1

FILED
2 2023 JUL 07 03:36 PM
KING COUNTY
3 SUPERIOR COURT CLERK
E-FILED
4 CASE #: 23-2-12298-4 SEA

7 SUPERIOR COURT OF WASHINGTON FOR KING COUNTY

8 LIGHTER CAPITAL QUINCY SPV LLC, a Case No.
Delaware limited liability company,
9 PETITION FOR APPOINTMENT OF
Petitioner, GENERAL RECEIVER
10
v.
11
PACIFIC EPOCH HOLDINGS, LLC, a
12 Delaware limited liability company, and JLM
PACIFIC EPOCH LLC, a Delaware limited
13 liability company,
14 Respondents.
15
Petitioner Lighter Capital Quincy SPV LLC, a Delaware limited liability company
16
(“Lighter Capital”), for its claims for relief against Respondents Pacific Epoch Holdings, LLC, a
17
Delaware limited liability company, and JLM Pacific Epoch LLC, a Delaware limited liability
18
company (each individually and collectively, the “Borrower”), alleges as follows:
19
I. PARTIES, JURISDICTION, AND VENUE
20
1.1. Lighter Capital is and was at all times material hereto a Delaware limited liability
21
company, with its principal place of business in Seattle, Washington. Lighter Capital is duly
22
qualified to bring this action, having met all legal prerequisites.
23
1.2. Pacific Epoch Holdings, LLC (“Pacific Epoch”) is and was at all times material
24
hereto a Delaware limited liability company, with its principal place of business in Seattle,
25
Washington.
26

27

PETITION FOR APPOINTMENT OF GENERAL LANE POWELL PC

1420 FIFTH AVENUE, SUITE 4200
RECEIVER - 1 P.O. BOX 91302
SEATTLE, WASHINGTON 98111-9402
206.223.7000 FAX: 206.223.7107
132020.0032/9431628.4
 1 1.3. JLM Pacific Epoch LLC (“JLM”) is and was at all times material hereto a Delaware
2 limited liability company, with its principal place of business in Seattle, Washington.
3 1.4. Venue and jurisdiction are proper pursuant to RCW 4.12.025 in that Borrower
4 resides in King County, Washington and the parties contractually agreed to the jurisdiction and
5 venue of the Superior Court of the State of Washington for King County.
6 II. FACTUAL BACKGROUND
7 2.1. Lighter Capital realleges and incorporates by reference paragraphs 1.1 through 1.4
8 of this Petition as though fully set forth herein.
9 2.2. Lighter Capital, as assignee from Lighter Capital, Inc., and Borrower are parties to
10 a Loan and Security Agreement dated as of August 13, 2021 (together with all schedules and
11 exhibits thereto, in each case, as amended, modified or otherwise supplemented from time to time,
12 the “Loan Agreement”), as amended by that certain First Amendment to Loan and Security
13 Agreement dated as of June 29, 2022, and that certain Second Amendment to Loan and Security
14 Agreement dated as of March 24, 2023, in each case by and between Borrower and Lighter Capital,
15 under the terms and conditions of which, Lighter Capital extended commercial loans to Borrower
16 in the aggregate stated principal amount of One Million Seven Hundred Ninety-Seven Thousand
17 Seven Hundred Seventy-Seven and 80/100 Dollars ($1,797,777.80) (collectively, the “Loans”). A
18 true and correct copy of the Loan Agreement, as amended, is attached hereto as Exhibit A and
19 incorporated herein by reference.
20 2.3. Under the terms of the Loan Agreement, Borrower promised and agreed to (i) make
21 regularly monthly payments of principal and interest on each of the Loans on the fifth calendar
22 day of each month while any Loan obligations remain outstanding, and (ii) perform in accordance
23 with various other covenants set forth therein.
24 2.4. In the event of default, the Loan Agreement provides for default interest at a rate
25 equal to five (5) percentage points above the interest rate applicable immediately prior to the
26 occurrence of the Event of Default (hereinafter the “Default Rate”).
27

PETITION FOR APPOINTMENT OF GENERAL LANE POWELL PC

1420 FIFTH AVENUE, SUITE 4200
RECEIVER - 2 P.O. BOX 91302
SEATTLE, WASHINGTON 98111-9402
206.223.7000 FAX: 206.223.7107
132020.0032/9431628.4




   

PACIFIC EPOCH HOLDINGS LLC

JLM PACIFIC EPOCH LLC
AND
LIGHTER CAPITAL, INC.

LOAN AND SECURITY AGREEMENT





   

(e) Liens arising from judgments, decrees or attachments in circumstances not

constituting an Event of Default hereunder;

(f) Liens incurred in connection with the extension, renewal or refinancing of the
indebtedness secured by Liens of the type described in clauses (a) and (c) above, 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
indebtedness being extended, renewed or refinanced does not increase; and

(g) other Liens as may be consented to in writing by Lender from time to time
(including Liens in favor of banks or financial institutions providing working capital facilities to Borrower which may
be senior to Lender’s Lien, subject to an intercreditor agreement in form and substance reasonably satisfactory to
Lender).

“Person” means any individual, sole proprietorship, partnership, limited liability company, joint venture,
trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock
company, estate, entity or governmental agency.

“Prepayment Fee” means a fee due upon prepayment of the Term Loan equal to (a) twelve (12) months of
interest calculated based on the outstanding principal balance of the Term Loan if such prepayment occurs prior to the
first anniversary of the Closing Date, (b) six (6) months of interest calculated based on the outstanding principal
balance of the Term Loan if such prepayment occurs on or after the first anniversary but prior to the second anniversary
of the Closing Date, (c) three (3) months of interest calculated based on the outstanding principal balance of the Term
Loan if such prepayment occurs on or after the second anniversary of the Closing Date.

“Prime Rate” means the Prime Rate published in the Money Rates section of the Western Edition of The
Wall Street Journal.

“Responsible Officer” means the individuals acting in the capacity of Borrower’s chief executive officer,
chief operating officer, and chief financial officer or controller, which, as of the Closing Date is Joseph Berger as
CEO.

“Schedule” means the schedule of exceptions attached hereto and as may be amended from time to time, and
approved by Lender, if any.

“Shares” means all of the issued and outstanding capital stock, membership units or other securities of any
Person (including any Subsidiary of Borrower) owned or held of record by Parent or any Subsidiary of Parent.

“Subordinated Debt” means any debt incurred by Borrower that is subordinated to the debt owing by
Borrower to Lender on terms acceptable to Lender (and identified as being such by Borrower and Lender), pursuant
to a subordination agreement in form and substance satisfactory to Lender.

“Subsidiary” means, as to any Person, a corporation, partnership, limited liability company or other entity of
which shares of stock or other ownership interests having ordinary voting power to elect a majority of the board of
directors or other managers of such corporation, partnership or other entity are at the time owned, or the management
of which is otherwise controlled, directly or indirectly through one or more intermediaries (including any Affiliate),
or both, by such Person. Unless the context otherwise requires, each reference to a Subsidiary herein shall be a
reference to a Subsidiary of Borrower.

“Term Loan Facility” means an aggregate amount not to exceed $1,000,000.00

“Term Loan Maturity Date” means the 36 month anniversary of the Closing Date.
 1 4.3. Borrower’s management stated its intent to wind down.
2 4.4. Borrower has demonstrated that it lacks the ability and resources to protect and
3 preserve its business operations (the “Business”), assets, and all tangible and intangible property
4 owned by Borrower, including, without limitation, the Collateral (together with the Business, the
5 “Assets”).
6 4.5. Lighter Capital holds an interest the Assets, in that substantially all of the Assets
7 are its Collateral.
8 4.6. The Collateral and its revenue producing potential are in danger of being lost,
9 materially injured or impaired, and dissipated.
10 4.7. Appointment of a receiver is necessary to protect, preserve, and maximize the value
11 of the Assets, including, without limitation, the Collateral, and to avoid further loss, injury and
12 impairment to the Assets, and protect the Assets’ revenue producing potential.
13 4.8. Lighter Capital seeks appointment of a general receiver in accordance with RCW
14 7.60 et seq. given (i) the Assets and their revenue-producing potential are in danger of being lost,
15 materially injured or impaired, and dissipated; (ii) Borrower is insolvent or in imminent danger of
16 insolvency; and (iii) the reasonable necessity to protect and preserve the Assets (including, without
17 limitation, the Collateral), and to avoid further loss, injury, and impairment thereto.
18 4.9. Lighter Capital is entitled to appointment of a receiver pursuant to RCW
19 7.60.025(1)(a), (i) and (nn).
20 4.10. Revitalization Partners, L.L.C. is qualified to act as a general receiver over
21 Borrower and the Assets, including, but not limited to, the Collateral.
22 WHEREFORE, Lighter Capital prays for relief as follows:
23 1. For an Order appointing an independent party as general receiver to take possession
24 and control of Borrower and the Assets, including, without limitation, the Collateral, with the
25 power of sale.
26 //
27

PETITION FOR APPOINTMENT OF GENERAL LANE POWELL PC

1420 FIFTH AVENUE, SUITE 4200
RECEIVER - 5 P.O. BOX 91302
SEATTLE, WASHINGTON 98111-9402
206.223.7000 FAX: 206.223.7107
132020.0032/9431628.4
 1 2. For such other and further relief as the Court deems just and proper.
2 DATED this 7th day of July, 2023.
3 LANE POWELL PC
4

5 By /s/Gregory R. Fox
Gregory R. Fox, WSBA No. 30559
6 James B. Zack, WSBA No. 48122
Attorneys for Petitioner Lighter Capital Quincy
7 SPV LLC
8

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

PETITION FOR APPOINTMENT OF GENERAL LANE POWELL PC

1420 FIFTH AVENUE, SUITE 4200
RECEIVER - 6 P.O. BOX 91302
SEATTLE, WASHINGTON 98111-9402
206.223.7000 FAX: 206.223.7107
132020.0032/9431628.4
 Exhibit “A”

Loan Agreement




   

and cash flow statement covering Parent’s consolidated operations during such period, prepared in accordance with
GAAP, consistently applied, or prepared using commonly accepted methods of recording and reporting of Borrower's
accounting information applied on a consistent basis, in a form acceptable to Lender and certified by a Responsible
Officer, (ii) [reserved], (iii) a Compliance Certificate signed by a Responsible Officer in substantially the form of
Exhibit D hereto, (iv) an inventory report (if applicable), and (v) deferred revenue schedule (if applicable); (c) as soon
as available, but in any event within one hundred twenty (120) days after the end of Parent’s fiscal year, consolidated
financial statements of Parent prepared in accordance with GAAP, consistently applied, or prepared using commonly
accepted methods of recording and reporting of Borrower's accounting information applied on a consistent basis; (d)
as soon as available, but in any event no later than the earlier to occur of thirty (30) days following the beginning of
each fiscal year or the date of approval by Parent’s board of directors/managers, an annual operating budget and
financial projections (including income statements, balance sheets and cash flow statements) for such fiscal year,
presented in a monthly format, approved by Parent’s board of directors/manager, and in a form and substance
acceptable to Lender; (e) copies of all statements, reports and notices sent or made available generally by Borrower
to its security holders or to any holders of Subordinated Debt and, if applicable, all reports on Forms 10-K and 10-Q
filed with the Securities and Exchange Commission; (f) promptly upon receipt of notice thereof, a report of any legal
actions pending or threatened against Borrower or any Subsidiary that could result in damages or costs to Borrower
or any Subsidiary of at least the Threshold Amount; (g) as soon as available, but in any event within ten (10) days of
filing, copies of Borrower's federal annual and quarterly tax returns and filings, and Borrower's state annual tax return
and (h) such budgets, sales projections, operating plans or other financial information and copies of notices, minutes,
consents and other material provided to Borrower’s board of directors/managers, as Lender may reasonably request
from time to time.

6.4 Annual Financial Audits. Borrower shall prepare its financial statements in accordance
with GAAP or prepared using commonly accepted methods of recording and reporting Borrower’s accounting
information applied on a consistent basis, and in form and substance reasonably satisfactory to Lender, which, at
Lender’s option and expense if an Event of Default has occurred and is continuing, may be audited by certified public
accountants; provided however, that the expense of any such audited financial statements shall be borne by Borrower
if (i) Borrower’s annual gross revenues exceed $10,000,000 or (ii) the audit results in the restatement of the financial
statements previously provided to Lender due to a discrepancy in excess of ten percent (10%) regarding Borrower’s
aggregate revenue, expenses, income, asset or liabilities for the reporting period as previously report by Borrower to
Lender.

6.5 Collateral Audits. Lender may audit the Collateral at Lender’s expense. Such audits will
be conducted no more often than annually unless an Event of Default has occurred and is continuing, in which case,
the audits will be at Borrower’s expense and may occur more frequently than annually. Unless an Event of Default
has occurred and is continuing, Lender will give Borrower ten (10) days advance notice of its intent to audit.

6.6 Taxes. Borrower shall make, and shall cause each Subsidiary to make, due and timely
payment or deposit of all federal, state, and local taxes, assessments, or contributions, and all tax payments and
withholding taxes required of it by applicable law, and will execute and deliver to Lender, on demand, appropriate
certificates attesting to the payment or deposit thereof. Without limiting the foregoing, Borrower will make, and will
cause each Subsidiary to make, timely payment or deposit of all amounts required by laws concerning F.I.C.A.,
F.U.T.A., state disability, unemployment, workers compensation, ERISA, and local, state, and federal income taxes,
and will, upon request, furnish Lender with proof satisfactory to Lender indicating that Borrower or a Subsidiary has
made such payments or deposits; provided that Borrower or a Subsidiary need not make any payment if the amount
or validity of such payment is contested in good faith by appropriate proceedings and is reserved against (to the extent
required by GAAP) by Borrower.

6.7 Insurance.

(a) Borrower shall maintain insurance on the Collateral and Borrower’s business in
such amounts and in such types as are reasonable and customary for similar businesses. The Collateral insurance shall
include a lender’s loss payable endorsement in favor of Lender as an additional loss payee, and Borrower shall provide




   




This LOAN AND SECURITY AGREEMENT is entered into as of /d2/ , by and between
LIGHTER CAPITAL, INC. (“Lender”), PACIFIC EPOCH HOLDINGS LLC (“Parent”), and JLM PACIFIC EPOCH
LLC (“JLM”).

RECITALS

Borrower wishes to obtain credit from time to time from Lender, and Lender desires to extend credit to
Borrower. This Agreement sets forth the terms on which Lender will advance credit to Borrower, and Borrower will
repay the amounts owing to Lender.

AGREEMENT

The parties agree as follows:

1. DEFINITIONS AND CONSTRUCTION.

1.1 Definitions. As used in this Agreement, the following terms shall have the following
definitions:

“Accounts” means all presently existing and hereafter arising accounts, contract rights, payment intangibles,
and all other forms of obligations owing to Borrower arising out of the sale or lease of goods (including, without
limitation, the licensing of software and other technology) or the rendering of services by Borrower, whether or not
earned by performance, and any and all credit insurance, guaranties, and other security therefor, as well as all
merchandise returned to or reclaimed by Borrower and Borrower’s Books relating to any of the foregoing.

“Affiliate” means, with respect to any Person, any Person that owns or controls directly or indirectly such
Person, any Person that controls or is controlled by or is under common control with such Person, and each of such
Person’s senior executive officers and directors.

“Borrower” means each of Parent and JLM, and any other Person joined as a borrower hereunder after the
Closing Date, each individually, and collectively.

“Borrower’s Books” means all of Borrower’s books and records including: ledgers; records concerning
Borrower’s assets or liabilities, the Collateral, business operations or financial condition; and all computer programs,
or tape files, and the equipment, containing such information.

“Business Day” means any day other than a Saturday, a Sunday or a national banking holiday.

“Change in Control” shall mean a transaction in which:

(a) the equity owners of the Borrower as of the Closing Date, taken together, cease to hold,
directly or indirectly: (i) more than fifty percent (50%) of (A) the outstanding capital stock or other units of ownership
of the Borrower or (B) the majority of capital accounts of the owners of the Borrower if Borrower is a limited liability
company; or (ii) the issued shares of capital stock or other units of ownership having the right to cast more than fifty
percent (50%) of the votes capable of being cast in general meetings of the owners of the Borrower;

(b) the equity owners of Borrower as of the Closing Date cease, directly or indirectly, to have
the power (whether by way of ownership or shares, proxy, contract, agency or otherwise) to appoint or remove all or
the majority of the directors or managers or other equivalent authorized persons or officers of the Borrower;

(c) at any time, any Person, or group of Persons acting in concert, acquires control of the
Borrower (where “acting in concert” means a group of Persons who, pursuant to an agreement or understanding,
whether formal or informal, actively co-operate to obtain or consolidate control of the Borrower); or




   

(d) Parent ceases to be the sole member and sole manager of JLM.

“Closing Date” means the date of this Agreement.

“Code” means the Washington Uniform Commercial Code.

“Collateral” means the property described on Exhibit A attached hereto.

“Contingent Obligation” means, as applied to any Person, any direct or indirect liability, contingent or
otherwise, of that Person with respect to (i) any indebtedness, lease, dividend, letter of credit or other obligation of
another; (ii) any obligations with respect to undrawn letters of credit, corporate credit cards, or merchant services
issued or provided for the account of that Person; and (iii) all obligations arising under any agreement or arrangement
designed to protect such Person against fluctuation in interest rates, currency exchange rates or commodity prices;
provided, however, that the term “Contingent Obligation” shall not include endorsements for collection or deposit in
the ordinary course of business. The amount of any Contingent Obligation shall be deemed to be an amount equal to
the stated or determined amount of the primary obligation in respect of which such Contingent Obligation is made or,
if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by Lender
in good faith; provided, however, that such amount shall not in any event exceed the maximum amount of the
obligations under the guarantee or other support arrangement.

“Copyrights” means any and all copyright rights, copyright applications, copyright registrations and like
protections in each work of authorship and derivative work thereof.

“Credit Extension” means each Term Loan or any other extension of credit by Lender for the benefit of
Borrower hereunder

“Daily Balance” means the amount of the Obligations owed at the end of a given day.

“Equipment” means all present and future machinery, equipment, tenant improvements, furniture, fixtures,
vehicles, tools, parts and attachments in which Borrower has any interest.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and the regulations
thereunder.

“Event of Default” has the meaning assigned in Article 8.

“Financial Account” means any depository, operating, or investment accounts maintained by Borrower or
any Subsidiary of Borrower.

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

“Governmental Authority” means any federal, state, provincial, municipal and foreign governmental entity,
authority, or agency or any other political subdivision, or any entity exercising executive, legislative judicial,
regulatory or administrative functions of government.

“Indebtedness” means (a) all indebtedness for borrowed money or the deferred purchase price of property or
services, including without limitation reimbursement and other obligations with respect to surety bonds and letters of
credit, (b) all obligations evidenced by notes, bonds, debentures or similar instruments, (c) all capital lease obligations
and (d) all Contingent Obligations.

“Insolvency Proceeding” means any proceeding commenced by or against any person or entity under any
provision of the United States Bankruptcy Code, as amended, or under any other bankruptcy or insolvency law,




   

ACH Authorization Form and Authorization Agreement for Pre-Authorized Payments (Debit)

Company Name: JLM PACIFIC EPOCH LLC (the “Borrower”)

The undersigned hereby authorizes Lighter Capital, Inc. (the “Lender”) and the financial institution or other
provider named below (“Bank”) to electronically charge Borrower’s account specified below for payments due.

Bank Name Wells Fargo NA

Branch Location (Where account was P.O. Box 6995, Portland, OR

opened)

Bank Transit/ABA Number 6800

Account Number 6758

Checking or Savings Account Checking

Account Name JLM Pacific Epoch LLC

PayPal Account Account Name N/A

PayPal Account E-Mail Address N/A

Other Electronic Account Name N/A

Other Account E-Mail Address N/A

This authority is to remain in full force and effect until Lender and Bank have received written notification from the
undersigned of its termination in such time and in such manner as to afford the Lender and Bank a reasonable
opportunity to act on it. Following termination of the authority granted hereby, Borrower shall make all payments
due the Lender at such time and in such manner as set forth in that certain Loan and Security Agreement by and
between Lender and Borrower.

Authorized Party: By:

Name: 

Title:

Company Tax ID Number: 5306





   

“Periodic Payments” means all installments or similar recurring payments that Borrower may now or
hereafter become obligated to pay to Lender pursuant to the terms and provisions of any instrument, or agreement
now or hereafter in existence between Borrower and Lender, .

“Permitted Distributions” means, with respect to any tax period during which the Borrower has been treated
as a pass through entity for federal income tax purposes, distributions to each shareholder or member of Borrower, as
the case may be (“Owner”), in an amount equal the amount of the federal, state and local income tax liabilities of such
Owner attributable to such Owner’s share of Borrower’s taxable income (giving effect for such purpose any
deductions, losses, and basis adjustments available to such Owner); provided that (i) such distributions shall be made
no more frequently than quarterly; (ii) such distributions may not be made later than one year after the tax period in
which the Owner’s applicable tax liability accrued or earlier than thirty (30) days before the Owner’s applicable taxes
become due; (iii) the aggregate of such distributions to all Owners in respect of any tax period shall not exceed the
aggregate amount of state, local and federal taxes that would otherwise have been payable by the Borrower had it not
been treated as a pass through entity (the “Borrower’s Base Tax Liability”), and (iv) the aggregate amount of such
distributions to any Owner in respect of any tax period shall not exceed the product of the Borrower’s Base Tax
Liability in respect of such period and such Owner’s percentage ownership interest in the Borrower during such
period.

“Permitted Indebtedness” means:

(a) Indebtedness of Borrower in favor of Lender arising under this Agreement or any
other Loan Document;

(b) Indebtedness existing on the Closing Date and disclosed in the Schedule;

(c) Indebtedness secured by a lien described in clause (c) of the defined term
“Permitted Liens,” provided such Indebtedness does not exceed the lesser of the cost or fair market value of the
equipment financed with such Indebtedness;

(d) Indebtedness to trade creditors incurred in the ordinary course of business;

(e) Subordinated Debt; and

(f) other Indebtedness as may be consented to in writing by Lender.

“Permitted Liens” means the following:

(a) Any Liens existing on the Closing Date and disclosed in the Schedule or arising
under this Agreement or the other Loan Documents;

(b) Liens for taxes, fees, assessments or other governmental charges or levies, either
not delinquent or being contested in good faith by appropriate proceedings, provided the same have no priority over
any of Lender’s security interests;

(c) Liens (i) upon or in any equipment which was not financed by Lender acquired or
held by Borrower or any of its Subsidiaries to secure the purchase price of such equipment or indebtedness incurred
solely for the purpose of financing the acquisition of such equipment, or (ii) existing on such equipment at the time of
its acquisition, provided that the Lien is confined solely to the property so acquired and improvements thereon, and
the proceeds of such equipment;

(d) leases or subleases and licenses or sublicenses of Borrower’s property granted by

Borrower in the ordinary course of Borrower’s business;




   

(e) Liens arising from judgments, decrees or attachments in circumstances not

constituting an Event of Default hereunder;

(f) Liens incurred in connection with the extension, renewal or refinancing of the
indebtedness secured by Liens of the type described in clauses (a) and (c) above, 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
indebtedness being extended, renewed or refinanced does not increase; and

(g) other Liens as may be consented to in writing by Lender from time to time
(including Liens in favor of banks or financial institutions providing working capital facilities to Borrower which may
be senior to Lender’s Lien, subject to an intercreditor agreement in form and substance reasonably satisfactory to
Lender).

“Person” means any individual, sole proprietorship, partnership, limited liability company, joint venture,
trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock
company, estate, entity or governmental agency.

“Prepayment Fee” means a fee due upon prepayment of the Term Loan equal to (a) twelve (12) months of
interest calculated based on the outstanding principal balance of the Term Loan if such prepayment occurs prior to the
first anniversary of the Closing Date, (b) six (6) months of interest calculated based on the outstanding principal
balance of the Term Loan if such prepayment occurs on or after the first anniversary but prior to the second anniversary
of the Closing Date, (c) three (3) months of interest calculated based on the outstanding principal balance of the Term
Loan if such prepayment occurs on or after the second anniversary of the Closing Date.

“Prime Rate” means the Prime Rate published in the Money Rates section of the Western Edition of The
Wall Street Journal.

“Responsible Officer” means the individuals acting in the capacity of Borrower’s chief executive officer,
chief operating officer, and chief financial officer or controller, which, as of the Closing Date is Joseph Berger as
CEO.

“Schedule” means the schedule of exceptions attached hereto and as may be amended from time to time, and
approved by Lender, if any.

“Shares” means all of the issued and outstanding capital stock, membership units or other securities of any
Person (including any Subsidiary of Borrower) owned or held of record by Parent or any Subsidiary of Parent.

“Subordinated Debt” means any debt incurred by Borrower that is subordinated to the debt owing by
Borrower to Lender on terms acceptable to Lender (and identified as being such by Borrower and Lender), pursuant
to a subordination agreement in form and substance satisfactory to Lender.

“Subsidiary” means, as to any Person, a corporation, partnership, limited liability company or other entity of
which shares of stock or other ownership interests having ordinary voting power to elect a majority of the board of
directors or other managers of such corporation, partnership or other entity are at the time owned, or the management
of which is otherwise controlled, directly or indirectly through one or more intermediaries (including any Affiliate),
or both, by such Person. Unless the context otherwise requires, each reference to a Subsidiary herein shall be a
reference to a Subsidiary of Borrower.

“Term Loan Facility” means an aggregate amount not to exceed $1,000,000.00

“Term Loan Maturity Date” means the 36 month anniversary of the Closing Date.




   

“Threshold Amount” means the amount equal to the lesser of (i) Fifty Thousand Dollars ($50,000) or (ii)
10% of the sum of the original principal amount of all Credit Extensions made to Borrower.

“Trademarks” means any trademark and servicemark rights, whether registered or not, applications to register
and registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with
and symbolized by such trademarks.

1.2 Accounting Terms. All accounting terms not specifically defined herein shall be
construed in accordance with GAAP and all calculations made hereunder shall be made in accordance with GAAP.
When used herein, the terms “financial statements” shall include the notes and schedules thereto.

2. LOAN AND TERMS OF PAYMENT.

2.1 Credit Extensions.

Borrower promises to pay to the order of Lender, in lawful money of the United States of America, the
aggregate unpaid principal amount of all Credit Extensions made by Lender to Borrower hereunder. Borrower shall
also pay interest on the unpaid principal amount of such Credit Extensions at rates in accordance with the terms hereof.
Borrower shall use the proceeds from any Credit Extension solely for business purposes (as working capital or other
uses permitted by Lender), and not for any personal, family or non-business related purposes.

(a) Term Loan.

(i) Subject to and upon the terms and conditions of this Agreement, on or
around the Closing Date, Lender shall make a single cash advance (the “Term Loan”) to Borrower in an original
principal amount equal to the Term Loan Facility. The Term Loan, once repaid, may not be reborrowed.

(ii) Interest shall accrue from the funding date of the Term Loan, on the
outstanding Daily Balance thereof, at a per annum rate equal to the greater of (x) 19.75% or (y) 15.50% above the
Prime Rate; provided however that all Obligations with respect to the Term Loan shall bear interest, from and after
the occurrence and during the continuance of an Event of Default, at a rate equal to five (5) percentage points above
the interest rate applicable immediately prior to the occurrence of the Event of Default.

(iii) Interest accruing on the Term Loan shall be payable monthly on the
fifth calendar day of each month so long as the Term Loan is outstanding (or if the fifth day falls on a day other than
a Business Day, on the next Business Day).

(iv) Term Loans shall be payable in equal monthly installments of principal,

beginning on the fifth day of the first month following the funding date of such Term Loan, and continuing on the
same day of each month thereafter through the Term Loan Maturity Date, at which time all amounts owing under
this Section 2.1(b) and any other amounts owing under this Agreement with respect to the Term Loans shall be
immediately due and payable.

(v) Upon the acceleration of the Term Loan following an Event of Default,
Borrower shall pay to Lender an amount equal to the total amount of all scheduled but unpaid amounts of interest
that would have accrued and been payable from the date of such prepayment through the stated date of maturity had
the Term Loan remained outstanding and been paid in accordance with the schedule set forth above (the “Make
Whole Payment”). Absent an Event of Default, Borrower shall have the option to prepay all (but not less than all) of
the outstanding Term Loan at any time without any requirement to pay the Make Whole Payment, provided that
Borrower provides written notice to Lender of its election to prepay the Term Loan by delivering a completed Request
Form in substantially similar form attached hereto as Exhibit B at least ten (10) days prior to such prepayment, and
pays, on the date of such prepayment, (i) the outstanding principal amount of the Term Loan being repaid, plus (ii)




   

all accrued interest thereon, plus (iii) all other sums, if any, that shall have become due and payable under the Loan
Documents and relate to the Term Loan, plus (iv) the Prepayment Fee.

2.2 General Payment Provisions and Calculations.

(a) Payments. Lender shall, at its option, charge such interest, all Lender Expenses,
and all Periodic Payments against any of Borrower’s Financial Accounts, and Borrower authorizes Lender to debit via
ACH such amounts from Borrower’s Financial Account(s) with prior notice to Borrower (provided however that the
failure of Lender to charge such payments do not obviate any of Borrower’s payment obligations hereunder). Any
interest not paid when due shall be compounded by becoming a part of the Obligations, and such interest shall
thereafter accrue interest at the rate then applicable hereunder. All payments shall be free and clear of any taxes,
withholdings, duties, impositions or other charges, to the end that Lender will receive the entire amount of any
Obligations payable hereunder, regardless of source of payment. Any payments being made on account of the
Obligations initiated by Borrower shall be accompanied by a completed Request Form in substantially the form
attached hereto as Exhibit B.

(b) Computation. In the event the Prime Rate is changed from time to time hereafter,
the applicable rate of interest hereunder that is based on the Prime Rate shall be increased or decreased, effective as
of the day the Prime Rate is changed, by an amount equal to such change in the Prime Rate. All interest chargeable
under the Loan Documents shall be computed on the basis of a three hundred sixty (360) day year for the actual
number of days elapsed.

(c) Crediting Payments. Any payments being made on account of the Obligations
initiated by Borrower shall be applied to the outstanding Obligations within three Business Days of Lender’s receipt
of such payment along with the completed Request Form. Prior to the occurrence of an Event of Default, Lender shall
credit any payment to such outstanding Obligation as Borrower specifies. After the occurrence of an Event of Default,
the receipt by Lender of any payment shall be applied to conditionally reduce Obligations in the manner and order as
Lender determines, but shall not be considered a payment on account unless such payment is of immediately available
federal funds. Notwithstanding anything to the contrary contained herein, any Request Form received by Lender after
12:00 noon Pacific Time shall be deemed to have been received by Lender as of the opening of business on the
immediately following Business Day. Whenever any payment to Lender under the Loan Documents would otherwise
be due (except by reason of acceleration) on a date that is not a Business Day, such payment shall instead be due on
the next Business Day, and additional fees or interest, as the case may be, shall accrue and be payable for the period
of such extension.

2.3 Fees and Expenses.

(a) [Reserved]

(b) Late Fee. If any payment is not made within ten (10) days after the date such
payment is due, Borrower shall pay to Lender, upon Lender’s election, a late fee equal to the lesser of $500 or the sum
of one percent (1%) of the original principal amount of the Credit Extensions (the “Late Fee”); provided however that
in any event, the Late Fee shall automatically be reduced to the maximum amount permitted to be charged under
applicable law.

2.4 Lender Expenses. Borrower shall pay to Lender on the Closing Date, all Lender Expenses
incurred through the Closing Date, and after the Closing Date, all Lender Expenses as and when they are incurred by
Lender, with notification to Borrower. Lender agrees to cap the Lender Expenses incurred through the Closing Date
at $5,000.00, unless Borrower is notified of additional costs in advance.

2.5 Term. This Agreement shall become effective on the Closing Date and, subject to
Section 13.7, shall continue in full force and effect for so long as any Obligations remain outstanding or Lender has
any obligation to make Credit Extensions under this Agreement. Notwithstanding the foregoing, Lender shall have




   

the right to terminate its obligation to make Credit Extensions under this Agreement immediately and without notice
upon the occurrence and during the continuance of an Event of Default. Notwithstanding termination, Lender’s Lien
on the Collateral shall remain in effect for so long as any Obligations are outstanding.

3. CONDITIONS OF LOANS.

3.1 Conditions Precedent to Initial Credit Extension. The obligation of Lender to make the
initial Credit Extension is subject to the condition precedent that Lender shall have received, in form and substance
satisfactory to Lender, the following:

(a) this Agreement;

(b) evidence of member/manager approval of the transactions contemplated herein;

(c) listing of Borrower’s Intellectual Property and Domain Names;

(d) a good standing certificate(s) of Borrower or the equivalent for the Borrower’s
state of incorporation or formation and principal office location,

(e) an executed Compliance Certificate in the form attached as Exhibit C hereto, or

other mutually agreeable form of such certificate;

(f) a duly executed ACH authorizations in the form attached as Exhibit D hereto;

(g) a fully-executed Noncompetition Agreement from each Key Employee;

(h) payment of the fees and Lender Expenses then due specified in Section 2.4 hereof;

(i) current financial statements of Borrower;

(j) such other documents, and completion of such other matters, as Lender may
reasonably deem necessary or appropriate.

3.2 Conditions Precedent to all Credit Extensions. The obligation of Lender to make each
Credit Extension, including the initial Credit Extension, is further subject to the following conditions:

(a) timely receipt by Lender of the Request Form as provided in Section 2.1;

(b) the representations and warranties contained in Section 5 shall be true and correct
in all material respects on and as of the date of such Credit Extension request and on the effective date of each Credit
Extension as though made at and as of each such date; and

(c) no Event of Default shall have occurred and be continuing, or would exist after
giving effect to such Credit Extension, and no event or condition shall exist that has had or could be reasonably
expected by Lender to have a Material Adverse Effect.

The making of each Credit Extension shall be deemed to be a representation and warranty by Borrower on the date of
such Credit Extension as to the accuracy of the facts referred to in this Section 3.2.




   

4. CREATION OF SECURITY INTEREST.

4.1 Grant of Security Interest. In consideration of, and as security for the prompt payment
of any and all Obligations and the prompt performance and satisfaction by Borrower of all other obligations,
covenants, and duties hereunder, Borrower grants and pledges to Lender a continuing security interest in all presently
existing and hereafter acquired or arising Collateral (including any proceeds from any Transfer or other disposition of
the Collateral). Such security interest constitutes a valid, first priority security interest in the presently existing
Collateral (subject to Permitted Liens that are permitted by Lender to be senior to Lender’s Lien), and will constitute
a valid, first priority security interest in Collateral acquired after the date hereof (subject to Permitted Liens that are
permitted by Lender to be senior to Lender’s Lien). Borrower hereby authorizes Lender to file a financing statement
to perfect this security interest, and Borrower shall take such actions at Borrower’s expense as Lender reasonably
deems appropriate from time to time to perfect or continue the security interest granted hereunder, including but not
limited to, causing each Subsidiary of Borrower to grant Lender a security interest in the Collateral as necessary to
perfect Lender’s security interest and/or to grant Lender a security interest in each Subsidiary’s property as additional
Collateral; or delivering any negotiable instruments to Lender to be held as possessory Collateral. Borrower shall from
time to time execute and deliver to Lender in a timely manner, all financing statements and other documents that
Lender may reasonably request, in form and substance satisfactory to Lender, to perfect and continue the perfection
of Lender’s security interests in the Collateral and in order to fully consummate the transactions contemplated by the
Loan Documents, including any account control agreements and ACH authorization with respect to Borrower’s
operating, depository or investment accounts, in form and substance satisfactory to Lender.

4.2 Pledge of Shares. Borrower hereby pledges, assigns and grants to Lender, a security interest
in all the Shares, together with all proceeds and substitutions thereof, all cash, stock and other moneys and property
paid thereon, all rights to subscribe for securities declared or granted in connection therewith, and all other cash and
noncash proceeds of the foregoing, as security for the performance of the Obligations. Within ten (10) days of Lender’s
request, the certificate or certificates evidencing the Shares (if certificated) will be delivered to Lender, accompanied
by an instrument of assignment duly executed in blank by Borrower. To the extent required by the terms and conditions
governing the Shares, Borrower shall cause the books of each entity whose Shares are part of the Collateral and any
transfer agent to reflect the pledge of the Shares. Upon the occurrence of an Event of Default hereunder, Lender may
effect the transfer of any securities included in the Collateral (including but not limited to the Shares) into the name
of Lender and cause new (as applicable) certificates representing such securities to be issued in the name of Lender
or its transferee. Borrower will execute and deliver such documents, and take or cause to be taken such actions, as
Lender may reasonably request to perfect or continue the perfection of Lender’s security interest in the Shares. Unless
an Event of Default shall have occurred and be continuing, Borrower shall be entitled to exercise any voting rights
with respect to the Shares and to give consents, waivers and ratifications in respect thereof, provided that no vote shall
be cast or consent, waiver or ratification given or action taken which would be inconsistent with any of the terms of
this Agreement or which would constitute or create any violation of any of such terms. All such rights to vote and
give consents, waivers and ratifications shall terminate upon the occurrence and continuance of an Event of Default..

4.3 Right to Inspect. Lender (through any of its officers, employees, or agents) shall have the
right from time to time, upon reasonable prior notice to Borrower, to inspect Borrower’s Books and to make copies
thereof and to check, test, and inspect the Collateral in order to verify Borrower’s financial condition or the amount,
condition of, or any other matter relating to, the Collateral. Borrower shall provide Lender with on-line “view only”
access to all of its accounts.

5. REPRESENTATIONS AND WARRANTIES.

Borrower represents and warrants to Lender as of the Closing Date and for so long as any Obligations are
owing to Lender that:

5.1 Due Organization and Qualification. Borrower and each Subsidiary is a corporation
duly existing under the laws of its state of incorporation and qualified and licensed to do business in any state in which
the conduct of its business or its ownership of property requires that it be so qualified. Borrower’s formation




   

documents (i.e., articles/certificate of incorporation and bylaws/operating agreement) provided to Lender prior to the
date hereof are true and complete copies of Borrower’s formation documents, and each of which are in full force and
effect on the date hereof.

5.2 Due Authorization; No Conflict. The execution, delivery, and performance of the Loan
Documents are within Borrower’s powers, have been duly authorized, and are not in conflict with nor constitute a
breach of any provision contained in Borrower’s formation documents (e.g., Articles/Certificate of Incorporation and
bylaws or operating agreement), nor will they constitute an event of default under any material agreement to which
Borrower is a party or by which Borrower is bound. Borrower is not in default under any material agreement to which
it is a party or by which it is bound.

5.3 No Prior Encumbrances. Borrower has good and marketable title to its property, free
and clear of Liens, except for Permitted Liens.

5.4 Bona Fide Accounts. The Accounts are bona fide existing obligations. The property and
services giving rise to such Accounts has been delivered or rendered to the account debtor or to the account debtor’s
agent for immediate and unconditional acceptance by the account debtor. Borrower has not received notice of actual
or imminent Insolvency Proceeding of any account debtor, except as disclosed to Lender in a Compliance Certificate
delivered hereunder.

5.5 Merchantable Inventory. All Inventory is in all material respects of good and marketable
quality, free from all material defects, except for Inventory for which adequate reserves have been made.

5.6 Intellectual Property; Contracts. Borrower is the sole owner of the Intellectual Property,
except for non-exclusive licenses granted by Borrower to its customers in the ordinary course of business. Each of
the Patents is valid and enforceable, and no part of the Intellectual Property has been judged invalid or unenforceable,
in whole or in part, and no claim has been made that any part of the Intellectual Property violates the rights of any
third party. Borrower’s rights as a licensee of intellectual property do not give rise to more than five percent (5%) of
its gross revenue in any given month, including without limitation revenue derived from the sale, licensing, rendering
or disposition of any product or service. Borrower is not a party to, or bound by, any agreement that restricts the
grant by Borrower of a security interest in Borrower’s rights under such agreement, other than (a) real property leases,
(b) standard, shrinkwrap or off-the shelf software licenses or other software licenses that are commercially available,
each entered into in the ordinary course of business, and (c) agreements to which Borrower is the payee containing
restrictions on assignment that are rendered unenforceable by operation of Code Sections 9-406, 9-407, or 9-408.

5.7 Names; Locations. Except as disclosed in the Schedule, Borrower has not done business
under any name other than that specified on the signature page hereof. The chief executive office of Borrower is
located at the address indicated on Borrower’s signature page attached hereto. All of Borrower’s Inventory and
Equipment is located only at the location set forth on Borrower’s signature page attached hereto.

5.8 Litigation. Except as set forth in the Schedule, there are no actions or proceedings pending
by or against Borrower or any Subsidiary before any court or administrative agency.

5.9 No Material Adverse Change in Financial Statements. All consolidated and

consolidating financial statements related to Borrower and any Subsidiary that Lender has received from Borrower
fairly present in all material respects Borrower’s financial condition as of the date thereof and Borrower’s consolidated
and consolidating results of operations for the period then ended. There has not been a material adverse change in the
consolidated or the consolidating financial condition of Borrower since the date of the most recent of such financial
statements submitted to Lender.

5.10 Solvency, Payment of Debts. Borrower (i) is able to pay its debts (including trade debts)
as they mature; (ii) the fair saleable value of Borrower’s assets (including goodwill minus disposition costs) exceeds




   

the fair value of its liabilities; and (iii) Borrower is not left with unreasonably small capital after the transactions
contemplated by this Agreement and the other Loan Documents.

5.11 Legal Compliance. Borrower is in compliance with all Legal Requirements.

5.12 Key Employees. Each Key Employee of Borrower is currently devoting substantially all
of the Key Employee(s)’s business time to the conduct of the business of the Borrower.

5.13 Taxes. Borrower and each Subsidiary have filed or caused to be filed all tax returns
required to be filed, and have paid, or have made adequate provision for the payment of, all taxes reflected therein.
Borrower and each Subsidiary have paid, or have made adequate provision for the payment of, all tax payments and
withholding taxes required to be paid by such Person.

5.14 Subsidiaries. Borrower does not own any stock, partnership interest or other equity
securities of any Person, except as set forth on the Schedule.

5.15 Government Consents. Borrower and each Subsidiary have obtained all material
consents, approvals and authorizations of, made all declarations or filings with, and given all notices to, all
governmental authorities that are necessary for the continued operation of Borrower’s business as currently conducted.

5.16 Operating, Depository and Investment Accounts. All of Borrower’s operating, deposit
and investment accounts are maintained or invested with the banks, financial institutions or other providers as set forth
on the Schedule.

5.17 Shares. Borrower has full power and authority to create a first priority lien on the Shares
and no disability or contractual obligation exists that would prohibit Borrower from pledging the Shares pursuant to
this Agreement. There are no subscriptions, warrants, rights of first refusal or other restrictions on transfer relative to,
or options exercisable with respect to the Shares. The Shares have been and will be duly authorized and validly issued,
and are fully paid and non-assessable. The Shares are not the subject of any present or threatened suit, action,
arbitration, administrative or other proceeding, and Borrower knows of no reasonable grounds for the institution of
any such proceedings.

5.18 Full Disclosure. No representation, warranty or other statement made by Borrower in any
certificate or written statement furnished to Lender contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements contained in such certificates or statements not misleading.

6. AFFIRMATIVE COVENANTS.

Borrower shall do all of the following:

6.1 Good Standings; Existence. Borrower shall, and shall cause each of its Subsidiaries to,
maintain its legal existence and good standing and will maintain in force all licenses and agreements necessary or
appropriate to the conduct of its business.

6.2 Compliance with Laws. Borrower shall comply, and shall cause each Subsidiary to
comply, with all Legal Requirements to which it is subject, noncompliance with which could have a Material Adverse
Effect. Borrower shall meet, and shall cause each Subsidiary to meet, the minimum funding requirements of ERISA
with respect to any employee benefit plans subject to ERISA.

6.3 Financial Statements, Reports, Certificates. Borrower shall deliver the following to
Lender: (a) within five (5) days after the last day of each month, copies of all reports and statements received by
Borrower from any of its banks or other financial institutions; (b) as soon as available, but in any event within thirty
(30) days after the end of each calendar month, (i) a company prepared consolidated balance sheet, income statement,




   

and cash flow statement covering Parent’s consolidated operations during such period, prepared in accordance with
GAAP, consistently applied, or prepared using commonly accepted methods of recording and reporting of Borrower's
accounting information applied on a consistent basis, in a form acceptable to Lender and certified by a Responsible
Officer, (ii) [reserved], (iii) a Compliance Certificate signed by a Responsible Officer in substantially the form of
Exhibit D hereto, (iv) an inventory report (if applicable), and (v) deferred revenue schedule (if applicable); (c) as soon
as available, but in any event within one hundred twenty (120) days after the end of Parent’s fiscal year, consolidated
financial statements of Parent prepared in accordance with GAAP, consistently applied, or prepared using commonly
accepted methods of recording and reporting of Borrower's accounting information applied on a consistent basis; (d)
as soon as available, but in any event no later than the earlier to occur of thirty (30) days following the beginning of
each fiscal year or the date of approval by Parent’s board of directors/managers, an annual operating budget and
financial projections (including income statements, balance sheets and cash flow statements) for such fiscal year,
presented in a monthly format, approved by Parent’s board of directors/manager, and in a form and substance
acceptable to Lender; (e) copies of all statements, reports and notices sent or made available generally by Borrower
to its security holders or to any holders of Subordinated Debt and, if applicable, all reports on Forms 10-K and 10-Q
filed with the Securities and Exchange Commission; (f) promptly upon receipt of notice thereof, a report of any legal
actions pending or threatened against Borrower or any Subsidiary that could result in damages or costs to Borrower
or any Subsidiary of at least the Threshold Amount; (g) as soon as available, but in any event within ten (10) days of
filing, copies of Borrower's federal annual and quarterly tax returns and filings, and Borrower's state annual tax return
and (h) such budgets, sales projections, operating plans or other financial information and copies of notices, minutes,
consents and other material provided to Borrower’s board of directors/managers, as Lender may reasonably request
from time to time.

6.4 Annual Financial Audits. Borrower shall prepare its financial statements in accordance
with GAAP or prepared using commonly accepted methods of recording and reporting Borrower’s accounting
information applied on a consistent basis, and in form and substance reasonably satisfactory to Lender, which, at
Lender’s option and expense if an Event of Default has occurred and is continuing, may be audited by certified public
accountants; provided however, that the expense of any such audited financial statements shall be borne by Borrower
if (i) Borrower’s annual gross revenues exceed $10,000,000 or (ii) the audit results in the restatement of the financial
statements previously provided to Lender due to a discrepancy in excess of ten percent (10%) regarding Borrower’s
aggregate revenue, expenses, income, asset or liabilities for the reporting period as previously report by Borrower to
Lender.

6.5 Collateral Audits. Lender may audit the Collateral at Lender’s expense. Such audits will
be conducted no more often than annually unless an Event of Default has occurred and is continuing, in which case,
the audits will be at Borrower’s expense and may occur more frequently than annually. Unless an Event of Default
has occurred and is continuing, Lender will give Borrower ten (10) days advance notice of its intent to audit.

6.6 Taxes. Borrower shall make, and shall cause each Subsidiary to make, due and timely
payment or deposit of all federal, state, and local taxes, assessments, or contributions, and all tax payments and
withholding taxes required of it by applicable law, and will execute and deliver to Lender, on demand, appropriate
certificates attesting to the payment or deposit thereof. Without limiting the foregoing, Borrower will make, and will
cause each Subsidiary to make, timely payment or deposit of all amounts required by laws concerning F.I.C.A.,
F.U.T.A., state disability, unemployment, workers compensation, ERISA, and local, state, and federal income taxes,
and will, upon request, furnish Lender with proof satisfactory to Lender indicating that Borrower or a Subsidiary has
made such payments or deposits; provided that Borrower or a Subsidiary need not make any payment if the amount
or validity of such payment is contested in good faith by appropriate proceedings and is reserved against (to the extent
required by GAAP) by Borrower.

6.7 Insurance.

(a) Borrower shall maintain insurance on the Collateral and Borrower’s business in
such amounts and in such types as are reasonable and customary for similar businesses. The Collateral insurance shall
include a lender’s loss payable endorsement in favor of Lender as an additional loss payee, and Borrower shall provide




   

to Lender certificates of insurance and endorsements in form and substance satisfactory to Lender evidencing the
foregoing within ten (10) days following the Closing Date.

(b) Borrower shall maintain key man life insurance on the Key Person(s) in an amount
at least equal to the sum of the original principal amount of all Credit Extensions made to Borrower, listing Lender as
the beneficiary of such policy and provide evidence of such key man life insurance, in form and substance satisfactory
to Lender, within sixty (60) days following the Closing Date. Borrower is not required to maintain key man life
insurance on Key Person(s) if within fifteen (15) days following the Closing Date, Borrower joins Lender's group
policy. For the avoidance of doubt, Borrower is not required to maintain key man life insurance on Key Person(s) if
aggregate outstanding amount of the Credit Extensions owing to Lender is less than $250,000.00. In the event of the
death of a Key Person during the term of this Agreement, all Obligations shall become immediately due and paid with
the proceeds from such key man life insurance policy.

6.8 Accounts. Borrower shall maintain, and shall cause each of its Subsidiaries to maintain
its Financial Accounts with the financial institutions listed on Schedule. Borrower shall provide Lender five (5) days
prior written notice before establishing any account at or with any domestic bank or financial institution other than
those listed on the Schedule and at Lender’s request provide Lender with ACH access to any such account(s). In the
Event of Default, at Lender’s request, Borrower shall cause the applicable bank or financial institution listed on the
Schedule to execute and deliver an account control agreement or other appropriate instrument in favor of Lender, in
form and satisfactory to Lender.

6.9 Financial Covenants. None.

6.10 Intellectual Property Rights.

(a) Borrower shall (i) protect, defend and maintain the validity and enforceability of
its Intellectual Property; (ii) promptly advise Lender in writing of material infringements of its Intellectual Property;
and (iii) not allow any Intellectual Property material to Borrower’s business to be abandoned, forfeited or dedicated
to the public without Lender’s written consent.

(b) Borrower shall give Lender quarterly written notice of any applications or
registrations of intellectual property rights filed with the United States Patent and Trademark Office, including the
date of such filing and the registration or application numbers, if any.

(c) Borrower shall give Lender not less than 30 days prior written notice of the filing
of any applications or registrations with the United States Copyright Office, including the title of such intellectual
property rights to be registered, as such title will appear on such applications or registrations, and the date such
applications or registrations will be filed, and execute and file such documents as Lender may reasonably request for
Lender to perfect or maintain its perfection in such intellectual property rights to be registered by Borrower.

6.11 Formation or Acquisition of Subsidiaries. At the time that Borrower forms any direct
or indirect Subsidiary or acquires any direct or indirect Subsidiary, Borrower shall (a) cause such new Subsidiary to
provide to Lender a joinder to this Agreement to cause such Subsidiary to become a co-borrower hereunder, together
with such appropriate financing statements and/or control agreements, all in form and substance satisfactory to Lender
(including being sufficient to grant Lender a first priority Lien (subject to Permitted Liens that are permitted by Lender
to be senior to Lender’s Lien) in and to the assets of such newly formed or acquired Subsidiary), (b) provide to Lender
appropriate certificates and powers and financing statements, pledging all of the direct or beneficial ownership interest
in such new Subsidiary, in form and substance satisfactory to Lender, and (c) provide to Lender all other
documentation in form and substance satisfactory to Lender that in its opinion is appropriate with respect to the
execution and delivery of the applicable documentation referred to above. Borrower’s compliance with the foregoing
covenant does not obviate Borrower’s obligations to comply with Section 7.3 or 7.7 of this Agreement with respect
to any Subsidiary.




   

6.12 Other Notices.

(a) Without limiting or contradicting any other more specific provision of this
Agreement, promptly (and in any event within three (3) Business Days) upon Borrower becoming aware of the
existence of any Event of Default or event described in Section 8 which, with the giving of notice or passage of time,
or both, would constitute an Event of Default, Borrower shall give written notice to Lender of such occurrence, which
such notice shall include a reasonably detailed description of such Event of Default or event which, with the giving of
notice or passage of time, or both, would constitute an Event of Default.

(b) If Borrower shall acquire a commercial tort claim (as defined in the Code),
Borrower shall promptly notify Lender in writing of the general details thereof, which writing shall be deemed as the
grant to Lender of a security interest therein and in the proceeds thereof.

6.13 Further Assurances. At any time and from time to time Borrower shall execute and
deliver such further instruments and take such further action as may reasonably be requested by Lender to effect the
purposes of this Agreement.

7. NEGATIVE COVENANTS.

Borrower will not do any of the following without the prior written consent of Lender:

7.1 Dispositions. Convey, sell, lease, transfer or otherwise dispose of (collectively, a

“Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, other than:
(i) Transfers of Inventory in the ordinary course of business; (ii) Transfers of non-exclusive licenses and similar
arrangements for the use of the property of Borrower or its Subsidiaries in the ordinary course of business; or
(iii) Transfers of worn-out or obsolete Equipment which was not financed by Lender.

7.2 Change in Business or Executive Office. Engage in any business, or permit any of its
Subsidiaries to engage in any business, other than the businesses currently engaged in by Borrower and any business
substantially similar or related thereto (or incidental thereto); or cease to conduct business in the manner conducted
by Borrower as of the Closing Date; or without thirty (30) days prior written notification to Lender, relocate its chief
executive office or state of incorporation or change its legal name; or without Lender’s prior written consent, change
the date on which its fiscal year ends.

7.3 Change in Control; Mergers or Acquisitions. Suffer or permit a Change in Control; or

merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with or into any other business
organization, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital stock or any
material portion of property of another Person, provided however, only advance written notice to the Lender will be
required for any action restricted by this Section 7.3 if all Obligations are paid in full in cash out of the proceeds of
the initial closing of such action and such payment is listed as a condition to the consummation of such action.

7.4 Indebtedness. Create, incur, assume or be or remain liable with respect to any
Indebtedness, or permit any Subsidiary so to do, other than Permitted Indebtedness. Enter into any debt financing
transaction (including any financing of accounts receivables, bridge loans or convertible note financings) other than
with respect to Permitted Indebtedness.

7.5 Encumbrances. Create, incur, assume or suffer to exist any Lien with respect to any of
its property (including without limitation, its Intellectual Property), or assign or otherwise convey any right to receive
income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for Permitted Liens, or
agree with any Person other than Lender not to grant a security interest in, or otherwise encumber, any of its property
(including without limitation, its Intellectual Property), or permit any Subsidiary to do so.




   

7.6 Distributions; Bonus Payments. Make payment to holder(s) of any convertible

promissory note of Borrower, or make any distributions or pay any dividends to any Person on account of any equity
ownership interest in Borrower or any Subsidiary, or make any payment on account of or in redemption, retirement
or purchase of any equity ownership interest in Borrower or any Subsidiary, or pay any bonuses to employees or
contractors, other than bonus payments that are consistent with past practices and as long as no Event of Default has
occurred that is continuing or would exist after giving effect to such payment (including any Event of Default under
Section 8.5). Notwithstanding the foregoing, as long as an Event of Default is not continuing, Borrower may make
Permitted Distributions.

7.7 Investments. Directly or indirectly acquire or own, or make any Investment in or to any
Person, or permit any of its Subsidiaries so to do, other than in the ordinary course of business as currently conducted;
or suffer or permit any Subsidiary to be a party to, or be bound by, an agreement that restricts such Subsidiary from
paying dividends or otherwise distributing property to Borrower.

7.8 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any
material transaction with any Affiliate of Borrower or any Subsidiary, except for transactions in the ordinary course
of Borrower’s business, upon fair and reasonable terms that are no less favorable to Borrower than would be obtained
in an arms-length transaction with a non-affiliated Person or non-subsidiary.

7.9 Subordinated Debt. Directly or indirectly make any payment in respect of any
Subordinated Debt, except as permitted under any subordination agreement governing approved and signed by Lender
governing such Subordinated Debt; or amend any provision in any document relating to Subordinated Debt, except to
extend the maturity date of such Subordinated Debt.

7.10 Inventory and Equipment. Store the Inventory or the Equipment with a bailee,
warehouseman, or other third party unless, at Lender’s request, the third party has been notified of Lender’s security
interest and Lender (a) has received an acknowledgment from the third party that it is holding or will hold the Inventory
or Equipment for Lender’s benefit or (b) is in pledge possession of the warehouse receipt, where negotiable, covering
such Inventory or Equipment. Store or maintain any Equipment or Inventory at a location other than the location set
forth in Section 10 of this Agreement.

7.11 Compliance. Become an “investment company” or be controlled by an “investment

company,” within the meaning of the Investment Company Act of 1940, or become principally engaged in, or
undertake as one of its important activities, the business of extending credit for the purpose of purchasing or carrying
margin stock, or use the proceeds of any Credit Extension for such purpose. Fail to meet the minimum funding
requirements of ERISA, permit a Reportable Event or Prohibited Transaction, as defined in ERISA, to occur, fail to
comply with the Federal Fair Labor Standards Act or violate any law or regulation, which violation could have a
Material Adverse Effect, or permit any of its Subsidiaries to do any of the foregoing.

8. EVENTS OF DEFAULT.

Any one or more of the following events shall constitute an Event of Default by Borrower under this
Agreement:

8.1 Payment Default. If Borrower fails to pay, when due, any of the Obligations, other than
by failure of Lender to initiate an ACH payment when sufficient funds are available in such Financial Accounts for
which Lender has ACH authorization.

8.2 Covenant Default.

(a) If any Borrower or any Subsidiary fails to perform any obligation under Article 6
or violates any of the covenants contained in Article 7 of this Agreement; or




   

(b) If any Borrower or any Subsidiary fails or neglects to perform or observe any
other material term, provision, condition, or covenant contained in this Agreement, in any of the Loan Documents, or
in any other present or future agreement between Borrower or any Subsidiary and Lender and as to any default under
such other term, provision, condition or covenant that can be cured, has failed to cure such default within ten days
after Borrower receives notice thereof or any officer of Borrower becomes aware thereof; provided, however, that if
the default cannot by its nature be cured within the ten day period or cannot after diligent attempts by Borrower be
cured within such ten day period, and such default is likely to be cured within a reasonable time, then Borrower shall
have an additional reasonable period (which shall not in any case exceed 30 days) to attempt to cure such default, and
within such reasonable time period the failure to have cured such default shall not be deemed an Event of Default but
no Credit Extensions will be made.

8.3 Material Adverse Effect. If there occurs any circumstance or circumstances that could
have a Material Adverse Effect.

8.4 Attachment. If any portion of any Borrower’s assets is attached, seized, subjected to a
writ or distress warrant, or is levied upon, or comes into the possession of any trustee, receiver or person acting in a
similar capacity and such attachment, seizure, writ or distress warrant or levy has not been removed, discharged or
rescinded within ten (10) days, or if any Borrower is enjoined, restrained, or in any way prevented by court order from
continuing to conduct all or any material part of its business affairs, or if a judgment or other claim becomes a lien or
encumbrance upon any portion of any Borrower’s assets, or if a notice of lien, levy, or assessment is filed of record
with respect to any Borrower’s assets by the United States Government, or any department, agency, or instrumentality
thereof, or by any state, county, municipal, or governmental agency, and the same is not paid within ten (10) days
after Borrower receives notice thereof, provided that none of the foregoing shall constitute an Event of Default where
such action or event is stayed or an adequate bond has been posted pending a good faith contest by Borrower (provided
that no Credit Extensions will be required to be made during such cure period).

8.5 Insolvency. If any Borrower becomes insolvent, or if an Insolvency Proceeding is

commenced by any Borrower, or if an Insolvency Proceeding is commenced against any Borrower and is not dismissed
or stayed within thirty (30) days (provided that no Credit Extensions will be made prior to the dismissal of such
Insolvency Proceeding).

8.6 Other Agreements. If there is a default or other failure to perform in any agreement to
which any Borrower is a party or by which it is bound resulting in a right by a third party or parties, whether or not
exercised, to accelerate the maturity of any Indebtedness in an amount in excess of the Threshold Amount or which
could have a Material Adverse Effect.

8.7 Judgments; Settlements; Fines; Penalties. If a judgment or judgments for the payment
of money in an amount, individually or in the aggregate, of at least the Threshold Amount shall be rendered against
any Borrower, or if any Borrower enters into any settlement agreement with respect to any litigation matters that
results in payment obligations or liabilities incurred by any Borrower in excess of the Threshold Amount; or if one or
more fines, penalties or orders or decrees for the payment of money in excess of the Threshold Amount shall be
rendered against any Borrower by any Governmental Authority; and the foregoing shall remain unsatisfied and
unstayed for a period of ten (10) days (provided that no Credit Extensions will be made prior to the satisfaction or stay
of such judgment, settlement, fine, penalty or orders or decree).

8.8 Key Employee. (a) If any Key Employee as of the Closing Date (i) ceases to devote
substantially all of his or her time to Borrower’s business and operations in the capacity that such Key Employee holds
as of the Closing Date; or (ii) forms, serve as board member of, be employed in any capacity by, or otherwise provide
material assistance to any competitor of Borrower, or (b) if any Key Employee violates the term of the noncompetition
agreement executed by such Key Employee.




   

8.9 Misrepresentations. If any material misrepresentation or material misstatement exists

now or hereafter in any warranty or representation set forth herein or in any certificate or Loan Document delivered
to Lender pursuant to this Agreement or to induce Lender to enter into this Agreement or any other Loan Document.

9. LENDER’S RIGHTS AND REMEDIES.

9.1 Rights and Remedies. Upon the occurrence and during the continuance of an Event of
Default, Lender may, at its election, without notice of its election and without demand, do any one or more of the
following, all of which are authorized by Borrower:

(a) Declare all or any portion of Obligations (including the Make Whole Payment) ,
whether evidenced by this Agreement, by any of the other Loan Documents, or otherwise, immediately due and
payable (provided that upon the occurrence of an Event of Default described in Section 8.5, all Obligations shall
become immediately due and payable without any action by Lender);

(b) Cease advancing money or extending credit to or for the benefit of Borrower
under this Agreement, or under any other agreement between Borrower and Lender;

(c) Settle or adjust disputes and claims directly with account debtors for amounts,
upon terms and in whatever order that Lender reasonably considers advisable;

(d) Make such payments and do such acts as Lender considers necessary or
reasonable to protect its security interest in the Collateral. Borrower agrees to assemble the Collateral if Lender so
requires, and to make the Collateral available to Lender as Lender may designate. Borrower authorizes Lender to
enter the premises where the Collateral is located, to take and maintain possession of the Collateral, or any part of it,
and to pay, purchase, contest, or compromise any encumbrance, charge, or lien which in Lender’s determination
appears to be prior or superior to its security interest and to pay all expenses incurred in connection therewith. With
respect to any of Borrower’s owned premises, Borrower hereby grants Lender a license to enter into possession of
such premises and to occupy the same, without charge, in order to exercise any of Lender’s rights or remedies provided
herein, at law, in equity, or otherwise;

(e) Set off and apply to the Obligations any and all balances and deposits of Borrower
held by Lender; or debit from any of Borrower’s accounts and apply any amounts Lender receives from such and debit
to the Obligations;

(f) Ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise
for sale, and sell (in the manner provided for herein) the Collateral. Lender is hereby granted a license or other right,
solely pursuant to the provisions of this Section 9.1, to use, without charge, Borrower’s labels, Patents, Copyrights,
rights of use of any name, trade secrets, trade names, Trademarks, service marks, and advertising matter, or any
property of a similar nature, as it pertains to the Collateral, in completing production of, advertising for sale, and
selling any Collateral and, in connection with Lender’s exercise of its rights under this Section 9.1, Borrower’s rights
under all licenses and all franchise agreements shall inure to Lender’s benefit;

(g) Dispose of the Collateral by way of one or more contracts or transactions, for cash
or on terms, in such manner and at such places (including Borrower’s premises) as Lender determines is commercially
reasonable, and apply any proceeds to the Obligations in whatever manner or order Lender deems appropriate;

(h) Lender may credit bid and purchase at any public sale; and

(i) Any deficiency that exists after disposition of the Collateral as provided above
will be paid immediately by Borrower.




   

Notwithstanding the foregoing, Lender, at its sole option and discretion, may elect in writing to forbear from exercising
any remedies or taking of the foregoing actions on account of an Event of Default, on such forbearance terms
determined by Lender, and for so long as Lender may determine, provided that Borrower takes such actions as may
be required by Lender to address such Event of Default within a reasonable time as determined in Lender’s sole
discretion.

9.2 Power of Attorney. Effective only upon the occurrence and during the continuance of an
Event of Default, Borrower hereby irrevocably appoints Lender (and any of Lender’s designated officers, agents or
employees) as Borrower’s true and lawful attorney to: (a) send requests for verification of Accounts or notify account
debtors of Lender’s security interest in the Accounts; (b) endorse Borrower’s name on any checks or other forms of
payment or security that may come into Lender’s possession; (c) sign Borrower’s name on any invoice or bill of lading
relating to any Account, drafts against account debtors, schedules and assignments of Accounts, verifications of
Accounts, and notices to account debtors; (d) dispose of any Collateral; (e) make, settle, and adjust all claims under
and decisions with respect to Borrower’s policies of insurance; (f) settle and adjust disputes and claims respecting the
accounts directly with account debtors, for amounts and upon terms which Lender determines to be reasonable; and
(g) whether or not an Event of Default has occurred that is continuing, file, in its sole discretion, one or more financing
or continuation statements and amendments thereto, relative to any of the Collateral. The appointment of Lender as
Borrower’s attorney in fact, and each and every one of Lender’s rights and powers, being coupled with an interest, is
irrevocable until all of the Obligations have been fully repaid and performed and Lender’s obligation to provide Credit
Extensions hereunder is terminated.

9.3 Accounts Collection. At any time after the occurrence of an Event of Default, Lender may
notify any Person owing funds to Borrower of Lender’s security interest in such funds and verify the amount of such
Account. Borrower shall collect all amounts owing to Borrower for Lender, receive in trust all payments as Lender’s
trustee, and immediately deliver such payments to Lender in their original form as received from the account debtor,
with proper endorsements for deposit.

9.4 Lender Expenses. If Borrower fails to pay any amounts or furnish any required proof of
payment due to third persons or entities, as required under the terms of this Agreement, then Lender may do any or
all of the following: (a) make payment of the same or any part thereof; (b) set up such reserves under a loan facility
in Section 2.1 as Lender deems necessary to protect Lender from the exposure created by such failure; or (c) obtain
and maintain insurance policies of the type discussed in Section 6.7 of this Agreement, and take any action with respect
to such policies as Lender deems prudent. Any amounts so paid or deposited by Lender shall constitute Lender
Expenses, shall be immediately due and payable, and shall bear interest at the then applicable rate hereinabove
provided, and shall be secured by the Collateral. Any payments made by Lender shall not constitute an agreement by
Lender to make similar payments in the future or a waiver by Lender of any Event of Default under this Agreement.

9.5 Lender’s Liability for Collateral. Lender shall not in any way or manner be liable or
responsible for: (a) the safekeeping of the Collateral; (b) any loss or damage thereto occurring or arising in any manner
or fashion from any cause; (c) any diminution in the value thereof; or (d) any act or default of any carrier,
warehouseman, bailee, forwarding agency, or other person whomsoever. All risk of loss, damage or destruction of
the Collateral shall be borne by Borrower.

9.6 Shares. Borrower recognizes that Lender may be unable to effect a public sale of any or
all the Shares, by reason of certain prohibitions contained in federal securities laws and applicable state and provincial
securities laws or otherwise, and may be compelled to resort to one or more private sales thereof to a restricted group
of purchasers which will be obliged to agree, among other things, to acquire such securities for their own account for
investment and not with a view to the distribution or resale thereof. Borrower acknowledges and agree that any such
private sale may result in prices and other terms less favorable than if such sale were a public sale and, notwithstanding
such circumstances, agrees that any such private sale shall be deemed to have been made in a commercially reasonable
manner. Lender shall be under no obligation to delay a sale of any of the Shares for the period of time necessary to
permit the issuer thereof to register such securities for public sale under federal securities laws or under applicable
state and provincial securities laws, even if such issuer would agree to do so. Upon the occurrence of an Event of




   

Default which continues, Lender shall have the right to exercise all such rights as a secured party under the Code as
it, in its sole judgment, shall deem necessary or appropriate, including without limitation the right to liquidate the
Shares and apply the proceeds thereof to reduce the Obligations. Effective only upon the occurrence and during the
continuance of an Event of Default, Borrower hereby irrevocably appoints Lender (and any of Lender’s designated
officers, or employees) as Borrower’s true and lawful attorney to enforce Borrower’s rights against any Subsidiary,
including the right to compel any Subsidiary to make payments or distributions owing to Borrower.

9.7 Remedies Cumulative. Lender’s rights and remedies under this Agreement, the Loan
Documents, and all other agreements shall be cumulative. Lender shall have all other rights and remedies not
inconsistent herewith as provided under the Code, by law, or in equity. No exercise by Lender of one right or remedy
shall be deemed an election, and no waiver by Lender of any Event of Default on Borrower’s part shall be deemed a
continuing waiver. No delay by Lender shall constitute a waiver, election, or acquiescence by it. No waiver by Lender
shall be effective unless made in a written document signed on behalf of Lender and then shall be effective only in the
specific instance and for the specific purpose for which it was given.

9.8 Demand; Protest. Borrower waives demand, protest, notice of protest, notice of default
or dishonor, notice of payment and nonpayment, notice of any default, nonpayment at maturity, release, compromise,
settlement, extension, or renewal of accounts, documents, instruments, chattel paper, and guarantees at any time held
by Lender on which Borrower may in any way be liable.

10. NOTICES.

Unless otherwise provided in this Agreement, all notices or demands by any party relating to this Agreement
or any other agreement entered into in connection herewith shall be in writing and shall be personally delivered or
sent by a recognized overnight delivery service, certified mail, postage prepaid, return receipt requested, or by email
or telefacsimile to Borrower or to Lender, as the case may be, at its addresses set forth on the signature page of this
Agreement. The parties hereto may change the address at which they are to receive notices hereunder, by notice in
writing in the foregoing manner given to the other.

11. CHOICE OF LAW AND VENUE.

The parties agree that this Agreement, and any disputes arising under this Agreement or the other Loan
Documents (collectively, a “Dispute”), will be governed by and construed in accordance with the laws of the State of
Washington, without giving effect to any conflict of laws principle to the contrary. The parties agree that venue for
any Dispute shall lie exclusively in the state or federal courts located in King County, Washington, and the parties
irrevocably waive any right to raise forum non conveniens or any other argument that Washington is not the proper
venue. The parties irrevocably consent to personal jurisdiction in the state and federal courts of the State of
Washington. Any judgment entered pursuant to this section may be enforced in any court of competent jurisdiction.
BORROWER AND LENDER MAY ONLY BRING CLAIMS AGAINST THE OTHER PERSON ONLY IN THEIR
INDIVIDUAL CAPACITY, and not as a plaintiff or class member in any purported class or representative proceeding.

12. JURY TRIAL WAIVER; JUDICIAL REFERENCE.

LENDER AND BORROWER WAIVE ANY RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE
OF ACTION ARISING OUT OF THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREIN OR THEREIN, INCLUDING WITHOUT LIMITATION
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR
STATUTORY CLAIMS. EACH PARTY RECOGNIZES AND AGREES THAT THE FOREGOING WAIVER
CONSTITUTES A MATERIAL INDUCEMENT FOR IT TO ENTER INTO THIS AGREEMENT. EACH PARTY
REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL
AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. IF THIS JURY WAIVER IS FOR ANY REASON
UNENFORCEABLE, THE PARTIES AGREE TO RESOLVE ALL CLAIMS, CAUSES AND DISPUTES




   

THROUGH JUDICIAL REFERENCE PURSUANT TO THE REVISED CODE OF WASHINGTON CHAPTER

4.48 ET SEQ., BEFORE A MUTUALLY ACCEPTABLE REFEREE IN KING COUNTY SITTING WITHOUT A
JURY OR, IF THE PARTIES CANNOT AGREE ON A REFEREE, THEN ONE APPOINTED BY THE
PRESIDING JUDGE OF THE KING COUNTY SUPERIOR COURT FOR KING COUNTY,
WASHINGTON. NOTHING IN THIS SECTION SHALL RESTRICT A PARTY FROM EXERCISING PRE-
JUDGMENT REMEDIES OR ITS RIGHTS UNDER THE UNIFORM COMMERCIAL CODE.

13. GENERAL PROVISIONS.

13.1 Successors and Assigns. This Agreement shall bind and inure to the benefit of the
respective successors and permitted assigns of each of the parties; provided, however, that neither this Agreement nor
any rights hereunder may be assigned by Borrower without Lender’s prior written consent, which consent may be
granted or withheld in Lender’s sole discretion. Lender shall have the right without the consent of or notice to
Borrower to sell, transfer, negotiate, or grant participation in all or any part of, or any interest in, Lender’s obligations,
rights and benefits hereunder.

13.2 Indemnification. Borrower shall defend, indemnify and hold harmless Lender and its
officers, employees, and agents against: (a) all obligations, demands, claims, and liabilities claimed or asserted by
any other party in connection with the transactions contemplated by this Agreement; and (b) all losses or Lender
Expenses in any way suffered, incurred, or paid by Lender as a result of or in any way arising out of, following, or
consequential to the transactions between Lender and Borrower whether under this Agreement, or otherwise
(including without limitation attorneys’ fees and expenses).

13.3 Time of Essence. Time is of the essence for the performance of all obligations set forth in
this Agreement.

13.4 Severability of Provisions. Each provision of this Agreement shall be severable from
every other provision of this Agreement for the purpose of determining the legal enforceability of any specific
provision.

13.5 Amendments in Writing, Integration. Neither this Agreement nor the Loan Documents
can be amended or terminated orally. All prior agreements, understandings, representations, warranties, and
negotiations between the parties hereto with respect to the subject matter of this Agreement and the Loan Documents,
if any, are merged into this Agreement and the Loan Documents.

13.6 Counterparts. This Agreement may be executed in any number of counterparts and by
different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an
original, and all of which, when taken together, shall constitute but one and the same Agreement.

13.7 Survival. All covenants, representations and warranties made in this Agreement shall
continue in full force and effect so long as any Obligations remain outstanding or Lender has any obligation to make
Credit Extensions to Borrower. The obligations of Borrower to indemnify Lender with respect to the expenses,
damages, losses, costs and liabilities described in Section 13.2 shall survive until all applicable statute of limitations
periods with respect to actions that may be brought against Lender have run.

13.8 Credit Reporting. During and after the term of this Agreement, Lender may furnish
certain information about the loans provided to Borrower, Borrower’s loan performance, and Borrower’s financial
condition to one or more commercial credit reporting agencies (“CCRA”). Borrower consents to Lender providing
such information and releases Lender from any liability arising from any losses, claims, or damages in connection
with Lender’s provision of such information to one or more CCRAs.




   

14. CO-BORROWER PROVISIONS.

14.1 Co-Borrowers. Borrowers are jointly and severally liable for the Obligations and Lender
may proceed against one Borrower to enforce the Obligations without waiving its right to proceed against any other
Borrower. This Agreement and the Loan Documents are a primary and original obligation of each Borrower and shall
remain in effect notwithstanding future changes in conditions, including any change of law or any invalidity or
irregularity in the creation or acquisition of any Obligations or in the execution or delivery of any agreement between
Lender and any Borrower. Each Borrower shall be liable for existing and future Obligations as fully as if all of the
Credit Extensions were advanced to such Borrower. Lender may rely on any certificate or representation made by
any Borrower as made on behalf of, and binding on, all Borrowers, including without limitation advance request forms
and compliance certificates. Each Borrower appoints each other Borrower as its agent with all necessary power and
authority to give and receive notices, certificates or demands for and on behalf of all Borrowers, to act as disbursing
agent for receipt of any Credit Extensions on behalf of each Borrower and to apply to Lender on behalf of each
Borrower for any Credit Extensions, any waivers and any consents. This authorization cannot be revoked, and Lender
need not inquire as to one Borrower’s authority to act for or on behalf of another Borrower.

14.2 Subrogation and Similar Rights. Notwithstanding any other provision of this Agreement
or any other Loan Document, each Borrower irrevocably waives, until all obligations are paid in full and Lender has
no further obligation to make Credit Extensions to Borrowers, all rights that it may have at law or in equity (including,
without limitation, any law subrogating a Borrower to the rights of Lender under the Loan Documents) to seek
contribution, indemnification, or any other form of reimbursement from any other Borrower, or any other Person now
or hereafter primarily or secondarily liable for any of the Obligations, for any payment made by a Borrower with
respect to the Obligations in connection with the Loan Documents or otherwise and all rights that it might have to
benefit from, or to participate in, any security for the Obligations as a result of any payment made by a Borrower with
respect to the Obligations in connection with the Loan Documents or otherwise. Any agreement providing for
indemnification, reimbursement or any other arrangement prohibited under this Section shall be null and void. If any
payment is made to a Borrower in contravention of this Section, such Borrower shall hold such payment in trust for
Lender and such payment shall be promptly delivered to Lender for application to the Obligations, whether matured
or unmatured.

14.3 Waivers. Each Borrower waives, to the extent permitted by law, notice of acceptance
hereof; notice of the existence, creation or acquisition of any of the Obligations; notice of an Event of Default except
as set forth herein; notice of the amount of the Obligations outstanding at any time; notice of any adverse change in
the financial condition of any other Borrower or of any other fact that might increase a Borrower’s risk; presentment
for payment; demand; protest and notice thereof as to any instrument; and all other notices and demands to which a
Borrower would otherwise be entitled by virtue of being a co-borrower or a surety. Each Borrower waives any defense
arising from any defense of any other Borrower, or by reason of the cessation from any cause whatsoever of the
liability of any other Borrower. Lender’s failure at any time to require strict performance by any Borrower of any
provision of the Loan Documents shall not waive, alter or diminish any right of Lender thereafter to demand strict
compliance and performance therewith. Each Borrower also waives any defense arising from any act or omission of
Lender that changes the scope of a Borrower’s risks hereunder. Each Borrower hereby waives any right to assert
against Lender any defense (legal or equitable), setoff, counterclaim, or claims that such Borrower individually may
now or hereafter have against another Borrower or any other Person liable to Lender with respect to the Obligations
in any manner or whatsoever.

14.4 Subrogation Defenses. Until all Obligations are paid in full and Lender has no further
obligation to make Credit Extensions to Borrowers, each Borrower hereby waives any defense based on impairment
or destruction of its subrogation or other rights against any other Borrower and waives all benefits which might
otherwise be available to it under any statutory or common law suretyship defenses or marshalling rights, now and
hereafter in effect, including under California Civil Code Sections 2809, 2810, 2819, 2839, 2845, 2848, 2849, 2850,
2899, and 3433 and California Code of Civil Procedure Sections 580a, 580b, 580d and 726, as those statutory
provisions are now in effect and hereafter amended, and under any other similar statutes now and hereafter in effect.




   

14.5 Right to Settle, Release.

(a) The liability of Borrowers hereunder shall not be diminished by (i) any agreement,
understanding or representation that any of the Obligations is or was to be guaranteed by another Person or secured
by other property, or (ii) any release or unenforceability, whether partial or total, of rights, if any, which Lender may
now or hereafter have against any other Person, including another Borrower, or property with respect to any of the
Obligations.

(b) Without notice to any given Borrowers and without affecting the liability of any
given Borrowers hereunder, Lender may (i) compromise, settle, renew, extend the time for payment, change the
manner or terms of payment, discharge the performance of, decline to enforce, or release all or any of the Obligations
with respect to any other Borrower by written agreement with such other Borrower, (ii) grant other indulgences to
another Borrower in respect of the Obligations, (iii) modify in any manner any documents relating to the Obligations
with respect to any other Borrower by written agreement with such other Borrower, (iv) release, surrender or exchange
any deposits or other property securing the Obligations, whether pledged by a Borrower or any other Person, or (v)
compromise, settle, renew, or extend the time for payment, discharge the performance of, decline to enforce, or release
all or any obligations of any guarantor, endorser or other Person who is now or may hereafter be liable with respect to
any of the Obligations.

14.6 Subordination. All indebtedness of a Borrower now or hereafter arising held by another
Borrower is subordinated to the Obligations and a Borrower holding the indebtedness shall take all actions reasonably
requested by Lender to effect, to enforce and to give notice of such subordination.

[SIGNATURE PAGE FOLLOWS]





   

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first
above written.

PACIFIC EPOCH HOLDINGS LLC

By: /s1/

Name: 

/n1/

Title: /t1/

JLM PACIFIC EPOCH LLC

By:

Name: 


Title:

Address for Notices:

2033 6th Avenue, Suite 600

Seattle, Washington,
98121

LIGHTER CAPITAL, INC.

By: /s2/

Name: /n2/



Title: /t2/

Address for Notices:

719 Second Ave Suite 1400

Seattle, WA 98104




   

EXHIBIT A

DEBTOR: PACIFIC EPOCH HOLDINGS LLC AND JLM PACIFIC EPOCH LLC

SECURED PARTY: LIGHTER CAPITAL, INC.

COLLATERAL DESCRIPTION ATTACHMENT

TO LOAN AND SECURITY AGREEMENT

All personal property of PACIFIC EPOCH HOLDINGS LLC AND JLM PACIFIC EPOCH LLC (each herein
referred to as “Borrower” or “Debtor”) whether presently existing or hereafter created or acquired, and wherever
located, including, but not limited to:

(a) all accounts (including health-care-insurance receivables), chattel paper (including tangible and
electronic chattel paper), commercial tort claims, deposit accounts, documents (including negotiable documents),
equipment (including all accessions and additions thereto), general intangibles (including payment intangibles and
software), goods (including fixtures), instruments (including promissory notes), inventory (including all goods held
for sale or lease or to be furnished under a contract of service, and including returns and repossessions), investment
property (including securities and securities entitlements), letter of credit rights, money, and all of Debtor’s books and
records with respect to any of the foregoing, and the computers and equipment containing said books and records; and

(b) any and all cash proceeds and/or noncash proceeds of any of the foregoing, including, without
limitation, insurance proceeds, and all supporting obligations and the security therefor or for any right to payment.
All terms above have the meanings given to them in the Washington Uniform Commercial Code, as amended or
supplemented from time to time.




   

EXHIBIT B

REQUEST FORM

To: LIGHTER CAPITAL, INC.

Email:

Date:

From: PACIFIC EPOCH HOLDINGS LLC AND JLM PACIFIC EPOCH LLC
Borrower’s Name

Signature

Responsible Officer’s Name (please print)

Responsible Officer’s Title

Borrower hereby requests funding of a Term Loan in the amount of $ _______ in accordance with the Term Loan
Facility as defined in the Loan Agreement.

Borrower hereby requests Lender initiate a payment in the amount of $_____________ to be applied to
[principal/interest/fees/expenses] of the [name of Credit Extension] in accordance with the Loan Agreement.

All representations and warranties of Borrower stated in the Loan Agreement are true, correct and complete in all
material respects as of the date of this request; provided that those representations and warranties expressly referring
to another date shall be true, correct and complete in all material respects as of such date.

Capitalized terms used herein and not otherwise defined have the meanings set forth in the Loan Agreement.




   

EXHIBIT C
COMPLIANCE CERTIFICATE

TO: LIGHTER CAPITAL, INC.

FROM: PACIFIC EPOCH HOLDINGS LLC AND JLM PACIFIC EPOCH LLC

The undersigned Responsible Officer of PACIFIC EPOCH HOLDINGS LLC, on behalf of itself and each other
Borrower, hereby certifies that in accordance with the terms and conditions of the Loan and Security Agreement
between Borrower and Lender dated as of /d2/

and as amended from time to time (the “Agreement”),
that (i) Borrower is in complete compliance for the period ending June 30, 2021 with all required covenants except as
noted below and (ii) all representations and warranties of Borrower stated in the Agreement are true and correct as of
the date hereof. Attached herewith are the required documents supporting the above certification.

The undersigned Responsible Officer further certifies that these are prepared in accordance with Generally
Accepted Accounting Principles (GAAP) and are consistently applied from one period to the next except as explained
in an accompanying letter or footnotes.

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

Reporting Covenant Required Complies

Monthly financial statements Monthly within 30 days Yes

Compliance Certificate Monthly within 30 days Yes
Copies of Bank Statements Monthly within 5 days Yes
Annual financial statements FYE within 120 days Yes
Annual operating budget, sales projections and Annually no later than 30 days following Yes
operating plans approved by board of directors the beginning of each fiscal year
Federal annual and quarterly tax returns and filings Within 10 days of filing Yes
State annual tax returns Within 10 days of filing Yes
A/R and Collateral Audit Initial and Annual Yes

Financial Covenant Required Actual Complies

[Reserved]

Comments Regarding Exceptions: See Attached.

Sincerely,

/s1/___________________________________
SIGNATURE


/t1/_______________________________________
TITLE



/d1/
DATE




   

EXHIBIT D

ACH Authorization Form and Authorization Agreement for Pre-Authorized Payments (Debit)

Company Name: Pacific Epoch Holdings LLC (the “Borrower”)

The undersigned hereby authorizes Lighter Capital, Inc. (the “Lender”) and the financial institution or other
provider named below (“Bank”) to electronically charge Borrower’s account specified below for payments due.

Bank Name Wells Fargo NA

Branch Location (Where account was P.O. Box 6995, Portland, OR 97228
opened)

Bank Transit/ABA Number 6800

Account Number 1706

Checking or Savings Account Checking

Account Name Pacific Epoch Holdings LLC

PayPal Account Account Name N/A

PayPal Account E-Mail Address N/A

Other Electronic Account Name N/A

Other Account E-Mail Address N/A

This authority is to remain in full force and effect until Lender and Bank have received written notification from the
undersigned of its termination in such time and in such manner as to afford the Lender and Bank a reasonable
opportunity to act on it. Following termination of the authority granted hereby, Borrower shall make all payments
due the Lender at such time and in such manner as set forth in that certain Loan and Security Agreement by and
between Lender and Borrower.

Authorized Party: By: /s1/

Name: 

/n1/


Title: /t1/

Company Tax ID Number: 4656





   

ACH Authorization Form and Authorization Agreement for Pre-Authorized Payments (Debit)

Company Name: JLM PACIFIC EPOCH LLC (the “Borrower”)

The undersigned hereby authorizes Lighter Capital, Inc. (the “Lender”) and the financial institution or other
provider named below (“Bank”) to electronically charge Borrower’s account specified below for payments due.

Bank Name Wells Fargo NA

Branch Location (Where account was P.O. Box 6995, Portland, OR

opened)

Bank Transit/ABA Number 6800

Account Number 6758

Checking or Savings Account Checking

Account Name JLM Pacific Epoch LLC

PayPal Account Account Name N/A

PayPal Account E-Mail Address N/A

Other Electronic Account Name N/A

Other Account E-Mail Address N/A

This authority is to remain in full force and effect until Lender and Bank have received written notification from the
undersigned of its termination in such time and in such manner as to afford the Lender and Bank a reasonable
opportunity to act on it. Following termination of the authority granted hereby, Borrower shall make all payments
due the Lender at such time and in such manner as set forth in that certain Loan and Security Agreement by and
between Lender and Borrower.

Authorized Party: By:

Name: 

Title:

Company Tax ID Number: 5306





   

SCHEDULE OF EXCEPTIONS

Permitted Indebtedness (Section 1.1)

N/A

Permitted Liens (Section 1.1)

N/A

Inbound Licenses (Section 5.6)

N/A

Prior Names; Locations (Section 5.7)

N/A

Litigation (Section 5.8)

N/A

Subsidiaries/Affiliates (Section 5.14)

Parent owns all of the capital stock, membership interests, and/or other equity interests of the following entities:

x JLM Pacific Epoch LLC

x Pacific Epoch Hong Kong Limited
x Beijing JLM Pacific Epoch Co, LTD (WOFE)
x Beijing JLM Pacific Epoch Co, LTD (Shanghai Company)




   

Operating, Electronic, Depository and Investment Accounts (Section 5.16)

FINANCIAL ACCOUNTS

Bank Name Branch Location Type of Account Account Number

P.O. Box 6995, Portland,

Wells Fargo NA Checking 1706
OR 97228

P.O. Box 6995, Portland,

Wells Fargo NA Checking 6758
OR 97228

PAYPAL INFORMATION:

Account Name: N/A

Email Address: N/A

Other Electronic Accounts:

Account Name: N/A

Email Address: N/A




   

INTELLECTUAL PROPERTY AND DOMAIN NAMES LIST

SCHEDULE A

Copyrights

Copyright Description Registration Number Registration Date

N/A N/A N/A

SCHEDULE B

Patents

Registration
Patent Description Registration / Application Date
/ Application Number

N/A N/A N/A

SCHEDULE C

Trademarks

Trademark Registration
Trademark Description Trademark Registration Date
Number

HKG Trademark for Pacific Epoch 30135569 September 01, 2019

US Trademark Registration for Pacific

4305503 March 19, 2013
Epoch

SCHEDULE D

Domain Names

Domain Name Expiration Date Name of Registrant Name of Registrant Organization

www.pacificepoch.com June 18, 2028 JLM Pacific Epoch LLC GoDaddy.com

The Borrower certifies that the above is a complete list of all of the Borrower's intellectual property and domain
names.



 
 
 
   

FIRST AMENDMENT
TO
LOAN AND SECURITY AGREEMENT

This FIRST Amendment to Loan and Security Agreement (the “Amendment”)is entered into as of /d2



/ , (the “First Amendment Date”) by and between Lighter Capital, Inc. (“Lender”) and Pacific
Epoch Holdings LLC and JLM Pacific Epoch LLC (together, the “Borrower”).

RECITALS

Borrower and Lender are parties to that certain Loan and Security Agreement dated as of August 13, 2021
and as amended from time to time (the “Agreement”). The parties desire to amend the Agreement in accordance with
the terms of this Amendment.

NOW, THEREFORE, the parties agree as follows:

1. The following definitions in Section 1.1 of the Agreement are hereby amended and restated in their
entirety to read as follows:

“Prepayment Fee” means a fee due upon prepayment of the Term Loan equal to (a) twelve
(12) months of interest calculated based on the outstanding principal balance of the Term
Loan if such prepayment occurs prior to the first anniversary of the First Amendment Date
(b) six (6) months of interest calculated based on the outstanding principal balance of the
Term Loan if such prepayment occurs on or after the first anniversary but prior to the
second anniversary of the First Amendment Date, (c) three (3) months of interest calculated
based on the outstanding principal balance of the Term Loan if such prepayment occurs on
or after the second anniversary of the First Amendment Date.

“Term Loan Facility” means an aggregate amount not to exceed $1,500,000.00.

“Term Loan Maturity Date” means the 36 month anniversary of the First Amendment Date.

2. Section 2.1(a)(i) of the Agreement is amended and restated in its entirety to read as follows:

Subject to the terms and conditions of this Agreement, on or around the Closing Date,
Lender made a cash advance to Borrower in the amount of $1,000,000.00 (“Original Term
Loan”). On or around the First Amendment Date, an additional cash advance was made to
Borrower in the original principal amount of $777,777.80, such that after such funding, the
aggregate outstanding principal amount of the loan owing to Borrower was equal to
$1,500,000.00 (the “Term Loan”).

3. The following is added to the end of Section 2.4 of the Agreement:

Lender agrees to cap Lender’s Expenses at $1,000.00 in connection with the First
Amendment at $1,000.00 through the First Amendment Date, unless Borrower is notified
of additional costs in advance.

4. The following is added to the end of Section 6.7(b) of the Agreement:

Notwithstanding the foregoing, Borrower shall have sixty (60) days from the First
Amendment Date to provide Lender with evidence of an increase to its key man life

1



 
 
 
   

insurance on the Key Employee(s) listing Lender as the beneficiary of such policy to an
amount at least equal to total Credit Extensions.

5. Unless otherwise defined, all initially capitalized terms in this Amendment shall be as defined in the
Agreement. The Agreement, as amended hereby, shall be and remain in full force and effect in accordance with its
respective terms and hereby is ratified and confirmed in all respects. Except as expressly set forth herein, the
execution, delivery, and performance of this Amendment shall not operate as a waiver of, or as an amendment of, any
right, power, or remedy of Lender under the Agreement, as in effect prior to the date hereof. Borrower ratifies and
reaffirms the continuing effectiveness of all agreements entered into in connection with the Agreement.

6. Borrower represents and warrants that the representations and warranties contained in the
Agreement are true and correct as of the date of this Amendment, and that no Event of Default has occurred and is
continuing.

7. This Amendment may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one instrument. In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if
such facsimile or “.pdf” signature page were an original hereof.

8. As a condition to the effectiveness of this Amendment, Lender shall have received, in form and
substance satisfactory to Lender, the following:

(a) this Amendment, duly executed by Borrower;

(b) evidence of board/stockholder approval of the transactions contemplated herein (including

a copy of the written consent executed by the requisite board members/stockholders);

(c) payment of all Lender Expenses incurred through the date of this Amendment; and

(d) such other documents, and completion of such other matters, as Lender may reasonably
deem necessary or appropriate.

[SIGNATURE PAGE FOLLOWS]

2



 
 
 
   

IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first date above
written.

BORROWER:

Pacific Epoch Holdings LLC

By: /s1/
Name: /n1/
Joseph Berger
Title: /t1/
CEO

JLM Pacific Epoch LLC

By: /s1/
Name: /n1/
Joseph Berger
Title: /t1/
CEO

LENDER:

LIGHTER CAPITAL, INC.

By: /s2/
Name: /n2/ 
 
Title: /t2/ 

3



   


SECOND AMENDMENT
TO
LOAN AND SECURITY AGREEMENT

This Second Amendment to Loan and Security Agreement is entered into as of 


/d2/
(the “Amendment”), by and between Lighter Capital, Inc. (“Lender”) and Pacific Epoch Holdings LLC and JLM
Pacific Epoch LLC (together, the “Borrower”).

RECITALS

Borrower and Lender are parties to that certain Loan and Security Agreement dated as of August 13, 2021
and as amended from time to time (the “Agreement”). The parties desire to amend the Agreement in accordance with
the terms of this Amendment.

NOW, THEREFORE, the parties agree as follows:

1. The following definition in Section 1.1 of the Agreement is amended and restated in its entirety to
read as follows:

“Credit Extension” means the Term Loan, the Term II Loan, and any other extension of
credit by Lender for the benefit of Borrower hereunder.

2. The following definitions are added to Section 1.1 of the Agreement in alphabetical order:

“Second Amendment Date” means the effective date of that certain Second Amendment to
Loan and Security Agreement by and between Borrower and Lender.

“Term II Loan Maturity Date” means the 27 month anniversary of the Second Amendment
Date

3. The following is added as a new subsection (b) following the end Section 2.1(a) of the Agreement:

(b) Term II Loan.

(i) Subject to and upon the terms and conditions of this Agreement, on or around
the First Amendment Date, Lender shall make an additional cash advance to Borrower in
the original principal amount of $20,000 (the “Term II Loan”).

(ii) Interest shall accrue from the funding date of the Term II Loan, on the
outstanding Daily Balance thereof, at a per annum rate equal to the greater of (x) twelve
percent (12.0%) above the Prime Rate or (y) eighteen and three quarters percent (18.75%);
provided however, that all Obligations with respect to the Term II Loan shall bear interest,
from and after the occurrence and during the continuance of an Event of Default, at a rate
equal to five (5) percentage points above the interest rate applicable immediately prior to
the occurrence of the Event of Default.

(iii) Interest accruing on the Term II Loan shall be payable monthly on the fifth
calendar day (or if such fifth day falls on a day other than a Business Day, then on the next
Business Day) of each month so long as the Term II Loan is outstanding.

(iv) The principal amount of the Term II Loan shall be payable in twenty-seven
(27) equal monthly installments, beginning on April 5, 2023, and continuing on the fifth

1



   


day of each month thereafter (or if such fifth day falls on a day other than a Business Day,
then on the next Business Day) through the Term II Loan Maturity Date, at which time all
amounts owing under this Section 2.1(b) and any other amounts owing under this
Agreement with respect to the Term II Loan shall be immediately due and payable. The
Term II Loan, once repaid, may not be reborrowed.

4. Unless otherwise defined, all initially capitalized terms in this Amendment shall be as defined in the
Agreement. The Agreement, as amended hereby, shall be and remain in full force and effect in accordance with its
respective terms and hereby is ratified and confirmed in all respects. Except as expressly set forth herein, the
execution, delivery, and performance of this Amendment shall not operate as a waiver of, or as an amendment of, any
right, power, or remedy of Lender under the Agreement, as in effect prior to the date hereof. Borrower ratifies and
reaffirms the continuing effectiveness of all agreements entered into in connection with the Agreement.

5. Borrower represents and warrants that the representations and warranties contained in the
Agreement are true and correct as of the date of this Amendment, and that no Event of Default has occurred and is
continuing.

6. This Amendment may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one instrument. In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if
such facsimile or “.pdf” signature page were an original hereof.

7. As a condition to the effectiveness of this Amendment, Lender shall have received, in form and
substance satisfactory to Lender, the following:

(a) this Amendment, duly executed by Borrower;

(b) evidence of board/stockholder approval of the transactions contemplated herein (including

a copy of the written consent executed by the requisite board members/stockholders);

(c) such other documents, and completion of such due diligence and other matters, as Lender
may reasonably deem necessary or appropriate.

[SIGNATURE PAGE FOLLOWS]

2



   


IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the first date above
written.

BORROWER:

Pacific Epoch Holdings LLC and JLM Pacific Epoch LLC

By: /s1/
Name: /n1/


Title: /t1/  

LENDER:

LIGHTER CAPITAL, INC.

By: /s2/
Name: /n2/

Title: /t  

3
 Exhibit “B”

UCC Financing Statements

 Exhibit “C”

Assignment Documents
 EXHIBIT A

FORM OF ASSIGNMENT

ASSIGNMENT, dated as of 9 September, 2021 (this “Assignment”), executed between

Lighter Capital Quincy SPV LLC, as Purchaser (the “Purchaser”), and Lighter Capital, Inc., as
Seller (the “Seller”).

WITNESSETH

WHEREAS, the Purchaser and the Seller are parties to the Purchase and Contribution
Agreement, dated as of July 16, 2021 (as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof, the “Purchase Agreement”),
between the Purchaser and the Seller; and

WHEREAS, pursuant to the Purchase Agreement, the Seller wishes to sell Related
Receivables and related Other Conveyed Property (as each such terms are defined in the Purchase
Agreement) to the Purchaser hereunder.

NOW, THEREFORE, in consideration of the premises and the mutual agreements

hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Purchaser and the Seller, intending to be legally bound,
hereby agree as follows:

1. Definitions. All terms defined in the purchase agreement (whether directly or by reference
to other documents) and used herein shall have such defined meanings when used herein, unless
otherwise defined herein.

“Cut-off Date” means, with respect to the Receivables and the related Other Conveyed
Property being conveyed hereby, 9 September, 2021.

2. Conveyance of Receivables. Subject to the conditions specified in Section 2.1 of the

Purchase Agreement and subject to the mutually agreed upon terms contained in the Purchase
Agreement, the Seller does hereby sell, transfer, assign, set over and otherwise convey to the
Purchaser, without recourse (subject to the obligations set forth herein and in the Purchase
Agreement) all right, title and interest of the Seller in and to the following:

(a) the Related Receivables listed on Schedule 1 to this Assignment and all
monies received with respect to such Related Receivables on and after the related Cut-off
Date;

(b) all Collections (as defined in the Loan Agreement) and other monies due
and to become due under the Portfolio Documents (or otherwise) related to the Related
 Receivables received on or after the date such Related Receivables were purchased by or
contributed to (or purportedly purchased by or contributed to) the Purchaser under this
Assignment (but solely to the extent such Collections and other monies relate to the
Related Receivables purchased by or contributed to (or purportedly purchased by or
contributed to) the Purchaser under this Assignment);

(c) all items required to be contained in the related Portfolio Documents and
any and all other documents or electronic records that the Seller or the Servicer keeps on
file in accordance with its customary procedures relating to such Related Receivables or
the related Account Obligor (as defined in the Loan Agreement);

(d) all property (including the right to receive future liquidation proceeds) that
secures the Related Receivables and that has been acquired by or on behalf of the
Purchaser pursuant to the liquidation of such Related Receivables;

(e) any and all security interests or liens and property subject thereto from time
to time securing or purporting to secure payment of such Related Receivables;

(f) all guarantees, indemnitees, warranties, letters of credit, insurance policies

and proceeds and premium refunds thereof and other agreements or arrangements of
whatever character from time to time supporting or securing payment of such Related
Receivables; and

(g) all present and future rights, claims, demands, causes and choses in action
in respect of any or all of the foregoing and all payments on or under and all proceeds and
investments of any kind and nature in respect of any of the foregoing.

3. Restatement of Representations and Warranties of Seller. The Seller hereby restates the
representations and warranties set forth in Sections 3.1 of the Purchase Agreement (with respect
to the Related Receivables specified in the attached addendum to the Schedule of Receivables
attached as Schedule 1 hereto) with full force and effect as if the same were fully set forth herein.
The Seller hereby certifies that all conditions precedent set forth in Section 2.1(b) of the Purchase
Agreement have been satisfied.

4. Restatement of Representations and Warranties of Purchaser. The Purchaser hereby

restates the representations and warranties set forth in Section 4.1 of the Purchase Agreement with
full force and effect as if the same were fully set forth herein. The Purchaser hereby certifies that
all conditions precedent set forth Section 2.1(b) of the Purchase Agreement have been satisfied.

5. Transfer and Assignment Sale of Receivables. The Seller hereby certifies that the Related
Receivables and Other Conveyed Property transferred to the Purchaser hereunder are free and clear
of all Liens (as defined in the Loan Agreement) (other than Permitted Liens (as defined in the Loan
Agreement)) and that the beneficial interest in and title to such Related Receivables and Other
Conveyed Property shall not be part of the Seller’s estate in the event of the filing of a bankruptcy
petition by or against the Seller under any bankruptcy law. In the event that, notwithstanding the
intent of the Seller, the transfer and assignment contemplated hereby and under the Purchase
Agreement is held not to be a sale or contribution, the transfer and assignment of such Related
Receivables and Other Conveyed Property hereunder shall constitute, and the Seller hereby grants
to the Purchaser, to secure its obligations hereunder, a security interest in the property referred to
in Section 2 above, which security interest has been assigned to the Agent, on behalf of the Agent
and the Lenders (and their successors and assigns), and this Assignment and the Purchase
Agreement shall each constitute a security agreement under Applicable Law.

6. Further Encumbrance of Receivables and Other Conveyed Property.

(a) Immediately upon the conveyance to the Purchaser by the Seller of the
Related Receivables and any item of related Other Conveyed Property pursuant to Section
2 above, and the payment by the Purchaser of the Purchase Price, all right, title and
interest of the Seller in and to such Related Receivables and Other Conveyed Property
shall terminate and all such right, title and interest shall vest in the Purchaser.

(b) Immediately upon the vesting of such Related Receivables and Other
Conveyed Property in the Purchaser, the Purchaser shall have assumed the sole right to
pledge or otherwise encumber such Related Receivables and related Other Conveyed
Property.

7. Counterparts. This Assignment may be executed in two or more counterparts, each of

which shall be an original, but all of which together shall constitute one and the same Instrument.

8. Governing Law. THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE

WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
 IN WITNESS WHEREOF, the undersigned have caused this Assignment to be duly
executed and delivered on the day and year first above written.

LIGHTER CAPITAL QUINCY SPV LLC,

as Purchaser

By:
Nick Baker
Chief Operating Officer

LIGHTER CAPITAL, INC.,

as Seller

By:
Nick Baker
Chief Operating Officer
 EXHIBIT A

FORM OF ASSIGNMENT

ASSIGNMENT, dated as of 7 July, 2022 (this “Assignment”), executed between Lighter

Capital Quincy SPV LLC, as Purchaser (the “Purchaser”), and Lighter Capital, Inc., as Seller (the
“Seller”).

WITNESSETH

WHEREAS, the Purchaser and the Seller are parties to the Purchase and Contribution
Agreement, dated as of July 16, 2021 (as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof, the “Purchase Agreement”),
between the Purchaser and the Seller; and

WHEREAS, pursuant to the Purchase Agreement, the Seller wishes to sell Related
Receivables and related Other Conveyed Property (as each such terms are defined in the Purchase
Agreement) to the Purchaser hereunder.

NOW, THEREFORE, in consideration of the premises and the mutual agreements

hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Purchaser and the Seller, intending to be legally bound,
hereby agree as follows:

1. Definitions. All terms defined in the purchase agreement (whether directly or by reference
to other documents) and used herein shall have such defined meanings when used herein, unless
otherwise defined herein.

“Cut-off Date” means, with respect to the Receivables and the related Other Conveyed
Property being conveyed hereby, 7 July, 2022.

2. Conveyance of Receivables. Subject to the conditions specified in Section 2.1 of the

Purchase Agreement and subject to the mutually agreed upon terms contained in the Purchase
Agreement, the Seller does hereby sell, transfer, assign, set over and otherwise convey to the
Purchaser, without recourse (subject to the obligations set forth herein and in the Purchase
Agreement) all right, title and interest of the Seller in and to the following:

(a) the Related Receivables listed on Schedule 1 to this Assignment and all
monies received with respect to such Related Receivables on and after the related Cut-off
Date;

(b) all Collections (as defined in the Loan Agreement) and other monies due
and to become due under the Portfolio Documents (or otherwise) related to the Related
 Receivables received on or after the date such Related Receivables were purchased by or
contributed to (or purportedly purchased by or contributed to) the Purchaser under this
Assignment (but solely to the extent such Collections and other monies relate to the
Related Receivables purchased by or contributed to (or purportedly purchased by or
contributed to) the Purchaser under this Assignment);

(c) all items required to be contained in the related Portfolio Documents and
any and all other documents or electronic records that the Seller or the Servicer keeps on
file in accordance with its customary procedures relating to such Related Receivables or
the related Account Obligor (as defined in the Loan Agreement);

(d) all property (including the right to receive future liquidation proceeds) that
secures the Related Receivables and that has been acquired by or on behalf of the
Purchaser pursuant to the liquidation of such Related Receivables;

(e) any and all security interests or liens and property subject thereto from time
to time securing or purporting to secure payment of such Related Receivables;

(f) all guarantees, indemnitees, warranties, letters of credit, insurance policies

and proceeds and premium refunds thereof and other agreements or arrangements of
whatever character from time to time supporting or securing payment of such Related
Receivables; and

(g) all present and future rights, claims, demands, causes and choses in action
in respect of any or all of the foregoing and all payments on or under and all proceeds and
investments of any kind and nature in respect of any of the foregoing.

3. Restatement of Representations and Warranties of Seller. The Seller hereby restates the
representations and warranties set forth in Sections 3.1 of the Purchase Agreement (with respect
to the Related Receivables specified in the attached addendum to the Schedule of Receivables
attached as Schedule 1 hereto) with full force and effect as if the same were fully set forth herein.
The Seller hereby certifies that all conditions precedent set forth in Section 2.1(b) of the Purchase
Agreement have been satisfied.

4. Restatement of Representations and Warranties of Purchaser. The Purchaser hereby

restates the representations and warranties set forth in Section 4.1 of the Purchase Agreement with
full force and effect as if the same were fully set forth herein. The Purchaser hereby certifies that
all conditions precedent set forth Section 2.1(b) of the Purchase Agreement have been satisfied.

5. Transfer and Assignment Sale of Receivables. The Seller hereby certifies that the Related
Receivables and Other Conveyed Property transferred to the Purchaser hereunder are free and clear
of all Liens (as defined in the Loan Agreement) (other than Permitted Liens (as defined in the Loan
Agreement)) and that the beneficial interest in and title to such Related Receivables and Other
Conveyed Property shall not be part of the Seller’s estate in the event of the filing of a bankruptcy
petition by or against the Seller under any bankruptcy law. In the event that, notwithstanding the
intent of the Seller, the transfer and assignment contemplated hereby and under the Purchase
Agreement is held not to be a sale or contribution, the transfer and assignment of such Related
Receivables and Other Conveyed Property hereunder shall constitute, and the Seller hereby grants
to the Purchaser, to secure its obligations hereunder, a security interest in the property referred to
in Section 2 above, which security interest has been assigned to the Agent, on behalf of the Agent
and the Lenders (and their successors and assigns), and this Assignment and the Purchase
Agreement shall each constitute a security agreement under Applicable Law.

6. Further Encumbrance of Receivables and Other Conveyed Property.

(a) Immediately upon the conveyance to the Purchaser by the Seller of the
Related Receivables and any item of related Other Conveyed Property pursuant to Section
2 above, and the payment by the Purchaser of the Purchase Price, all right, title and
interest of the Seller in and to such Related Receivables and Other Conveyed Property
shall terminate and all such right, title and interest shall vest in the Purchaser.

(b) Immediately upon the vesting of such Related Receivables and Other
Conveyed Property in the Purchaser, the Purchaser shall have assumed the sole right to
pledge or otherwise encumber such Related Receivables and related Other Conveyed
Property.

7. Counterparts. This Assignment may be executed in two or more counterparts, each of

which shall be an original, but all of which together shall constitute one and the same Instrument.

8. Governing Law. THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE

WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
 IN WITNESS WHEREOF, the undersigned have caused this Assignment to be duly
executed and delivered on the day and year first above written.

LIGHTER CAPITAL QUINCY SPV LLC,

as Purchaser

By:
Nick Baker
Chief Operating Officer

LIGHTER CAPITAL, INC.,

as Seller

By:
Nick Baker
Chief Operating Officer
 EXHIBIT A

FORM OF ASSIGNMENT

ASSIGNMENT, dated as of 3 April, 2023 (this “Assignment”), executed between Lighter

Capital Quincy SPV LLC, as Purchaser (the “Purchaser”), and Lighter Capital, Inc., as Seller (the
“Seller”).

WITNESSETH

WHEREAS, the Purchaser and the Seller are parties to the Purchase and Contribution
Agreement, dated as of July 16, 2021 (as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof, the “Purchase Agreement”),
between the Purchaser and the Seller; and

WHEREAS, pursuant to the Purchase Agreement, the Seller wishes to sell Related
Receivables and related Other Conveyed Property (as each such terms are defined in the Purchase
Agreement) to the Purchaser hereunder.

NOW, THEREFORE, in consideration of the premises and the mutual agreements

hereinafter contained, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Purchaser and the Seller, intending to be legally bound,
hereby agree as follows:

1. Definitions. All terms defined in the purchase agreement (whether directly or by reference
to other documents) and used herein shall have such defined meanings when used herein, unless
otherwise defined herein.

“Cut-off Date” means, with respect to the Receivables and the related Other Conveyed
Property being conveyed hereby, 3 April, 2023.

2. Conveyance of Receivables. Subject to the conditions specified in Section 2.1 of the

Purchase Agreement and subject to the mutually agreed upon terms contained in the Purchase
Agreement, the Seller does hereby sell, transfer, assign, set over and otherwise convey to the
Purchaser, without recourse (subject to the obligations set forth herein and in the Purchase
Agreement) all right, title and interest of the Seller in and to the following:

(a) the Related Receivables listed on Schedule 1 to this Assignment and all
monies received with respect to such Related Receivables on and after the related Cut-off
Date;

(b) all Collections (as defined in the Loan Agreement) and other monies due
and to become due under the Portfolio Documents (or otherwise) related to the Related
 Receivables received on or after the date such Related Receivables were purchased by or
contributed to (or purportedly purchased by or contributed to) the Purchaser under this
Assignment (but solely to the extent such Collections and other monies relate to the
Related Receivables purchased by or contributed to (or purportedly purchased by or
contributed to) the Purchaser under this Assignment);

(c) all items required to be contained in the related Portfolio Documents and
any and all other documents or electronic records that the Seller or the Servicer keeps on
file in accordance with its customary procedures relating to such Related Receivables or
the related Account Obligor (as defined in the Loan Agreement);

(d) all property (including the right to receive future liquidation proceeds) that
secures the Related Receivables and that has been acquired by or on behalf of the
Purchaser pursuant to the liquidation of such Related Receivables;

(e) any and all security interests or liens and property subject thereto from time
to time securing or purporting to secure payment of such Related Receivables;

(f) all guarantees, indemnitees, warranties, letters of credit, insurance policies

and proceeds and premium refunds thereof and other agreements or arrangements of
whatever character from time to time supporting or securing payment of such Related
Receivables; and

(g) all present and future rights, claims, demands, causes and choses in action
in respect of any or all of the foregoing and all payments on or under and all proceeds and
investments of any kind and nature in respect of any of the foregoing.

3. Restatement of Representations and Warranties of Seller. The Seller hereby restates the
representations and warranties set forth in Sections 3.1 of the Purchase Agreement (with respect
to the Related Receivables specified in the attached addendum to the Schedule of Receivables
attached as Schedule 1 hereto) with full force and effect as if the same were fully set forth herein.
The Seller hereby certifies that all conditions precedent set forth in Section 2.1(b) of the Purchase
Agreement have been satisfied.

4. Restatement of Representations and Warranties of Purchaser. The Purchaser hereby

restates the representations and warranties set forth in Section 4.1 of the Purchase Agreement with
full force and effect as if the same were fully set forth herein. The Purchaser hereby certifies that
all conditions precedent set forth Section 2.1(b) of the Purchase Agreement have been satisfied.

5. Transfer and Assignment Sale of Receivables. The Seller hereby certifies that the Related
Receivables and Other Conveyed Property transferred to the Purchaser hereunder are free and clear
of all Liens (as defined in the Loan Agreement) (other than Permitted Liens (as defined in the Loan
Agreement)) and that the beneficial interest in and title to such Related Receivables and Other
Conveyed Property shall not be part of the Seller’s estate in the event of the filing of a bankruptcy
petition by or against the Seller under any bankruptcy law. In the event that, notwithstanding the
intent of the Seller, the transfer and assignment contemplated hereby and under the Purchase
Agreement is held not to be a sale or contribution, the transfer and assignment of such Related
Receivables and Other Conveyed Property hereunder shall constitute, and the Seller hereby grants
to the Purchaser, to secure its obligations hereunder, a security interest in the property referred to
in Section 2 above, which security interest has been assigned to the Agent, on behalf of the Agent
and the Lenders (and their successors and assigns), and this Assignment and the Purchase
Agreement shall each constitute a security agreement under Applicable Law.

6. Further Encumbrance of Receivables and Other Conveyed Property.

(a) Immediately upon the conveyance to the Purchaser by the Seller of the
Related Receivables and any item of related Other Conveyed Property pursuant to Section
2 above, and the payment by the Purchaser of the Purchase Price, all right, title and
interest of the Seller in and to such Related Receivables and Other Conveyed Property
shall terminate and all such right, title and interest shall vest in the Purchaser.

(b) Immediately upon the vesting of such Related Receivables and Other
Conveyed Property in the Purchaser, the Purchaser shall have assumed the sole right to
pledge or otherwise encumber such Related Receivables and related Other Conveyed
Property.

7. Counterparts. This Assignment may be executed in two or more counterparts, each of

which shall be an original, but all of which together shall constitute one and the same Instrument.

8. Governing Law. THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE

WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
 IN WITNESS WHEREOF, the undersigned have caused this Assignment to be duly
executed and delivered on the day and year first above written.

LIGHTER CAPITAL QUINCY SPV LLC,

as Purchaser

By:
Nick Baker
Chief Operating Officer

LIGHTER CAPITAL, INC.,

as Seller

By:
Nick Baker
Chief Operating Officer