVR Agreement the Trustee shall deem it desirable that a matter be proved or established prior to
              taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officer’s Certificate and the Trustee shall not be liable for
              any action it takes or omits to take in good faith reliance thereon or an Opinion of Counsel; 

            

            

            (d)  the Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization
              and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with such advice or Opinion of Counsel;

            

            

            (e)  the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this CVR Agreement at the request or direction
              of any of the Holders pursuant to this CVR Agreement, unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such
              request or direction;

            

            

            (f)  the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement,
              instrument, opinion, report, notice, request, consent, order, approval, appraisal, bond, debenture, note, coupon, security, or other paper or document, but the Trustee in its discretion may make such further inquiry or investigation into such
              facts or matters as it may see fit, and if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the pertinent books and records of the Company, personally or by agent or attorney, as may
              be reasonably necessary for such inquiry or investigation and in a manner so as to not unreasonably interfere with the normal business operations of the Company or any of its Affiliates; provided,
              however, that Company shall not be required to provide any books or records to the extent that the provision thereof (i) would, as reasonably determined based on the advice of outside counsel,
              jeopardize any attorney-client privilege or (ii) would contravene any Law, charter, articles or certificate or organization or incorporation and bylaws or other organization or governing documents, or any contract or agreement to which the
              Company or any of its Affiliates is subject or bound;

             

            

            
              17

              
                

            

            

            

            (g)  the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or
              attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder;

            

            

            (h)  the Trustee shall not be liable for any action taken, suffered or omitted to be taken by it in good faith and reasonably believed by it to be
              authorized or within the discretion or rights or powers conferred upon it by this CVR Agreement; and

            

            

            (i)  the Trustee shall not be deemed to have notice of any default or Event of Default unless a Responsible Officer of the Trustee has actual
              knowledge thereof or unless written notice thereof has been received by such Responsible Officer at the Corporate Trust Office and such notice references the CVRs and this CVR Agreement and the fact that such notice constitutes notification
              of default or Event of Default.

            

            

            Section 4.3.  Notice of Default. If a default occurs hereunder with respect to the Securities, the Trustee shall give
              the Holders notice of any such default actually known to it as and to the extent applicable and provided by the Trust Indenture Act; provided, however,
              that in the case of any default of the character specified in Section 8.1(b) with respect to the Securities, no notice to Holders shall be given until at least thirty (30) days after the
              occurrence thereof. For the purpose of this Section 4.3, the term “default” means any event that is, or
              after notice or lapse of time or both would become, an Event of Default with respect to the Securities.

            

            

            Section 4.4.  Not Responsible for Recitals or Issuance of Securities. The Trustee shall not be accountable for the
              Company’s issuance of or obligations under the Securities. The recitals contained herein and in the Securities, except the Trustee’s certificates of
              authentication, shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this CVR Agreement or of the
              Securities.

            

            

            Section 4.5.  May Hold Securities. The Trustee, any Paying Agent, Security Registrar or any other agent of the
              Company, in its individual or any other capacity, may become the owner or pledgee of Securities, and, subject to Sections 4.8 and 4.13, may
              otherwise deal with the Company with the same rights it would have if it were not Trustee, Paying Agent, Security Registrar or such other agent.

            

            

            Section 4.6.  Money Held in Trust. Money held by the Trustee in trust hereunder need not be segregated from other
              funds except to the extent required by Law. The Trustee shall be under no liability for interest on any money received by it hereunder.

            

            

            Section 4.7.  Compensation and Reimbursement. The Company agrees:

            

            

            (a)  to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder in such amount as the Company and the
              Trustee shall agree from time to time (which compensation shall not be limited by any provision of Law in regard to the compensation of a trustee of an express trust);

            

            

            (b)  except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable and documented out-of-pocket
              expenses, disbursements and advances incurred or made by the Trustee in accordance with any provision of this CVR Agreement (including the reasonable compensation and the reasonable expenses and disbursements of its agents and outside
              counsel), except any such expense, disbursement or advance as may be attributable to the Trustee’s negligence, bad faith or willful misconduct; and

            

            

            (c)  to indemnify the Trustee and each of its agents, officers, directors and employees (each an “indemnitee”) for, and to hold it harmless against, any loss, liability or reasonable and documented out-of-pocket expense (including the reasonable
              compensation and the reasonable expenses and disbursements of its agents and outside counsel) incurred without negligence, bad faith or willful misconduct on its part, arising out of or in connection with the acceptance or administration of
              this trust and the performance of its duties hereunder, including the reasonable and documented out-of-pocket costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its
              powers or duties

             

            

            
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             hereunder. The Company’s payment obligations pursuant to this Section 4.7 shall survive the termination of this CVR
              Agreement.

            

            

            Section 4.8.  Disqualification; Conflicting Interests.

            

            

            (a)  If applicable, to the extent that the Trustee or the Company determines that the Trustee has a conflicting interest within the meaning of the
              Trust Indenture Act, the Trustee shall immediately notify the Company of such conflict and, within ninety (90) days after ascertaining that it has such conflicting interest, either eliminate such conflicting interest or resign to the extent
              and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this CVR Agreement. The Company shall take prompt steps to have a successor appointed in the manner provided in this CVR Agreement.

            

            

            (b)  If the Trustee fails to comply with Section 4.8(a), the Trustee shall, within ten (10) days
              of the expiration of such ninety (90) day period, transmit a notice of such failure to the Holders in the manner and to the extent provided in the Trust Indenture Act and this CVR Agreement.

            

            

            (c)  If the Trustee fails to comply with Section 4.8(a) after written request therefor by the
              Company or any Holder, then any Holder of any Security who has been a bona fide Holder for at least six (6) months may on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of
              such Trustee and the appointment of a successor Trustee.

            

            

            Section 4.9.  Corporate Trustee Required; Eligibility. There shall at all times be a Trustee hereunder which satisfies
              the applicable requirements of Sections 310(a)(1) and (5) of the Trust Indenture Act and has a combined capital and surplus of at least one hundred million dollars ($100,000,000). If such corporation publishes reports of condition at least
              annually, pursuant to Law or to the requirements of a supervising or examining authority, then for the purposes of this Section 4.9, the combined capital and surplus of such corporation shall
              be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section 4.9, it shall resign immediately in the manner and with the effect hereinafter specified in this Article 4.

            

            

            Section 4.10.  Resignation and Removal; Appointment of Successor.

            

            

            (a)  No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article

                  4 shall become effective until the acceptance of appointment by the successor Trustee under Section 4.11.

            

            

            (b)  The Trustee, or any trustee or trustees hereafter appointed, may resign at any time by giving written notice thereof to the Company. If an
              instrument of acceptance by a successor Trustee shall not have been delivered to the Trustee within thirty (30) days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for
              the appointment of a successor Trustee.

            

            

            (c)  The Trustee may be removed at any time by an Act of the Majority Holders, delivered to the Trustee and to the Company.

            

            

            (d)  If at any time:

            

            

            (i)  the Trustee shall fail to comply with Section 4.8 after written request therefor by the
              Company or by any Holder who has been a bona fide Holder of a Security for at least six (6) months, or

            

            

            (ii)  the Trustee shall cease to be eligible under Section 4.9 and shall fail to resign after
              written request therefor by the Company or by any such Holder, or

            

            

            (iii)  the Trustee shall become incapable of acting or shall be adjudged bankrupt or insolvent, or a receiver of the Trustee or of its property
              shall be appointed, or any public officer shall

             

            

            
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            take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation,

            

            

            then, in any case, (A) the Company, by a Board Resolution or an action of the chief executive officer of the Company, may remove the Trustee, or (B) the Holder of any Security who has been a bona fide Holder of a
              Security for at least six (6) months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

            

            

            (e)  If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, the
              Company, by a Board Resolution or an action of the chief executive officer of the Company, shall promptly appoint a successor Trustee. If, within one year after any removal by the Majority Holders, a successor Trustee shall be appointed by an
              Act of the Majority Holders delivered to the Company and the retiring Trustee, then the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment in accordance with Section
                  4.11, become the successor Trustee and supersede the successor Trustee appointed by the Company. If no successor Trustee shall have been so appointed by the Company or the Majority Holders and accepted appointment within sixty
              (60) days after the retiring Trustee tenders its resignation or is removed, the retiring Trustee may, or, the Holder of any Security who has been a bona fide Holder for at least six (6) months may, on behalf of himself and all others
              similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee.

            

            

            (f)  The Company shall give notice of each resignation and each removal of the Trustee and each appointment of a successor Trustee by mailing
              written notice of such event by first-class mail, postage prepaid, or otherwise delivering such written notice to the Holders as their names and addresses appear in the Security Register. Each notice shall include the name of the successor
              Trustee and the address of its Corporate Trust Office. If the Company fails to send such notice within ten (10) days after acceptance of appointment by a successor Trustee, it shall not be a default hereunder but the successor Trustee shall
              cause the notice to be mailed or otherwise delivered at the expense of the Company. 

            

            

            Section 4.11.  Acceptance of Appointment of Successor.

            

            

            (a)  Every successor Trustee appointed hereunder shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument
              accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers,
              trusts and duties of the retiring Trustee; but, upon request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument
              transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee, and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder. Upon
              request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers and trusts.

            

            

            (b)  No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible
              under this Article 4.

            

            

            Section 4.12.  Merger, Conversion, Consolidation or Succession to Business. Any corporation into which the Trustee may
              be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all of the
              corporate trust business of the Trustee, by sale or otherwise, shall be the successor of the Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article 4,
              without the execution or filing of any paper or any further act on the part of any of the Parties hereto. In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger,
              conversion, sale or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities; and such
              certificate shall have the full force which it is anywhere in the Securities or in this CVR Agreement provided that the certificate of the

             

            

            
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              Trustee shall have; provided that the right to adopt the certificate of authentication of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or
              consolidation.

            

            

            Section 4.13.  Preferential Collection of Claims Against Company. If and when the Trustee shall be or shall become a
              creditor, directly or indirectly, secured or unsecured, of the Company (or any other obligor upon the Securities), excluding any creditor relationship set forth in Section 311(b) of the Trust Indenture Act, if applicable, the Trustee shall be
              subject to the applicable provisions of the Trust Indenture Act regarding the collection of claims against the Company (or any such other obligor).

            

            

            ARTICLE 5

              HOLDERS’ LISTS AND REPORTS BY THE TRUSTEE AND COMPANY 

            

            

            Section 5.1.  Company to Furnish Trustee Names and Addresses of Holders. The Company will furnish or cause to be
              furnished to the Trustee (a) promptly after the issuance of the Securities, and semi-annually thereafter, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders as of a recent date, and (b) at
              such times as the Trustee may request in writing, within thirty (30) days after receipt by the Company of any such request, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders as of a date not
              more than fifteen (15) days prior to the time such list is furnished; provided, however, that if and for so long as the Trustee shall be the
              Security Registrar, no such list need be furnished.

            

            

            Section 5.2.  Preservation of Information; Communications to Holders.

            

            

            (a)  The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of the Holders contained in the most
              recent list furnished to the Trustee as provided in Section 5.1 and the names and addresses of Holders received by the Trustee in its capacity as Security Registrar. The Trustee may destroy
              any list furnished to it as provided in Section 5.1 upon receipt of a new list so furnished.

            

            

            (b)  The rights of the Holders to communicate with other Holders with respect to their rights under this CVR Agreement and the corresponding rights
              and privileges of the Trustee shall be as provided by Section 312(b)(2) of the Trust Indenture Act, if applicable.

            

            

            (c)  Every Holder, by receiving and holding Securities, agrees with the Company and the Trustee that neither the Company nor the Trustee shall be
              deemed to be in violation of Law or held accountable by reason of the disclosure of any such information as to the names and addresses of the Holders made pursuant to the Trust Indenture Act (if applicable), regardless of the source from
              which such information was derived.

            

            

            Section 5.3.  Reports by Trustee.

            

            

            (a)  Within sixty (60) days after December 31 of each year commencing with the December 31 following the date of this CVR Agreement, the Trustee
              shall transmit to all Holders such reports concerning the Trustee and its actions under this CVR Agreement as may be required pursuant to the Trust Indenture Act to the extent and in the manner provided pursuant thereto. The Trustee shall
              also comply with Section 313(b)(2) of the Trust Indenture Act, if applicable. The Trustee shall also transmit by mail or otherwise deliver all reports as required by Section 313(c) of the Trust Indenture Act, if applicable.

            

            

            (b)  A copy of each such report shall, at the time of such transmission to the Holders, be filed by the Trustee with each stock exchange, if any,
              upon which the Securities are listed, with the Commission and also with the Company. The Company will promptly notify the Trustee when the Securities are listed on any stock exchange.

            

            

            Section 5.4.  Reports by Company.  The Company shall comply with the provisions of Section 314(a) of the Trust Indenture Act to the extent applicable.

             

            

            
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            ARTICLE 6

              AMENDMENTS

            

            

            Section 6.1.  Amendments Without Consent of Holders. Without the consent of any Holders, the Company and the Trustee,
              at any time and from time to time, may enter into one or more amendments hereto or to the Securities, for any of the following purposes:

            

            

            (a)  to convey, transfer, assign, mortgage or pledge to the Trustee as security for the Securities any property or assets;

            

            

            (b)  to evidence the succession of another Person to the Company, and the assumption by any such successor of any obligations pursuant to Article

                9 hereof;

            

            

            (c)  to add to the covenants of the Company such further covenants, restrictions, conditions or provisions as the Company and the Trustee shall
              consider to be for the protection of the Holders, and to make the occurrence, or the occurrence and continuance, of a default in any such additional covenants, restrictions, conditions or provisions an Event of Default permitting the
              enforcement of all or any of the several remedies provided in this CVR Agreement as herein set forth; provided that in respect of any such additional covenant, restriction, condition or
              provision, such amendment may provide for a particular period of grace after default (which period may be shorter or longer than that allowed in the case of other defaults) or may provide for an immediate enforcement upon such an Event of
              Default or may limit the remedies available to the Trustee upon such an Event of Default or may limit the right of the Majority Holders to waive such an Event of Default;

            

            

            (d)  to cure any ambiguity, or to correct or supplement any provision herein or in the Securities which may be defective or inconsistent with any
              other provision herein; provided, that such provisions shall not materially reduce the benefits of this CVR Agreement or the Securities to the Holders;

            

            

            (e)  to make any other provisions with respect to matters or questions arising under this CVR Agreement; provided,
              that such provisions shall not adversely affect in any material respect the interests of the Holders;

            

            

            (f)  to make any amendments or changes necessary to comply or maintain compliance with the Trust Indenture Act, if applicable; or

            

            

            (g)  to make any other change that does not adversely affect in any material respect the interests of the Holders.

            

            

            Section 6.2.  Amendments with Consent of Holders. With the consent of the Majority Holders (including any consent
              obtained in connection with a tender offer or exchange for, or purchase of, the CVRs), by Act of said Holders delivered to the Company and the Trustee, the Company (when authorized by a Board Resolution or the chief executive officer of the
              Company) and the Trustee may enter into one or more amendments hereto or to the Securities for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this CVR Agreement or to the Securities
              or of modifying in any manner the rights of the Holders under this CVR Agreement or to the Securities; provided, however, that no such
              amendment shall, without the consent of the Holder of each Outstanding Security affected thereby:

            

            

            (a)  (i) modify in a manner adverse in any material respect to the Holders the time for payment or (ii) modify in a manner adverse to the Holders
              the amount of any CVR Payment; 

            

            

            (b)  reduce the number of CVRs, the consent of whose Holders is required for any such amendment; or

             

            

            
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            (c)  modify any of the provisions of this Section 6.2, except to increase the percentage of
              Holders from whom consent or approval is required or to provide that certain other provisions of this CVR Agreement cannot be modified or waived without the consent of the each Holder affected thereby.

            

            

            It shall not be necessary for any Act of Holders under this Section 6.2 to approve the particular form of any proposed amendment, but it shall be sufficient if
              such Act shall approve the substance thereof.

            

            

            Section 6.3.  Execution of Amendments. In executing any amendment permitted by this Article 6, the Trustee (subject to Section 4.1) shall be fully protected in relying upon an Opinion of Counsel or Officer’s Certificate stating that the execution of such
              amendment is authorized or permitted by this CVR Agreement. The Trustee shall execute any amendment authorized pursuant to this Article 6 if the amendment does not adversely affect the Trustee’s own rights, duties or immunities under this CVR Agreement or otherwise. Otherwise, the Trustee may, but need not, execute such amendment.

            

            

            Section 6.4.  Effect of Amendments.  Upon the execution of any amendment
              under this Article 6, this CVR Agreement and the Securities shall be modified in accordance therewith, and such amendment shall form a part of this CVR Agreement and the Securities for all purposes; and every Holder of Securities
              theretofore or thereafter authenticated, as applicable, and delivered hereunder shall be bound thereby. 

            

            

            Section 6.5.  Conformity with Trust Indenture Act. Every amendment executed pursuant to this Article 6 shall conform to the applicable requirements of the Trust Indenture Act, if any.

            

            

            Section 6.6.  Reference in Securities to Amendments. If an amendment changes the terms of a Security, the Trustee may
              require the Holder of the Security to deliver it to the Trustee. Global Securities authenticated and delivered after the execution of any amendment pursuant to this Article 6 may, and shall if
              required by the Trustee, bear a notation in the form approved by the Trustee as to any matter provided for in such amendment. If the Company shall so determine, new Securities so modified as to conform, in the opinion of the Trustee, on the
              one hand, and the Board of Directors or the chief executive officer of the Company, on the other hand, to any such amendment may be prepared and executed by the Company, as applicable, and authenticated, as applicable, and delivered by the
              Trustee in exchange for Outstanding Securities. Failure to make the appropriate notation or to issue a new Security shall not affect the validity of such amendment.

            

            

            ARTICLE 7

              COVENANTS

            

            

            Section 7.1.  Payment of Amounts, if any, to Holders. The Company will duly and punctually pay the amounts, if any,
              due on the Securities in accordance with the terms of the Securities and this CVR Agreement. Such amounts shall be considered paid on the applicable Payment Date if, on or prior to such Payment Date, the Company makes, or causes to be made,
              the payment required pursuant to subclauses (i) or (ii) of Section 3.1(c) of this CVR Agreement. Notwithstanding any other provision of this CVR Agreement, the Company or any
              of its Affiliates, the Trustee or the Paying Agent, shall be entitled to deduct and withhold, or cause to be deducted and withheld, from any amounts payable or otherwise deliverable pursuant to this CVR
                Agreement to any Person, such amounts as are required to be deducted and withheld therefrom under the Code or any provision of state, local or foreign Tax Law. To the extent that amounts are so deducted and withheld by the Company
              or any of its Affiliates, the Trustee or the Paying Agent, such deducted and withheld amounts shall be (a) paid over to the applicable Governmental Entity in accordance with applicable Law and (b) treated for all purposes of this CVR
              Agreement as having been paid to the Person in respect of which such deduction and withholding was made by the Company or any of its Affiliates, the Trustee or the Paying Agent, as the case may be. The consent of the Holders shall not be
              required for any such withholding.

            

            

            Section 7.2.  Maintenance of Office or Agency.

            

            

            (a)  As long as any of the Securities remain Outstanding, the Company will maintain an office or agency (i) where Securities may be presented or
              surrendered for payment, (ii) where Securities may be surrendered for registration of transfer or exchange and (iii) where notices and demands to or upon the

             

            

            
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            Company in respect of the Securities and this CVR Agreement may be served. The office or agency of the Trustee at [] shall be such office or agency of the Company, unless
              the Company shall designate and maintain some other office or agency for one or more of such purposes. The Company or any of its Subsidiaries may act as Paying Agent, registrar or transfer agent; provided that such Person shall take
              appropriate actions to avoid the commingling of funds. The Company will give prompt written notice to the Trustee of any change in the location of any such office or agency. If at any time the Company shall fail to furnish the Trustee with
              the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations,
              surrenders, notices and demands.

            

            

            (b)  The Company may from time to time designate one or more other offices or agencies where the Securities may be presented or surrendered for any
              or all such purposes, and may from time to time rescind such designation; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain at least one office or
              agency for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and any change in the location of any such office or agency.

            

            

            Section 7.3.  Money for Security Payments to Be Held in Trust.

            

            

            (a)  If the Company or any of its Subsidiaries shall at any time act as the Paying Agent, it will, on or before a Payment Date, segregate and hold
              in trust for the benefit of the Holders all sums held by such Paying Agent for payment on the Securities until such sums shall be paid to the Holders as herein provided, and will promptly notify the Trustee of any default by the Company in
              making payment on the Securities.

            

            

            (b)  Whenever the Company shall have one or more Paying Agents for the Securities, it will, on or before a Payment Date, deposit with the Paying
              Agent(s) a sum in same day funds sufficient to pay the amount, if any, so becoming due; such sum to be held in trust for the benefit of the Persons entitled to such amount, and (unless such Paying Agent is the Trustee) the Company will
              promptly notify the Trustee of such action or any failure so to act.

            

            

            (c)  The Company will cause each Paying Agent other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent
              shall agree with the Trustee, subject to the provisions of this Section 7.3, that (i) such Paying Agent will hold all sums held by it for the payment of any amount payable on Securities in
              trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will notify the Trustee of the sums so held and (ii) that it will give the Trustee notice of
              any failure by the Company (or by any other obligor on the Securities) to make any payment on the Securities when the same shall be due and payable.

            

            

            (d)  Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment on any Security and remaining
              unclaimed for one year after the applicable Payment Date shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security shall thereafter, as a general
              unsecured creditor (subject to Article 10), look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money shall thereupon cease.

            

            

            Section 7.4.  Listing of CVRs. The Company hereby covenants and agrees to work in good faith to cause the Securities
              to be approved for listing (subject to notice of issuance) for trading on the NASDAQ Global Market or other national securities exchange.

            

            

            Section 7.5.  Non-Use of Name. Neither the Trustee nor the Holders shall use the name, trademark, trade name, or logo
              of the Company, its Affiliates or their respective employees, agents or representatives in any publicity or news release relating to this CVR Agreement or its subject matter, without the prior express written permission of the Company.

             

            

            
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            ARTICLE 8

              REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT

            

            

            Section 8.1.  Event of Default Defined; Waiver of Default. “Event of Default”, with respect to the Securities, means each one of the following events, which shall have occurred and be continuing:

            

            

            (a)  default in the payment by the Company pursuant to the terms of this CVR Agreement of all or any part of any CVR Payment after a period of ten
              (10) Business Days after such CVR Payment shall become due and payable on the applicable Payment Date; or

            

            

            (b)  material default in the performance, or breach in any material respect, of any covenant in respect of the Securities (other than a covenant in
              respect of the Securities, a default in the performance or breach of which is elsewhere in this Section 8.1 specifically dealt with), and continuance of such default or breach for a period of
              ninety (90) days after there has been given by registered or certified mail to the Company by the Trustee or to the Company and the Trustee by the Majority Holders, a written notice specifying such default or breach and requiring it to be
              remedied and stating that such notice is a “Notice of Default” hereunder.

            

            

            If an Event of Default described above occurs and is continuing, then, and in each and every such case, either the Trustee by notice in writing to the Company or the Trustee upon the written request of the
              Majority Holders by notice in writing to the Company (and to the Trustee if given by the Majority Holders), may bring suit to protect the rights of the Holders, including to obtain payment for any amounts then due and payable.

            

            

            The foregoing provisions of this Section 8.1, however, are subject to the condition that if, at any time after the Trustee shall have begun such suit, and
              before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, the Company shall pay or shall deposit with the Trustee a sum sufficient to pay all amounts which shall have become
              due and such amount as shall be sufficient to cover reasonable compensation to the Trustee, its agents, attorneys and counsel, and all other expenses and liabilities incurred and all advances made by the Trustee, and if any and all Events of
              Default under this CVR Agreement shall have been cured, waived or otherwise remedied as provided herein, then and in every such case the Majority Holders, by written notice to the Company and to the Trustee, may waive all defaults with
              respect to the Securities, but no such waiver or rescission and annulment shall extend to or shall affect any subsequent default or shall impair any right consequent thereof.

            

            

            Section 8.2.  Collection by the Trustee; the Trustee May Prove Payment Obligations. The Company covenants that in case
              default shall be made in the payment of all or any part of the Securities when the same shall have become due and payable, whether at a Payment Date or otherwise, then upon demand of the Trustee, the Company will pay to the Trustee for the
              benefit of the Holders the whole amount that then shall have become due and payable on all Securities; and in addition thereto, such further amount as shall be sufficient to cover the costs and
              expenses of collection, including reasonable compensation to the Trustee and each predecessor Trustee, their respective agents, attorneys and counsel, and any expenses and liabilities incurred, and all advances made, by the Trustee and each
              predecessor Trustee, except as a result of its negligence, bad faith or willful misconduct.

            

            

            The Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce
              any such rights, whether for the specific enforcement of any covenant or agreement in this CVR Agreement or in aid of the exercise of any power granted herein, or to enforce any other remedy.

            

            

            In case the Company shall fail forthwith to pay such amounts upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any action or
              proceedings at Law or in equity for the collection of the sums so due and unpaid, and may prosecute any such action or proceedings to judgment or final decree, and may enforce any such judgment or final decree against the Company or other
              obligor upon such Securities and collect in the manner provided by Law out of the property of the Company or other obligor upon such Securities, wherever situated, the moneys adjudged or decreed to be payable.

             

            

            
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            In any judicial proceedings relative to the Company or other obligor upon the Securities, irrespective of whether any amount is then due and payable with respect to the Securities, the Trustee is authorized:

            

            

            (a)  to file and prove a claim or claims for the whole amount owing and unpaid in respect of the Securities, and to file such other papers or
              documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for reasonable compensation to the Trustee and each predecessor Trustee, and their respective agents, attorneys and counsel, and for
              reimbursement of all expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee, except as a result of negligence, bad faith or willful misconduct) and of the Holders allowed in any judicial
              proceedings relative to the Company or other obligor upon the Securities, or to their respective property;

            

            

            (b)  unless prohibited by and only to the extent required by applicable Law, to vote on behalf of the Holders in any election of a trustee or a
              standby trustee in arrangement, reorganization, liquidation or other bankruptcy or insolvency proceedings or person performing similar functions in comparable proceedings; and 

            

            

            (c)  to collect and receive any moneys or other property payable or deliverable on any such claims, and to distribute all amounts received with
              respect to the claims of the Holders and of the Trustee on their behalf; and any trustee, receiver, or liquidator, custodian or other similar official is hereby authorized by each of the Holders to make payments to the Trustee, and, in the
              event that the Trustee shall consent to the making of payments directly to the Holders, to pay to the Trustee such amounts as shall be sufficient to cover reasonable compensation to the Trustee, each predecessor Trustee and their respective
              agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee, except as a result of its negligence, bad faith or willful misconduct, and all other amounts
              due to the Trustee or any predecessor Trustee pursuant to Section 4.7. To the extent that such payment of reasonable compensation, expenses, disbursements, advances and other amounts out of
              the estate in any such proceedings shall be denied for any reason, payment of the same shall be secured by a lien on, and shall be paid out of, any and all distributions, dividends, moneys, securities and other property which the Holders may
              be entitled to receive in such proceedings, whether in liquidation or under any plan of reorganization or arrangement or otherwise.

            

            

            Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or
              composition affecting the Securities, or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding except, as aforesaid, to vote for the election of a trustee in
              bankruptcy or similar person.

            

            

            All rights of action and of asserting claims under this CVR Agreement, or under any of the Securities, may be enforced by the Trustee without the possession of any of the Securities or the production thereof
              and any trial or other proceedings instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment, subject to the payment of the expenses, disbursements and compensation of the Trustee,
              each predecessor Trustee and their respective agents and attorneys, shall be for the ratable benefit of the Holders.

            

            

            In any proceedings brought by the Trustee (and also any proceedings involving the interpretation of any provision of this CVR Agreement to which the Trustee shall be a party) the Trustee shall be held to
              represent all the Holders, and it shall not be necessary to make any Holders of such Securities parties to any such proceedings.

            

            

            Section 8.3.  Application of Proceeds. Any monies collected by the Trustee pursuant to this Article 8 in respect of any Securities shall be applied in the following order at the date or dates fixed by the Trustee upon presentation of the several Securities in respect of which monies have been collected
              and stamping (or otherwise noting) thereon the payment in exchange for the presented Securities if only partially paid or upon surrender thereof if fully paid:

            

            

            FIRST: To the payment of costs and expenses in respect of which monies have been collected, including reasonable compensation to the Trustee and each predecessor
              Trustee and their respective agents and attorneys and of all expenses and liabilities incurred, and all advances made, by the Trustee and each

             

            

            
              26

              
                

            

            predecessor Trustee, except as a result of its negligence, bad faith or willful misconduct, and all other amounts due to the Trustee or any predecessor Trustee pursuant to 

            Section 4.7;

            

            

            SECOND: To the payment of the whole amount then owing and unpaid upon all the Securities, and in case such monies shall be insufficient to pay in full the whole amount so
              due and unpaid upon the Securities, then to the payment of such amounts without preference or priority of any security over any other Security, ratably to the aggregate of such amounts due and payable; and

            

            

            THIRD: To the payment of the remainder, if any, to the Company or any other person lawfully entitled thereto.

            

            

            Section 8.4.  Suits for Enforcement. In case an Event of Default has occurred, has not been waived and is continuing,
              the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this CVR Agreement by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either
              at Law or in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in this CVR Agreement or in aid of the exercise of any power granted in this CVR Agreement or to enforce any other
              legal or equitable right vested in the Trustee by this CVR Agreement or by Law.

            

            

            Section 8.5.  Restoration of Rights on Abandonment of Proceedings. In case the Trustee or any Holder shall have
              proceeded to enforce any right under this CVR Agreement and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Trustee or to such Holder, then and in every such case the
              Company and the Trustee and the Holders shall be restored respectively to their former positions and rights hereunder, and all rights, remedies and powers of the Company, the Trustee and the Holders shall continue as though no such
              proceedings had been taken.

            

            

            Section 8.6.  Limitations on Suits by Holders. Subject to the rights of the Holders under Section 8.7, no Holder of any Security shall have any right, by virtue or by availing of any provision of this CVR Agreement, to institute any action or proceeding at Law or in equity or in bankruptcy or otherwise upon
              or under or with respect to this CVR Agreement, or for the appointment of a trustee, receiver, liquidator, custodian or other similar official or for any other remedy hereunder, unless such Holder previously shall have given to the Trustee
              written notice of default and of the continuance thereof, as hereinbefore provided, and unless the Majority Holders also shall have made written request upon the Trustee to institute such action or proceedings in its own name as trustee
              hereunder and shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby and the Trustee for thirty (30) days after receipt of such notice,
              request and offer of indemnity shall have failed to institute any such action or proceeding and no direction inconsistent with such written request shall have been given to the Trustee pursuant to Section

                  8.9; it being understood and intended, and being expressly covenanted by the Holder of every Security with every other Holder and the Trustee, that no one or more Holders of the Securities
                shall have any right in any manner whatsoever by virtue or by availing of any provision of this CVR Agreement to effect, disturb or prejudice the rights of any other such Holder of Securities, or to obtain or seek to obtain priority over or
                preference to any other such Holder or to enforce any right under this CVR Agreement, except in the manner herein provided and for the equal, ratable and common benefit of all Holders of the Securities. For the protection and
              enforcement of the provisions of this Section 8.6, each and every Holder and the Trustee shall be entitled to such relief as can be given either at Law or in equity.

            

            

            Section 8.7.  Unconditional Right of Holders to Institute Certain Suits. Notwithstanding any other provision in this
              CVR Agreement and any provision of any Security, but subject to Article 10, the right of any Holder of any Security to receive payment of the amounts payable in respect of such Security on or after the respective due dates expressed
              in such Security, or to institute suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.

            

            

            Section 8.8.  Powers and Remedies Cumulative; Delay or Omission Not Waiver of Default.

            

            

            (a)  Except as provided in Section 8.6, no right or remedy herein conferred upon or reserved to
              the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by Law, be cumulative and in addition to every other right and remedy given

             

            

            
              27

              
                

            

            hereunder or now or hereafter existing at Law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent
              the concurrent assertion or employment of any other appropriate right or remedy.

            

            

            (b)  No delay or omission of the Trustee or of any Holder to exercise any right or power accruing upon any Event of Default occurring and continuing
              as aforesaid shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or an acquiescence therein; and, subject to Section 8.6, every power and remedy given by this CVR Agreement or by Law to the Trustee or to the Holders may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the Holders.

            

            

            Section 8.9.  Control by Holders.

            

            

            (a)  The Majority Holders shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the
              Trustee, or exercising any power conferred on the Trustee with respect to the Securities by this CVR Agreement; provided that such direction shall not be otherwise than in accordance with Law
              and the provisions of this CVR Agreement; and provided further that (subject to the provisions of Section

                  4.1) the Trustee shall have the right to decline to follow any such direction if the Trustee, being advised by counsel, shall determine that the action or proceeding so directed may not lawfully be taken or if the Trustee in
              good faith by its board of directors, the executive committee, or a committee of directors or Responsible Officers of the Trustee shall determine that the action or proceedings so directed would involve the Trustee in personal liability or if
              the Trustee in good faith shall so determine that the actions or forbearances specified in or pursuant to such direction would be unduly prejudicial to the interests of Holders of the Securities not joining in the giving of said direction.

            

            

            (b)  Nothing in this CVR Agreement shall impair the right of the Trustee in its discretion to take any action deemed proper by the Trustee and which
              is not inconsistent with such direction or directions by Holders.

            

            

            Section 8.10.  Waiver of Past Defaults.

            

            

            (a)  In the case of a default or an Event of Default specified in clause (b) of Section 8.1, the
              Majority Holders may waive any such default or Event of Default, and its consequences except a default in respect of a covenant or provisions hereof which cannot be modified or amended without the consent of the Holder of each Security
              affected. In the case of any such waiver, the Company, the Trustee and the Holders shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other default or impair
              any right consequent thereon.

            

            

            (b)  Upon any such waiver, such default shall cease to exist and be deemed to have been cured and not to have occurred, and any Event of Default
              arising therefrom shall be deemed to have been cured, and not to have occurred for every purpose of this CVR Agreement; but no such waiver shall extend to any subsequent or other default or Event of Default or impair any right consequent
              thereon.

            

            

            Section 8.11.  The Trustee to Give Notice of Default, But May Withhold in Certain Circumstances. The Trustee shall
              mail or otherwise deliver to the Holders, as the names and addresses of such Holders appear on the Security Register (as provided under Section 313(c) of the Trust Indenture Act, if applicable), written notice of all defaults which have
              occurred and are known to the Trustee, such notice to be transmitted within ninety (90) days after the occurrence thereof, unless such defaults shall have been cured before the giving of such notice (the term “default” for the purpose of this
              Section 8.11 being hereby defined to mean any event or condition which is, or with notice or lapse of time or both would become, an Event of Default); provided that, except in the case of default in the payment of the amounts
              payable in respect of any of the Securities, the Trustee shall be protected in withholding such notice if and for so long as the board of directors, the executive committee, or a trust committee of directors or trustees and/or Responsible
              Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Holders; provided further, that in the case of any breach of the character specified in Section 8.1(b) with
              respect to the Securities, no notice to Holders shall be given until at least thirty (30) days after the occurrence thereof.

             

            

            
              28

              
                

            

             

            

            Section 8.12.  Right of Court to Require Filing of Undertaking to Pay Costs. All Parties to this CVR Agreement agree,
              and each Holder of any Security by his or her acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this CVR Agreement or in any suit
              against the Trustee for any action taken, suffered or omitted by it as the Trustee, the filing by any party litigant in such suit of an undertaking to pay the reasonable and documented out-of-pocket costs of such suit, and that such court may
              in its discretion assess reasonable and documented out-of-pocket costs, including reasonable and documented out-of-pocket attorneys’ fees, against any party litigant in such suit, having due regard to
              the merits and good faith of the claims or defenses made by such party litigant; provided, however, that the provisions of this Section 8.12 shall not apply to any suit
              instituted by the Trustee, to any suit instituted by any Holder or group of Holders holding in the aggregate more than ten percent (10%) of the Securities Outstanding or to any suit instituted by any Holder for the enforcement of the payment
              of any Security on or after the due date expressed in such Security.

            

            

            ARTICLE 9

              CONSOLIDATION OR MERGER

            

            

            Section 9.1.  Company May Consolidate or Merge on Certain Terms. Subject to the provisions of Section 1.16,
              the Company covenants that it will not consolidate or merge with or into any other Person unless (a) the Company shall be the continuing Person or (b) the successor Person shall expressly assume, by an instrument supplemental hereto, executed
              and delivered to the Trustee in form reasonably satisfactory to the Trustee, the due and punctual performance and observance of all covenants and conditions of this CVR Agreement to be performed by the Company.

            

            

            Section 9.2.  Successor Person Substituted.

            

            

            (a)  In case of any consolidation or merger and, following such, assumption by the successor Person pursuant to Section 9.1, such successor
              Person shall succeed to and be substituted for the Company with the same effect as if it had been named herein. Such successor Person may cause to be signed, and may issue either in its own name (or, if it is the successor to the Company, in
              the name of the Company prior to such succession) any or all of the Securities issuable hereunder, in the case of Global Securities, which theretofore shall not have been signed by the Company and delivered to the Trustee; and, upon the order
              of such successor Person instead of the Company and subject to all the terms, conditions and limitations in this CVR Agreement prescribed, the Trustee shall authenticate and shall deliver any Securities which previously shall have been signed
              and delivered to the Trustee for authentication, and any Securities which such successor Person thereafter shall cause to be signed and delivered to the Trustee for that purpose. All of the Securities so issued shall in all respects have the
              same legal rank and benefit under this CVR Agreement as the Securities theretofore or thereafter issued in accordance with the terms of this CVR Agreement as though all of such Securities had been issued at the date of the execution hereof. 

            

            

            (b)  In case of any such consolidation or merger and, following such, assumption by the successor Person pursuant to Section 9.1, such
              changes in phraseology and form (but not in substance) may be made in the Securities thereafter to be issued as may be appropriate.

            

            

            (c)  In the event of any such consolidation or merger and following such, assumption by the successor Person pursuant to Section 9.1, the
              Company or any Person which shall theretofore have become such in the manner described in this Article 9 shall be discharged from all obligations and covenants under this CVR Agreement and the Securities and may be liquidated and
              dissolved.

            

            

            Section 9.3.  Officer’s Certificate to the Trustee. The Trustee, subject to the provisions of Sections 4.1 and 4.2, shall receive an Officer’s Certificate, prepared in accordance with Section 1.2 and Section 1.3, as conclusive evidence that any such consolidation or merger, and any such assumption, complies with the applicable provisions of this CVR
              Agreement, and if a supplemental agreement is required in connection with such transaction, such supplemental agreement complies with this Article 9 and that there has been compliance with all conditions precedent herein provided for
              or relating to such transaction. 

            

            

            Section 9.4.  Successors and Assigns. All covenants, provisions and agreements in this CVR Agreement by or for the
              benefit of the Company, the Trustee or the Holders shall bind and inure to the benefit of their respective successors, assigns, heirs and personal representatives, whether so expressed or not.

            

            

            
              29

              
                

            

            

            

            ARTICLE 10

              SUBORDINATION

            

            

            Section 10.1.  Agreement to Subordinate. The Company agrees, and each Holder by accepting a Security hereunder agrees,
              that the CVR Payments, the Bankruptcy Claims and all other obligations under this CVR Agreement and the Securities and any rights or claims relating thereto (collectively, the “Junior Obligations”) are subordinated in right of payment, to the extent and in the manner provided in this Article 10,
              to the prior payment in full in cash of all Senior Obligations of the Company (whether outstanding on the date hereof or hereafter created, incurred, assumed or guaranteed), and that the subordination is for the benefit of the holders of such
              Senior Obligations.

            

            

            Section 10.2.  Liquidation; Dissolution; Bankruptcy. Upon any distribution to creditors of the Company in a
              liquidation or dissolution of the Company or in a bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to the Company or its property, in an assignment for the benefit of creditors or any marshaling of the
              Company’s assets and liabilities:

            

            

            (a)  holders of Senior Obligations will be entitled to receive payment in full in cash of all Senior Obligations of the Company before the Holders
              will be entitled to receive any payment of any kind with respect to the Junior Obligations; and

            

            

            (b)  until all Senior Obligations of the Company (as provided in clause (a) above) are paid in full in cash, any distribution to which Holders would
              be entitled but for this Article 10 will be made to holders of Senior Obligations of the Company, as their interests may appear.

            

            

            Section 10.3.  Default on Senior Obligations.  The Company shall not be required to (and may not) make any payment or
              distribution to any Holder in respect of Junior Obligations or acquire from any Holder for cash or property any Junior Obligations:

            

            

            (a)  if any default on any Senior Obligations exceeding one million dollars ($1,000,000) in aggregate principal amount would occur as a result of
              such payment, distribution or acquisition;

            

            

            (b)  during the continuance of any payment default in respect of any Senior Obligations exceeding one million dollars ($1,000,000) in aggregate
              principal amount (after expiration of any applicable grace period);

            

            

            (c)  if the maturity of any Senior Obligations representing more than one million dollars ($1,000,000) in aggregate principal amount is accelerated
              in accordance with its terms and such acceleration has not been rescinded; or

            

            

            (d)  following the occurrence of any default (other than a payment default, and after the expiration of any applicable grace period) with respect to
              any Senior Obligations with an aggregate principal amount of more than one million dollars ($1,000,000), the effect of which is to permit the holders of such Senior Obligations (or a trustee or agent acting on their behalf) to cause, with the
              giving of notice if required, the maturity of such Senior Obligations to be accelerated, for a period commencing upon the receipt by the Trustee (with a copy to the Company) of a written notice of such default from the representative of the
              holders of such Senior Obligations and ending when such Senior Obligations are paid in full in cash or, if earlier, when such default is cured or waived.

            

            

            Section 10.4.  When Distribution Must Be Paid Over.

            

            

            (a)  In the event that the Trustee or any Holder receives any payment of any Junior Obligations at a time when such payment is prohibited by this Article 10, such payment will be held by the Trustee or such Holder in trust for the benefit of, and will be paid forthwith over and delivered, upon written request, to the holders of Senior
              Obligations of the Company as their interests may appear or their representative under the agreement, indenture or other document (if any) pursuant to which such Senior Obligations may have been issued, as their respective interests may
              appear, for application to the payment of all such Senior Obligations

             

            

            
              30

              
                

            

            remaining unpaid to the extent necessary to pay such Senior Obligations in full in accordance with their terms, after giving effect to any concurrent payment or distribution
              to or for the holders of Senior Obligations.

            

            

            (b)  Any amount received by any Holder as a result of direct or indirect credit support for the Junior Obligations from any Affiliate of the Company
              shall be treated as payments received by such Holder from the Company that are subject to the provisions of this Article 10.

            

            

            (c)  With respect to the holders of Senior Obligations, the Trustee undertakes to perform only those obligations on the part of the Trustee as are
              specifically set forth in this Article 10, and no implied covenants or obligations with respect to the holders of Senior Obligations will be read into this CVR Agreement against the Trustee.
              The Trustee will not be deemed to owe any fiduciary duty to the holders of Senior Obligations, and will not be liable to any such holders if the Trustee pays over or distributes to or on behalf of Holders or the Company or any other Person
              money or assets to which any holders of Senior Obligations are then entitled by virtue of this Article 10, except if such payment is made as a result of the willful misconduct or gross
              negligence of the Trustee.

            

            

            Section 10.5.  Notice by Company. The Company will promptly notify the Trustee of any facts known to the Company that
              would cause a payment of any Junior Obligations to violate this Article 10, but failure to give such notice will not affect the subordination of the Junior Obligations to the Senior
              Obligations as provided in this Article 10.

            

            

            Section 10.6.  Subordination Effective Notwithstanding Deficiencies with Respect to Senior Obligations; Waiver of Right to Contest Senior Obligation; Reinstatement
                of Subordination Provisions.

            

            

            (a)  The Holders hereby agree that subordination provisions contained in this Article 10 are
              unconditional, irrespective of the validity, regularity or enforceability of the Senior Obligations, the absence of any action to enforce the same, any waiver or consent by any holder of Senior Obligations with respect to any provisions
              thereof, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense. Without limiting the foregoing, and
              notwithstanding anything to the contrary contained elsewhere in this CVR Agreement, in the event that the amount of Senior Obligations are reduced or diminished for any reason (other than as a result of the payment in cash thereof), whether
              because of the applicability of fraudulent conveyance or other applicable Laws, or any other invalidity or limitation on the amount of Senior Obligations, the subordination provisions thereof shall apply to the full amount of Senior
              Obligations (without giving effect to any reduction, invalidity or diminution thereof), and the turnover provisions hereunder shall be fully enforceable with respect to the full amount of Senior Obligations (without giving effect to any such
              reduction, invalidity or diminution thereof), even if the effect thereof is that there will be no (or a limited amount of) Senior Obligations to which the Junior Obligations are subrogated after the payment in full in cash of any of the
              remaining Senior Obligations (without giving effect to any reductions, invalidity or diminution thereof, except for reductions as a result of payments thereof in cash).

            

            

            (b)  The Trustee and the Holders agree that they shall not (and hereby waive any right to) take any action to contest or challenge (or assist or
              support any other Person in contesting or challenging), directly or indirectly, whether or not in any proceeding (including in any proceeding commenced by or against any Person under any provision of the Bankruptcy Code, as now and
              hereinafter in effect, or any successor statute or under any other state or federal bankruptcy or insolvency Law, assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or
              proceedings seeking reorganization, arrangement, or other similar relief), the validity or enforceability of the Senior Obligations. 

            

            

            (c)  If any payment made or in respect of the Senior Obligations must be disgorged or returned for any reason, the Senior Obligations shall be
              reinstated hereunder and for all purposes of this Article 10 (including the turnover provisions hereof) such payment shall be deemed to have never been made with respect to the Senior
              Obligations.

            

            

            Section 10.7.  Relative Rights. This Article 10 defines the relative
              rights of Holders and holders of Senior Obligations. Nothing in this CVR Agreement will (a) impair, as between the Company and Holders, the obligations

             

            

            
              31

              
                

            

             

            

            of the Company under this CVR Agreement and the Securities or (b) affect the relative rights of Holders and creditors of the Company other than their
              rights in relation to holders of Senior Obligations.  If the Company fails because of this Article 10 to pay any amounts due in respect of the Securities on a Payment Date in violation of Section 8.1, such failure is still an Event of Default.

            

            

            Section 10.8.  Subordination May Not Be Impaired by Company. No right of any holder of Senior Obligations to enforce
              the subordination of the Junior Obligations may be impaired by any act or failure to act by the Company or any Holder or by the failure of the Company or any Holder to comply with this CVR Agreement.

            

            

            Section 10.9.  Distribution or Notice to Representative. Whenever a distribution is to be made or a notice given to
              holders of Senior Obligations, the distribution may be made and the notice given to such holders’ representatives in accordance with the terms of the instrument or other agreement governing such Senior Obligations. Upon any payment or
              distribution of assets of the Company referred to in this Article 10, the Trustee and the Holders will be entitled to rely upon any order or decree made by any court of competent jurisdiction
              or upon any certificate of such representative or of the liquidating trustee or agent or other Person making any distribution to the Trustee or to the Holders for the purpose of ascertaining the Persons entitled to participate in such
              distribution, the holders of the Senior Obligations and other obligations of the Company, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article 10.

            

            

            Section 10.10.  Rights of the Trustee. Notwithstanding the provisions of this Article

                  10 or any other provision of this CVR Agreement, the Trustee will not be charged with knowledge of the existence of any facts that would prohibit the making of any payment or distribution by the Trustee, and the Trustee may
              continue to make payments on the Securities, unless the Trustee has received at its Corporate Trust Office at least one (1) Business Day prior to the date of such payment written notice of facts that would cause the payment of any Junior
              Obligations to violate this Article 10. Only the Company or a representative of Senior Obligations may give the notice. Nothing in this Article 10
              will impair the claims of, or payments to, the Trustee under or pursuant to Section 4.7. The Trustee in its individual or any other capacity may hold Senior Obligations with the same rights it
              would have if it were not the Trustee.

            

            

            Section 10.11.  Authorization to Effect Subordination. Each Holder, by the Holder’s
              acceptance of the Securities, authorizes and directs the Trustee on such Holder’s behalf to take such action as may be necessary or appropriate to effectuate the subordination as provided in this Article 10, and appoints the Trustee to act as such Holder’s attorney-in-fact for any and all such purposes. If the Trustee (or any other Person acting on
              behalf of and at the direction of the Majority Holders) does not file a proper proof of claim or proof of debt in the form required in any proceeding referred to in Section 8.2 hereof at least
              thirty (30) days before the expiration of the time to file such claim, the representatives of the Senior Obligations are hereby authorized to file an appropriate claim for and on behalf of the Holders of the Securities.

            

            

            [Signature Page Follows]

            

            

            

            
              32

              
                

            

            

            

            IN WITNESS WHEREOF, the Parties hereto have caused this CVR Agreement to be duly executed, all as of the day and year first above written.

            

            

            

            

            	 	
                    AKORN, INC.

                  
	 	 	 
	 	
                    By:

                  	 
	 	 	
                    Name:

                  
	 	 	
                    Title:

                  
	 	 	 
	 	
                    [          ], as the Trustee

                  
	 	 	 
	 	
                    By:

                  	 
	 	 	
                    Name:

                  
	 	 	
                    Title:

                  

             

            

            

            

            

            

            

            
              
                

            

            
             

            

            ANNEX A

            

            

            EXAMPLE CALCULATIONS OF EBITDA, EXCESS EBITDA AND ANNUAL PAYMENT (1)

            (dollars in millions)

            
               

                	
                         

                      	 	
                        For the Twelve Months Ended December 31,

                      	 
	
                         

                      	 	
                         2018

                      	 	 	
                        20XX

                      	 	 	
                        20XX

                      	 
	
                        Calculation of EBITDA:

                      	 	 	 	 	 	 	 	 	 
	
                        Net income (loss)

                      	 	
                        $ 

                      	
                        (402

                      	
                        )

                      	 	
                        $

                      	
                        158

                      	 	 	
                        $

                      	
                        208

                      	 
	
                        plus:      Interest expense, net

                      	 	 	
                        46

                      	 	 	 	
                        46

                      	 	 	 	
                        46

                      	 
	
                        minus:   Income tax benefit

                      	 	 	
                        (36

                      	
                        )

                      	 	 	
                        (36

                      	
                        )

                      	 	 	
                        (36

                      	
                        )

                      
	
                        plus:      Depreciation expense

                      	 	 	
                        29

                      	 	 	 	
                        29

                      	 	 	 	
                        29

                      	 
	
                        plus:      Amortization expense

                      	 	 	
                        53

                      	 	 	 	
                        53

                      	 	 	 	
                        53

                      	 
	
                        EBITDA

                      	 	
                        $ 

                      	
                        (309

                      	
                        )

                      	 	
                        $

                      	
                        250

                      	 	 	
                        $

                      	
                        300

                      	 
	
                         

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        Calculation of Excess EBITDA:

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        Total short-term and long-term debt

                      	 	
                        $

                      	
                        820

                      	 	 	
                        $

                      	
                        820

                      	 	 	
                        $

                      	
                        820

                      	 
	
                        plus:      Deferred financing costs

                      	 	 	
                        12

                      	 	 	 	
                        12

                      	 	 	 	
                        12

                      	 
	
                        minus:   Unrestricted cash and cash equivalents

                      	 	 	
                        (225

                      	
                        )

                      	 	 	
                        (225

                      	
                        )

                      	 	 	
                        (225

                      	
                        )

                      
	
                        plus:      Minimum cash

                      	 	 	
                        100

                      	 	 	 	
                        100

                      	 	 	 	
                        100

                      	 
	
                        Net Debt

                      	 	
                        $

                      	
                        707

                      	 	 	
                        $

                      	
                        707

                      	 	 	
                        $

                      	
                        707

                      	 
	
                         

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        Excess EBITDA denominator

                      	 	 	
                        3.0

                      	 	 	 	
                        3.0

                      	 	 	 	
                        3.0

                      	 
	
                         

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        Excess EBITDA threshold

                      	 	
                        $

                      	
                        236

                      	 	 	
                        $

                      	
                        236

                      	 	 	
                        $

                      	
                        236

                      	 
	
                         

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        EBITDA

                      	 	
                        $ 

                      	
                        (309

                      	
                        )

                      	 	
                        $

                      	
                        250

                      	 	 	
                        $

                      	
                        300

                      	 
	
                        minus:   Excess EBITDA threshold

                      	 	 	
                        (236

                      	
                        )

                      	 	 	
                        (236

                      	
                        )

                      	 	 	
                        (236

                      	
                        )

                      
	
                        Excess EBITDA

                      	 	
                        $

                      	
                        0

                      	 	 	
                        $

                      	
                        15

                      	 	 	
                        $

                      	
                        65

                      	 
	
                         

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        Calculation of Annual Payment:

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        Excess EBITDA

                      	 	
                        $

                      	
                        0

                      	 	 	
                        $

                      	
                        15

                      	 	 	
                        $

                      	
                        65

                      	 
	
                        multiplied by:  Payment percentage

                      	 	 	
                        33.3

                      	
                        %

                      	 	 	
                        33.3

                      	
                        %

                      	 	 	
                        33.3

                      	
                        %

                      
	
                        Annual Payment before adjustment for Annual Payment Cap

                      	 	
                        $

                      	
                        0

                      	 	 	
                        $

                      	
                        5

                      	 	 	
                        $

                      	
                        22

                      	 
	
                         

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        Annual Payment Cap

                      	 	
                        $

                      	
                        12

                      	 	 	
                        $

                      	
                        12

                      	 	 	
                        $

                      	
                        12

                      	 
	
                         

                      	 	 	 	 	 	 	 	 	 	 	 	 
	
                        Aggregate Annual Payment (2)

                      	 	
                        $

                      	
                        0

                      	 	 	
                        $

                      	
                        5

                      	 	 	
                        $

                      	
                        12

                      	 

                

              

            

            
              
                
                  	

                        	(1)	
                          Calculations for the twelve (12) months ended December 31, 2018 are based on financial information reported in the Company’s annual report on Form 10-K for such fiscal year.  The other
                            calculations are illustrative figures selected solely for the purpose of illustrating Annual Payment calculations that are above and below the Annual Payment Cap.

                        

                

              

              

              

              
                
                  	

                        	(2)	
                          Pursuant to the definition of “Annual Payment” in Section 1.1, this amount will be divided by the Initial CVR Settlement Amount to determine the payments in respect of each
                            Outstanding CVR.

                        

                

              

            

             

            

            
              A-1

              
                

            

            
             

            

            ANNEX B

             

            THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE CONTINGENT VALUE RIGHTS AGREEMENT (THE “CVR AGREEMENT”) HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF. THIS SECURITY IS NOT
              EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE CVR AGREEMENT, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS
              SECURITY AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE CVR
              AGREEMENT.

             

            UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DIRECT REGISTRATION FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
              NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
              REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”) TO THE ISSUER OR ITS AGENT FOR
              REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
              TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
              INTEREST HEREIN.

             

            AKORN, INC.

             

            	
                    No.

                  	
                    Certificate for

                  	
                    Contingent Value Rights

                  
	
                    CUSIP

                  	
                    [________]

                  	 

             

            This certifies that __________, or registered assigns (the “Holder”), is the
              registered holder of the number of Contingent Value Rights (“CVRs” or “Securities”) set forth above. Each CVR entitles the Holder, subject to the provisions contained herein and in the CVR Agreement referred to on the reverse
              hereof, to payments from Akorn, Inc., a Louisiana corporation (the “Company”), in an amount and in the form
              determined pursuant to the provisions set forth on the reverse hereof and as more fully described in the CVR Agreement referred to on the reverse hereof. Such payments shall be made by the Company on the applicable Payment Date, as defined in
              the CVR Agreement referred to on the reverse hereof, in accordance with the terms of the CVR Agreement.

            

            

            Payment of any amounts pursuant to this CVR certificate shall be made only to the registered Holder (as defined in the CVR Agreement) of this CVR certificate. Such payment shall be made at the office or agency
              maintained by the Company for such purpose, in such coin or currency of the United States of America as at the time is legal tender for the payment of public and private debts; provided, however,
              that the Company may pay such amounts by wire transfer or check payable in such money. [     ] has been initially appointed as Paying Agent at its office or agency in [     ]. 

            

            

            Reference is hereby made to the further provisions of this CVR certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

             

            Unless the certificate of authentication hereon has been duly executed by the Trustee referred to on the reverse hereof by manual signature, this CVR certificate shall not be entitled to any benefit under the CVR Agreement, or be valid or
              obligatory for any purpose.

             

            [Signature Page Follows]

            
              B-1

              
                

            

            
            

            

            IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

             

            Dated: [•]

             

            	 	
                    By:

                  	 
	 	 	
                    Name:

                  
	 	 	
                    Title:

                  

             

            [Form of Reverse of CVR certificate]

             

            1.  This CVR certificate is issued under and in accordance with the Contingent Value Rights Agreement, dated as of [______], 2019 (the “CVR Agreement”), between the Company and [          ], as trustee (the “Trustee,” which term includes any successor Trustee under the CVR Agreement), and is subject to the terms and provisions contained in the CVR Agreement, to all of which terms and provisions the Holder of this CVR
              certificate consents by acceptance hereof. The CVR Agreement is hereby incorporated herein by reference and made a part hereof. Reference is hereby made to the CVR Agreement for a full statement of the respective rights, limitations of
              rights, duties, obligations and immunities thereunder of the Company, the Trustee and the Holders of the CVRs. All capitalized terms used in this CVR certificate without definition shall have the respective meanings ascribed to them in the
              CVR Agreement. Copies of the CVR Agreement can be obtained by contacting the Trustee.

            

            

            2.  On each Payment Date, if any, the Company shall make the payments required by Section 3.1(c)(i) or (ii), as applicable, of the CVR Agreement.

            

            

            3.  In the event of any conflict between this CVR certificate and the CVR Agreement, the CVR Agreement shall govern and prevail.

            

            

            4.  Each CVR Payment, if any, and interest thereon, if any, shall be payable by the Company in such coin or currency of the United States of America as at the time is legal tender for the payment of public and
              private debts; provided, however, that such amounts may be paid by check or wire transfer
              payable in such money. [] has been initially appointed as Paying Agent at its office or agency in [].

            

            

            5.  If an Event of Default occurs and is continuing, either the Trustee may or the Majority Holders, by notice to the Company and to the Trustee, may bring suit in accordance with the terms and conditions of
              the CVR Agreement to protect the rights of the Holders, including to obtain payment of all amounts then due and payable.

            

            

            6.  The CVR Agreement permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the
              holders of CVRs under the CVR Agreement at any time by the Company and the Trustee with the consent of the Majority Holders of the CVRs at the time outstanding.

            

            

            7.  No reference herein to the CVR Agreement and no provision of this CVR certificate or of the CVR Agreement shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay any
              amounts determined pursuant to the terms hereof and of the CVR Agreement at the times, place and amount, and in the manner, herein prescribed.

            

            

            8. Each CVR Payment or any other right, claim or payment of any kind under this CVR certificate, if any, shall be subordinated in right of payment, as set forth in Article 10 of the CVR Agreement, to the prior
              payment in full in cash of all Senior Obligations whether outstanding on the date of the CVR Agreement or thereafter incurred.

            

            

            9. As provided in the CVR Agreement and subject to certain limitations therein set forth, the transfer of the CVRs represented by this CVR certificate is registrable on the Security Register, upon surrender of
              this CVR certificate for registration of transfer at the office or agency of the Company maintained for such purpose duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security
              Registrar duly executed by the Holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new CVR certificates or Direct Registration Securities, for the same amount of CVRs, will be issued to the

             

            

            
              B-2

              
                

            

            
            

            

            designated transferee or transferees. The Company hereby initially designates the office of [     ] at [     ] as the office for registration of transfer of this CVR certificate.

             

            

            10.  As provided in the CVR Agreement and subject to certain limitations therein set forth, this CVR certificate is exchangeable for one or more CVR certificates or Direct Registration Securities representing the same number of CVRs as
            represented by this CVR certificate as requested by the Holder surrendering the same.
            

            

            11.  No service charge will be made for any registration of transfer or exchange of CVRs, but the Company may require payment of a sum sufficient to cover all documentary, stamp or similar issue or transfer
              taxes or other governmental charges payable in connection with any registration of transfer or exchange.

            

            

            12.  Prior to the time of due presentment of this CVR certificate for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this CVR
              certificate is registered as the owner hereof for all purposes, and neither the Company, the Trustee nor any agent shall be affected by notice to the contrary.

            

            

            13. Neither the Company nor the Trustee has any duty or obligation to the holder of this CVR certificate, except as expressly set forth herein or in the CVR Agreement.

            

            

            
              B-3

              
                

            

            

            TRUSTEE’S CERTIFICATE OF AUTHENTICATION

            

            

             

            This is one of the Global Securities referred to in the within-mentioned CVR Agreement.

             

            	 	
                    [          ], as the Trustee

                  

             

            Dated: [         ]

            

            

            	 	
                    By:

                  	 
	 	 	
                    Authorized Signatory

                  

            

            

            

            

            

            

          

        

      

      

    

  

  B-4Exhibit

LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT (this “Agreement”) dated as of August 7, 2019 (the “Effective Date”) by and among (a) SILICON VALLEY BANK, a California corporation (“Bank”) and (b)(i) SYNACOR, INC., a Delaware corporation (“Synacor”), (ii) NTV INTERNET HOLDINGS, LLC, a Delaware limited liability company (“NTV”), and (iii) SYNC HOLDINGS, LLC, a Delaware limited liability company (“Sync”, and together with Synacor and NTV, individually and collectively, jointly and severally, the “Borrower”), provides the terms on which Bank shall lend to Borrower and Borrower shall repay Bank.  The parties agree as follows:
1ACCOUNTING AND OTHER TERMS
Accounting terms not defined in this Agreement shall be construed following GAAP.  Calculations and determinations must be made following GAAP.  Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in Section 13.  All other terms contained in this Agreement, unless otherwise indicated, shall have the meaning provided by the Code to the extent such terms are defined therein.
2    LOAN AND TERMS OF PAYMENT
2.1    Promise to Pay.  Borrower hereby unconditionally promises to pay Bank the outstanding principal amount of all Credit Extensions and accrued and unpaid interest thereon as and when due in accordance with this Agreement.
2.2    Revolving Line.
(a)    Availability.  Subject to the terms and conditions of this Agreement and to deduction of Reserves, Bank may, in its good faith business discretion, make Advances not exceeding the Availability Amount.  Amounts borrowed under the Revolving Line may be repaid and, prior to the Revolving Line Maturity Date, reborrowed, subject to the applicable terms and conditions precedent herein.
(b)    Termination; Repayment.  The Revolving Line terminates on the Revolving Line Maturity Date, when the principal amount of all Advances, the unpaid interest thereon, and all other Obligations relating to the Revolving Line shall be immediately due and payable.
2.3    Overadvances.  If, at any time, the outstanding principal amount of any Advances exceeds the lesser of either the Revolving Line or the Borrowing Base, Borrower shall immediately pay to Bank in cash the amount of such excess (such excess, the “Overadvance”). Without limiting Borrower’s obligation to repay Bank any Overadvance, Borrower agrees to pay Bank interest on the outstanding amount of any Overadvance, on demand, at a per annum rate equal to the rate that is otherwise applicable to Advances plus five percent (5.0%).
2.4    Payment of Interest on the Credit Extensions.
(a)    Interest Rate.  Subject to Section 2.4(b), the principal amount outstanding under the Revolving Line shall accrue interest at a floating per annum rate equal to the greater of (i) when a Performance Pricing Period is in effect, (A) one-half of one percent (0.50%) above the Prime Rate and (B) five and one-half of one percent (5.50%) and (ii) when a Performance Pricing Period is not in effect, (A) one percent (1.0%) above the Prime Rate and (B) six percent (6.0%), which interest, in each case, shall be payable monthly in accordance with Section 2.4(d) below.
(b)    Default Rate.  Immediately upon the occurrence and during the continuance of an Event of Default, Obligations shall bear interest at a rate per annum which is five percent (5.0%) above the rate that is otherwise applicable thereto (the “Default Rate”).  Fees and expenses which are required to be paid by Borrower pursuant to the Loan Documents (including, without limitation, Bank Expenses) but are not paid when due shall bear interest until paid at a rate equal to the highest rate applicable to the Obligations.  Payment or acceptance of the 

increased interest rate provided in this Section 2.4(b) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Bank.
(c)    Adjustment to Interest Rate.  Changes to the interest rate of any Credit Extension based on changes to the Prime Rate shall be effective on the effective date of any change to the Prime Rate and to the extent of any such change. 
(d)    Payment; Interest Computation.  Interest is payable monthly on the Payment Date of each month and shall be computed on the basis of a 360-day year for the actual number of days elapsed.  In computing interest, (i) all payments received after 12:00 p.m. Eastern time on any day shall be deemed received at the opening of business on the next Business Day, and (ii) the date of the making of any Credit Extension shall be included and the date of payment shall be excluded; provided, however, that if any Credit Extension is repaid on the same day on which it is made, such day shall be included in computing interest on such Credit Extension. 
2.5    Fees.  Borrower shall pay to Bank:  
(a)    Revolving Line Commitment Fee.  A fully earned, non-refundable commitment fee of Sixty Thousand Dollars ($60,000.00), on the Effective Date;
(b)    Unused Revolving Line Facility Fee.  Payable quarterly in arrears on the last day of each calendar quarter occurring prior to the Revolving Line Maturity Date, and on the Revolving Line Maturity Date, a fee (the “Unused Revolving Line Facility Fee”) in an amount equal to one-half of one percent (0.50%) per annum of the average unused portion of the Revolving Line, as determined by Bank, computed on the basis of a year with the applicable number of days as set forth in Section 2.4(d).  The unused portion of the Revolving Line, for purposes of this calculation, shall be calculated on a calendar year basis and shall equal the difference between (i) the Revolving Line, and (ii) the average for the period of the daily closing balance of the Revolving Line outstanding; and
(c)    Bank Expenses.  All Bank Expenses (including reasonable attorneys’ fees and expenses for documentation and negotiation of this Agreement) incurred through and after the Effective Date, when due (or, if no stated due date, upon demand by Bank).
Unless otherwise provided in this Agreement or in a separate writing by Bank, Borrower shall not be entitled to any credit, rebate, or repayment of any fees earned by Bank pursuant to this Agreement notwithstanding any termination of this Agreement or the suspension or termination of Bank’s obligation to make loans and advances hereunder.  Bank may deduct amounts owing by Borrower under the clauses of this Section 2.5 pursuant to the terms of Section 2.6(c).  Bank shall provide Borrower written notice of deductions made from the Designated Deposit Account pursuant to the terms of the clauses of this Section 2.5.
2.6    Payments; Application of Payments; Debit of Accounts.  
(a)    All payments to be made by Borrower under any Loan Document shall be made in immediately available funds in Dollars, without setoff or counterclaim, before 12:00 p.m. Eastern time on the date when due.  Payments of principal and/or interest received after 12:00 p.m. Eastern time are considered received at the opening of business on the next Business Day.  When a payment is due on a day that is not a Business Day, the payment shall be due the next Business Day, and additional fees or interest, as applicable, shall continue to accrue until paid.  
(b)    Bank has the exclusive right to determine the order and manner in which all payments with respect to the Obligations may be applied.  Borrower shall have no right to specify the order or the accounts to which Bank shall allocate or apply any payments required to be made by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application is not specified elsewhere in this Agreement.

2

(c)    Bank may debit any of Borrower’s deposit accounts, including the Designated Deposit Account, for principal and interest payments or any other amounts Borrower owes Bank when due.  These debits shall not constitute a set-off.
2.7    Withholding.  Payments received by Bank from Borrower under this Agreement will be made free and clear of and without deduction for any and all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority (including any interest, additions to tax or penalties applicable thereto).  Specifically, however, if at any time any Governmental Authority, applicable law, regulation or international agreement requires Borrower to make any withholding or deduction from any such payment or other sum payable hereunder to Bank, Borrower hereby covenants and agrees that the amount due from Borrower with respect to such payment or other sum payable hereunder will be increased to the extent necessary to ensure that, after the making of such required withholding or deduction, Bank receives a net sum equal to the sum which it would have received had no withholding or deduction been required, and Borrower shall pay the full amount withheld or deducted to the relevant Governmental Authority.  Borrower will, upon request, furnish Bank with proof reasonably satisfactory to Bank indicating that Borrower has made such withholding payment; provided, however, that Borrower need not make any withholding payment if the amount or validity of such withholding payment is contested in good faith by appropriate and timely proceedings and as to which payment in full is bonded or reserved against by Borrower.  The agreements and obligations of Borrower contained in this Section 2.7 shall survive the termination of this Agreement.
3    CONDITIONS OF LOANS
3.1    Conditions Precedent to Initial Credit Extension.  Bank’s obligation to make the initial Credit Extension is subject to the condition precedent that Bank shall have received, in form and substance satisfactory to Bank, such documents, and completion of such other matters, as Bank may reasonably deem necessary or appropriate, including, without limitation:
(a)    duly executed original signatures to the Loan Documents;
(b)    the Operating Documents and long-form good standing certificates of Borrower certified by the Secretary of State (or equivalent agency) of Borrower’s jurisdiction of organization or formation and (except  for that certain New York good standing certificate to be delivered in accordance with Section 6.14) each jurisdiction in which Borrower is qualified to conduct business, each as of a date no earlier than thirty (30) days prior to the Effective Date;
(c)    a secretary’s certificate of Synacor with respect to such Synacor’s Operating Documents, incumbency, specimen signatures and resolutions authorizing the execution and delivery of this Agreement and the other Loan Documents to which it is a party;
(d)    a limited liability company borrowing certificate of each of NTV and Sync with respect to such Borrower’s Operating Documents, incumbency, specimen signatures and resolutions authorizing the execution and delivery of this Agreement and the other Loan Documents to which it is a party;
(e)    duly executed original signatures to the completed Borrowing Resolutions for each Borrower;
(f)    certified copies, dated as of a recent date, of financing statement searches, as Bank may request, accompanied by written evidence (including any UCC termination statements) that the Liens indicated in any such financing statements either constitute Permitted Liens or have been or, in connection with the initial Credit Extension, will be terminated or released;
(g)    the Perfection Certificate of each Borrower, together with the duly executed original signature thereto;

3

(h)    Intellectual Property search results and completed exhibits to the IP Agreement;
(i)    evidence satisfactory to Bank that the insurance policies required by Section 6.7 hereof are in full force and effect;
(j)    the completion of the Initial Audit; 
(k)    with respect to the initial Advance, a completed Borrowing Base Report (and any schedules related thereto and including any other information requested by Bank with respect to Borrower’s Accounts); and
(l)    payment of the fees and Bank Expenses then due as specified in Section 2.5 hereof.
3.2    Conditions Precedent to all Credit Extensions.  Bank’s obligations to make each Credit Extension, including the initial Credit Extension, is subject to the following conditions precedent:
(a)    timely receipt of the Credit Extension request and any materials and documents required by Section 3.4; 
(b)    the representations and warranties in this Agreement shall be true, accurate, and complete in all material respects on the date of the proposed Credit Extension and on the Funding Date of each Credit Extension; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, and no Event of Default shall have occurred and be continuing or result from the Credit Extension.  Each Credit Extension is Borrower’s representation and warranty on that date that the representations and warranties in this Agreement remain true, accurate, and complete in all material respects; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date; and
(c)    Bank determines to its satisfaction that there has not been any material impairment in the general affairs, management, results of operation, financial condition or the prospect of repayment of the Obligations, nor any material adverse deviation by Borrower from the most recent business plan of Borrower presented to and accepted by Bank.
3.3    Covenant to Deliver.  Borrower agrees to deliver to Bank each item required to be delivered to Bank under this Agreement as a condition precedent to any Credit Extension.  Borrower expressly agrees that a Credit Extension made prior to the receipt by Bank of any such item shall not constitute a waiver by Bank of Borrower’s obligation to deliver such item, and the making of any Credit Extension in the absence of a required item shall be in Bank’s sole discretion.
3.4    Procedures for Borrowing.  Subject to the prior satisfaction of all other applicable conditions to the making of an Advance set forth in this Agreement, to obtain an Advance, Borrower (via an individual duly authorized by an Administrator) shall notify Bank (which notice shall be irrevocable) by electronic mail by 12:00 p.m. Eastern time on the Funding Date of the Advance.  Such notice shall be made by Borrower through Bank’s online banking program, provided, however, if Borrower is not utilizing Bank’s online banking program, then such notice shall be in a written format acceptable to Bank that is executed by an Authorized Signer.  Bank shall have received satisfactory evidence that the Board has approved that such Authorized Signer may provide such notices and request Advances.  In connection with any such notification, Borrower must promptly deliver to Bank by electronic mail or through Bank’s online banking program such reports and information, including without limitation, sales journals, cash receipts journals, accounts receivable aging reports, as Bank may request in its sole discretion.  Bank shall credit proceeds of an Advance to the Designated Deposit Account.  Bank may make 

4

Advances under this Agreement based on instructions from an Authorized Signer or without instructions if the Advances are necessary to meet Obligations which have become due.
4    CREATION OF SECURITY INTEREST 
4.1    Grant of Security Interest.  Borrower hereby grants Bank, to secure the payment and performance in full of all of the Obligations, a continuing security interest in, and pledges to Bank, the Collateral, wherever located, whether now owned or hereafter acquired or arising, and all proceeds and products thereof.  
Borrower acknowledges that it previously has entered, and/or may in the future enter, into Bank Services Agreements with Bank.  Regardless of the terms of any Bank Services Agreement, Borrower agrees that any amounts Borrower owes Bank thereunder shall be deemed to be Obligations hereunder and that it is the intent of Borrower and Bank to have all such Obligations secured by the first priority perfected security interest in the Collateral granted herein (subject only to Permitted Liens that are permitted pursuant to the terms of this Agreement to have superior priority to Bank’s Lien in this Agreement).
If this Agreement is terminated, Bank’s Lien in the Collateral shall continue until the Obligations (other than inchoate indemnity obligations) are repaid in full in cash.  Upon payment in full in cash of the Obligations (other than inchoate indemnity obligations) and at such time as Bank’s obligation to make Credit Extensions has terminated, Bank shall, at the sole cost and expense of Borrower, release its Liens in the Collateral and all rights therein shall revert to Borrower.  In the event (x) all Obligations (other than inchoate indemnity obligations), except for Bank Services, are satisfied in full, and (y) this Agreement is terminated, Bank shall terminate the security interest granted herein upon Borrower providing cash collateral acceptable to Bank in its good faith business judgment for Bank Services, if any.  In the event such Bank Services consist of outstanding Letters of Credit, Borrower shall provide to Bank cash collateral in an amount equal to (x) if such Letters of Credit are denominated in Dollars, then at least one hundred five percent (105.0%); and (y) if such Letters of Credit are denominated in a Foreign Currency, then at least one hundred ten percent (110.0%), of the Dollar Equivalent of the face amount of all such Letters of Credit plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its business judgment), to secure all of the Obligations relating  to such  Letters of Credit.
4.2    Priority of Security Interest.  Borrower represents, warrants, and covenants that the security interest granted herein is and shall at all times continue to be a first priority perfected security interest in the Collateral (subject only to Permitted Liens that are permitted pursuant to the terms of this Agreement to have superior priority to Bank’s Lien under this Agreement).  If Borrower shall acquire a commercial tort claim, Borrower shall promptly notify Bank in a writing signed by Borrower of the general details thereof and grant to Bank in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance reasonably satisfactory to Bank.
4.3    Authorization to File Financing Statements.  Borrower hereby authorizes Bank to file financing statements, without notice to Borrower, with all appropriate jurisdictions to perfect or protect Bank’s interest or rights hereunder, including a notice that any disposition of the Collateral, by either Borrower or any other Person, shall be deemed to violate the rights of Bank under the Code.   Such financing statements may indicate the Collateral as “all assets of the Debtor” or words of similar effect, or as being of an equal or lesser scope, or with greater detail, all in Bank’s discretion.
5    REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants as follows: 
5.1    Due Organization, Authorization; Power and Authority.  Borrower is duly existing and in good standing as a Registered Organization in its jurisdiction of formation and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property requires that it be qualified except where the failure to do so could not reasonably be expected to have a material adverse effect on Borrower’s business.  In connection with this Agreement, Borrower has delivered to Bank a completed certificate 

5

signed by each Borrower, entitled “Perfection Certificate” (collectively, the “Perfection Certificate”).  Borrower represents and warrants to Bank that (a) Borrower’s exact legal name is that indicated on the Perfection Certificate and on the signature page hereof; (b) Borrower is an organization of the type and is organized in the jurisdiction set forth in the Perfection Certificate; (c) the Perfection Certificate accurately sets forth Borrower’s organizational identification number or accurately states that Borrower has none; (d) the Perfection Certificate accurately sets forth Borrower’s place of business, or, if more than one, its chief executive office as well as Borrower’s mailing address (if different than its chief executive office); (e) Borrower (and each of its predecessors) has not, in the past five (5) years, changed its jurisdiction of formation, organizational structure or type, or any organizational number assigned by its jurisdiction; and (f) all other information set forth on the Perfection Certificate pertaining to Borrower and each of its Subsidiaries is accurate and complete (it being understood and agreed that Borrower may from time to time update certain information in the Perfection Certificate after the Effective Date to the extent permitted by one or more specific provisions in this Agreement).  If Borrower is not now a Registered Organization but later becomes one, Borrower shall promptly notify Bank of such occurrence and provide Bank with Borrower’s organizational identification number.
The execution, delivery and performance by Borrower of the Loan Documents to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower’s organizational documents, (ii) contravene, conflict with, constitute a default under or violate any material Requirement of Law, (iii) contravene, conflict or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any of its Subsidiaries or any of their property or assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full force and effect), or (v) conflict with, contravene, constitute a default or breach under, or result in or permit the termination or acceleration of, any material agreement by which Borrower is bound.  Borrower is not in default under any agreement to which it is a party or by which it is bound in which the default could reasonably be expected to have a material adverse effect on Borrower’s business.  
5.2    Collateral.  Borrower has good title to, rights in, and the power to transfer each item of the Collateral upon which it purports to grant a Lien hereunder, free and clear of any and all Liens except Permitted Liens.  Borrower has no Collateral Accounts at or with any bank or financial institution other than Bank or Bank’s Affiliates except for the Collateral Accounts described in the Perfection Certificate delivered to Bank in connection herewith and which Borrower has taken such actions as are necessary to give Bank a perfected security interest therein, pursuant to the terms of Section 6.8(b).  The Accounts are bona fide, existing obligations of the Account Debtors.  
The Collateral is not in the possession of any third party bailee (such as a warehouse) except as otherwise provided in the Perfection Certificate.  None of the components of the Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as permitted pursuant to Section 7.2.
All Inventory is in all material respects of good and marketable quality, free from material defects.
Borrower is the sole owner of the Intellectual Property which it owns or purports to own except for (a) non-exclusive licenses granted to its customers in the ordinary course of business, (b) over-the-counter software that is commercially available to the public, and (c) material Intellectual Property licensed to Borrower and noted on the Perfection Certificate.  Each Patent which it owns or purports to own and which is material to Borrower’s business is valid and enforceable, and no part of the Intellectual Property which Borrower owns or purports to own and which is material to Borrower’s business has been judged invalid or unenforceable, in whole or in part.  To the best of Borrower’s knowledge, no claim has been made that any part of the Intellectual Property violates the rights of any third party except to the extent such claim would not reasonably be expected to have a material adverse effect on Borrower’s business.
Except as noted on the Perfection Certificate, Borrower is not a party to, nor is it bound by, any Restricted License.
5.3    Accounts Receivable.  

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(a)    For each Account with respect to which Advances are requested, on the date each Advance is requested and made, such Account shall be an Eligible Account.
(b)    All statements made and all unpaid balances appearing in all invoices, instruments and other documents evidencing the Eligible Accounts are and shall be true and correct and all such invoices, instruments and other documents, and all of Borrower’s Books are genuine and in all respects what they purport to be.  All sales and other transactions underlying or giving rise to each Eligible Account shall comply in all material respects with all applicable laws and governmental rules and regulations.  Borrower has no knowledge of any actual or imminent Insolvency Proceeding of any Account Debtor whose accounts are Eligible Accounts in any Borrowing Base Report.  To the best of Borrower’s knowledge, all signatures and endorsements on all documents, instruments, and agreements relating to all Eligible Accounts are genuine, and all such documents, instruments and agreements are legally enforceable in accordance with their terms.  
5.4    Litigation.  Except as disclosed on the Perfection Certificate, there are no actions or proceedings pending or, to the knowledge of any Responsible Officer, threatened in writing by or against Borrower or any of its Subsidiaries involving more than, individually or in the aggregate, Fifty Thousand Dollars ($50,000.00).
5.5    Financial Statements; Financial Condition.  All consolidated financial statements for Borrower and any of its Subsidiaries delivered to Bank fairly present in all material respects Borrower’s consolidated financial condition and Borrower’s consolidated results of operations.  There has not been any material deterioration in Borrower’s consolidated financial condition since the date of the most recent financial statements submitted to Bank.
5.6    Solvency.  The fair salable value of Borrower’s consolidated assets (including goodwill minus disposition costs) exceeds the fair value of Borrower’s liabilities; Borrower is not left with unreasonably small capital after the transactions in this Agreement; and Borrower is able to pay its debts (including trade debts) as they mature.
5.7    Regulatory Compliance.  Borrower is not an “investment company” or a company “controlled” by an “investment company” under the Investment Company Act of 1940, as amended.  Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors).  Borrower (a) has complied in all material respects with all Requirements of Law, and (b) has not violated any Requirements of Law the violation of which could reasonably be expected to have a material adverse effect on its business.  None of Borrower’s or any of its Subsidiaries’ properties or assets has been used by Borrower or any Subsidiary or, to the best of Borrower’s knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than legally.  Borrower and each of its Subsidiaries have obtained all consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all Governmental Authorities that are necessary to continue their respective businesses as currently conducted.
5.8    Subsidiaries; Investments.  Borrower does not own any stock, partnership, or other ownership interest or other equity securities except for Permitted Investments.  
5.9    Tax Returns and Payments; Pension Contributions.  Borrower has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except (a) to the extent such taxes are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted, so long as such reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor, or (b) if such taxes, assessments, deposits and contributions do not, individually or in the aggregate, exceed Twenty-Five Thousand Dollars ($25,000.00).  
To the extent Borrower defers payment of any contested taxes, Borrower shall (i) notify Bank in writing of the commencement of, and any material development in, the proceedings, and (ii) post bonds or take any other steps required to prevent the Governmental Authority levying such contested taxes from obtaining a Lien upon 

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any of the Collateral that is other than a “Permitted Lien.”  Borrower is unaware of any claims or adjustments proposed for any of Borrower’s prior tax years which could result in additional taxes becoming due and payable by Borrower in excess of Five Thousand Dollars ($5,000.00).  Borrower has paid all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms, and Borrower has not withdrawn from participation in, and has not 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 Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency.
5.10    Use of Proceeds.  Borrower shall use the proceeds of the Credit Extensions solely as working capital and to fund its general business requirements and not for personal, family, household or agricultural purposes.
5.11    Full Disclosure.  No written representation, warranty or other statement of Borrower in any certificate or written statement given to Bank, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Bank, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized by Bank that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results).
5.12    Definition of “Knowledge.”  For purposes of the Loan Documents, whenever a representation or warranty is made to Borrower’s knowledge or awareness, to the “best of” Borrower’s knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable investigation, of any Responsible Officer.
6    AFFIRMATIVE COVENANTS
Borrower shall do all of the following:
6.1    Government Compliance.  
(a)    Maintain its and all its Subsidiaries’ legal existence and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on Borrower’s business or operations.  Borrower shall comply, and have each Subsidiary comply, in all material respects, with all laws, ordinances and regulations to which it is subject.
(b)    Obtain all of the Governmental Approvals necessary for the performance by Borrower of its obligations under the Loan Documents to which it is a party and the grant of a security interest to Bank in all of its property.  Borrower shall promptly provide copies of any such obtained Governmental Approvals to Bank.
6.2    Financial Statements, Reports, Certificates.  Provide Bank with the following:
(a)    a Borrowing Base Report (and any schedules related thereto and including any other information requested by Bank with respect to Borrower’s Accounts) (i) within thirty (30) days after the end of each month in which Advances are outstanding or have been requested and (ii) within forty-five (45) days after the end of each month in which Advances are not outstanding and have not been requested;
(b)    within forty-five (45) days after the end of each month, (A) monthly accounts receivable agings, aged by invoice date, (B) monthly accounts payable agings, aged by invoice date, and outstanding or held check registers, if any, and (C) a Deferred Revenue report;  
(c)    as soon as available, but no later than forty-five (45) days after the last day of each month, a company prepared consolidated balance sheet and income statement covering Borrower’s consolidated 

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operations for such month certified by a Responsible Officer and in a form acceptable to Bank (the “Monthly Financial Statements”);
(d)    within forty-five (45) days after the last day of each month and together with the Monthly Financial Statements, a duly completed Compliance Certificate signed by a Responsible Officer, certifying that as of the end of such month, Borrower was in full compliance with all of the terms and conditions of this Agreement, and setting forth calculations showing compliance with the financial covenants set forth in this Agreement and such other information as Bank may reasonably request, including, without limitation, a statement that at the end of such month there were no held checks; 
(e)    within seventy-five (75) days after the end of each fiscal year of Borrower, and contemporaneously with any updates or amendments thereto, (i) annual operating budgets (including income statements, balance sheets and cash flow statements, by month), and (ii) annual financial projections (on a quarterly basis), in each case as approved by the Board, together with any related business forecasts used in the preparation of such annual financial projections;
(f)    as soon as available, and in any event within one hundred twenty (120) days following the end of Borrower’s fiscal year, audited consolidated financial statements prepared under GAAP, consistently applied, together with an unqualified opinion on the financial statements from an independent certified public accounting firm reasonably acceptable to Bank;
(g)    in the event that Borrower becomes subject to the reporting requirements under the Exchange Act, within five (5) days of filing, copies of all periodic and other reports, proxy statements and other materials filed by Borrower with the SEC, any Governmental Authority succeeding to any or all of the functions of the SEC or with any national securities exchange, or distributed to its shareholders, as the case may be.  Documents required to be delivered pursuant to the terms hereof (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which Borrower posts such documents, or provides a link thereto, on Borrower’s website on the internet at Borrower’s website address; provided, however, Borrower shall promptly notify Bank in writing (which may be by electronic mail) of the posting of any such documents;
(h)    within five (5) days of delivery, copies of all statements, reports and notices made available to Borrower’s security holders or to any holders of Subordinated Debt;
(i)    prompt written notice of any changes to the beneficial ownership information set out in Section 14 of the Perfection Certificate.  Borrower understands and acknowledges that Bank relies on such true, accurate and up-to-date beneficial ownership information to meet Bank’s regulatory obligations to obtain, verify and record information about the beneficial owners of its legal entity customers;
(j)    prompt report of any legal actions pending or threatened in writing against Borrower or any of its Subsidiaries that could result in damages or costs to Borrower or any of its Subsidiaries of, individually or in the aggregate, Two Hundred Fifty Thousand Dollars ($250,000.00) or more; and
(k)    promptly, from time to time, such other information regarding Borrower or compliance with the terms of any Loan Documents as reasonably requested by Bank.
6.3    Accounts Receivable.
(a)    Schedules and Documents Relating to Accounts.  Borrower shall deliver to Bank transaction reports and schedules of collections, as provided in Section 6.2, on Bank’s standard forms; provided, however, that Borrower’s failure to execute and deliver the same shall not affect or limit Bank’s Lien and other rights in all of Borrower’s Accounts, nor shall Bank’s failure to advance or lend against a specific Account affect or limit Bank’s Lien and other rights therein.  If requested by Bank, Borrower shall furnish Bank with copies (or, at Bank’s request, originals) of all contracts, orders, invoices, and other similar documents, and all shipping 

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instructions, delivery receipts, bills of lading, and other evidence of delivery, for any goods the sale or disposition of which gave rise to such Accounts.  In addition, Borrower shall deliver to Bank, on its request, the originals of all instruments, chattel paper, security agreements, guarantees and other documents and property evidencing or securing any Accounts, in the same form as received, with all necessary indorsements, and copies of all credit memos. 
(b)    Disputes.  Borrower shall promptly notify Bank of all disputes or claims relating to Accounts.  Borrower may forgive (completely or partially), compromise, or settle any Account for less than payment in full, or agree to do any of the foregoing so long as (i) Borrower does so in good faith, in a commercially reasonable manner, in the ordinary course of business, in arm’s-length transactions, and reports the same to Bank in the regular reports provided to Bank; (ii) no Event of Default has occurred and is continuing; and (iii) after taking into account all such discounts, settlements and forgiveness, the total outstanding Advances will not exceed the lesser of the Revolving Line or the Borrowing Base. 
(c)    Collection of Accounts.  Borrower shall direct all Account Debtors to deliver or transmit all proceeds of Accounts into a lockbox account or the Designated Deposit Account (such accounts, collectively, the “Lockbox Account”).  Whether or not an Event of Default has occurred and is continuing, Borrower shall immediately deliver all payments on and proceeds of Accounts to the Lockbox Account.  Subject to Bank’s right to maintain a reserve pursuant to Section 6.3(d), provided no Event of Default has occurred, all amounts received in the Lockbox Account shall be transferred on a daily basis to Borrower’s operating account with Bank. Borrower hereby authorizes Bank to transfer to the Lockbox Account any amounts that Bank reasonably determines are proceeds of the Accounts (provided that Bank is under no obligation to do so and this allowance shall in no event relieve Borrower of its obligations hereunder).
(d)    Reserves.  Notwithstanding any terms in this Agreement to the contrary, at times when an Event of Default exists, Bank may hold any proceeds of the Accounts and any amounts in the Lockbox Account that are not applied to the Obligations pursuant to Section 6.3(c) above as a reserve to be applied to any Obligations regardless of whether such Obligations are then due and payable.
(e)    Returns.  Provided no Event of Default has occurred and is continuing, if any Account Debtor returns any Inventory to Borrower, Borrower shall promptly (i) determine the reason for such return, (ii) issue a credit memorandum to the Account Debtor in the appropriate amount, and (iii) provide a copy of such credit memorandum to Bank, upon request from Bank.  In the event any attempted return occurs after the occurrence and during the continuance of any Event of Default, Borrower shall hold the returned Inventory in trust for Bank, and immediately notify Bank of the return of the Inventory.  
(f)    Verifications; Confirmations; Credit Quality; Notifications.  Bank may, from time to time, (i) verify and confirm directly with the respective Account Debtors the validity, amount and other matters relating to the Accounts, either in the name of Borrower or Bank or such other name as Bank may choose, and notify any Account Debtor of Bank’s security interest in such Account and/or (ii) conduct a credit check of any Account Debtor to approve any such Account Debtor’s credit.  In addition, Bank may notify Account Debtors to make payments in respect of Accounts directly to Bank.
(g)    No Liability.  Bank shall not be responsible or liable for any shortage or discrepancy in, damage to, or loss or destruction of, any goods, the sale or other disposition of which gives rise to an Account, or for any error, act, omission, or delay of any kind occurring in the settlement, failure to settle, collection or failure to collect any Account, or for settling any Account in good faith for less than the full amount thereof, nor shall Bank be deemed to be responsible for any of Borrower’s obligations under any contract or agreement giving rise to an Account.  Nothing herein shall, however, relieve Bank from liability for its own gross negligence or willful misconduct.
6.4    Remittance of Proceeds.  Except as otherwise provided in Section 6.3(c), deliver, in kind, all proceeds arising from the disposition of any Collateral to Bank in the original form in which received by Borrower not later than the following Business Day after receipt by Borrower, to be applied to the Obligations (a) prior to an Event of Default, pursuant to the terms of Section 6.3(c) hereof, and (b) after the occurrence and during the 

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continuance of an Event of Default, pursuant to the terms of Section 9.4 hereof; provided that, if no Event of Default has occurred and is continuing, Borrower shall not be obligated to remit to Bank the proceeds of the sale of worn out or obsolete Equipment disposed of by Borrower in good faith in an arm’s length transaction for an aggregate purchase price of Twenty Five Thousand Dollars ($25,000.00) or less (for all such transactions in any fiscal year).  Borrower agrees that it will not commingle proceeds of Collateral with any of Borrower’s other funds or property, but will hold such proceeds separate and apart from such other funds and property and in an express trust for Bank.  Nothing in this Section 6.4 limits the restrictions on disposition of Collateral set forth elsewhere in this Agreement.
6.5    Taxes; Pensions.  Timely file, and require each of its Subsidiaries to timely file, all required tax returns and reports and timely pay, and require each of its Subsidiaries to timely pay, all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower and each of its Subsidiaries, except for deferred payment of any taxes contested pursuant to the terms of Section 5.9 hereof, and shall deliver to Bank, on demand, appropriate certificates attesting to such payments, and pay all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms.
6.6    Access to Collateral; Books and Records.  At reasonable times, on three (3) Business Days’ notice (provided no notice is required if an Event of Default has occurred and is continuing), Bank, or its agents, shall have the right to inspect the Collateral and the right to audit and copy Borrower’s Books.  The foregoing inspections and audits shall be conducted no more often than once every six (6) months unless an Event of Default has occurred and is continuing in which case such inspections and audits shall occur as often as Bank shall determine is necessary. The foregoing inspections and audits shall be conducted at Borrower’s expense and the charge therefor shall be One Thousand Dollars ($1,000.00) per person per day (or such higher amount as shall represent Bank’s then-current standard charge for the same), plus reasonable out-of-pocket expenses.  In the event Borrower and Bank schedule an audit more than eight (8) days in advance, and Borrower cancels or seeks to or reschedules the audit with less than eight (8) days written notice to Bank, then (without limiting any of Bank’s rights or remedies) Borrower shall pay Bank a fee of Two Thousand Dollars ($2,000.00) plus any out-of-pocket expenses incurred by Bank to compensate Bank for the anticipated costs and expenses of the cancellation or rescheduling.  
6.7    Insurance.  
(a)    Keep its business and the Collateral insured for risks and in amounts standard for companies in Borrower’s industry and location and as Bank may reasonably request.  Insurance policies shall be in a form, with financially sound and reputable insurance companies that are not Affiliates of Borrower, and in amounts that are satisfactory to Bank.  All applicable property policies shall have a lender’s loss payable endorsement showing Bank as the sole lender loss payee.  All liability policies shall show, or have endorsements showing, Bank as an additional insured.  Bank shall be named as lender loss payee and/or additional insured with respect to any such insurance providing coverage in respect of any Collateral. 
(b)    Ensure that proceeds payable under any property policy are, at Bank’s option, payable to Bank on account of the Obligations.  
(c)    At Bank’s request, Borrower shall deliver certified copies of insurance policies and evidence of all premium payments.  Each provider of any such insurance required under this Section 6.7 shall agree, by endorsement upon the policy or policies issued by it or by independent instruments furnished to Bank, that it will give Bank thirty (30) days prior written notice before any such policy or policies shall be materially altered or canceled.  If Borrower fails to obtain insurance as required under this Section 6.7 or to pay any amount or furnish any required proof of payment to third persons and Bank, Bank may make all or part of such payment or obtain such insurance policies required in this Section 6.7, and take any action under the policies Bank deems prudent.
6.8    Accounts.
(a)    Maintain its and all of its U.S. Subsidiaries’ primary operating and other deposit accounts, the Lockbox Account and primary securities/investment accounts with Bank and Bank’s Affiliates, provided that 

11

accounts in the name of Borrower maintained with Bank and Bank’s Affiliates shall represent at least fifty percent (50.0%) of the aggregate Dollar value of Borrower’s and its Subsidiaries’ accounts at all financial institutions.
(b)    In addition to and without limiting the restrictions in (a), Borrower shall provide Bank five (5) days prior written notice before establishing any Collateral Account at or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account that Borrower at any time maintains, Borrower shall cause the applicable bank or financial institution (other than Bank) at or with which any Collateral Account is maintained to execute and deliver a Control Agreement or other appropriate instrument with respect to such Collateral Account to perfect Bank’s Lien in such Collateral Account in accordance with the terms hereunder which Control Agreement may not be terminated without the prior written consent of Bank.  The provisions of the previous sentence shall not apply to (i) deposit accounts exclusively used for payroll, payroll taxes, and other employee wage and benefit payments to or for the benefit of Borrower’s employees and identified to Bank by Borrower as such and (ii) Excluded Accounts.
6.9    Financial Covenants.
(a)    Liquidity Coverage.  To be tested as of the last day of each calendar month, determined on a consolidated basis with respect to Borrower and its Subsidiaries, a Liquidity Coverage Ratio of not less than 2.25 to 1.0.
(b)    Free Cash Flow.  To be tested as of the end of each fiscal quarter that is a Testing Quarter, measured on a trailing six-month basis, determined on a consolidated basis with respect to Borrower and its Subsidiaries, Free Cash Flow of at least: (i) for the six-month period ending on September 30, 2019, ($2,000,000.00), (ii) for the six-month period ending on December 31, 2019, $0.00, (iii) for the six-month period ending on March 31, 2020, $0.00, and (iv) for the six-month period ending on June 30, 2020, ($3,000,000.00).
With respect to the period ending September 30, 2020 and each testing period thereafter, the levels of Free Cash Flow shall be established, based upon, among other factors, Bank’s then current underwriting and Borrower’s Board-approved operating plan and financial projections, in form and substance acceptable to Bank.  With respect thereto:
(i) Borrower’s failure to agree in writing (which agreement shall be set forth in a written amendment to this Agreement) on or before April 30, 2020, to any Free Cash Flow covenant levels proposed by Bank with respect to any period from September 30, 2020 through and including December 31, 2020, shall result in an immediate Event of Default for which there shall be no grace or cure period; and

(ii) with respect to the period ending January 31, 2021 and each testing period thereafter, the levels of Free Cash Flow shall be set at Zero Dollars ($0.00), unless, on or before March 1, 2021, Borrower otherwise agrees in writing (which agreement shall be set forth in a written amendment to this Agreement) to any Free Cash Flow covenant levels proposed by Bank with respect to such testing periods.

6.10    Protection and Registration of Intellectual Property Rights.  
(a)    (i) Protect, defend and maintain the validity and enforceability of its Intellectual Property; (ii) promptly advise Bank in writing of material infringements or any other event that could reasonably be expected to materially and adversely affect the value of its Intellectual Property; and (iii) not allow any Intellectual Property material to Borrower’s business to be abandoned, forfeited or dedicated to the public without Bank’s written consent.
(b)    To the extent not already disclosed in writing to Bank on the Effective Date, if Borrower (i) obtains any Patent, registered Trademark, registered Copyright, registered mask work, or any pending application for any of the foregoing, whether as owner, licensee or otherwise, or (ii) applies for any Patent or the registration of any Trademark, then Borrower shall immediately provide written notice thereof to Bank and shall execute such intellectual property security agreements and other documents and take such other actions as Bank may request in its good faith business judgment to perfect and maintain a first priority perfected security interest in favor of Bank in 

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such property.  If Borrower decides to register any Copyrights or mask works in the United States Copyright Office, Borrower shall: (x) provide Bank with at least fifteen (15) days prior written notice of Borrower’s intent to register such Copyrights or mask works together with a copy of the application it intends to file with the United States Copyright Office (excluding exhibits thereto); (y) execute an intellectual property security agreement and such other documents and take such other actions as Bank may request in its good faith business judgment to perfect and maintain a first priority perfected security interest in favor of Bank in the Copyrights or mask works intended to be registered with the United States Copyright Office; and (z) record such intellectual property security agreement with the United States Copyright Office contemporaneously with filing the Copyright or mask work application(s) with the United States Copyright Office.  Borrower shall promptly provide to Bank copies of all applications that it files for Patents or for the registration of Trademarks, Copyrights or mask works, together with evidence of the recording of the intellectual property security agreement required for Bank to perfect and maintain a first priority perfected security interest in such property.
(c)    Provide written notice to Bank within ten (10) days of entering or becoming bound by any Restricted License (other than over-the-counter software that is commercially available to the public).  Borrower shall take such steps as Bank requests to obtain the consent of, or waiver by, any person whose consent or waiver is necessary for (i) any Restricted License to be deemed “Collateral” and for Bank to have a security interest in it that might otherwise be restricted or prohibited by law or by the terms of any such Restricted License, whether now existing or entered into in the future, and (ii) Bank to have the ability in the event of a liquidation of any Collateral to dispose of such Collateral in accordance with Bank’s rights and remedies under this Agreement and the other Loan Documents.
6.11    Litigation Cooperation.  From the date hereof and continuing through the termination of this Agreement, make available to Bank, without expense to Bank, Borrower and its officers, employees and agents and Borrower’s books and records, to the extent that Bank may deem them reasonably necessary to prosecute or defend any third-party suit or proceeding instituted by or against Bank with respect to any Collateral or relating to Borrower.
6.12    Online Banking.  
              (a)    Utilize Bank’s online banking platform for all matters requested by Bank which shall include, without limitation (and without request by Bank for the following matters), uploading information pertaining to Accounts and Account Debtors, requesting approval for exceptions, requesting Credit Extensions, and uploading financial statements and other reports required to be delivered by this Agreement (including, without limitation, those described in Section 6.2 of this Agreement).
               (b)    Comply with the terms of Bank’s Online Banking Agreement as in effect from time to time and ensure that all persons utilizing Bank’s online banking platform are duly authorized to do so by an Administrator.  Bank shall be entitled to assume the authenticity, accuracy and completeness of any information, instruction or request for a Credit Extension submitted via Bank’s online banking platform and to further assume that any submissions or requests made via Bank’s online banking platform have been duly authorized by an Administrator.
6.13    Further Assurances.  Execute any further instruments and take further action as Bank reasonably requests to perfect or continue Bank’s Lien in the Collateral or to effect the purposes of this Agreement.  Deliver to Bank, within five (5) days after the same are sent or received, copies of all correspondence, reports, documents and other filings with any Governmental Authority regarding compliance with or maintenance of Governmental Approvals or Requirements of Law or that could reasonably be expected to have a material adverse effect on any of the Governmental Approvals or otherwise on the operations of Borrower or any of its Subsidiaries.
6.14    Post-Closing Conditions.  Deliver to Bank (a) within thirty (30) days of the Effective Date, (i) duly executed original signatures to a Control Agreement with M&T Bank and (ii) evidence satisfactory to Bank that the insurance endorsements required by Section 6.7 hereof are in full force and effect, together with appropriate evidence showing lender loss payable and/or additional insured clauses or endorsements in favor of Bank; (b) within 

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forty-five (45) days of the Effective Date, a landlord’s consent in favor of Bank, in form and substance satisfactory to Bank, for each of the following leased locations, by the respective landlord thereof: (i) 40 La Riviere Drive, Buffalo, New York 14202, (ii) 450 7th Avenue, 43rd Floor, New York, New York 10123, (iii) 1 Technology Park Dr., Westford, Massachusetts 01886, (iv) 2591 Dallas Parkway, Suite 200, Frisco, Texas 75034, (v) 655 Montgomery Street, San Francisco, California 94111, and (vi) 300 N. Continental Blvd, 1st Floor, El Segundo, California 90245; and (c) within ten (10) days of the Effective Date, a good standing certificate of NTV certified by the Secretary of State of New York, dated as of a date no earlier than thirty (30) days prior to the date on which the certificate is delivered to Bank.
7    NEGATIVE COVENANTS
Borrower shall not do any of the following without Bank’s prior written consent:
7.1    Dispositions.  Convey, sell, lease, transfer, assign, or otherwise dispose of (including, without limitation, pursuant to a Division) (collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for Transfers (a) of Inventory in the ordinary course of business; (b) of worn-out or obsolete Equipment that is, in the reasonable judgment of Borrower, no longer economically practicable to maintain or useful in the ordinary course of business of Borrower; (c) consisting of Permitted Liens and Permitted Investments; (d) consisting of the sale or issuance of any stock of Borrower permitted under Section 7.2 of this Agreement; and (e) consisting of Borrower’s use or transfer of money or Cash Equivalents in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents.
7.2    Changes in Business, Management, Control, or Business Locations.  (a) Engage in or permit any of its Subsidiaries to engage in any business other than the businesses currently engaged in by Borrower and such Subsidiary, as applicable, or reasonably related thereto; (b) liquidate or dissolve; (c) fail to provide notice to Bank of any Key Person departing from or ceasing to be employed by Borrower within five (5) days after such Key Person’s departure from Borrower; or (d) permit or suffer any Change in Control.  
Borrower shall not, without at least fifteen (15) days prior written notice to Bank: (1) add any new offices or business locations, including warehouses (unless such new offices or business locations contain less than One Hundred Thousand Dollars ($100,000.00) in Borrower’s assets or property) or deliver any portion of the Collateral valued, individually or in the aggregate, in excess of One Hundred Thousand Dollars ($100,000.00) to a bailee at a location other than to a bailee and at a location already disclosed in the Perfection Certificate, (2) change its jurisdiction of organization, (3) change its organizational structure or type, (4) change its legal name, or (5) change any organizational number (if any) assigned by its jurisdiction of organization.  If Borrower intends to add any new offices or business locations, including warehouses, containing in excess of One Hundred Thousand Dollars ($100,000.00) of Borrower's assets or property, then Borrower will first receive the written consent of Bank, and the landlord of any such new offices or business locations, including warehouses, shall execute and deliver a landlord consent in form and substance satisfactory to Bank.  If Borrower intends to deliver any portion of the Collateral valued, individually or in the aggregate, in excess of One Hundred Thousand Dollars ($100,000.00) to a bailee, and Bank and such bailee are not already parties to a bailee agreement governing both the Collateral and the location to which Borrower intends to deliver the Collateral, then Borrower will first receive the written consent of Bank, and such bailee shall execute and deliver a bailee agreement in form and substance satisfactory to Bank.
7.3    Mergers or Acquisitions.  Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or property of another Person (including, without limitation, by the formation of any Subsidiary or pursuant to a Division), except for Permitted Acquisitions.  A Subsidiary may merge or consolidate into another Subsidiary or into Borrower.
7.4    Indebtedness.  Create, incur, assume, or be liable for any Indebtedness, or permit any Subsidiary to do so, other than Permitted Indebtedness.

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7.5    Encumbrance.  Create, incur, allow, or suffer any Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for Permitted Liens, permit any Collateral not to be subject to the first priority security interest granted herein, or enter into any agreement, document, instrument or other arrangement (except with or in favor of Bank) with any Person which directly or indirectly prohibits or has the effect of prohibiting Borrower or any Subsidiary from assigning, mortgaging, pledging, granting a security interest in or upon, or encumbering any of Borrower’s or any Subsidiary’s Intellectual Property, except as is otherwise permitted in Section 7.1 hereof and the definition of “Permitted Liens” herein.
7.6    Maintenance of Collateral Accounts.  Maintain any Collateral Account except pursuant to the terms of Section 6.8(b) hereof.
7.7    Distributions; Investments.  (a) Pay any dividends or make any distribution or payment or redeem, retire or purchase any capital stock provided that Borrower may repurchase the stock of former employees or consultants pursuant to stock repurchase agreements so long as an Event of Default does not exist at the time of any such repurchase and would not exist after giving effect to any such repurchase, provided that (i) the aggregate amount of all such repurchases does not exceed Ten Million Dollars ($10,000,000.00) and (ii) immediately after giving effect to such repurchases, Borrower shall have Availability Liquidity of no less than Fifteen Million Dollars ($15,000,000.00); or (b) directly or indirectly make any Investment (including, without limitation, by the formation of any Subsidiary) other than Permitted Investments, or permit any of its Subsidiaries to do so.
7.8    Transactions with Affiliates.  Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower, except for transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained in an arm’s length transaction with a non-affiliated Person.
7.9    Subordinated Debt.  (a) Make or permit any payment on any Subordinated Debt, except under the terms of the subordination, intercreditor, or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to the Subordinated Debt which would increase the amount thereof, provide for earlier or greater principal, interest, or other payments thereon, or adversely affect the subordination thereof to Obligations owed to Bank.
7.10    Compliance.  Become an “investment company” or a company controlled by an “investment company”, under the Investment Company Act of 1940, as amended, or undertake as one of its important activities extending credit to purchase or carry margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System), or use the proceeds of any Credit Extension for that purpose; fail to meet the minimum funding requirements of ERISA, permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur; fail to comply with the Federal Fair Labor Standards Act or violate any other law or regulation, if the violation could reasonably be expected to have a material adverse effect on Borrower’s business, or permit any of its Subsidiaries to do so; withdraw or permit any Subsidiary to withdraw from participation in, permit partial or complete termination of, or permit the occurrence of any other event with respect to, any present pension, profit sharing and deferred compensation plan which could reasonably be expected to result in any liability of Borrower, including any liability to the Pension Benefit Guaranty Corporation or its successors or any other governmental agency.
8    EVENTS OF DEFAULT
Any one of the following shall constitute an event of default (an “Event of Default”) under this Agreement:
8.1    Payment Default.  Borrower fails to (a) make any payment of principal or interest on any Credit Extension when due, or (b) pay any other Obligations within three (3) Business Days after such Obligations are due and payable (which three (3) Business Day cure period shall not apply to payments due on the Revolving Line Maturity Date).  During the cure period, the failure to make or pay any payment specified under clause (b) hereunder is not an Event of Default (but no Credit Extension will be made during the cure period);

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8.2    Covenant Default.  
(a)    Borrower fails or neglects to perform any obligation in Sections 6.2, 6.3, 6.4, 6.5, 6.6, 6.7, 6.8, 6.9, 6.10, 6.12, or 6.14 or violates any covenant in Section 7; or
(b)    Borrower fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 8) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within ten (10) days after the occurrence thereof; provided, however, that if the default cannot by its nature be cured within the ten (10) day period or cannot after diligent attempts by Borrower be cured within such ten (10) day period, and such default is likely to be cured within a reasonable time, then Borrower shall have an additional period (which shall not in any case exceed thirty (30) days) to attempt to cure such default, and within such reasonable time period the failure to cure the default shall not be deemed an Event of Default (but no Credit Extensions shall be made during such cure period).  Cure periods provided under this section shall not apply, among other things, to financial covenants or any other covenants set forth in clause (a) above;
8.3    Material Adverse Change.  A Material Adverse Change occurs;
8.4    Attachment; Levy; Restraint on Business.  
(a)    (i) The service of process seeking to attach, by trustee or similar process, any funds of Borrower or of any entity under the control of Borrower (including a Subsidiary), or (ii) a notice of lien or levy is filed against any of Borrower’s assets by any Governmental Authority, and the same under subclauses (i) and (ii) hereof are not, within ten (10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Credit Extensions shall be made during any ten (10) day cure period; or 
(b)     (i) any material portion of Borrower’s assets is attached, seized, levied on, or comes into possession of a trustee or receiver, or (ii) any court order enjoins, restrains, or prevents Borrower from conducting all or any material part of its business;
8.5    Insolvency.  (a) Borrower or any of its Subsidiaries is unable to pay its debts (including trade debts) as they become due or otherwise becomes insolvent; (b) Borrower or any of its Subsidiaries begins an Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower or any of its Subsidiaries and is not dismissed or stayed within thirty (30) days (but no Credit Extensions shall be made while any of the conditions described in clause (a) exist and/or until any Insolvency Proceeding is dismissed);
8.6    Other Agreements.  There is, under any agreement to which Borrower is a party with a third party or parties, (a) any default resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount individually or in the aggregate in excess of Fifty Thousand Dollars ($50,000.00); or (b) any breach or default by Borrower, the result of which could have a material adverse effect on Borrower’s business; 
8.7    Judgments; Penalties.  One or more fines, penalties or final judgments, orders or decrees for the payment of money in an amount, individually or in the aggregate, of at least Two Hundred Fifty Thousand Dollars ($250,000.00) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower by any Governmental Authority, and the same are not, within ten (10) days after the entry, assessment or issuance thereof, discharged, satisfied, or paid, or after execution thereof, stayed or bonded pending appeal, or such judgments are not discharged prior to the expiration of any such stay (provided that no Credit Extensions will be made prior to the satisfaction, payment, discharge, stay, or bonding of such fine, penalty, judgment, order or decree);
8.8    Misrepresentations.  Borrower or any Person acting for Borrower makes any representation, warranty, or other statement now or later in this Agreement, any Loan Document or in any writing delivered to Bank 

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or to induce Bank to enter this Agreement or any Loan Document, and such representation, warranty, or other statement is incorrect in any material respect when made;
8.9    Subordinated Debt.  Any document, instrument, or agreement evidencing any Subordinated Debt shall for any reason be revoked or invalidated or otherwise cease to be in full force and effect, any Person shall be in breach thereof or contest in any manner the validity or enforceability thereof or deny that it has any further liability or obligation thereunder, or the Obligations shall for any reason be subordinated or shall not have the priority contemplated by this Agreement or any applicable subordination or intercreditor agreement; or
8.10    Governmental Approvals.  Any Governmental Approval shall have been (a) revoked, rescinded, suspended, modified in an adverse manner or not renewed in the ordinary course for a full term or (b) subject to any decision by a Governmental Authority that designates a hearing with respect to any applications for renewal of any of such Governmental Approval or that could result in the Governmental Authority taking any of the actions described in clause (a) above, and such decision or such revocation, rescission, suspension, modification or non-renewal (i) causes, or could reasonably be expected to cause, a Material Adverse Change, or (ii) adversely affects the legal qualifications of Borrower or any of its Subsidiaries to hold such Governmental Approval in any applicable jurisdiction and such revocation, rescission, suspension, modification or non-renewal could reasonably be expected to affect the status of or legal qualifications of Borrower or any of its Subsidiaries to hold any Governmental Approval in any other jurisdiction.
9    BANK’S RIGHTS AND REMEDIES
9.1    Rights and Remedies.  Upon the occurrence and during the continuance (beyond any applicable grace period, if any) of an Event of Default, Bank may, without notice or demand, do any or all of the following:
(a)    declare all Obligations immediately due and payable (but if an Event of Default described in Section 8.5 occurs all Obligations are immediately due and payable without any action by Bank);
(b)    stop advancing money or extending credit for Borrower’s benefit under this Agreement or under any other agreement between Borrower and Bank;
(c)    demand that Borrower (i) deposit cash with Bank in an amount equal to at least (A) one hundred five percent (105.0%) of the Dollar Equivalent of the aggregate face amount of all Letters of Credit denominated in Dollars remaining undrawn, and (B) one hundred ten percent (110.0%) of the Dollar Equivalent of the aggregate face amount of all Letters of Credit denominated in a Foreign Currency remaining undrawn (plus, in each case, all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit;
(d)    terminate any FX Contracts;
(e)    verify the amount of, demand payment of and performance under, and collect any Accounts and General Intangibles, settle or adjust disputes and claims directly with Account Debtors for amounts on terms and in any order that Bank considers advisable, and notify any Person owing Borrower money of Bank’s security interest in such funds.  Borrower shall collect all payments in trust for Bank and, if requested by Bank, immediately deliver the payments to Bank in the form received from the Account Debtor, with proper endorsements for deposit;
(f)    make any payments and do any acts it considers necessary or reasonable to protect the Collateral and/or its security interest in the Collateral.  Borrower shall assemble the Collateral if Bank requests and make it available as Bank designates.  Bank may enter premises where the Collateral is located, take and maintain possession of any part of the Collateral, and pay, purchase, contest, or compromise any Lien which appears to be 

17

prior or superior to its security interest and pay all expenses incurred. Borrower grants Bank a license to enter and occupy any of its premises, without charge, to exercise any of Bank’s rights or remedies;
(g)    apply to the Obligations any (i) balances and deposits of Borrower it holds, or (ii) amount held by Bank owing to or for the credit or the account of Borrower;
(h)    ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell the Collateral.  Bank is hereby granted a non-exclusive, royalty-free license or other right to use, without charge, Borrower’s labels, Patents, Copyrights, mask works, rights of use of any name, trade secrets, trade names, Trademarks, and advertising matter, or any similar property as it pertains to the Collateral, in completing production of, advertising for sale, and selling any Collateral and, in connection with Bank’s exercise of its rights under this Section 9.1, Borrower’s rights under all licenses and all franchise agreements inure to Bank’s benefit;
(i)    place a “hold” on any account maintained with Bank and/or deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any Control Agreement or similar agreements providing control of any Collateral;
(j)    demand and receive possession of Borrower’s Books; and
(k)    exercise all rights and remedies available to Bank under the Loan Documents or at law or equity, including all remedies provided under the Code (including disposal of the Collateral pursuant to the terms thereof).
9.2    Power of Attorney.  Borrower hereby irrevocably appoints Bank as its lawful attorney-in-fact to:  (a) exercisable following the occurrence of an Event of Default, (i) sign Borrower’s name on any invoice or bill of lading for any Account or drafts against Account Debtors; (ii) demand, collect, sue, and give releases to any Account Debtor for monies due, settle and adjust disputes and claims about the Accounts directly with Account Debtors, and compromise, prosecute, or defend any action, claim, case, or proceeding about any Collateral (including filing a claim or voting a claim in any bankruptcy case in Bank’s or Borrower’s name, as Bank chooses); (iii) make, settle, and adjust all claims under Borrower’s insurance policies; (iv) pay, contest or settle any Lien, charge, encumbrance, security interest, or other claim in or to the Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; (v) transfer the Collateral into the name of Bank or a third party as the Code permits; and (vi) receive, open and dispose of mail addressed to Borrower; and (b) regardless of whether an Event of Default has occurred, (i) endorse Borrower’s name on any checks, payment instruments, or other forms of payment or security; and (ii) notify all Account Debtors to pay Bank directly.  Borrower hereby appoints Bank as its lawful attorney-in-fact to sign Borrower’s name on any documents necessary to perfect or continue the perfection of Bank’s security interest in the Collateral regardless of whether an Event of Default has occurred until all Obligations have been satisfied in full and the Loan Documents have been terminated.  Bank’s foregoing appointment as Borrower’s attorney in fact, and all of Bank’s rights and powers, coupled with an interest, are irrevocable until all Obligations have been fully repaid and performed and the Loan Documents have been terminated.
9.3    Protective Payments.  If Borrower fails to obtain the insurance called for by Section 6.7 or fails to pay any premium thereon or fails to pay any other amount which Borrower is obligated to pay under this Agreement or any other Loan Document or which may be required to preserve the Collateral, Bank may obtain such insurance or make such payment, and all amounts so paid by Bank are Bank Expenses and immediately due and payable, bearing interest at the then highest rate applicable to the Obligations, and secured by the Collateral.  Bank will make reasonable efforts to provide Borrower with notice of Bank obtaining such insurance at the time it is obtained or within a reasonable time thereafter.  No payments by Bank are deemed an agreement to make similar payments in the future or Bank’s waiver of any Event of Default.
9.4    Application of Payments and Proceeds.  If an Event of Default has occurred and is continuing (or at any time on the terms set forth in Section 6.3(c), regardless of whether an Event of Default exists), Bank shall have the right to apply in any order any funds in its possession, whether from Borrower account balances, payments, proceeds realized as the result of any collection of Accounts or other disposition of the Collateral, or otherwise, to 

18

the Obligations.  Bank shall pay any surplus to Borrower by credit to the Designated Deposit Account or to other Persons legally entitled thereto; Borrower shall remain liable to Bank for any deficiency.  If Bank, directly or indirectly, enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Bank shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price or deferring the reduction of the Obligations until the actual receipt by Bank of cash therefor.
9.5    Bank’s Liability for Collateral.  So long as Bank complies with reasonable banking practices regarding the safekeeping of the Collateral in the possession or under the control of Bank, Bank shall not be liable or responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage to the Collateral; (c) any diminution in the value of the Collateral; or (d) any act or default of any carrier, warehouseman, bailee, or other Person.  Borrower bears all risk of loss, damage or destruction of the Collateral.
9.6    No Waiver; Remedies Cumulative.  Bank’s failure, at any time or times, to require strict performance by Borrower of any provision of this Agreement or any other Loan Document shall not waive, affect, or diminish any right of Bank thereafter to demand strict performance and compliance herewith or therewith.  No waiver hereunder shall be effective unless signed by the party granting the waiver and then is only effective for the specific instance and purpose for which it is given.  Bank’s rights and remedies under this Agreement and the other Loan Documents are cumulative.  Bank has all rights and remedies provided under the Code, by law, or in equity.  Bank’s exercise of one right or remedy is not an election and shall not preclude Bank from exercising any other remedy under this Agreement or other remedy available at law or in equity, and Bank’s waiver of any Event of Default is not a continuing waiver.  Bank’s delay in exercising any remedy is not a waiver, election, or acquiescence.  
9.7    Demand Waiver.  Borrower waives demand, notice of default or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise, settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees held by Bank on which Borrower is liable.
9.8    Borrower Liability.  Any Borrower may, acting singly, request Credit Extensions hereunder.  Each Borrower hereby appoints each other as agent for the other for all purposes hereunder, including with respect to requesting Credit Extensions hereunder.  Each Borrower hereunder shall be jointly and severally obligated to repay all Credit Extensions made hereunder, regardless of which Borrower actually receives said Credit Extension, as if each Borrower hereunder directly received all Credit Extensions.  Each Borrower waives (a) any suretyship defenses available to it under the Code or any other applicable law, and (b) any right to require Bank to: (i) proceed against any Borrower or any other person; (ii) proceed against or exhaust any security; or (iii) pursue any other remedy.  Bank may exercise or not exercise any right or remedy it has against any Borrower or any security it holds (including the right to foreclose by judicial or non-judicial sale) without affecting any Borrower’s liability.  Notwithstanding any other provision of this Agreement or other related document, each Borrower irrevocably waives all rights that it may have at law or in equity (including, without limitation, any law subrogating Borrower to the rights of Bank under this Agreement) to seek contribution, indemnification or any other form of reimbursement from any other Borrower, or any other Person now or hereafter primarily or secondarily liable for any of the Obligations, for any payment made by Borrower with respect to the Obligations in connection with this Agreement or otherwise and all rights that it might have to benefit from, or to participate in, any security for the Obligations as a result of any payment made by Borrower with respect to the Obligations in connection with this Agreement or otherwise.  Any agreement providing for indemnification, reimbursement or any other arrangement prohibited under this Section 9.8 shall be null and void.  If any payment is made to a Borrower in contravention of this Section 9.8, such Borrower shall hold such payment in trust for Bank and such payment shall be promptly delivered to Bank for application to the Obligations, whether matured or unmatured.
10    NOTICES
All notices, consents, requests, approvals, demands, or other communication by any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and three (3) Business Days after deposit in the U.S. mail, first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail or facsimile transmission; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges 

19

prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address, facsimile number, or email address indicated below.  Bank or Borrower may change its mailing or electronic mail address or facsimile number by giving the other party written notice thereof in accordance with the terms of this Section 10. 
If to Borrower:    Synacor, Inc. 
    40 La Riviere Dr., Suite 300 
                                 Buffalo, New York 14202 
    Attn:      Chief Financial Officer 
    Fax:      716-332-0081 
    Email:      tim.heasley@synacor.com
With a copy to:        Synacor, Inc.
40 La Riviere Dr., Suite 300 
                                         Buffalo, New York 14202 
                    Attn:      Legal Department 
                    Email:      legaldept@synacor.com
If to Bank:        Silicon Valley Bank                                             275 Grove Street, Suite 2-200 
                                                       Newton, Massachusetts 02466 
                    Attn:    Michelle Gallipeau 
                    Email:      MGallipeau@svb.com
		
	with a copy to:
	Morrison & Foerster LLP 
200 Clarendon Street, 20th Floor 
Boston, Massachusetts 02116 
Attn:      David A. Ephraim, Esquire 
Email:     DEphraim@mofo.com

11    CHOICE OF LAW, VENUE, AND JURY TRIAL WAIVER 
Except as otherwise expressly provided in any of the Loan Documents, New York law governs the Loan Documents without regard to principles of conflicts of law.  Borrower and Bank each submit to the exclusive jurisdiction of the State and Federal courts in New York, New York; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing suit or taking other legal action in any other jurisdiction to realize on the Collateral or any other security for the Obligations, or to enforce a judgment or other court order in favor of Bank.  Borrower expressly submits and consents in advance to such jurisdiction in any action or suit commenced in any such court, and Borrower hereby waives any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consents to the granting of such legal or equitable relief as is deemed appropriate by such court.  Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered or certified mail addressed to Borrower at the address set forth in, or subsequently provided by Borrower in accordance with, Section 10 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s actual receipt thereof or three (3) days after deposit in the U.S. mails, proper postage prepaid.
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS 

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WAIVER IS A MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT.  EACH PARTY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.
This Section 11 shall survive the termination of this Agreement.
12    GENERAL PROVISIONS
12.1    Termination Prior to Maturity Date; Survival.  All covenants, representations and warranties made in this Agreement shall continue in full force until this Agreement has terminated pursuant to its terms and all Obligations have been satisfied.  So long as Borrower has satisfied the Obligations (other than inchoate indemnity obligations, and any other obligations which, by their terms, are to survive the termination of this Agreement, and any Obligations under Bank Services Agreements that are cash collateralized in accordance with Section 4.1 of this Agreement), this Agreement may be terminated prior to the Revolving Line Maturity Date by Borrower, effective three (3) Business Days after written notice of termination is given to Bank.  Those obligations that are expressly specified in this Agreement as surviving this Agreement’s termination shall continue to survive notwithstanding this Agreement’s termination. 
12.2    Successors and Assigns.  This Agreement binds and is for the benefit of the successors and permitted assigns of each party.  Borrower may not assign this Agreement or any rights or obligations under it without Bank’s prior written consent (which may be granted or withheld in Bank’s discretion).  Bank has the right, without the consent of or notice to Borrower, to sell, transfer, assign, negotiate, or grant participation in all or any part of, or any interest in, Bank’s obligations, rights, and benefits under this Agreement and the other Loan Documents. 
12.3    Indemnification.  Borrower agrees to indemnify, defend and hold Bank and its directors, officers, employees, agents, attorneys, or any other Person affiliated with or representing Bank (each, an “Indemnified Person”) harmless against:  (i) all obligations, demands, claims, and liabilities (collectively, “Claims”) claimed or asserted by any other party in connection with the transactions contemplated by the Loan Documents; and (ii) all losses or expenses (including Bank Expenses) in any way suffered, incurred, or paid by such Indemnified Person as a result of, following from, consequential to, or arising from transactions between Bank and Borrower (including reasonable attorneys’ fees and expenses), except for Claims and/or losses directly caused by such Indemnified Person’s gross negligence or willful misconduct.
This Section 12.3 shall survive until all statutes of limitation with respect to the Claims, losses, and expenses for which indemnity is given shall have run.
12.4    Time of Essence.  Time is of the essence for the performance of all Obligations in this Agreement.
12.5    Severability of Provisions.  Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision.
12.6    Correction of Loan Documents.  Bank may correct patent errors and fill in any blanks in the Loan Documents consistent with the agreement of the parties.
12.7    Amendments in Writing; Waiver; Integration.  No purported amendment or modification of any Loan Document, or waiver, discharge or termination of any obligation under any Loan Document, shall be enforceable or admissible unless, and only to the extent, expressly set forth in a writing signed by the party against which enforcement or admission is sought.  Without limiting the generality of the foregoing, no oral promise or statement, nor any action, inaction, delay, failure to require performance or course of conduct shall operate as, or evidence, an amendment, supplement or waiver or have any other effect on any Loan Document.  Any waiver granted shall be limited to the specific circumstance expressly described in it, and shall not apply to any subsequent or other circumstance, whether similar or dissimilar, or give rise to, or evidence, any obligation or commitment to grant any further waiver.  The Loan Documents represent the entire agreement about this subject matter and 

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supersede prior negotiations or agreements.  All prior agreements, understandings, representations, warranties, and negotiations between the parties about the subject matter of the Loan Documents merge into the Loan Documents.
12.8    Counterparts.  This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, is an original, and all taken together, constitute one Agreement.
12.9    Confidentiality.  In handling any confidential information, Bank shall exercise the same degree of care that it exercises for its own proprietary information, but disclosure of information may be made: (a) to Bank’s Subsidiaries or Affiliates (such Subsidiaries and Affiliates, together with Bank, collectively, “Bank Entities”); (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided, however, Bank shall use its best efforts to obtain any prospective transferee’s or purchaser’s agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to Bank’s regulators or as otherwise required in connection with Bank’s examination or audit; (e) as Bank considers appropriate in exercising remedies under the Loan Documents; and (f) to third-party service providers of Bank so long as such service providers have executed a confidentiality agreement with Bank with terms no less restrictive than those contained herein.  Confidential information does not include information that is either: (i) in the public domain or in Bank’s possession when disclosed to Bank, or becomes part of the public domain (other than as a result of its disclosure by Bank in violation of this Agreement) after disclosure to Bank; or (ii) disclosed to Bank by a third party, if Bank does not know that the third party is prohibited from disclosing the information.
Bank Entities may use anonymous forms of confidential information for aggregate datasets, for analyses or reporting, and for any other uses not expressly prohibited in writing by Borrower.  The provisions of the immediately preceding sentence shall survive the termination of this Agreement.
12.10    Electronic Execution of Documents.  The words “execution,” “signed,” “signature” and words of like import in any Loan Document shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity and enforceability as a manually executed signature or the use of a paper-based recordkeeping systems, as the case may be, to the extent and as provided for in any applicable law, including, without limitation, any state law based on the Uniform Electronic Transactions Act.
12.11    Right of Setoff.   Borrower hereby grants to Bank a Lien and a right of setoff as security for all Obligations to Bank, whether now existing or hereafter arising upon and against all deposits, credits, collateral and property, now or hereafter in the possession, custody, safekeeping or control of Bank or any entity under the control of Bank (including a subsidiary of Bank) or in transit to any of them.  At any time after the occurrence and during the continuance of an Event of Default, without demand or notice, Bank may setoff the same or any part thereof and apply the same to any liability or Obligation of Borrower even though unmatured and regardless of the adequacy of any other collateral securing the Obligations.  ANY AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.
12.12    Captions.  The headings used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.
12.13    Construction of Agreement.  The parties mutually acknowledge that they and their attorneys have participated in the preparation and negotiation of this Agreement.  In cases of uncertainty this Agreement shall be construed without regard to which of the parties caused the uncertainty to exist.
12.14    Relationship.  The relationship of the parties to this Agreement is determined solely by the provisions of this Agreement.  The parties do not intend to create any agency, partnership, joint venture, trust, fiduciary or other relationship with duties or incidents different from those of parties to an arm’s-length contract.

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12.15    Third Parties.  Nothing in this Agreement, whether express or implied, is intended to: (a) confer any benefits, rights or remedies under or by reason of this Agreement on any persons other than the express parties to it and their respective permitted successors and assigns; (b) relieve or discharge the obligation or liability of any person not an express party to this Agreement; or (c) give any person not an express party to this Agreement any right of subrogation or action against any party to this Agreement.
13    DEFINITIONS
13.1    Definitions.  As used in the Loan Documents, the word “shall” is mandatory, the word “may” is permissive, the word “or” is not exclusive, the words “includes” and “including” are not limiting, the singular includes the plural, and numbers denoting amounts that are set off in brackets are negative.  As used in this Agreement, the following capitalized terms have the following meanings:
“Account” is, as to any Person, any “account” of such Person as “account” is defined in the Code with such additions to such term as may hereafter be made, and includes, without limitation, all accounts receivable and other sums owing to such Person.
“Account Debtor” is any “account debtor” as defined in the Code with such additions to such term as may hereafter be made.
“Adjusted EBITDA” shall mean, calculated on a consolidated basis with respect to Borrower and its Subsidaries, (a) Net Income, plus (b) Interest Expense, plus (c) to the extent deducted in the calculation of Net Income, depreciation expense and amortization expense, plus (d) income tax expense, plus (e) stock compensation, plus (f) non-cash items and one-time expenses approved by Bank in its sole discretion. 
“Administrator” is an individual that is named:
(a)     as an “Administrator” in the “SVB Online Services” form completed by Borrower with the authority to determine who will be authorized to use SVB Online Services (as defined in Bank’s Online Banking Agreement as in effect from time to time) on behalf of Borrower; and 
(b)     as an Authorized Signer of Borrower in an approval by the Board.
“Advance” or “Advances” means a revolving credit loan (or revolving credit loans) under the Revolving Line.
“Affiliate” is, with respect to any Person, each other Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by or is under common control with the Person, and each of that Person’s senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person’s managers and members.  For purposes of the definition of Eligible Accounts, Affiliate shall include a Specified Affiliate.
“Agreement” is defined in the preamble hereof.
“Authorized Signer” is any individual listed in Borrower’s Borrowing Resolution who is authorized to execute the Loan Documents, including making (and executing if applicable) any Credit Extension request, on behalf of Borrower.
“Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) the amount available under the Borrowing Base minus (b) the outstanding principal balance of any Advances.
“Availability Liquidity” is at any time, the sum of (a) the aggregate amount of unrestricted and unencumbered cash and Cash Equivalents held at such time in the name of Borrower at all financial institutions, plus (b) the Availability Amount.

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“Bank” is defined in the preamble hereof.
“Bank Entities” is defined in Section 12.9. 
“Bank Expenses” are all audit fees and expenses, costs, and expenses (including reasonable attorneys’ fees and expenses) for preparing, amending, negotiating, administering, defending and enforcing the Loan Documents (including, without limitation, those incurred in connection with appeals or Insolvency Proceedings) or otherwise incurred with respect to Borrower.
“Bank Services”  are any products, credit services, and/or financial accommodations previously, now, or hereafter provided to Borrower or any of its Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any letters of credit, cash management services (including, without limitation, merchant services, direct deposit of payroll, business credit cards, and check cashing services), interest rate swap arrangements, and foreign exchange services as any such products or services may be identified in Bank’s various agreements related thereto (each, a “Bank Services Agreement”).
“Bank Services Agreement” is defined in the definition of Bank Services.
“Board” is Borrower’s board of directors (or the limited liability company equivalent thereof).
“Borrower” is defined in the preamble hereof.
“Borrower’s Books” are all Borrower’s books and records including ledgers, federal and state tax returns, records regarding Borrower’s assets or liabilities, the Collateral, business operations or financial condition, and all computer programs or storage or any equipment containing such information.
“Borrowing Base” is seventy-five percent (75.0%) of Eligible Accounts, as determined by Bank from Borrower’s most recent Borrowing Base Report; provided, however, that Bank has the right to decrease the foregoing percentage in its good faith business judgment to mitigate the impact of events, conditions, contingencies, or risks which may adversely affect the Collateral or its value.
“Borrowing Base Report” is that certain report of the value of certain Collateral in the form specified by Bank to Borrower from time to time.
“Borrowing Resolutions” are, with respect to any Person, those resolutions adopted by such Person’s board of directors or limited liability company equivalent (and, if required under the terms of such Person’s Operating Documents, stockholders or members, as applicable) and delivered by such Person to Bank approving the Loan Documents to which such Person is a party and the transactions contemplated thereby, together with a certificate executed by its secretary on behalf of such Person certifying (a) such Person has the authority to execute, deliver, and perform its obligations under each of the Loan Documents to which it is a party, (b) that set forth as a part of or attached as an exhibit to such certificate is a true, correct, and complete copy of the resolutions then in full force and effect authorizing and ratifying the execution, delivery, and performance by such Person of the Loan Documents to which it is a party, (c) the name(s) of the Person(s) authorized to execute the Loan Documents, including making (and executing if applicable) any Credit Extension request, on behalf of such Person, together with a sample of the true signature(s) of such Person(s), and (d) that Bank may conclusively rely on such certificate unless and until such Person shall have delivered to Bank a further certificate canceling or amending such prior certificate.
“Business Day” is any day that is not a Saturday, Sunday or a day on which Bank is closed.
“Cash” is Borrower’s and its Subsidiaries’ unrestricted and unencumbered cash (a) at Bank or (b) held at other financial institutions in accounts that are subject to a Control Agreement in favor of Bank.
“Cash Equivalents” means (a) marketable direct obligations issued or unconditionally guaranteed by the United States or any agency or any State thereof having maturities of not more than one (1) year from the date of 

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acquisition; (b) commercial paper maturing no more than one (1) year after its creation and having the highest rating from either Standard & Poor’s Ratings Group or Moody’s Investors Service, Inc.; and (c) Bank’s certificates of deposit issued maturing no more than one (1) year after issue.
“Cash Liquidity” is the sum of (a) Cash plus (b) the Availability Amount.
“Change in Control” means (a) at any time, any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), shall become, or obtain rights (whether by means of warrants, options or otherwise) to become, the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)‐5 under the Exchange Act), directly or indirectly, of twenty-five percent (25.0%) or more of the ordinary voting power for the election of directors of Borrower (determined on a fully diluted basis) other than by the sale of Borrower’s equity securities in a public offering or to venture capital or private equity investors so long as Borrower identifies to Bank the venture capital or private equity investors at least seven (7) Business Days prior to the closing of the transaction and provides to Bank a description of the material terms of the transaction; (b) during any period of twelve (12) consecutive months, a majority of the members of the board of directors or other equivalent governing body of Borrower cease to be composed of individuals (i) who were members of that board or equivalent governing body on the first day of such period, (ii) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body or (iii) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body; or (c) at any time, Borrower shall cease to own and control, of record and beneficially, directly or indirectly, one hundred percent (100.0%) of each class of outstanding capital stock of each subsidiary of Borrower free and clear of all Liens (except Liens created by this Agreement).
“Claims” is defined in Section 12.3.
“Code” is the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of New York; provided, that, to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the Code, the definition of such term contained in Article or Division 9 shall govern; provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, or priority of, or remedies with respect to, Bank’s Lien on any Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the State of New York, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies and for purposes of definitions relating to such provisions.
“Collateral” is any and all properties, rights and assets of Borrower described on Exhibit A.
“Collateral Account” is any Deposit Account, Securities Account, or Commodity Account.
“Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may hereafter be made.
“Compliance Certificate” is that certain certificate in the form attached hereto as Exhibit B.
“Contingent Obligation” is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation, in each case, directly or indirectly guaranteed, endorsed, co made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not include endorsements in the ordinary course of business.  The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated 

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liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.
“Control Agreement” is any control agreement entered into among the depository institution at which Borrower maintains a Deposit Account or the securities intermediary or commodity intermediary at which Borrower maintains a Securities Account or a Commodity Account, Borrower, and Bank pursuant to which Bank obtains control (within the meaning of the Code) over such Deposit Account, Securities Account, or Commodity Account.
“Copyrights” are any and all copyright rights, copyright applications, copyright registrations and like protections in each work of authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret.
“Credit Extension” is any Advance, any Overadvance or any other extension of credit by Bank for Borrower’s benefit.
“Default Rate” is defined in Section 2.4(b).
“Deferred Revenue” is all amounts received or invoiced in advance of performance under contracts and not yet recognized as revenue.
“Deposit Account” is any “deposit account” as defined in the Code with such additions to such term as may hereafter be made.
“Designated Deposit Account” is each of (a) the account number ending 816 (last three digits) maintained by Synacor with Bank, (b) the account number ending 045 maintained by Synacor with Bank, and (c) any other account of Borrower maintained at Bank that Borrower and Bank shall agree in writing to designate as a “Designated Deposit Account” (email shall suffice) (provided, however, if no such account number is included, then the Designated Deposit Account shall be any deposit account of Borrower maintained with Bank as chosen by Bank).
“Division” means, in reference to any Person which is an entity, the division of such Person into two (2) or more separate Persons, with the dividing Person either continuing or terminating its existence as part of such division, including, without limitation, as contemplated under Section 18-217 of the Delaware Limited Liability Company Act for limited liability companies formed under Delaware law, or any analogous action taken pursuant to any other applicable law with respect to any corporation, limited liability company, partnership or other entity.
“Dollars,” “dollars” or use of the sign “$” means only lawful money of the United States and not any other currency, regardless of whether that currency uses the “$” sign to denote its currency or may be readily converted into lawful money of the United States.
“Dollar Equivalent” is, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in a Foreign Currency, the equivalent amount therefor in Dollars as determined by Bank at such time on the basis of the then-prevailing rate of exchange in San Francisco, California, for sales of the Foreign Currency for transfer to the country issuing such Foreign Currency.
“Effective Date” is defined in the preamble hereof.
“Eligible Accounts” means Accounts owing to Borrower which arise in the ordinary course of Borrower’s business that meet all Borrower’s representations and warranties in Section 5.3, that have been, at the option of Bank, confirmed in accordance with Section 6.3(f) of this Agreement, and are due and owing from Account Debtors deemed creditworthy by Bank in its sole discretion. Bank reserves the right, at any time after the Effective Date, in its sole discretion in each instance, to either (i) adjust any of the criteria set forth below and to establish new criteria or (ii) deem any Accounts owing from a particular Account Debtor or Account Debtors to not meet the criteria to be Eligible Accounts.  Unless Bank otherwise agrees in writing, Eligible Accounts shall not include:

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(a)    Accounts (i) for which the Account Debtor is Borrower’s Affiliate, officer, employee, investor, or agent, or (ii) that are intercompany Accounts;
(b)    Accounts that the Account Debtor has not paid within ninety (90) days of invoice date regardless of invoice payment period terms;
(c)    Accounts with credit balances over ninety (90) days from invoice date;
(d)    Accounts owing from an Account Debtor if fifty percent (50%) or more of the Accounts owing from such Account Debtor have not been paid within ninety (90) days of invoice date;
(e)    Accounts owing from an Account Debtor (i) which does not have its principal place of business in the United States or (ii) whose billing address (as set forth in the applicable invoice for such Account) is not in the United States, unless in the case of both (i) and (ii) such Accounts are Accounts owing from other Accounts Debtors located in the European Union or Australia;
(f)    Accounts billed from and/or payable to Borrower outside of the United States (sometimes called foreign invoiced accounts);
(g)    Accounts in which Bank does not have a first priority, perfected security interest under all applicable laws;
(h)    Accounts billed and/or payable in a Currency other than Dollars;
(i)    Accounts owing from an Account Debtor to the extent that Borrower is indebted or obligated in any manner to the Account Debtor (as creditor, lessor, supplier or otherwise - sometimes called “contra” accounts, accounts payable, customer deposits or credit accounts); 
(j)    Accounts with or in respect of accruals for marketing allowances, incentive rebates, price protection, cooperative advertising and other similar marketing credits, unless otherwise approved by Bank in writing;
(k)    Accounts owing from an Account Debtor which is a United States government entity or any department, agency, or instrumentality thereof unless Borrower has assigned its payment rights to Bank and the assignment has been acknowledged under the Federal Assignment of Claims Act of 1940, as amended;
(l)    Accounts with customer deposits and/or with respect to which Borrower has received an upfront payment, to the extent of such customer deposit and/or upfront payment;
(m)    Accounts for demonstration or promotional equipment, or in which goods are consigned, or sold on a “sale guaranteed”, “sale or return”, “sale on approval”, or other terms if Account Debtor’s payment may be conditional;
(n)    Accounts owing from an Account Debtor where goods or services have not yet been rendered to the Account Debtor (sometimes called memo billings or pre-billings);
(o)    Accounts subject to contractual arrangements between Borrower and an Account Debtor where payments shall be scheduled or due according to completion or fulfillment requirements (sometimes called contracts accounts receivable, progress billings, milestone billings, or fulfillment contracts);
(p)    Accounts owing from an Account Debtor the amount of which may be subject to withholding based on the Account Debtor’s satisfaction of Borrower’s complete performance (but only to the extent of the amount withheld; sometimes called retainage billings);

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(q)    Accounts subject to trust provisions, subrogation rights of a bonding company, or a statutory trust;
(r)    Accounts owing from an Account Debtor that has been invoiced for goods that have not been shipped to the Account Debtor unless Bank, Borrower, and the Account Debtor have entered into an agreement acceptable to Bank wherein the Account Debtor acknowledges that (i) it has title to and has ownership of the goods wherever located, (ii) a bona fide sale of the goods has occurred, and (iii) it owes payment for such goods in accordance with invoices from Borrower (sometimes called “bill and hold” accounts);
(s)    Accounts for which the Account Debtor has not been invoiced;
(t)    Accounts that represent non-trade receivables or that are derived by means other than in the ordinary course of Borrower’s business;
(u)    Accounts for which Borrower has permitted Account Debtor’s payment to extend beyond ninety (90) days (including Accounts with a due date that is more than ninety (90) days from invoice date);
(v)    Accounts arising from chargebacks, debit memos or other payment deductions taken by an Account Debtor;
(w)    Accounts arising from product returns and/or exchanges (sometimes called “warranty” or “RMA” accounts);
(x)    Accounts in which the Account Debtor disputes liability or makes any claim (but only up to the disputed or claimed amount), or if the Account Debtor is subject to an Insolvency Proceeding (whether voluntary or involuntary), or becomes insolvent, or goes out of business; 
(y)    Accounts owing from an Account Debtor, whose total obligations to Borrower exceed twenty-five percent (25.0%) of all Accounts, except for Google, for which such percentage is forty percent (40.0%), for the amounts that exceed that percentage, unless Bank approves in writing; and
(z)    Accounts for which Bank in its good faith business judgment determines collection to be doubtful, including, without limitation, accounts represented by “refreshed” or “recycled” invoices.
“European Union” means Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden and the United Kingdom.
“Equipment” is all “equipment” as defined in the Code with such additions to such term as may hereafter be made, and includes without limitation all machinery, fixtures, goods, vehicles (including motor vehicles and trailers), and any interest in any of the foregoing.
“ERISA” is the Employee Retirement Income Security Act of 1974, and its regulations.
“Event of Default” is defined in Section 8.
“Exchange Act” is the Securities Exchange Act of 1934, as amended.
“Excluded Account” means any account maintained at a bank or financial institution (other than Bank) in which Borrower maintains less than Three Hundred Fifty Thousand Dollars ($350,000.00); provided that the aggregate amount maintained in all such accounts at all such banks and financial institutions shall not exceed, at any time, One Million Dollars ($1,000,000.00).
“Foreign Currency” means lawful money of a country other than the United States.

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“Free Cash Flow” shall mean (a) Adjusted EBITDA, minus (b) capital expenditures determined in accordance with GAAP, minus (c) capitalized software expenses, determined in accordance with GAAP, and minus (d) cash taxes, determined in accordance with GAAP.
“Funding Date” is any date on which a Credit Extension is made to or for the account of Borrower which shall be a Business Day.
“FX Contract” is any foreign exchange contract by and between Borrower and Bank under which Borrower commits to purchase from or sell to Bank a specific amount of Foreign Currency on a specified date.
“GAAP” is generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other Person as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination.
“General Intangibles” is all “general intangibles” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation, all Intellectual Property, claims, income and other tax refunds, security and other deposits, payment intangibles, contract rights, options to purchase or sell real or personal property, rights in all litigation presently or hereafter pending (whether in contract, tort or otherwise), insurance policies (including without limitation key man, property damage, and business interruption insurance), payments of insurance and rights to payment of any kind.
“Governmental Approval” is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority.
“Governmental Authority” is any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any self-regulatory organization.
“Indebtedness” is (a) indebtedness for borrowed money or the deferred price of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations, and (d) Contingent Obligations.
“Indemnified Person” is defined in Section 12.3.
“Initial Audit” is Bank’s inspection of Borrower’s Accounts, the Collateral, and Borrower’s Books, with results satisfactory to Bank in its sole and absolute discretion.
“Insolvency Proceeding” is any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or insolvency law, including assignments for the benefit of creditors, compositions, extensions generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief.
“Intellectual Property” means, with respect to any Person, all of such Person’s right, title, and interest in and to the following:
(a)    its Copyrights, Trademarks and Patents; 
(b)    any and all trade secrets and trade secret rights, including, without limitation, any rights to unpatented inventions, know-how and operating manuals;
(c)    any and all source code;

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(d)    any and all design rights which may be available to such Person;
(e)    any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the Intellectual Property rights identified above; and
(f)    all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents.
“Interest Expense” means for any fiscal period, interest expense (whether cash or non-cash) determined in accordance with GAAP for the relevant period ending on such date, including, in any event, interest expense with respect to any Credit Extension and other Indebtedness of Borrower and its Subsidiaries, including, without limitation or duplication, all commissions, discounts, or related amortization and other fees and charges with respect to letters of credit and bankers’ acceptance financing and the net costs associated with interest rate swap, cap, and similar arrangements, and the interest portion of any deferred payment obligation (including leases of all types).
“Inventory” is all “inventory” as defined in the Code in effect on the date hereof with such additions to such term as may hereafter be made, and includes without limitation all merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products, including without limitation such inventory as is temporarily out of Borrower’s custody or possession or in transit and including any returned goods and any documents of title representing any of the above.
“Investment” is any beneficial ownership interest in any Person (including stock, partnership interest or other securities), and any loan, advance or capital contribution to any Person.
“IP Agreement” is, collectively, (a) that certain Intellectual Property Security Agreement between Synacor and Bank dated as of the Effective Date, (b) that certain Intellectual Property Security Agreement between NTV and Bank dated as of the Effective Date, and (c) that certain Intellectual Property Security Agreement between Sync and Bank dated as of the Effective Date, each as may be amended, modified or restated from time to time.
“Key Person” is each of Borrower’s (a) Chief Executive Officer, who is Himesh Bhise as of the Effective Date and (b) Chief Financial Officer, who is Timothy J. Heasley as of the Effective Date.
“Letter of Credit” is a standby or commercial letter of credit issued by Bank upon request of Borrower based upon an application, guarantee, indemnity, or similar agreement.
“Lien” is a claim, mortgage, deed of trust, levy, charge, pledge, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.
“Liquidity” is, at any time, the sum of (a) (i) Cash and (ii) Cash Equivalents of Borrower and its Subsidiaries at Bank or Bank’s Affiliates or held at other financial institutions in accounts that are subject to a Control Agreement in favor of Bank plus (b) the aggregate outstanding Eligible Accounts.
“Liquidity Coverage Ratio” is a ratio of (a) Liquidity to (b) the aggregate outstanding Obligations.
“Loan Documents” are, collectively, this Agreement and any schedules, exhibits, certificates, notices, and any other documents related to this Agreement, the IP Agreement, the Perfection Certificate, any Control Agreement, any Bank Services Agreement, any subordination agreement, any note, or notes or guaranties executed by Borrower, and any other present or future agreement by Borrower with or for the benefit of Bank, all as amended, restated, or otherwise modified.
“Lockbox Account” is defined in Section 6.3(c).

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“Material Adverse Change” is (a) a material impairment in the perfection or priority of Bank’s Lien in the Collateral or in the value of such Collateral; (b) a material adverse change in the business, operations, or condition (financial or otherwise) of Borrower; (c) a material impairment of the prospect of repayment of any portion of the Obligations; or (d) Bank determines, based upon information available to it and in its reasonable judgment, that there is a reasonable likelihood that Borrower shall fail to comply with one or more of the financial covenants in Section 6 during the next succeeding financial reporting period.
“Monthly Financial Statements” is defined in Section 6.2(c).
“Net Income” means, as calculated on a consolidated basis for Borrower and its Subsidiaries for any period as at any date of determination, the net profit (or loss), after provision for taxes, of Borrower and its Subsidiaries for such period taken as a single accounting period.
“Obligations” are Borrower’s obligations to pay when due any debts, principal, interest, fees, Bank Expenses, the Unused Revolving Line Facility Fee, and other amounts Borrower owes Bank now or later, whether under this Agreement, the other Loan Documents, or otherwise, including, without limitation, all obligations relating to Bank Services and interest accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower assigned to Bank, and to perform Borrower’s duties under the Loan Documents.
“Operating Documents” are, for any Person, such Person’s formation documents, as certified by the Secretary of State (or equivalent agency) of such Person’s jurisdiction of organization on a date that is no earlier than thirty (30) days prior to the Effective Date, and, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its limited liability company agreement (or similar agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with all current amendments or modifications thereto.
“Overadvance” is defined in Section 2.3.
“Patents” means all patents, patent applications and like protections including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same.
“Payment Date” is the last calendar day of each month.
“Perfection Certificate” is defined in Section 5.1.
“Performance Pricing Period” is, on and after the Effective Date, provided no Event of Default has occurred and is continuing, the period (a) commencing on the first (1st) day of the month following the day that Borrower provides to Bank a written report that Borrower has, has, at all times during the immediately preceding calendar quarter maintained Cash Liquidity, as determined by Bank in its sole discretion, in an amount equal to or greater than Twenty Million Dollars ($20,000,000.00) (the “Threshold Amount”); and (b) terminating on the earlier to occur of (i) the occurrence of an Event of Default, and (ii) the first (1st) day thereafter in which Borrower fails to maintain the Threshold Amount, as determined by Bank in its sole discretion.  Upon the termination of a Performance Pricing Period, Borrower must maintain the Threshold Amount each consecutive day for one (1) fiscal quarter as determined by Bank in its sole discretion, prior to entering into a subsequent Performance Pricing Period.  Borrower shall give Bank prior written notice of Borrower’s election to enter into any such Performance Pricing Period, and each such Performance Pricing Period shall commence on the first (1st) day of the monthly period following the date Bank determines, in its sole discretion, that the Threshold Amount has been achieved.
“Permitted Acquisition” is the acquisition by Borrower of all or substantially all of the assets of another company or companies (collectively, the “Target”), provided that (a) Target is engaged in a similar line of business as Borrower both prior to and after giving effect to such acquisition, (b) such acquisition is non-hostile in nature, (c) no Event of Default has occurred and is continuing or would exist after giving effect to such acquisition, (d) Borrower remains a separate legal entity following the transactions in connection with and contemplated by such acquisition, (e) Borrower provides evidence to Bank acceptable to Bank in its sole and absolute discretion, at least thirty (30) days 

31

prior to giving effect to such acquisition, that Borrower is and shall be in compliance with the financial covenants set forth in Section 6.9 of this Agreement both prior to and after giving effect to such acquisition, (f) if the Target is a surviving entity, immediately after giving effect to such acquisition, Borrower shall provide Bank a joinder agreement and cause Target to join this Agreement as a co-borrower, on terms acceptable to Bank in its sole and absolute discretion, (g) the total consideration used by Borrower in connection with all such acquisitions does not exceed Ten Million Dollars ($10,000,000.00) in the aggregate, per calendar year, (g) prior to the consummation of such acquisition, Borrower delivers to Bank evidence that the assets of Target are free and clear of all Liens, (h) no Indebtedness, other than Permitted Indebtedness, shall be assumed or incurred by Borrower in connection with such acquisition, and (i) immediately after giving effect to such acquisition, Borrower shall have Availability Liquidity of no less than Fifteen Million Dollars ($15,000,000.00).
“Permitted Indebtedness” is:
(a)    Borrower’s Indebtedness to Bank under this Agreement and the other Loan Documents;
(b)    Indebtedness existing on the Effective Date which is shown on the Perfection Certificate;
(c)    Subordinated Debt;
(d)    unsecured Indebtedness to trade creditors incurred in the ordinary course of business; 
(e)    Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business;
(f)    Indebtedness secured by Liens permitted under clauses (a) and (c) of the definition of “Permitted Liens” hereunder; and
(g)    extensions, refinancings, modifications, amendments and restatements of any items of Permitted Indebtedness (a) through (f) above, provided that the principal amount thereof is not increased or the terms thereof are not modified to impose more burdensome terms upon Borrower or its Subsidiary, as the case may be.
“Permitted Investments” are:
(a)    Investments (including, without limitation, Subsidiaries) existing on the Effective Date which are shown on the Perfection Certificate; 
(b)    Investments consisting of Cash Equivalents; 
(c)    Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of Borrower;
(d)    Investments consisting of deposit accounts (but only to the extent that Borrower is permitted to maintain such accounts pursuant to Section 6.8 of this Agreement) in which Bank has a first priority perfected security interest;
(e)    Investments accepted in connection with Transfers permitted by Section 7.1;
(f)    Investments consisting of the creation of a Subsidiary for the purpose of consummating a Permitted Acquisition, provided such Subsidiary joins this Agreement as a co-borrower, on terms acceptable to Bank in its sole and absolute discretion;
(g)    Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers or directors 

32

relating to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee stock purchase plans or agreements approved by the Board;
(h)    Investments (including debt obligations) received in connection with the bankruptcy or reorganization of customers or suppliers and in settlement of delinquent obligations of, and other disputes with, customers or suppliers arising in the ordinary course of business; and
(i)    Investments consisting of notes receivable of, or prepaid royalties and other credit extensions, to customers and suppliers who are not Affiliates, in the ordinary course of business; provided that this paragraph (i) shall not apply to Investments of Borrower in any Subsidiary.
 “Permitted Liens” are:
(a)    Liens existing on the Effective Date which are shown on the Perfection Certificate or arising under this Agreement or the other Loan Documents;
(b)    Liens for taxes, fees, assessments or other government charges or levies, either (i) not due and payable or (ii) being contested in good faith and for which Borrower maintains adequate reserves on Borrower’s Books, provided that no notice of any such Lien has been filed or recorded under the Internal Revenue Code of 1986, as amended, and the Treasury Regulations adopted thereunder;
(c)    purchase money Liens and capital leases (i) on Equipment acquired or held by Borrower incurred for financing the acquisition of the Equipment securing no more than Two Hundred Fifty Thousand Dollars ($250,000.00) in the aggregate amount outstanding, or (ii) existing on Equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the Equipment; and
(d)    Liens incurred in the extension, renewal or refinancing of the Indebtedness secured by Liens described in (a) through (c), but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase.
“Person” is any individual, sole proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.
“Prime Rate” is the rate of interest per annum from time to time published in the money rates section of The Wall Street Journal or any successor publication thereto as the “prime rate” then in effect; provided that, in the event such rate of interest is less than zero, such rate shall be deemed to be zero for purposes of this Agreement; and provided further that if such rate of interest, as set forth from time to time in the money rates section of The Wall Street Journal, becomes unavailable for any reason as determined by Bank, the “Prime Rate” shall mean the rate of interest per annum announced by Bank as its prime rate in effect at its principal office in the State of California (such Bank announced Prime Rate not being intended to be the lowest rate of interest charged by Bank in connection with extensions of credit to debtors); provided that, in the event such rate of interest is less than zero, such rate shall be deemed to be zero for purposes of this Agreement.
“Registered Organization” is any “registered organization” as defined in the Code with such additions to such term as may hereafter be made.
“Requirement of Law” is as to any Person, the organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.
“Reserves” means, as of any date of determination, such amounts as Bank may from time to time establish and revise in its good faith business judgment, reducing the amount of Advances and other financial accommodations 

33

which would otherwise be available to Borrower (a) to reflect events, conditions, contingencies or risks which, as determined by Bank in its good faith business judgment, do or may adversely affect (i) the Collateral or any other property which is security for the Obligations or its value (including without limitation any increase in delinquencies of Accounts), (ii) the assets, business or prospects of Borrower, or (iii) the security interests and other rights of Bank in the Collateral (including the enforceability, perfection and priority thereof); or (b) to reflect Bank's reasonable belief that any collateral report or financial information furnished by or on behalf of Borrower to Bank is or may have been incomplete, inaccurate or misleading in any material respect; or (c) in respect of any state of facts which Bank determines constitutes an Event of Default or may, with notice or passage of time or both, constitute an Event of Default.
“Responsible Officer” is any of the Chief Executive Officer, President, Chief Financial Officer and Controller of Borrower.  
“Restricted License” is any material license or other agreement with respect to which Borrower is the licensee (a) that prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such license or agreement or any other property, or (b) for which a default under or termination of could interfere with Bank’s right to sell any Collateral.
“Revolving Line” is an aggregate principal amount equal to Twelve Million Dollars ($12,000,000.00).
“Revolving Line Maturity Date” is August 7, 2021
“SEC” shall mean the Securities and Exchange Commission, any successor thereto, and any analogous Governmental Authority.
“Securities Account” is any “securities account” as defined in the Code with such additions to such term as may hereafter be made.
“Specified Affiliate” is any Person (a) more than ten percent (10.0%) of whose aggregate issued and outstanding equity or ownership securities or interests, voting, non-voting or both, are owned or held directly or indirectly, beneficially or of record, by Borrower, and/or (b) whose equity or ownership securities or interests representing more than ten percent (10.0%) of such Person’s total outstanding combined voting power are owned or held directly or indirectly, beneficially or of record, by Borrower.
“Subordinated Debt” is indebtedness incurred by Borrower subordinated to all of Borrower’s now or hereafter indebtedness to Bank (pursuant to a subordination, intercreditor, or other similar agreement in form and substance satisfactory to Bank entered into between Bank and the other creditor), on terms acceptable to Bank.
“Subsidiary” is, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person.  Unless the context otherwise requires, each reference to a Subsidiary herein shall be a reference to a Subsidiary of Borrower.
“Testing Quarter” is each fiscal quarter in which, as of the last day of such fiscal quarter, Borrower’s Cash Liquidity is less than Twenty Million Dollars ($20,000,000.00)  
“Threshold Amount” is defined in the definition of Performance Pricing Period.    
“Trademarks” means any trademark and servicemark rights, whether registered or not, applications to register and registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks.
“Transfer” is defined in Section 7.1. 

34

“Unused Revolving Line Facility Fee” is defined in Section 2.5(b).
[Signature page follows.]

35

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the Effective Date.
BORROWER:

SYNACOR, INC.

By:  /s/ Timothy J. Heasley                 
Name: Timothy J. Heasley                  
Title:  CFO                                    
    

NTV INTERNET HOLDINGS, LLC

By:  /s/ Timothy J. Heasley                 
Name: Timothy J. Heasley                  
Title:  Manager                                        
    

SYNC HOLDINGS, LLC

By:  /s/ Timothy J. Heasley                 
Name: Timothy J. Heasley                  
Title:  Manager                                    

BANK:

SILICON VALLEY BANK

By:  /s/ Michelle Gallipeai                  
Name: Michelle Gallipeai                   
Title:  VP                                    

Signature Page to Loan and Security Agreement

Signature Page to Loan and Security Agreement

EXHIBIT A - COLLATERAL DESCRIPTION

The Collateral consists of all of Borrower’s right, title and interest in and to the following personal property:
All goods, Accounts (including health-care receivables), Equipment, Inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, General Intangibles, Intellectual Property, commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts, certificates of deposit, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and
all Borrower’s Books relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing.    

EXHIBIT B
COMPLIANCE CERTIFICATE

TO:    SILICON VALLEY BANK                        Date:                  
FROM: SYNACOR, INC., NTV INTERNET HOLDINGS, LLC and SYNC HOLDINGS, LLC

The undersigned authorized officer of SYNACOR, INC., NTV INTERNET HOLDINGS, LLC and SYNC HOLDINGS, LLC (“Borrower”) certifies that under the terms and conditions of the Loan and Security Agreement between Borrower and Bank (as amended, the “Agreement”) certifies that under the terms and conditions of the Loan and Security Agreement between Borrower and Bank (the “Agreement”), (1) Borrower is in complete compliance for the period ending _______________ with all required covenants except as noted below, (2) there are no Events of Default, (3) all representations and warranties in the Agreement are true and correct in all material respects on this date except as noted below; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, (4) Borrower, and each of its Subsidiaries, has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except as otherwise permitted pursuant to the terms of Section 5.9 of the Agreement, and (5) no Liens have been levied or claims made against Borrower or any of its Subsidiaries, if any, relating to unpaid employee payroll or benefits of which Borrower has not previously provided written notification to Bank.  Attached are the required documents supporting the certification.  The undersigned certifies that these are prepared in accordance with GAAP consistently applied from one period to the next except as explained in an accompanying letter or footnotes.  The undersigned acknowledges that no borrowings may be requested at any time or date of determination that Borrower is not in compliance with any of the terms of the Agreement, and that compliance is determined not just at the date this certificate is delivered.  Capitalized terms used but not otherwise defined herein shall have the meanings given them in the Agreement.
Attached are the required documents supporting the certification.  The undersigned certifies that these are prepared in accordance with GAAP consistently applied from one period to the next except as explained in an accompanying letter or footnotes.  The undersigned acknowledges that no borrowings may be requested at any time or date of determination that Borrower is not in compliance with any of the terms of the Agreement, and that compliance is determined not just at the date this certificate is delivered.  Capitalized terms used but not otherwise defined herein shall have the meanings given them in the Agreement.

	
			
	Please indicate compliance status by circling Yes/No under “Complies” column.

	 

	Reporting Covenants
	Required
	Complies

	 
	 
	 

	Monthly financial statements and Compliance Certificate
	Monthly within 45 days
	Yes   No

	Annual financial statement (CPA Audited)
	FYE within 120 days
	Yes   No

	Board projections
	FYE within 75 days
	Yes   No

	Borrowing Base Report
	When Advances outstanding/requested: Monthly within 30 days

When Advances not outstanding/requested: Monthly within 45 days

	Yes   No

	A/R & A/P Agings and Deferred Revenue Report
	Monthly within 45 days
	Yes   No

	 

	The following Intellectual Property was registered (or a registration application submitted) after the Effective Date (if no registrations, state “None”)
___________________________________________________________________________________________
___________________________________________________________________________________________

	
				
	Financial Covenants
	Required
	Actual
	Complies

	 
	 
	 
	 

	Liquidity Coverage Ratio (tested on a monthly basis)
	2.25:1.0
	_____:1.0
	Yes   No

	Cash plus Availability Amount
	>$20,000,000
	$_______
	Yes   No (if no, 
complete below)

	Trailing 6 Month Free Cash Flow (tested on a quarterly basis) 
when Cash Liquidity less than $20,000,000
	*________
	$_______
	Yes   No

*See Section 6.9(b) of the Agreement.

The following financial covenant analyses and information set forth in Schedule 1 attached hereto are true and accurate as of the date of this Certificate.
	
			
	      Performance Pricings
	Applies

	Cash Liquidity > $20,000,000
	Greater of (a) Prime + 0.50% or (b) 5.50%
	Yes   No

	Cash Liquidity < $20,000,000
	Greater of (a) Prime + 1.0% or (b) 6.0%
	Yes   No

Other Matters

	
			
	Have there been any amendments of or other changes to the capitalization table of Borrower and to the Operating Documents of Borrower or any of its Subsidiaries?  If yes, provide copies of any such amendments or changes with this Compliance Certificate.
	Yes
	No

The following are the exceptions with respect to the certification above:  (If no exceptions exist, state “No exceptions to note.”)
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
	
		
	SYNACOR, INC.

By:    
Name:    
Title:    

NTV INTERNET HOLDINGS, LLC

By:    
Name:    
Title:    

SYNC HOLDINGS, LLC

By:    
Name:    
Title:    
	BANK USE ONLY

Received by: _____________________
AUTHORIZED SIGNER
Date:    _________________________

Verified: ________________________
AUTHORIZED SIGNER
Date:    _________________________

Compliance Status:   Yes     No

Schedule 1 to Compliance Certificate
Financial Covenants of Borrower
In the event of a conflict between this Schedule and the Loan Agreement, the terms of the Loan Agreement shall govern.
Dated:    ____________________
I.    Liquidity Coverage Ratio (Section 6.9(a)) (tested monthly)
		
	Required:
	To be tested as of the last day of each calendar month, determined on a consolidated basis with respect to Borrower and its Subsidiaries, a Liquidity Coverage Ratio of not less than 2.25 to 1.0.

Actual:        ___ to 1.0
	
			
	A.
	Borrower’s and its Subsidiaries’ unrestricted and unencumbered cash (a) at Bank or (b) held at other financial institutions in accounts that are subject to a Control Agreement 

	$_______

	B.
	Borrower’s and its Subsidiaries’ Cash Equivalents at Bank or Bank’s Affiliates or held at other financial institutions in accounts that are subject to a Control Agreement in favor of Bank

	$_______

	C.
	Aggregate outstanding Eligible Accounts (as set forth in Borrowing Base Certificate)

	$_______

	D.
	Line A plus line B plus line C
	$_______

	E.
	Aggregate value of all outstanding obligations and liabilities of Borrower to Bank
	$_______

	F.
	Liquidity Coverage Ratio (Line D divided by Line E)
	___:1.0

Is Line F equal to or greater than the applicable ratio above?
  No, not in compliance                          Yes, in compliance
II.    Free Cash Flow (Section 6.9(b)) (tested quarterly)
		
	Required:
	To be tested as of the end of each fiscal quarter that is a Testing Quarter, measured on a trailing six-month basis, determined on a consolidated basis with respect to Borrower and its Subsidiaries, Free Cash Flow of at least: (i) for the six-month period ending on September 30, 2019, ($2,000,000.00), (ii) for the six-month period ending on December 31, 2019, $0.00, (iii) for the six-month period ending on March 31, 2020, $0.00, and (iv) for the six-month period ending on June 30, 2020, ($3,000,000.00)

Actual:        $________________

	
			
	A.
	Net Income
	$________

	B.
	Interest Expense

	$_________

	C.
	To the extent deducted in the calculation of Net Income, depreciation and amortization expense
	$_________

	D.
	Income tax expense
	$_________

	E.
	Stock compensation
	$_________

	F.
	Non-cash items and one-time expenses approved by Bank, in its sole discretion

	$_________

	G.
	Adjusted EBITDA (Sum of lines A through F)
	

$_________

	H.
	Capital Expenditures
	$_________

	I.
	Capitalized Software Expenses
	$_________

	J.
	Cash Taxes
	$_________

	K.
	Free Cash Flow (line G minus line H minus line I minus line J)
	$_________

Is line K equal to or greater than the applicable amount above?

  No, not in compliance          Yes, in compliance    _______ N/A [not tested or quarter-end]

ny-1711691

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