Document:

Stock Option Agreement

  
 Exhibit 10.29

 Execution Copy 
 FORM OF 
 STOCK OPTION AGREEMENT  

(David L. Calhoun) 
 THIS AGREEMENT, dated as of November 22, 2006 (the “Grant Date”) is made by and between Valcon Acquisition Holding B.V., a private company with limited liability incorporated under
the laws of The Netherlands, having its registered office in Haarlem, The Netherlands (hereinafter referred to as the “Company”), and the individual whose name is set forth on the signature page hereof, who is an employee of the
Company or a Subsidiary of the Company, hereinafter referred to as the “Optionee”. Any capitalized terms herein not otherwise defined in Article I shall have the meaning set forth in the Plan (as hereinafter defined). 

WHEREAS, the Company wishes to carry out the Plan, the terms of which are hereby incorporated by reference and made a part of this
Agreement; and 
 WHEREAS, the Committee, charged with administration of the Plan, has determined that it would be to the
advantage and best interest of the Company and its shareholders to grant the Option provided for herein to the Optionee as an incentive for increased efforts during his term of office with the Company or its Subsidiaries, and has advised the Company
thereof and instructed the undersigned officers to issue said Option; 
 NOW, THEREFORE, in consideration of the mutual
covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: 
 ARTICLE I 
 DEFINITIONS 

Whenever the following terms are used in this Agreement, they shall have the meaning specified in the Plan or below unless the context
clearly indicates to the contrary. 
 Section 1.1. – Cause 

“Cause” shall mean “Cause” as such term may be defined in that certain employment agreement between the Optionee,
Luxco and VNU, Inc. dated August 22, 2006 (the “Employment Agreement”). 
 Section 1.2. – Fiscal
Year 
 “Fiscal Year” shall mean each fiscal year of the Company (which, for the avoidance of doubt, ends on
December 31 of any given calendar year). 
 Section 1.3. – Good Reason 

“Good Reason” shall mean “Good Reason” as such term is defined in the Employment Agreement. 

  
 Section 1.4. –
Investor Return 
 “Investor Return” shall mean, on any given date, the aggregate amount of cash proceeds
(including the receipt of any dividends or other distributions) received by the Investors and Affiliates in respect of their aggregate direct and indirect equity investment in the Company (excluding, for the avoidance of doubt, debt investment).

 Section 1.5. – Option 
 “Option” shall mean the aggregate of the Time Option and the Performance Option granted under Section 2.1 of this Agreement. 
 Section 1.6. – Permanent Disability 
 “Permanent
Disability” shall mean “Disability” as such term is defined in the Employment Agreement. 
 Section 1.7. –
Performance Option 
 “Performance Option” shall mean the right and option to acquire, on the terms and
conditions set forth in Section 3.1(a)(ii) and (iii), 3.1(b)(ii) and 3.1(c)(iii) and (v), all or any part of an aggregate of the number of shares of Common Stock, as shall be evidenced by entry in the Company’s shareholder register, set
forth on the signature page of this Agreement. 
 Section 1.8. – Time Option 

“Time Option” shall mean the right and option to acquire, on the terms and conditions set forth in Section 3.1(a)(i),
3.1(b)(i) and 3.1(c)(i) and (ii), all or any part of an aggregate of the number of shares of Common Stock, as shall be evidenced by entry in the Company’s shareholder register, set forth on the signature page of this Agreement. 

ARTICLE II 

GRANT OF OPTIONS 

Section 2.1. – Grant of Options 
 For good and valuable consideration, on and as of the date hereof the Company irrevocably grants to the Optionee (i) a Time Option upon the terms and conditions set forth in this Agreement and
(ii) a Performance Option upon the terms and conditions set forth in this Agreement. The Option shall consist of a Time Option and a Performance Option. 
 Section 2.2. – Exercise Price 
 Subject to Section 2.4,
the exercise prices of the shares of Common Stock covered by the Time Option and Performance Option shall be as set forth on the signature page of this Agreement. 

  
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 Section 2.3. – No
Guarantee of Employment 
 Nothing in this Agreement or in the Plan shall confer upon the Optionee any right to continue in
the employ of the Company or any Subsidiary or shall interfere with or restrict in any way the rights of the Company and its Subsidiaries, which are hereby expressly reserved, to terminate the employment of the Optionee at any time for any reason
whatsoever, with or without cause, subject to the applicable provisions of, if any, the Optionee’s employment agreement with the Company or its Subsidiaries or offer letter provided by the Company or its Subsidiaries to the Optionee.

 Section 2.4. – Adjustments to Option 
 The Option shall be adjusted pursuant to Sections 8 or 9 of the Plan, as applicable. Any such adjustment made in good faith thereunder shall be final and binding upon the Optionee, the Company and all
other interested persons. 
 ARTICLE III 
 PERIOD OF EXERCISABILITY 
 Section 3.1. – Commencement of
Exercisability 
 (a) So long as the Optionee continues to be employed by the Company or any of its Subsidiaries, the Option
shall become exercisable pursuant to the following schedules: 
 (i) Time Option. Subject to clause (b)(i)
below, the Time Option shall become vested and exercisable as follows: (x) with respect to 5% of the shares of Common Stock underlying such Time Option, on December 31, 2006; and (y) with respect to 19% of the shares of Common Stock
underlying such Time Option, on each of the subsequent five anniversaries of December 31, 2006. 
 (ii)
Performance Option. The Performance Option shall become vested and exercisable as follows: (x) with respect to 5% of the shares of Common Stock underlying such Performance Option, on December 31, 2006, if the Annual Performance
Target set forth on Schedule A attached hereto for Fiscal Year 2006 is achieved; and (y) with respect to 19% of the shares of Common Stock underlying such Performance Options, for each of the subsequent five Fiscal Years, starting with the 2007
Fiscal Year, on each of the subsequent five anniversaries of December 31, 2006, if and only if the Company achieves the Annual Performance Target set forth on Schedule A attached hereto for each such Fiscal Year. 

(iii) In the event that the Annual Performance Target is not achieved in a particular Fiscal Year (any such year, a
“Missed Year”), if and only to the extent that performance of the Company in any subsequent Fiscal Year satisfies the Cumulative Performance Target (as set forth in Schedule A) applicable to any such subsequent Fiscal
Year, then the applicable percentage of the Performance Option that was scheduled to become vested and exercisable in respect of such Missed Year shall become vested and exercisable as of the end of the Fiscal Year in respect of which the
Cumulative Performance Target is achieved. 

  
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 (b) Notwithstanding
the foregoing, so long as the Optionee continues to be employed by the Company or any of its Subsidiaries through the occurrence of a Change in Control: 
 (i) the Time Option shall become immediately exercisable as to 100% of the shares of Common Stock underlying such Time Option immediately prior to a Change in Control (but only to the extent such Option
has not otherwise terminated or become exercisable), and 
 (ii) the Performance Option shall become immediately
exercisable as to 100% of the shares of Common Stock underlying such Performance Option immediately prior to a Change in Control (but only to the extent such Option has not otherwise terminated or become exercisable) only if, as a result of the
Change in Control, the Investor Return equals or exceeds the Applicable Multiple (as set forth on Schedule B for each applicable Fiscal Year) of the Base Price. 
 (c) Upon a termination of the Optionee’s employment for any reason (other than for Cause by the Company or without Good Reason by the Optionee but which shall include, for the avoidance of doubt due
to the Optionee’s death or Permanent Disability): 
 (i) occurring prior to
January 1, 2009, each installment of the Time Option that would, but for such termination, be scheduled to vest and become exercisable on December 31st of each Fiscal Year 2006 through 2008 (to the extent such installment has not previously vested pursuant to
Section 3.1(a) or (b) above) will become 100% vested and exercisable upon such termination; 
 (ii)
occurring on or after January 1, 2009, a pro-rata portion of the installment of the Time Option that would, but for such termination, be scheduled to vest and become exercisable on December 31 of the Fiscal Year in which the termination
occurs will become vested and exercisable upon such termination, with such pro-rata portion determined based on the number of days the Optionee was employed by the Company or any of its Subsidiaries during such Fiscal Year, relative to the number of
days of such full Fiscal Year; and 
 (iii) occurring within the last six months of any Fiscal Year, if the
Annual Performance Target for such year is achieved, then a pro rata portion of the installment of the Performance Option that would, but for such termination, be scheduled to vest and become exercisable on December 31 of the Fiscal Year in
which the termination occurs will become vested and exercisable upon such December 31, with such pro-rata portion determined based on the number of days the Optionee was employed by the Company or any of its Subsidiaries during such Fiscal
Year, relative to the number of days of such full Fiscal Year (such vesting event, a “Special Termination Vesting Event”). 

  
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 (iv)
Notwithstanding the foregoing, in the event it is determined by the Company (in consultation with its auditors) that the provisions of Section 3.1(c)(iii) results in the Option (or any portion hereof) being classified as a liability as
contemplated by FASB Statement No. 123R, Share-Based Payment, including any amendments and interpretations thereto, then Section 3.1(c)(iii) shall be of no further force and effect, and instead the following provision shall apply: Upon a
termination of the Optionee’s employment for any reason (other than for Cause by the Company or without Good Reason by the Optionee but which shall include, for the avoidance of doubt, due to the Optionee’s death or Permanent Disability)
occurring within the last six months of any Fiscal Year, a Special Termination Vesting Event shall occur if and only if the Performance Target for such Fiscal Year is met, based on the EBITDA (as such term is defined in Schedule A) achieved
for the twelve month trailing period ending the month end prior to the month in which the termination event occurs. 
 (d)
Notwithstanding the foregoing, no Option shall become exercisable as to any additional shares of Common Stock (which do not otherwise become exercisable in accordance with Section 3.1(a), (b) or (c) above) following the termination of
employment of the Optionee for any reason and any Option, which is unexercisable as of the Optionee’s termination of employment, shall be immediately cancelled without payment therefor. 

(e) Any portion of the Performance Option that vests pursuant to subsections 3.1(a)(iii) or 3.1(c)(iii) above, shall be referred to as
the “Additional Vested Performance Options”. 
 Section 3.2. – Expiration of Option 

Except as otherwise provided in Section 5 or 6 of the Management Stockholder’s Agreement, the Optionee may not exercise the
Option to any extent after the first to occur of the following events: 
 (a) The tenth anniversary of the Grant Date, provided
that the Optionee remains employed by the Company or any of its Subsidiaries through such date; 
 (b) The first anniversary of
the date of the Optionee’s termination of employment, if the Optionee’s employment is terminated by reason of death or Permanent Disability (unless earlier terminated as provided in Section 3.2(e) below) provided that if during
such entire one-year period the Common Stock is not publicly traded on an established securities market (“publicly traded”) or if the Executive is not legally free to sell on such market the shares of Common Stock subject to the vested
portion of the Option, then, as to the vested portion of the Option, the Option will remain outstanding through six months following the date upon which (x) the last of the shares of Common Stock subject to such portion of the Option
becomes publicly traded, and (y) the Optionee would be legally free to sell the last of such shares of Common Stock on such market (the “Proviso Period”). Notwithstanding the foregoing, in the case of any Additional Vested
Performance Options, the Optionee shall have the same period to exercise such Options, as if his employment had been terminated by the Company without Cause on the date on which the achievement of the applicable performance targets as identified in
Section 3.1(a)(ii) and (iii) above is determined (the “AVPO Period”); 

  
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 (c) Six months after
the Optionee is terminated by the Company or any of its Subsidiaries without Cause or the Optionee terminates employment with Good Reason (unless earlier terminated as provided in Section 3.2(e) below), provided that this exercise period
will be extended subject to the application of the Proviso Period and the AVPO Period, if applicable; 
 (d) With respect to a
termination of Optionee’s employment by Optionee without Good Reason (other than due to death or Permanent Disability), (x) if such termination occurs prior to January 1, 2010, immediately upon such termination; (y) if such
termination occurs after December 31, 2009, and prior to January 1, 2012, 30 days following such termination; and (z) if such termination occurs after December 31, 2011, six months following such termination, provided that
this exercise period will be extended subject to the application of the Proviso Period and/or the AVPO Period, as applicable; 

(e) The date the Option is terminated pursuant to Section 4 of the Management Stockholder’s Agreement; or 

(f) At the discretion of the Company, if the Committee so determines pursuant to Section 9 of the Plan, the effective date of a
merger, consolidation or other capital change or transaction of the Company that is a Change in Control, provided that, the Company shall make payment to the Optionee in respect of the termination of his Options upon such date based on the
consideration received by stockholders of the Company. 
 ARTICLE IV 

EXERCISE OF OPTION 

Section 4.1. – Person Eligible to Exercise 
 Except as otherwise provided in the Management Stockholder’s Agreement, during the lifetime of the Optionee, only he may exercise an Option or any portion thereof. After the death of the Optionee,
any exercisable portion of an Option may, prior to the time when an Option becomes unexercisable under Section 3.2, be exercised by his personal representative or by any person empowered to do so under the Optionee’s will or under the then
applicable laws of descent and distribution. 
 Section 4.2. – Partial Exercise 

Any exercisable portion of an Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time
prior to the time when the Option or portion thereof becomes unexercisable under Section 3.2; provided, however, that any partial exercise shall be for whole shares of Common Stock only. 

Section 4.3. – Manner of Exercise 
 An Option, or any exercisable portion thereof, may be exercised solely by delivering to the General Counsel of the Company or his office all of the following prior to the time when the Option or such
portion becomes unexercisable under Section 3.2: 
 (a) Notice in writing signed by the Optionee or the other person then
entitled to exercise the Option or portion thereof, stating that the Option or portion thereof is thereby exercised, such notice complying with all applicable rules established by the Committee; 

  
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 (b) (i) Full payment
(in cash or by check or by a combination thereof) for the shares with respect to which such Option or portion thereof is exercised; (ii) indication that the Optionee elects to have the number of Shares that would otherwise be issued to the
Optionee reduced by a number of Shares having an equivalent Fair Market Value to the payment that would otherwise be made by Optionee to the Company pursuant to clause (i) of this subsection (b); or (iii) a number of Shares held by the
Optionee at least six months having an equivalent Fair Market Value to the payment that would otherwise be made by Optionee to the Company pursuant to clause (i) of this subsection (b). 

(c) At any time that the Common Stock is not publicly traded on an established securities market, a bona fide written representation and
agreement, in a form satisfactory to the Committee, signed by the Optionee or other person then entitled to exercise such Option or portion thereof, stating that the shares of Common Stock are being acquired for his own account, for investment and
without any present intention of distributing or reselling said shares or any of them except as may be permitted under the Securities Act of 1933, as amended (the “Act”), and then applicable rules and regulations thereunder, and
that the Optionee or other person then entitled to exercise such Option or portion thereof will indemnify the Company against and hold it free and harmless from any loss, damage, expense or liability resulting to the Company if any sale or
distribution of the shares by such person is contrary to the representation and agreement referred to above; provided, however, that the Committee may, in its reasonable discretion, take whatever additional actions it deems reasonably
necessary to ensure the observance and performance of such representation and agreement and to effect compliance with the Act and any other federal, provincial or state securities laws or regulations; 

(d) Full payment to the Company (in cash or by check or by a combination thereof) of all amounts which, under applicable law, it is
required to withhold upon exercise of the Option; and 
 (e) In the event the Option or portion thereof shall be exercised
pursuant to Section 4.1 by any person or persons other than the Optionee, appropriate proof of the right of such person or persons to exercise the option. 
 Without limiting the generality of the foregoing, the Committee may require an opinion of counsel acceptable to it to the effect that any subsequent transfer of shares acquired on exercise of an Option
does not violate the Act. If the Optionee is a resident of the United States, the written representation and agreement referred to in subsection (c) above shall, however, not be required if the shares to be issued pursuant to such exercise have
been registered under the Act, and such registration is then effective in respect of such shares. 

  
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 Section 4.4. –
Conditions to Issuance of Stock 
 The shares of stock issuable upon the exercise of an Option, or any portion thereof,
shall not be required to be so physically issued to the Optionee. For the avoidance of doubt, shares shall be deemed to have been issued when evidenced by entry in the Company’s shareholder register. Such shares shall be fully paid and
nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock acquired upon the exercise of an Option or portion thereof prior to fulfillment of all of the following conditions: 

(a) The obtaining of approval or other clearance from any state, provincial or federal governmental agency which the Committee shall, in
its reasonable and good faith discretion, determine to be necessary or advisable (and the Company and the Optionee shall each use reasonable efforts to obtain all such clearances and approvals as soon as reasonably practicable); and 

(b) The lapse of such reasonable period of time following the exercise of the Option as the Committee may from time to time establish for
reasons of administrative convenience or as may otherwise be required by applicable law. 
 Section 4.5. – Rights as
Stockholder 
 The holder of an Option shall not be, nor have any of the rights or privileges of, a stockholder of the
Company in respect of any shares he may be issued upon the exercise of the Option or any portion thereof unless and until such shares shall have been issued as evidenced by entry in the Company’s shareholder register upon satisfaction of the
conditions set forth in Section 4.4. 

  
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 ARTICLE V 

MISCELLANEOUS 

Section 5.1. – Administration 
 The Committee shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to
interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding upon the Optionee, the Company and all other interested persons. No member of the
Committee shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or the Option. In its absolute discretion, the Board may at any time and from time to time exercise any and all rights
and duties of the Committee under the Plan and this Agreement. Notwithstanding the foregoing, determinations regarding Good Reason, Permanent Disability, Cause and Change in Control shall be determined as set forth in the Employment Agreement.

 Section 5.2. – Option Not Transferable 
 Subject to applicable law to the contrary, neither the Option nor any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Optionee or his successors in
interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 5.2 shall not prevent transfers by will or by
the applicable laws of descent and distribution or to a partnership, limited liability company, corporation, trust or custodianship, the beneficiaries of which may include only the Optionee, his spouse (or ex-spouse) or his lineal descendants
(including adopted children) or, if at any time after any such transfer there shall be no then living spouse or lineal descendants, then to the ultimate beneficiaries of any such trust or to the estate of a deceased beneficiary. 

Section 5.3. – Notices 
 Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its General Counsel, and any notice to be given to the Optionee shall be addressed to
him at the address given beneath his signature hereto. By a notice given pursuant to this Section 5.3, either party may hereafter designate a different address for notices to be given to it or him. Any notice which is required to be given to
the Optionee, shall, if the Optionee is then deceased, be given to the Optionee’s personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 5.3. Any
notice shall have been deemed duly given (i) upon electronic confirmation of facsimile, (ii) one business day following the date sent when sent by overnight delivery and (iii) five (5) business days following the date mailed when
mailed by registered or certified mail return receipt requested and postage prepaid, in each case as follows. 

  
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 Section 5.4. –
Titles; Pronouns 
 Titles are provided herein for convenience only and are not to serve as a basis for interpretation or
construction of this Agreement. The masculine pronoun shall include the feminine and neuter, and the singular the plural, where the context so indicates. 
 Section 5.5. – Applicability of Plan and Management Stockholder’s Agreement 
 The Option and the shares of Common Stock issued to the Optionee upon exercise of the Option shall be subject to all of the terms and provisions of the Plan, the Management Stockholder’s Agreement
and the Sale Participation Agreement, to the extent applicable to the Option and such shares. In the event of any conflict between this Agreement and the Plan, the terms of this Agreement shall control and shall be deemed a part of the Plan solely
for purposes of the Optionee. In the event of any conflict between this Agreement or the Plan and the Management Stockholder’s Agreement, the terms of the Management Stockholder’s Agreement shall control. 

Section 5.6. – Amendment 
 This Agreement may be amended only by a writing executed by the parties hereto, which specifically states that it is amending this Agreement. 
 Section 5.7. – Governing Law 
 The laws of the State of New
York shall govern the interpretation, validity and performance of the terms of this Agreement, except to the extent that the issue or transfer of Stock shall be subject to mandatory provisions of the laws of The Netherlands. 

Section 5.8. – Arbitration 
 Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration, conducted before an arbitrator in New York, New York, in accordance with the
rules of the American Arbitration Association then in effect. Only individuals who are (a) lawyers engaged full-time in the practice of law, as in-house counsel or as a professor of law; and (b) on the AAA register of arbitrators shall be
selected as an arbitrator. Within twenty (20) days of the conclusion of the arbitration hearing, the arbitrator shall prepare written findings of fact and conclusions of law. It is mutually agreed that the written decision of the arbitrator
shall be valid, binding, final and non-appealable; provided however, that the parties hereto agree that the arbitrator shall not be empowered to award punitive damages against any party to such arbitration. In the event that an action
is brought to enforce the provisions of this Agreement pursuant to this Section 5.8, (x) if the arbitrator determines that the Optionee is the prevailing party in such action, the Company shall be required to pay the reasonable
attorney’s fees and expenses of the Optionee in connection with such arbitration, as well as the arbitrator’s full fees and expenses and (y) if the Company prevails in such action or if, in the opinion of the court or arbitrator
deciding such action, there is no prevailing party, each party shall pay his or its own attorney’s fees and expenses and the arbitrator’s fees and expenses will be borne equally by the parties thereto. 

  
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 Section 5.9. – Code
Section 409A 
 If any payments of money, delivery of shares of Common Stock or other benefits due to the Participant hereunder could cause
the application of an accelerated or additional tax under Section 409A of the Code, such payments, delivery of shares or other benefits shall be deferred if deferral will make such payment, delivery of shares or other benefits compliant under
Section 409A of the Code, otherwise such payment, delivery of shares or other benefits shall be restructured, to the extent possible, in a manner, determined by the Company and reasonably acceptable to the Participant, that does not cause such
an accelerated or additional tax. 
 Section 5.10. – Counterparts 
 This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 

  
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	VALCON ACQUISITION HOLDING B.V.
		
	By:	 	 /s/ Scott Schoen

		 	Scott Schoen
	Its:	 	Managing Director
	
	OPTIONEE:
	
	 /s/ David L. Calhoun

	 David L. Calhoun

  

					
	Aggregate number of shares of Common Stock for which the Time Option granted hereunder is exercisable (100% of number of shares) at an exercise price per share equal
to USD $10.00 (“Base Price”):	  	 	3,000,000	  
		  	 	 	 
		
	Aggregate number of shares of Common Stock for which the Time Option granted hereunder is exercisable (100% of number of shares) at an exercise price per share equal
to USD $20.00:	  	 	500,000	  
		  	 	 	 
		
	Aggregate number of shares of Common Stock for which the Performance Option granted hereunder is exercisable (100% of the number of shares) at an exercise price per
share equal USD $10.00:	  	 	3,000,000	  
		  	 	 	 
		
	Aggregate number of shares of Common Stock for which the Performance Option granted hereunder is exercisable (100% of number of shares) at an exercise price equal to
USD $20.00:	  	 	500,000	  
		  	 	 	 

 [SIGNATURE PAGE OF STOCK OPTION AGREEMENT] 

  
 Schedule A

 The Annual Performance Targets are based on the Company’s achievement of the following EBITDA targets for the
following Fiscal Years: 
  

									
	 Fiscal Year
	  	Annual Performance Target	 	  	Cumulative Performance Target	 
	 	  	 (EBITDA in millions)
	 	  	 (EBITDA in millions)
	 
			
	
20061
	  	$	922	  	  	$	922	  
			
	 2007
	  	$	1128	  	  	$	2050	  
			
	 2008
	  	$	1361	  	  	$	3411	  
			
	 2009
	  	$	1476	  	  	$	4887	  
			
	 2010
	  	$	1566	  	  	$	6453	  
			
	 2011
	  	$	1681	  	  	$	8134	  

 “EBITDA”
shall mean earnings before interest, taxes, depreciation and amortization plus transaction, management and/or similar fees paid to the Investors and/or their Affiliates. The Board shall, fairly and appropriately, adjust the calculation of EBITDA to
reflect, to the extent not contemplated in the management plan, the following: material acquisitions, material divestitures, extraordinary corporate transactions (which shall mean spin-off, share combination, recapitalization, liquidation,
dissolution, reorganization, merger, amalgamation, combination, consolidation, Change in Control, payment of a dividend (other than a cash dividend paid as part of a regular dividend program), the sale of all of substantially all of the assets
of the Company or other similar transaction or occurrence which affects the equity securities of the Company or the value thereof), extraordinary capital investment programs in excess of $25 million and not included in the
BAU Capital Budget, any change required by GAAP relating to share-based compensation or for other changes in GAAP promulgated by accounting standard setters that, in each case, the Board in its good faith judgment determines require adjustment of
EBITDA. The Board’s determination of such adjustment shall be based on the Company’s accounting as set forth in its books and records and on the financial plan of the Company pursuant to which the Annual Performance Targets were originally
established. 
  

	1	 Fiscal Year 2006 to be defined as the period beginning on the Closing Date and ending on December 31, 2006. All other Fiscal Years will be
calendar years commencing on January 1 and ending on December 31. 

  
 If the Company makes
any material acquisition in any year, the Annual Performance Target for such year and Cumulative Performance Target for such year and subsequent years will be adjusted, fairly and appropriately, by the amount of EBITDA in the plan for the target
presented to the Board at the time the acquisition is approved by the Board, in its good faith judgment. Annual Performance Targets and Cumulative Performance Targets will also be fairly and appropriately adjusted by the Board, in its good faith
judgment, to the extent not contemplated in the plan for the following: any material divestitures, extraordinary corporate transactions (which shall mean spin-off, share combination, recapitalization, liquidation, dissolution, reorganization,
merger, amalgamation, combination, consolidation, Change in Control, payment of a dividend (other than a cash dividend paid as part of a regular dividend program), the sale of all of substantially all of the assets of the Company or
other similar transaction or occurrence which affects the equity securities of the Company or the value thereof), extraordinary capital investment programs in excess of $25 million and not included in the BAU Capital Budget,
any change required by GAAP relating to share-based compensation or other changes in GAAP promulgated by accounting standard setters. In the event that any of the foregoing action is taken, such adjustment shall be only the amount deemed reasonably
necessary by the Board, in the exercise of its good faith judgment, after consultation of the Company’s accountants, to accurately reflect the direct and measurable effect such event has on such Annual Performance Targets and Cumulative
Performance Targets. The intent of such adjustments is to keep the probability of achieving the Annual Performance Targets and Cumulative Performance Targets the same as if the event triggering such adjustment had not occurred. The Board’s
determination of such necessary adjustment shall be made within 60 days following the completion or closing of such event, and shall be based on the Company’s accounting as set forth in its books and records and on the Company’s financial
plan pursuant to which the Annual Performance Targets and Cumulative Performance Targets were originally established. 

  
 Schedule B

 Applicable Multiple shall be determined in accordance with the following table: 

 

					
	 2006
	  	 	2.76	  
	 2007
	  	 	2.74	  
	 2008
	  	 	2.72	  
	 2009
	  	 	2.70	  
	 2010
	  	 	2.67	  
	 2011
	  	 	2.64	  
	 2012
	  	 	2.61	  
	 2013
	  	 	2.58	  
	 2014
	  	 	2.54	  
	 2015
	  	 	2.50	  
	 2016
	  	 	2.46	  
	 2017
	  	 	2.41	  
	 2018
	  	 	2.35	  
	 2019
	  	 	2.29	  
	 2020
	  	 	2.23	  
	 2021
	  	 	2.16	  
	 2022
	  	 	2.08	  
	 2023
	  	 	1.99	  
	 2024
	  	 	1.89	  
	 2025
	  	 	1.79$1.0 Million Promissory Note issued on November 1, 2010

  
 Exhibit 10.1

 THIS PROMISSORY NOTE IS SUBORDINATE TO CERTAIN OBLIGATIONS OF THE COMPANY AS DESCRIBED IN THE BFI LOAN DOCUMENTS (DEFINED HEREIN)
AND SUBJECT TO THAT CERTAIN DEBT SUBORDINATION AGREEMENT DATED MARCH 19, 2010 AMONG BFI BUSINESS FINANCE AND THE HOLDER. 
 THIS
PROMISSORY NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, OR QUALIFIED UNDER ANY STATE SECURITIES LAWS. THIS NOTE MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
QUALIFICATION OR AN EXEMPTION THEREFROM UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS. 
 THIS PROMISSORY NOTE HAS BEEN
ISSUED WITH “ORIGINAL ISSUE DISCOUNT” WITHIN THE MEANING OF SECTION 1273 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. UPON WRITTEN REQUEST, THE COMPANY WILL PROMPTLY MAKE AVAILABLE TO ANY HOLDER OF THIS NOTE THE FOLLOWING INFORMATION:
(1) THE ISSUE PRICE AND DATE OF THE NOTE, (2) THE AMOUNT OF ORIGINAL ISSUE DISCOUNT ON THE NOTE AND (3) THE YIELD TO MATURITY OF THE NOTE. TO OBTAIN THIS INFORMATION, A HOLDER SHOULD CONTACT THE CHIEF FINANCIAL OFFICER AT 2070 LAS
PALMAS DRIVE, CARLSBAD, CA 92011. 
 PROMISSORY NOTE 

 

			
	 $1,000,000
	  	November 1, 2010
		  	San Diego, California

FOR VALUE RECEIVED, Orange 21 North America Inc. (formerly known as Spy Optic, Inc.), a California corporation (the
“Company”), promises to pay to the order of Costa Brava Partnership III, L.P., a Delaware limited partnership, or its registered assigns (“Holder”), the principal sum of One Million Dollars ($1,000,000) on
July 29, 2011 (the “Maturity Date”), together with fees and interest thereon as provided in Section 2 of this Note (the “Note”). 
 1. Definitions. For purposes of this Note, the following terms shall have the following meanings: 
 “Affiliate” shall mean with respect to any Person, any other Person which directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common
Control with, such first Person. 
 “BFI Loan Documents” shall mean the Loan and Security Agreement, dated as
of February 26, 2007, between the Company and BFI Business Finance, as modified by the First Modification to Loan and Security Agreement, dated as of December 7, 2007, as further modified by the Second Modification to Loan and Security
Agreement dated as of February 12, 2008, and as further modified by the Third Modification to Loan and Security Agreement dated as of June 23, 2008, and the other Loan Documents as defined therein. 

  
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“Business” means the business of the Company or its Subsidiaries of designing, developing, manufacturing and marketing
products for the action sports, motorsports and youth lifestyle markets, and related activities, as conducted or proposed to be conducted by the Company or its Subsidiaries on the date hereof and reasonable extensions thereof. 

“Business Day” means any day which is not a Saturday or Sunday or a legal holiday on which national banks are authorized
or required to be closed. 
 “Control” shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a person, whether through the ownership of voting securities, by contract or otherwise, and the terms “Controlling” and “Controlled” (and the lower-case versions of
the same) shall have meanings correlative thereto. 
 “Debt” shall mean all liabilities, obligations and
indebtedness of every kind and nature of any Person, including, without limitation: (i) all obligations for borrowed money, including, without limitation, all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or
other similar instruments or deferred purchase price of property; (ii) obligations as lessee under any leases (including under any capital leases); (iii) any reimbursement or other obligations under any performance or surety bonds, any
letters of credit and similar instruments issued for the account of such Person; (iv) all net obligations in respect of any derivative products; (v) all guaranties, endorsements (other than for collection or deposit in the ordinary course
of business), and other contingent obligations to purchase, to provide funds for payment, to supply funds to invest in any other Person, or otherwise to assure a creditor against loss; and (vi) obligations secured by any Lien on property owned
by such Person, whether or not the obligations have been assumed or are limited in recourse. 
 “GAAP” means
generally accepted principles of good accounting practice in the United States, consistently applied. 
 “Governmental
Authority” shall mean any federal, state, local or other governmental department, commission, board, bureau, agency or other instrumentality or authority, domestic or foreign, exercising executive, legislative, judicial, regulatory or
administrative authority or functions of or pertaining to government. 
 “Investment” shall mean, with respect
to any Person, any direct or indirect acquisition or investment by such Person, whether by means of any loan, advance to, guarantee or assumption of Debt of, or purchase or other acquisition or any other debt participation or interest in such
Person, any purchase or other acquisition of any capital stock, debt or other securities of such Person, any capital contribution to such Person in, or any other investment in, or acquisition (in one transaction or a series of transactions) of, any
interest or all or substantially all of the property and assets or business of another Person or assets constituting a business unit, line of business or division of, such Person. 

“Legal Requirement” means any present or future requirement imposed upon the Company or any of its Subsidiaries by any
law, statute, rule, regulation, directive, order, decree or guideline (or any interpretation thereof by courts or of administrative bodies) of the United States of America, or any state, or other political subdivision thereof, or by any board,

  
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governmental or administrative agency, central bank or monetary authority of the United States of America or any other jurisdiction in which the Company owns property or conducts its business, or
any political subdivision of any of the foregoing. 
 “Lien” shall mean any security interest, mortgage,
pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory, judgment or other), claim or other priority or preferential arrangement of any kind or nature whatsoever, including any conditional sale or other title retention
agreement, any easement, right of way or other encumbrance on title to real property, and any capital lease having substantially the same economic effect as any of the foregoing (other than a financing statement filed by a lessor in respect of an
operating lease not intended as security). 
 “Material Adverse Effect” shall mean any event, matter, condition
or circumstance which (i) has or would reasonably be expected to have a material adverse effect on the business, properties, operations, condition (financial or otherwise) or prospects of the Company and its Subsidiaries, taken as a whole;
(ii) would materially impair the ability of the Company or any other Person to perform or observe their respective obligations under or in respect of this Note; (iii) would materially impair the rights and remedies of Holder under this
Note, or (iv) affects the legality, validity, binding effect or enforceability of this Note. 

“Obligations” shall mean all debts, liabilities, obligations, covenants and duties of the Company howsoever created,
arising or evidenced, whether direct or indirect, joint or several, absolute or contingent, or now or hereafter existing, or due or to become due, which arise out of or in connection with this Note, including, without limitation, all costs and
expenses incurred by Holder in connection with the enforcement of this Note and any interest and fees that accrue to Holder after the commencement by or against the Company of any proceeding under any laws naming the Company as a debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in such proceeding. 
 “Organic
Document” means, relative to any Person, its articles or certificate of incorporation, or certificate of limited partnership or formation, its bylaws, partnership or operating agreement or other organizational documents, and all
stockholders agreements, voting trusts and similar arrangements applicable to any of its capital stock, partnership interests or other ownership interests. 
 “Permitted Debt” shall mean (i) Obligations of the Company to Holder hereunder or under any other document related to or in connection with the Note; (ii) Obligations of the
Company under (a) the Promissory Note dated as March 19, 2010 (the “March 2010 Note”), by the Company in favor of Holder and under any other document related to or in connection therewith and (b) the Promissory Note dated as
of October 4, 2010 (the “October 2010 Note”), by the Company in favor of Holder and under any other document related to or in connection therewith; (iii) Debt of the Company under the BFI Loan Documents not to exceed $4,000,0000
at any one time outstanding, or extensions, renewals and refinancings of such Debt, provided that the principal amount of such Debt being extended, renewed or refinanced under the BFI Loan Documents does not increase and in no case shall the
Company be permitted to draw in excess of $4,000,000 at any one time outstanding under the BFI Loan Documents; (iv) Debt of the Company and any Subsidiary of the Company existing on the date hereof and disclosed to

  
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Holder on Schedule A hereto or extensions, renewals and refinancings of such Debt, provided that the principal amount of such Debt being extended, renewed or refinanced does not
increase and the terms thereof are not modified to impose more burdensome terms upon Company or the relevant Subsidiary; (v) Debt of Orange 21 Europe, S.r.l. (formerly known as Spy Optic, S.r.l.) and LEM S.r.l. and extensions, renewals and
refinancings of such Debt; (vi) accounts payable to trade creditors for goods and services and current operating liabilities (not the result of the borrowing of money) incurred in the ordinary course of business of Company or any Subsidiary of
the Company in accordance with customary terms; (vii) Debt consisting of guarantees resulting from endorsement of negotiable instruments for collection by the Company or a Subsidiary of the Company in the ordinary course of business;
(viii) interest rate swaps, currency swaps and similar financial products entered into or obtained in the ordinary course of business; and (viii) capital leases or other Debt incurred solely to acquire equipment, computers, software or
implement tenant improvements which is secured in accordance with clause (ix) of the definition of “Permitted Liens” and is not in excess of the lesser of the purchase price or the fair market value of such equipment, computers,
software or tenant improvements on the date of acquisition. 
 “Permitted Investments” shall mean debt
obligations maturing within twelve months of the time of acquisition thereof which are accorded a rating of AA- or better by S&P (or an equivalent rating by another recognized credit rating agency of similar standing), commercial paper with a
maturity of 270 calendar days or less which is accorded a rating of A4 or better by S&P (or an equivalent rating by another recognized credit rating agency of similar standing), certificates of deposit maturing within twelve months of the time
of acquisition thereof issued by commercial banks that are accorded a rating by a recognized rating service then in the business of rating commercial banks which is in the first quartile of the rating categories used by such service, obligations
maturing within twelve months of the time of acquisition thereof of any Governmental Authority which obligations from time to time are accorded a rating of BBB or better by S&P (or an equivalent rating by another recognized credit rating agency
of similar standing), and demand deposits, certificates of deposit, bankers acceptance and time deposits (having a tenor of less than one year) of United States banks having total assets in excess of $1,000,000,000. 

“Permitted Liens” shall mean (i) the existing Liens as of the date hereof disclosed to Holder on Schedule B hereto,
or incurred in connection with the extension, renewal or refinancing of the Debt secured by such existing Liens, provided that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the
principal amount of the Debt being extended, renewed or refinanced does not increase; (ii) Liens on the assets of Orange 21 Europe, S.r.l. (formerly known as Spy Optic, S.r.1.) and LEM S.r.l. securing Debt permitted by clause (iv) of the
definition of Permitted Debt; (iii) Liens for taxes, fees, assessments or other governmental charges or levies, either not delinquent or being contested in good faith by appropriate proceedings and which are adequately reserved for in
accordance with GAAP; (iv) Liens of materialmen, mechanics, warehousemen, carriers or employees or other like Liens arising in the ordinary course of business and securing obligations either not delinquent or being contested in good faith by
appropriate proceedings which are adequately reserved for in accordance with GAAP and which do not in the aggregate materially impair the use or value of the property or risk the loss or forfeiture of title thereto; (v) Liens consisting of
deposits or pledges to secure the payment of worker’s compensation, 

  
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unemployment insurance or other social security benefits or obligations, or to secure the performance of bids, trade contracts, leases, public or statutory obligations, surety or appeal bonds or
other obligations of a like nature incurred in the ordinary course of business (other than for Debt or any Liens arising under ERISA); (vi) easements, rights of way, servitudes or zoning or building restrictions and other minor encumbrances on
real property and irregularities in the title to such property which do not in the aggregate materially impair the use or value of such property or risk the loss or forfeiture of title thereto; (vii) statutory landlord’s Liens under leases
to which Company or any of its Subsidiaries is a party; and (viii) Liens (A) upon or in any equipment, computers or software acquired or held by Company or any of its Subsidiaries or tenant improvements implemented by Company or any of its
Subsidiaries to secure the purchase price of such equipment, computers or software or Debt incurred solely for the purpose of financing the acquisition of such equipment, computers or software or the implementation of such tenant improvements, or
(B) existing on such equipment, computers or software at the time of its acquisition, provided that the Lien is confined solely to the property so acquired and improvements thereon, or the proceeds of such equipment, computers, software or
tenant improvements. 
 “Person” shall mean an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof. 

“SEC Reports” shall mean reports, schedules, forms and registration statements, and any amendments thereto, filed with
the Securities and Exchange Commission (the “Commission”) pursuant to the Securities Act of 1933 or Securities Exchange Act of 1934 and the rules and regulations of the Commission promulgated thereunder. 

“Subsidiary” shall mean, with respect to any Person (herein referred to as the “parent”), any corporation,
limited liability company, partnership, association or other business entity (i) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or more than 50% of the
general partnership interests are, at the time any determination is being made, owned, controlled or held by the parent, or (ii) that is, at any time any determination is made, otherwise Controlled by, the parent or one or more Subsidiaries of
the parent and one or more Subsidiaries of the parent. 
 2. Payment of Interest and Fees. 

(a) Interest Generally. Interest shall accrue from the date hereof on a daily basis on the unpaid principal amount of this Note
outstanding from time to time (computed on the basis of actual calendar days elapsed and a year of 365 days) at a rate equal to, from the date hereof through through the Maturity Date, (a) 9% per annum payable in cash monthly in arrears on the
last day of each calendar month, and (b) 3% per annum payable in cash on the Maturity Date. 
 (b) Default Interest.
Upon the occurrence and during the continuance of any Event of Default, this Note shall bear interest at a rate per annum equal to 2% plus the rate otherwise applicable to the Note. 

  
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 (c) Fees. On
each of December 31, 2010 and the Maturity Date, the Company shall pay the Holder a facility fee of 0.55% of the original principal amount of this Note. 
 3. Payments. 
 (a) Form of Payment. All payments of interest and
principal shall be in lawful money of the United States of America by a check drawn on the account of the Company and sent via overnight courier service to Holder at such address as previously provided to the Company in writing (which address, in
the case of Holder as of the date of issuance hereof, shall initially be the address for Holder as set forth in this Note); provided that Holder may elect to receive a payment of cash via wire transfer of immediately available funds by providing the
Company with prior written notice setting out such request and Holder’s wire transfer instructions. Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such payment shall be made on the immediately
succeeding Business Day and such extension of time shall be included in the computation of accrued interest. All payments shall be applied first to accrued interest, and thereafter to principal. 

(b) No Set-Off. The Company agrees to make all payments under this Note without set-off or deduction and regardless of any
counterclaim or defense. 
 (c) Prepayment. The Company shall have the right to prepay all amounts owed under this Note
in whole or in part at any time upon five (5) Business Days prior written notice to Holder. 
 4. Representations and
Warranties. The Company hereby makes the following representations and warranties to Holder, which are made and given subject to, and qualified in their entirety by the schedule of exceptions attached hereto as Schedule C: 

(a) Organization, Good Standing and Qualification. The Company is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation, and has all requisite power and authority to execute, deliver and perform its obligations under this Note. Each of the Company and its Subsidiaries is qualified to do business and is in good standing in
each jurisdiction in which the failure so to qualify or be in good standing would have a Material Adverse Effect, and has all requisite power and authority to own its assets and carry on its business. 

(b) Corporate Power and Authorization; Consents. The execution, delivery and performance by the Company of this Note have been
duly authorized by all necessary action of the Company and do not and will not (i) contravene the terms of the Company’s Organic Documents; (ii) result in a breach of, or constitute a default (or an event that with notice or lapse of
time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any lease, instrument, contract or other agreement to which the
Company or any of its Subsidiaries are party or by which they or their properties may be bound or affected; (iii) necessitate the consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing
with, any Governmental Authority or any third party; or (iv) violate any provision of any law, rule, regulation, order, judgment, decree or the like binding on or affecting the Company, except in the case of each of clauses (ii), (iii) and
(iv), such as would not result in a Material Adverse Effect. 

  
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 (c)
Enforceability. This Note constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms 
 (d) Financial Statements and Other Information. Orange 21, Inc., a Delaware corporation and sole owner of the Company (“Parent”), has previously furnished to Holder copies of (i) its
audited consolidated financial statements for the fiscal year ended December 31, 2009, including the balance sheet as of the close of the fiscal year and the income statement for such year, together with a statement of cash flows and
(ii) unaudited copies of its consolidated balance sheet, income statement and statement of cash flows as of and for the six month period ended June 30, 2010 (the “Financial Statements”). The Financial Statements fairly
present, in all material respects, in conformity with GAAP (except as may be indicated in the notes thereto), the financial position of the Company taken as a whole as of the date thereof for the period specified therein (subject to normal year-end
adjustments). There are no material liabilities required in accordance with GAAP to be set forth in the Financial Statements that are not so set forth. Since December 31, 2009, there has been no event or circumstance, either individually or in
the aggregate, that has had or would reasonably be expected to have a Material Adverse Effect. All forecasts and projections that Parent and/or the Company have provided to Holder have been prepared in good faith on the basis of the assumptions
stated therein, which assumptions were believed to be reasonable at the time made, it being understood that projections as to future events are not to be viewed as facts and actual results may vary materially from such forecasts. 

(e) Litigation. There is no action, suit, proceeding or investigation pending or, to the knowledge of Company and its
Subsidiaries, currently threatened against the Company and its Subsidiaries which questions the validity of this Note or any related document or the right of the Company and its Subsidiaries to enter into such agreements, or to consummate the
transactions contemplated hereby or thereby, or which would reasonably be expected to result, either individually or in the aggregate, in any Material Adverse Effect, nor, to the knowledge of the Company, is there any reasonable basis for the
foregoing. The Company and its Subsidiaries are not parties or subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality which would reasonably be expected to have a Material
Adverse Effect. There is no material action, suit, proceeding or investigation by Company and its Subsidiaries currently pending or which Company and its Subsidiaries intend to initiate. 

(f) Operations in Conformity With Law, etc. The operations of the Business as conducted by the Company and its Subsidiaries are
not in violation of any Legal Requirement presently in effect, except for such violations and defaults as do not and will not, in the aggregate, result, or create a material risk of resulting, in any Material Adverse Effect. The Company and its
Subsidiaries have not received notice of any such violation or default, and the Company and its Subsidiaries have no knowledge of any reasonable basis on which the operations of the Business as conducted by the Company and its Subsidiaries would
reasonably be expected to violate or to give rise to any such violation or default. 

  
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 (g) Intellectual
Property. The Company and its Subsidiaries have obtained all material patents, trademarks, service marks, trade names, copyrights, licenses and other rights, free from materially burdensome restrictions, that are necessary for the operation of
the Business, except for those for which the failure to obtain is not reasonably likely to have a Material Adverse Effect. The Company and its Subsidiaries have not received or otherwise been made aware of any communications alleging that the
Company and its Subsidiaries have violated or, by conducting the Business, would violate, in any material respect, any patents, trademarks, service marks, trade names, copyrights, trade secrets, information, proprietary rights and processes of any
other person or entity used in the conduct of its Business. 
 (h) Title to Property and Assets. The Company and its
Subsidiaries have good and marketable title to, or valid leasehold interests in or rights to use, all of the material assets and properties used by the Company and its Subsidiaries in the Business (collectively, the “Properties and
Facilities”), subject to no Liens except for the Permitted Liens. Taken as a whole, the Properties and Facilities are in good repair, working order and condition (ordinary wear and tear excepted) and all such assets and properties are owned
or leased by the Company and its Subsidiaries free and clear of all Liens, except for the Permitted Liens, or as otherwise permitted hereunder. The Properties and Facilities constitute all of the material assets, properties and rights of any type
used in or necessary for the conduct of the Business. 
 (i) Tax Returns, Payments and Elections. The Company and its
Subsidiaries have filed all material tax returns and reports (or timely extensions) as required by law relating to any material tax liability of the Company and its Subsidiaries. Such returns and reports are true and correct in all material respects
and the Company and its Subsidiaries have paid all material taxes and other assessments due, except where the validity or amount thereof is being contested in good faith by appropriate proceedings and adequate reserves have been set aside on the
Financial Statements. There are no pending, or to the knowledge of the Company and its Subsidiaries, contemplated reviews, audits or proceedings with respect to any tax return, report or other tax liability of the Company or any of its Subsidiaries,
which, in either case, relates to any material tax liability of the Company or any such Subsidiary. 
 (j) Employment
Matters. The Company and its Subsidiaries have complied in all material respects with all applicable state and federal equal employment opportunity laws and with other laws related to employment, including without limitation all laws relating to
withholding of taxes and other sums. All persons classified by the Company and its Subsidiaries as independent contractors for employee benefit and state and federal tax purposes are appropriately classified, except where the failure to do so would
not reasonably be expected to have a Material Adverse Effect. The Company and its Subsidiaries are not delinquent in material payments to any of its employees, consultants or independent contractors for any wages, salaries, commissions, bonuses or
other direct compensation for any services performed for it to the date hereof, except where such a delinquency would not reasonably be expected to have a Material Adverse Effect. 

(k) Affiliate Arrangements. There are no contractual arrangements or obligations owed to or by the Company and its Subsidiaries by
or to any Affiliate other than this Note, the March 2010 Note and the October 2010 Note and obligations to employees and officers for (i) payment of salary and commissions and bonuses for services rendered, (ii) reimbursement for
reasonable expenses incurred on its behalf and (iii) other standard employee benefits made generally available to all employees. 

  
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 (l) Permits and
Licenses. The Company and its Subsidiaries have all permits, licenses and any similar authority necessary for the conduct of their Business, the lack of which could reasonably be expected to have a Material Adverse Effect. The Company and its
Subsidiaries are not in default in any material respect under any of such permits, licenses or other similar authority. 
 (m)
Customer and Trade Relations. As of the date hereof, there exists no actual or, to the knowledge of the Company and its Subsidiaries, threatened termination or cancellation of, or any material adverse modification or change in the business
relationship of the Company and its Subsidiaries with any customer, supplier or licensor material to its operations. 
 5.
Affirmative Covenants. So long as any indebtedness under this Note remains outstanding, the Company shall, and shall cause each of its Subsidiaries to: 
 (a) Compliance with Laws. Comply in all material respects with applicable laws, rules, regulations and orders, such compliance to include, without limitations, paying before the same become
delinquent all taxes, assessments, and charges imposed upon it or upon its property by any Governmental Authority except for good faith contests for which adequate reserves are being maintained. 

(b) Insurance. Carry and maintain in full force and effect, at its own expense and with financially sound and reputable insurance
companies, insurance in such amounts, with such deductibles and covering such risks as is customarily carried by companies engaged in the same or similar businesses and owning similar properties in the localities where the Company or any such
Subsidiary operates. 
 (c) Continuance of Business. Maintain its legal existence, licenses and privileges in good
standing under and in compliance with all applicable laws and continue to operate its business as currently conducted. Without limiting the generality of the foregoing, the Company and its Subsidiaries shall do and cause to be done all things
necessary to apply for, preserve, maintain and keep in full force and effect all of its registrations of trademarks, service marks and other marks, trade names and other trade rights, patents, copyrights and other intellectual property in accordance
with prudent business practices. 
 (d) Maintenance. Conduct its business in a manner consistent with relevant industry
standards, keep its material assets and properties in good working order and condition and make all needful and proper repairs, replacements and improvements thereof so that such business may be properly and prudently conducted at all times.

 (e) Leases. Pay when due all rents and other amounts payable under any leases to which the Company or any Subsidiary
is a party or by which the Company or such Subsidiary’s properties and assets are bound, unless such payments are the subject of a permitted protest. 

  
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 (f) Books and
Records. Keep adequate records and books of account, in which complete entries will be made in accordance with GAAP, reflecting all financial transactions of the Company and any such Subsidiary. 

(g) Inspection. At any reasonable time and from time to time permit Holder or any of its agents or representatives to visit and
inspect any of the properties of the Company and any such Subsidiary and to examine and make copies of and abstracts from the records and books of account of the Company and such Subsidiary, and to discuss the business affairs, finances and accounts
of the Company and such Subsidiary with any of the officers, employees or accountants of such Loan Party and such Subsidiary. The Company hereby irrevocably authorizes all accountants and third parties to disclose and deliver to Holder at the
Company’s expense all financial information, books and records, work papers, management reports and other information in their possession relating to the Company whether verbally, in writing (by record or authenticated record) or otherwise.

 (h) Notice of Litigation. Provide to Holder promptly after the filing or commencement thereof, notice of all actions,
suits, and proceedings before any court or Governmental Authority affecting the Company or any such Subsidiary, and in any event within three (3) days after the occurrence thereof, which could have a Material Adverse Effect. 

(i) Notice of Material Adverse Effect, Etc. So long as any amount payable hereunder shall remain unpaid, furnish to Holder:
(i) prompt written notice, and in any event within three (3) days after the occurrence thereof, of any other condition or event, which has resulted, or that could reasonably be expected to result, in a Material Adverse Effect; and
(ii) such other statements, lists of property and accounts, budgets, forecasts, projections, reports, or other information respecting the operations, properties, business or condition (financial or otherwise) of the Company or any Subsidiary as
Holder may from time to time reasonably request; provided that any such information shall be kept confidential and will be subject to the terms and conditions of a non-disclosure agreement between the parties. 

(j) Notice of Defaults and Events of Defaults. Provide to Holder, as soon as possible and in any event within three (3) days
after the occurrence thereof, written notice of each event which either (i) is an Event of Default, or (ii) with the giving of notice or lapse of time or both would constitute an Event of Default, in each case setting forth the details of
such event and the action which is proposed to be taken by the Company and any such Subsidiary with respect thereto. 
 (k)
Taxes. Pay and discharge (i) all federal and other material taxes, fees, assessments and governmental charges or levies imposed upon it or upon its properties or assets prior to the date on which penalties attach thereto, and all lawful
claims for labor, materials and supplies which, if unpaid, might become a Lien upon any of its properties or assets, except to the extent such taxes, fees, assessments or governmental charges or levies, or such claims, are being contested in good
faith by appropriate proceedings and are adequately reserved against in accordance with GAAP; and (ii) all other lawful claims which, if unpaid, would by law become a Lien upon its property not constituting a Permitted Lien. 

  
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 (l) Governmental
Approvals. Promptly obtain and maintain any and all authorizations, consents, approvals, licenses, franchises, concessions, leases, rulings, permits, certifications, exemptions, filings or registrations by or with any Governmental Authority
material and necessary for the Company and any such Subsidiary to conduct its business and own (or lease) its properties or to execute, deliver and perform this Note. 
 (m) Preliminary Annual Financial Statements. If Seth Hamot is no longer a member of Parent’s board of directors, provide Holder as soon as possible after the end of each fiscal year of the
Company, and in any event within sixty (60) days of the end of the Company’s fiscal year, preliminary year end financial statements, including but not limited to, the balance sheet and income statement for such year. 

(n) Reviewed Annual Financial Statements. If Seth Hamot is no longer a member of Parent’s board of directors, provide Holder
as soon as possible after the end of each fiscal year of the Company, and in any event within one hundred twenty (120) days of the end of the Company’s fiscal year: 
 (i) a complete copy of the Company’s financial statements, including but not limited to (1) the management letter, if any; (2) the balance sheet as of the close of the fiscal year; and
(3) the income statement for such year, together with a statement of cash flows, reviewed by a firm of independent certified public accountants of recognized standing and acceptable to Holder, or if permitted by Holder in writing, by the
Company. 
 (ii) a statement certified by the chief financial officer of the Company that the Company is in compliance with all
the terms, conditions, covenants, and warranties of this Note; and 
 (iii) a complete copy of all filings required under
securities law. 
 (o) Other Financial Statements. No later than thirty (30) days after the close of each month
(each, an “Accounting Period”), if Seth Hamot is no longer a member of Parent’s board of directors, provide Holder with the balance sheet of the Company as of the close of such Accounting Period and its income statement for
that portion of the then current fiscal year through the end of such Accounting Period certified by the chief financial officer of the Company as being complete, correct, and fairly representing its financial condition and the results of operations.

 (p) Tax Returns. If Seth Hamot is no longer a member of Parent’s board of directors, provide Holder copies of
each of the Company’s federal income tax returns, and any amendments thereto, within one hundred twenty (120) days after the end of the Company’s fiscal year. 
 (q) Fees and Expenses. Pay the out-of-pocket fees and expenses incurred by Holder in connection with the preparation and administration of this Note and any amendments, modifications or waivers of
the provisions hereof, including attorneys’ fees. Such fees will be indebtedness under this Note, and shall be due and payable on the date hereof and deducted from the proceeds of this Note. 

  
 -11-

  
 6. Negative
Covenants. So long as Obligations under this Note remain outstanding, the Company shall not, and, with respect to paragraphs (a) through (g) below, shall not permit any of its Subsidiaries to: 

(a) Liens. Create or suffer to exist any Lien on any assets of the Company or any such Subsidiary except Permitted Liens.

 (b) Debt. Incur any Debt other than Permitted Debt; prepay, redeem, purchase, defease or otherwise satisfy in any
manner prior to the scheduled repayment thereof any Permitted Debt (other than amounts due or permitted to be prepaid in respect of this Note, the March 2010 Note, the October 2010 Note and Debt permitted by clause (v) of the definition of
Permitted Debt); or amend, modify or otherwise change the terms of any Permitted Debt (other than this Note, the March 2010 Note, and Debt permitted by clause (v) of the definition of Permitted Debt) so as to accelerate the scheduled repayment
thereof or increase the principal amount of such Permitted Debt. 
 (c) Restrictions on Fundamental Changes. Enter into
any acquisition, merger, consolidation, reorganization, or recapitalization, or reclassify its capital stock, or liquidate, wind up, or dissolve itself (or suffer any liquidation or dissolution), become a partner in a partnership, a member or
equityholder of a joint venture, limited liability company or similar entity, or convey, sell, assign, lease, license, transfer, or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its business,
property, or assets (including shares of capital stock of the Company or any of its Subsidiaries), whether now owned or hereafter acquired, or acquire by purchase or otherwise all or substantially all of the properties, assets, stock, or other
evidence of beneficial ownership of any Person. 
 (d) Extraordinary Transactions and Disposal of Assets. Enter into any
transaction not in the ordinary course of the Business, including the sale, lease, license, moving, relocation, transfer or other disposition, whether by sale or otherwise, of any of the assets of the Company or its Subsidiaries except for sales of
inventory in the ordinary course of business or except as expressly permitted by this Note. 
 (e) Change Name. Change
the name of the Company or any of its Subsidiaries, Federal Employer Identification Number, business structure, or identity, or add any new fictitious name. To that effect, the Company shall not do business under any name other than the correct
legal name of the Company and its Subsidiaries, unless the Company has provided to Holder evidence that Company or such Subsidiary has taken such legal steps required with respect to fictitious or assumed names under the applicable laws of the
jurisdictions in which the Company or such Subsidiary is located and/or does business. 
 (f) Changes in Business. Enter
into or engage in any business other than that carried on (or contemplated to be carried on) as of the date hereof. 
 (g)
Distributions. Declare or pay any dividends or make any distribution of any kind on the Company’s or any such Subsidiary’s capital stock, or purchase, redeem or otherwise acquire, directly or indirectly, any shares of the
Company’s or such Subsidiary’s capital stock, any rights to acquire shares of capital stock of the Company or such Subsidiary, except for 

  
 -12-

 
the repurchase of such securities from former employees of or consultants to the Company or such Subsidiary at the original issue price paid therefor pursuant to contractual rights of the Company
or such Subsidiary upon the termination of such employees’ or consultants’ employment by or provision of service to the Company or such Subsidiary. 
 (h) Amendment of Organic Documents. Amend, supplement, or otherwise modify any of the provisions of the Organic Documents of the Company. 

(i) Investments. Make any Investments except Permitted Investments. 

(j) Accounting Changes. Change its fiscal year or make or permit any change in accounting policies or reporting practices, except
as required by GAAP. 
 (k) Subsidiaries. Organize, create or acquire any Subsidiary. 

(l) Transactions with Affiliates. Directly or indirectly enter into or permit to exist any material transaction with any of its
Affiliates except for transactions that are in the ordinary course of the business of the Company or unanimously approved by the Parent’s board of directors, upon fair and reasonable terms, that are fully disclosed to Holder prior to the
entering of such transactions, and that are no less favorable to the Company than would be obtained in arm’s length transaction with a non-Affiliate. 
 (m) Management. Make any significant change in its management without a minimum thirty (30) days’ prior written notice to Holder. 

(n) Suspension. Suspend or cease operations with respect to a substantial portion of its business except as unanimously approved
by the Parent’s board of directors. 
 7. Use of Proceeds. The Company shall use the proceeds from the amounts
loaned to the Company under this Note for general working capital and other lawful corporate purposes. 
 8. Default.

 (a) Events of Default. For purposes of this Note, any of the following events which shall occur shall constitute an
“Event of Default”: 
 (i) any indebtedness under this Note is not paid when and as the same shall become due
and payable, whether at maturity, by acceleration, five (5) days following notice of prepayment or otherwise; 
 (ii)
default shall occur in the observance or performance of (A) any covenant, obligation or agreement of the Company contained in Sections 5 or 6, or (B) any other provision of this Note, and, in the case of this clause (B), such default shall
continue uncured for a period of ten (10) days; 
 (iii) any representation, warranty or certification made herein by or
on behalf of the Company or any of its Subsidiaries shall prove to have been false or incorrect in any material respect on the date or dates as of which made (any such falsity being a “Representation Default”); 

  
 -13-

  
 (iv) the Company
shall (A) apply for or consent to the appointment of a receiver, trustee, custodian or liquidator of itself or any part of its property, (B) become subject to the appointment of a receiver, trustee, custodian or liquidator for itself or
any part of its property, (C) make an assignment for the benefit of creditors, (D) fail generally, become unable or admit in writing to its inability to pay its debts as they become due, (E) institute any proceedings under the United
States Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar law affecting the rights of creditors generally, or file a petition or answer seeking reorganization or an arrangement with
creditors to take advantage of any insolvency law, or file an answer admitting the material allegations of a bankruptcy, reorganization or insolvency petition filed against it, or (F) become subject to any involuntary proceedings under the
United States Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar law affecting the rights of creditors generally; 

(v) the Company shall (i) liquidate, wind up or dissolve (or suffer any liquidation, wind-up or dissolution), except to the extent
expressly permitted by Section 6, (ii) suspend its operations other than in the ordinary course of business, or (iii) take any action to authorize any of the actions or events set forth above in this Section 8(a)(v); 

(vi) the Company or any Subsidiary (i) fails to make any payment beyond the applicable grace period, if any, whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise, (a) under the BFI Loan Documents, (b) under the March 2010 Note, (c) under the October 2010 Note or (d) in respect of any Debt (other than the Debt hereunder, the
Debt under the BFI Loan Documents and the Debt under the March 2010 Note and October 2010 Note) having an aggregate outstanding principal amount (individually or in the aggregate with all other Debt as to which such a failure shall exist) of not
less than $5,000, (ii) fails to observe or perform any other agreement or condition relating to (a) the BFI Loan Documents, (b) the March 2010 Note, (c) the October 2010 Note or (d) any such Debt described in clause (i)(d)
above, or any other event occurs, the effect of which default or other event is to cause, or to permit the holder or holders of the BFI Loan Documents, the March 2010 Note, the October 2010 Note or any such Debt described in (i)(d) above (or a
trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, the Debt under the BFI Loan Documents, the March 2010 Note, the October 2010 Note or the Debt described in (i)(d)
above to become due or to be repurchased, prepaid, defeased or redeemed (automatically or otherwise); 
 (vii) Parent shall
breach the terms of the Design, Manufacturing and Distribution License between O’Neill Trademark BV as Licensor and Parent as Licensee, or the Trademark Sublicense Agreement by and between Margaritaville Eyewear, LLC as Sublicensor and Parent
as Sublicensee (each, a “License Agreement”), or any other event occurs under or in connection with a License Agreement, the effect of such breach or other event is to cause, or to permit to cause, the licensor under such License
Agreement to terminate the License Agreement or reduce in scope or duration any aspect of the License Agreement; 

  
 -14-

  
 (viii) any final
judgment or judgments for the payment of money shall be rendered against the Company in excess of $5,000 which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged or stayed pending appeal, or are not
discharged within thirty (30) days after the expiration of such stay, other than any judgment which is covered by insurance or an indemnity from a credit worthy party; provided that the Company provides Holder a written statement from such
insurer or indemnity provider (which written statement shall be reasonably satisfactory to Holder) to the effect that such judgment is covered by insurance or an indemnity and the Company will receive the proceeds of such insurance or indemnity
within 30 days of the issuance of such judgment; or 
 (ix) this Note shall for any reason cease to be, or shall be asserted by
the Company not to be, a legal, valid and binding obligation of the Company. 
 (b) Consequences of Events of Default.

 (i) If any Event of Default shall occur for any reason, whether voluntary or involuntary, and be continuing, Holder may,
upon notice or demand, declare the outstanding Obligations under this Note to be due and payable, whereupon the outstanding Obligations under this Note shall be and become immediately due and payable, and the Company shall immediately pay to Holder
all such Obligations. Upon the occurrence of an actual or deemed entry of an order for relief with respect to the Company under the United States Bankruptcy Code, then all Obligations under this Note shall automatically be due immediately without
notice of any kind. The Company agrees to pay Holder all out-of-pocket costs and expenses incurred by Holder (including attorney’s fees) in connection with the enforcement or protection of its rights in relation to this Agreement, including any
suit, action, claim or other activity of the Holder to collect or otherwise enforce the Obligations under this Note or any portion thereof, or in connection with the transactions contemplated hereby. 

(ii) Holder shall also have any other rights which Holder may have been afforded under any contract or agreement at any time and any
other rights which Holder may have pursuant to applicable law. 
 9. Lost, Stolen, Destroyed or Mutilated Note. In case
this Note shall be mutilated, lost, stolen or destroyed, the Company shall issue a new Note of like date, tenor and denomination and deliver the same in exchange and substitution for and upon surrender and cancellation of such mutilated Note, or in
lieu of this Note being lost, stolen or destroyed, upon receipt of evidence satisfactory to the Company of such loss, theft or destruction. 
 10. Waiver of Jury Trial. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, THE COMPANY (BY ITS EXECUTION HEREOF) AND THE HOLDER (BY ITS ACCEPTANCE OF THIS NOTE) WAIVES AND
COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE OR ACTION ARISING OUT OF OR BASED UPON OR RELATING TO THIS NOTE OR IN ANY WAY CONNECTED WITH OR RELATED
OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING. 

  
 -15-

  
 11. Governing
Law. This Note shall be deemed to be a contract made under the laws of the State of New York and for all purposes shall be governed by, construed under, and enforced in accordance with the laws of the State of New York. 

12. Amendment and Waiver. Any term of this Note may be amended and the observance of any term of this Note may be waived (either
generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and Holder. 
 13. Notices. Any notice or other communication in connection with this Note may be made and is deemed to be given as follows: (i) if in writing and delivered in person or by courier, on the
date when it is delivered; (ii) if by facsimile, when received at the correct number (proof of which shall be an original facsimile transmission confirmation slip or equivalent); or (iii) if sent by certified or registered mail or the
equivalent (return receipt requested), on the date such mail is delivered, unless the date of that delivery is not a Business Day or that communication is delivered on a Business Day but after the close of business on such Business Day in which case
such communication shall be deemed given and effective on the first following Business Day. Any such notice or communication given pursuant to this Note shall be addressed to the intended recipient at its address or number (which may be changed by
either party at any time) specified as follows: 
  

			
	 If to the Company:
	 	 Orange 21 North America, Inc.

2070 Las Palmas Drive
 Carlsbad, CA
92011
 Facsimile No.: (760) 804-8420
 Telephone No.: (760) 804-8421
 Attention: Chief Executive Officer

		
	 With a copy to:
	 	 Sheppard, Mullin, Richter & Hampton LLP
 12275 El Camino Real, Suite 200
 San Diego, CA 92130-2006

Facsimile No.: (858) 509-3691
 Attention:
John Hentrich, Esq.

		
	 If to Holder:
	 	 Costa Brava Partnership III, L.P.
 c/o Roark, Rearden & Hamot, LLC
 420 Boylston St, Suite 5-F

Boston, MA 02116
 Facsimile No:
(617) 267-6785
 Attention: Seth W. Hamot, President

		
	 With a copy to:
	 	 Ropes & Gray LLP

Prudential Tower
 Boston, MA 02199

Facsimile No: (617) 951-7050
 Attention:
David A. Fine, Esq. and Jeffrey R. Katz, Esq.

  
 -16-

  
 14.
Severability. If at any time any provision of this Note shall be held by any court of competent jurisdiction to be illegal, void or unenforceable, such provision shall be of no force and effect, but the illegality or unenforceability of such
provision shall have no effect upon the legality or enforceability of any other provision of this Note. 
 15.
Assignment. The provisions of this Note shall be binding upon and inure to the benefit of each of the Company and the Holder and their respective successors and assigns, provided that the Company shall not have the right to assign its rights
and obligations hereunder or any interest herein. This Note may be endorsed, assigned and transferred in whole or in part by the Holder to any other Person. 
 16. Indemnity. The Company agrees to indemnify the Holder, and its respective directors, officers, employees and agents (each such Person being called an “Indemnitee”) against, and
to hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including reasonable counsel fees, charges and disbursements, incurred by or asserted against any Indemnitee arising out of in any way
connected with, or as a result of (i) the execution or delivery of this Note or any agreement or instrument contemplated thereby, the performance by the parties thereto of their respective obligations thereunder or the consummation of the
transactions contemplated thereby or (ii) any breach by the Company of its obligations under this Note or any agreement or instrument contemplated thereby. 
 17. Remedies Cumulative; Failure or Indulgence Not a Waiver. The remedies provided in this Note shall be cumulative and in addition to all other remedies available under this Note. No failure or
delay on the part of Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of
any other right, power or privilege. 
 18. Excessive Interest. Notwithstanding any other provision herein to the
contrary, this Note is hereby expressly limited so that the interest rate charged hereunder shall at no time exceed the maximum rate permitted by applicable law. If, for any circumstance whatsoever, the interest rate charged exceeds the maximum rate
permitted by applicable law, the interest rate shall be reduced to the maximum rate permitted, and if Holder shall have received an amount that would cause the interest rate charged to be in excess of the maximum rate permitted, such amount that
would be excessive interest shall be applied to the reduction of the principal amount owing hereunder (without charge for prepayment) and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal, such
excess shall be refunded to the Company. 
 Further, notwithstanding any other provision herein to the contrary, and without any
further action from the parties to this Note, if the fees (except with respect to paragraph 16) and interest charged hereunder shall be determined by a court of competent jurisdiction to be a “financial benefit” for purposes of 8 §
203(c)(v) of the General Corporation Law of the State of Delaware, this Note shall be deemed amended to eliminate such fees and reduce such interest rate to 0%. If Holder shall have received any such fees or interest, such amounts shall be applied
to the reduction of the principal amount owing hereunder (without charge for prepayment), or if such fees and interest paid to the Holder exceed the unpaid balance of principal, such excess shall be refunded to the Company. 

  
 -17-

  
 19. Registered
Obligation. The Company shall establish and maintain a record of ownership (the “Register”) in which it will register by book entry the interest of the initial Holder and of each subsequent assignee in this Note, and in the
right to receive any payments of principal and interest or any other payments hereunder, and any assignment of any such interest. The Company shall make appropriate entries in the Register to reflect any assignment promptly following receipt of
written notice from the assignor of such assignment. Notwithstanding anything herein to the contrary, this Note is intended to be treated as a registered obligation for federal income tax purposes and the right, title, and interest of the Holder and
its assignees in and to payments under this Note shall be transferable only upon notation of such transfer in the Register. This Section shall be construed so that the Note is at all times maintained in “registered form” within the meaning
of Sections 163(f), 871(h)(2) and 881(c)(2) of the Internal Revenue Code and any related regulations (or any successor provisions of the Code or such regulations). 
 20. Entire Agreement. This Note contains the entire understanding of the parties with respect to the subject matter hereof and supersedes all prior agreements, understandings, discussions and
representations, oral or written, with respect to such matters, which the parties acknowledge have been merged into this Note. 

21. Waiver of Notice. To the extent permitted by law, the Company hereby waives demand, notice, protest and all other demands and
notices in connection with the delivery, acceptance, performance, default or enforcement of this Note. 
 22.
Subordination. This Promissory Note and each of Holder’s rights and privileges hereunder is expressly subject to the terms of that certain Debt Subordination Agreement by and between BFI Business Finance and Holder dated the date hereof.

 [Remainder of Page Intentionally Left Blank] 

  
 -18-

  
 IN WITNESS WHEREOF,
the each of the undersigned has caused this Note to be duly executed by its officers, thereunto duly authorized as of the date first above written. 
  

			
	THE COMPANY:
	
	ORANGE 21 NORTH AMERICA INC.
		
	 By:
	 	 /s/ A. Stone Douglass

	 Name:
	 	A. Stone Douglass
	 Title:
	 	CFO

  
 -19-

  
 SCHEDULE A

 Debt 
 See attached. 

  
 -20-

  
 SCHEDULE B

 Liens 
 See attached. 

  
 -21-

  
 SCHEDULE C

 Exceptions 
 See attached. 

  
 -22-

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