S-1/A

As filed with the Securities and Exchange Commission on January 11, 2022.

Registration No. 333-260111​

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Amendment No. 3
to

FORM S-1

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

FLEXENERGY GREEN SOLUTIONS, INC.

(Exact name of registrant as specified in its charter)

Delaware	3629	86-1384045
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification No.)

112 Corporate Drive
Portsmouth, NH 03801
(603) 430-7000

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Mark Schnepel
Chief Executive Officer
FlexEnergy Green Solutions, Inc.
112 Corporate Drive
Portsmouth, NH 03801
(603) 430-7000
(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Garett Sleichter, Esq.
Rutan & Tucker, LLP
18575 Jamboree Road
Suite 900
Irvine, CA 92612
Phone (714) 641-5100
Fax (714) 546-9035 Michael A. Hedge, Esq.
K&L Gates LLP
1 Park Plaza
Twelfth Floor
Irvine, CA 92614
Phone (949) 253-0900
Fax (949) 253-0902

Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☒
Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price(1)(2)			Amount of Registration Fee(3)
Common Stock, par value $0.0001 per share	​	$	25,555,550	​	$	2,369.00
Warrants to purchase Common Stock, par value $0.0001 per share(4)	​	​	​	​	​	​
Common Stock issuable upon exercise of Warrants	​	$	28,111,050	​	$	2,605.89
Underwriter’s warrant(5)	​	​	​	​	​	​
Common Stock issuable upon exercise of underwriter’s warrant(5)	​	$	4,600,000	​	$	426.42
Total	​	$	58,266,600	​	$	5,401.31

(1)

Pursuant to Rule 416, the securities being registered hereunder include such indeterminate number of additional securities as may be issuable to prevent dilution resulting from stock splits, stock dividends or similar transactions.

(2)

Estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rule 457(o) of the Securities Act of 1933, as amended.

(3)

$4,270.40 of this registration fee was previously paid by the registrant.

(4)

No fee is required pursuant to Rule 457(i).

(5)

The registrant has agreed to issue, upon the closing of this offering, a warrant to Roth Capital Partners, LLC entitling it to purchase a number of shares of common stock equal to 2.5% of the aggregate units sold in this offering. The exercise price of the warrant will be equal to 120% of the public offering price of the units offered hereby.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not the solicitation of an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

Subject to completion, dated January 11, 2022.

PRELIMINARY PROSPECTUS

2,222,222 Units
Common Stock and Warrants

FlexEnergy Green Solutions, Inc.

We are offering 2,222,222 units of securities (the “Units”), each consisting of one share of our common stock, par value $0.0001 per share and one warrant (the “Warrants”) to purchase one share of our common stock at an exercise price equal to $        (110% of the initial public offering price per Unit) per share, exercisable until the third anniversary of the issuance date, and subject to certain adjustments and cashless exercise provisions as described herein. Prior to this offering, there has been no public market for our securities. We anticipate that the initial public offering price per Unit will be between $8.00 and $10.00 per Unit. Our common stock has been approved for listing on The Nasdaq Capital Market (“Nasdaq”) under the symbol “FLXE” subject to official notice of issuance. We do not intend to apply for any listing of the Warrants on Nasdaq or any other securities exchange or nationally recognized trading system, and we do not expect a market to develop for the Warrants.

The offering is being underwritten on a firm commitment basis. We have granted the underwriter an option to buy up to an additional 333,333 shares of common stock and/or Warrants to purchase 333,333 additional shares of common stock from us in any combination thereof to cover over-allotments. The underwriter may exercise this option at any time and from time to time during the 30-day period from the date of this prospectus.

​	No Exercise of Over- Allotment					Full Exercise of Over- Allotment
​	Per Unit(2)			Total		Per Unit(2)			Total
Initial public offering price	​	$		​	$	​	$		​	$
Underwriting discounts and commissions(1)	​	$		​	$	​	$		​	$
Proceeds to us, before expenses	​	$		​	$	​	$		​	$

(1)

In addition, we have agreed to reimburse the underwriter for certain expenses. See “Underwriting” on page 94 of this prospectus for additional information.

(2)

The public offering price corresponds to an assumed public offering price per share of $     and an assumed public offering price per Warrant of $0.01.

We have agreed to issue, upon the closing of this offering, an underwriter’s warrant to Roth Capital Partners, LLC entitling it to purchase a number of shares of common stock equal to 2.5% of the number of Units issued in this offering. The underwriter’s warrant will be exercisable at a per share exercise price equal to 120% of the initial public offering price. See “Underwriting — Underwriter’s Warrant.”

We are an “emerging growth company” and a “smaller reporting company” as defined under federal securities laws and, as such, have elected to comply with certain reduced public company reporting requirements. See “Prospectus

Summary — Implications of Being an Emerging Growth Company and a Smaller Reporting Company.”

After the completion of this offering, we will be a “controlled company” within the meaning of Nasdaq corporate governance standards. See “Prospectus Summary — Implications of Being a Controlled Company.”

Investing in our securities involves a high degree of risk. See the section captioned “Risk Factors” beginning on page 13 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities.

Neither the Securities and Exchange Commission nor any other state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

The underwriter expects to deliver the securities to the purchasers on or about January   , 2022.

Roth Capital Partners

The date of this prospectus is January   , 2022

TABLE OF CONTENTS

​	Page
Prospectus Summary	​	1
The Offering	​	8
Summary Historical Combined Consolidated Financial Data	​	10
Risk Factors	​	13
Special Note Regarding Forward-Looking Statements	​	35
Use of Proceeds	​	37
Dividend Policy	​	38
Capitalization	​	39
Dilution	​	40
Management’s Discussion and Analysis of Financial Condition and Results of Operations	​	42
Business	​	60
Management	​	69
Executive Compensation	​	73
Certain Relationships and Related Party Transactions	​	78
Principal Stockholders	​	81
Description of Capital Stock	​	83
Shares Eligible for Future Sale	​	87
Material U.S. Federal Income Tax Consequences to Non-U.S. Holders of Our Securities	​	89
Underwriting	​	94
Legal Matters	​	99
Experts	​	99
Where You Can Find More Information	​	99
Index to Financial Statements	​	F-1

Until            , 2022, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

We have not, and the underwriter has not, authorized anyone to provide you with different information, and we and the underwriter takes no responsibility for any other information others may give you. We are not, and the underwriter is not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than its date.

For Investors Outside of the United States

We have not, and the underwriter has not, done anything that would permit this offering or possession of distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the U.S. Persons who come into possession of this prospectus and any free writing prospectus we may authorize for use in connection with this offering in jurisdictions outside the U.S. are required to inform themselves about and to observe any restrictions as to this offering and the distribution of this prospectus and any such free writing prospectus applicable to that jurisdiction.

Basis of Presentation

The financial information provided in this prospectus consists of the consolidated and combined financial information of FlexEnergy, Inc. (“FEI”), and Flex Leasing Power & Service LLC (“FLPS”).

i

FlexEnergy Green Solutions, Inc. (“FGS”) was formed on December 31, 2020 as a Delaware corporation, and is a wholly-owned subsidiary of FlexEnergy Power Solutions, LLC (“FPS”). FGS has not, to date, conducted any activities other than those incident to its formation and the preparation of the registration statement of which this prospectus is a part. At or prior to the closing of this offering, FPS will contribute its equity interests in FEI and FLPS to FGS, and FEI and FLPS will become wholly owned subsidiaries of FGS. We refer to these contributions collectively as the “Contribution Transaction.” In addition, on August 16, 2021, FPS entered into a Simple Agreement for Future Equity (as amended from time to time, the “SAFE”) with RNS Flex, LLC (RNS”) and TRF Platform Holdings, LLC (“TRF”) whereby, for an aggregate investment of $5,500,000 (the “Invested Amount”), RNS and TRF received the right to receive from FPS a number of the shares of FGS common stock issued to FPS in the Contribution Transaction equal to the Invested Amount divided by 80% of the issuance price per Unit in this offering (the “SAFE Transaction”). In consideration of the contribution by FPS of the SAFE proceeds to the capital of FEI and FLPS, FGS will redeem any shares transferred to RNS and TRF up to the full amount of the over-allotment net proceeds at a per share price equal to the per Unit price in this offering. If this offering does not occur, then the SAFE will automatically convert and RNS and TRF will each receive the right to receive from FPS equity in FLPS representing percentage economic and ownership interest equal to (A) 36.67% multiplied by (B) a fraction, (I) the numerator of which is the Funded Amount (as defined in the SAFE), and (II) the denominator of which is $5,500,000. See “Certain Relationships and Related Party Transactions  —  SAFE Transaction.”

FGS will be the financial reporting entity following this offering. Other than the balance sheets as of December 31, 2020 and September 30, 2021, financial information of FGS has not been included in this prospectus as since its formation on December 31, 2020 it has not entered into any business transactions or activities, has no capitalization, and had no assets or liabilities during the periods presented in this prospectus.

Trademarks, Trade Names and Service Marks

“FlexEnergy Green Solutions, Inc.” and other registered or common law trademarks, service marks or trade names appearing in this prospectus are the property of FGS or one of its subsidiaries (after completion of the Contribution Transaction). Other trademarks, service marks or trade names appearing in this prospectus are the property of their owners. We do not intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. We have omitted the ® and ™ designations, as applicable, for the trademarks used in this prospectus.

Market, Industry and Other Data

Unless otherwise indicated, information contained in this prospectus concerning our industry and the markets in which we operate, including our general expectations and market position, market opportunity and market size, is based on reports from various sources. Because this information involves a number of assumptions and limitations, you are cautioned not to give undue weight to such information. Information based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. The information in any such publication, report, survey or article is not incorporated by reference in this prospectus. In addition, projections, assumptions and estimates of our future performance and the future performance of the industry in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section captioned “Risk Factors” and elsewhere in this prospectus. See “Special Note Regarding Forward-Looking Statements.”

ii

PROSPECTUS SUMMARY

This summary highlights selected information that is presented in greater detail elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our securities. You should read this entire prospectus carefully, including the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and our combined consolidated financial statements and the related notes included elsewhere in this prospectus before making an investment decision. Unless the context otherwise requires, the terms “FlexEnergy,” “the Company,” “we,” “us” and “our” refer to (i) upon completion of this offering, FGS and, unless otherwise stated, all of its subsidiaries, and (ii) prior to the completion of this offering, FEI and FLPS and, unless otherwise stated, all of their consolidated subsidiaries.

Our Company

We are an energy focused technology company that designs, manufactures, sells and leases cost-effective energy solutions that lower our customers’ environmental footprint, often by making useable energy from sources of fuel or heat otherwise overlooked or wasted. We do this through two different types of highly engineered products. First, our Flex Turbines offer a reliable source for distributed or grid connected electrical power, capable of being fired by a wide variety of gaseous fuels from waste gas from landfills and natural gas flaring to higher BTU fuels such as propane and synthetic gas. Leasing and sales of Flex Turbines presently represent the bulk of our operations and revenues. Flex Turbines provide our customers with solutions to gain independence over their electricity generation and minimize overall reliance on the grid. Second, we offer heat recovery products that are integral to promising emerging power technologies, such as high efficiency fuel cells for power generation that can be fueled by hydrogen or natural gas. These Flex Heat Recovery products are in the early stages of commercialization, and presently constitute a small but increasingly growing and important portion of our operations and revenues as the future of energy generation emerges.

We focus on providing proven technology and support that enables reliable, efficient and economic green energy solutions. Our business consists of leasing and service of our Flex Turbines supported by a vertically integrated OEM, together with direct sales of our Flex Turbine and Flex Heat Recovery systems. As of September 30, 2021, we have amassed over 8.8 million hours of field runtime on our turbine fleet with over 122 megawatts (“MW”) shipped, of which 49 MW make up our lease fleet. This balance of core competencies in turbine power and heat recovery with current cash flow generation helps fund growth of our technology suite and expansion of applications into new and existing markets. The primary applications of our technology include: converting waste gas to useful energy, improving traditional processes and enabling emerging clean technology. We are actively expanding into other key markets for which our products are well suited, and we are confident in generating opportunities in additional geographic markets and product extensions into different applications.

Our combined consolidated financial statements have been prepared as though we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We have incurred operating losses and negative cash flows from operations since inception. As of September 30, 2021, we had an accumulated deficit of approximately $138.36 million. Management expects to continue to incur operating losses and negative cash flows from operations through the remainder of 2022. We are dependent upon the receipt of additional capital investments and other financings to fund our ongoing operations and may need to raise additional capital in order to continue to fund operations. We believe we will be able to obtain additional capital through equity financings or other arrangements to fund operations; however, there can be no assurance that such additional financing, if available, can be obtained on acceptable terms. If we are unable to obtain such additional financing, future operations would need to be scaled back or discontinued. Accordingly, these factors raise substantial doubt about our ability to continue as a going concern within one year after the date the combined consolidated financial statements are issued. See “Risk Factors — Risk Factors Relating to our Business and Industry — Our management has expressed substantial doubt about our ability to continue as a going concern without additional capital investment.”

1

Primary Applications

The primary applications of our technology include:

•

Converting Waste Gas to Useful Energy:   The Flex Turbine can run on waste fuels such as methane from landfills and carbon dioxide (“CO2”) heavy field gas from oil producing wells down to 350 BTUs, as well as synthetic gasses such as ethane produced in the refining process with up to 2,500 BTUs to produce reliable, distributed electricity.

•

Improving Traditional Processes:   Flex Heat Recovery systems utilize our proprietary highly efficient, high temperature, high pressure heat exchanger technology. These products have a smaller footprint than competing systems due to their design efficiency, making them ideal for space constrained applications. They are currently being evaluated by potential customers for the next generation of carbon capture technology, multiple fuel cell applications, and emissions reduction projects. The Flex Turbine can be installed in Commercial and Industrial (“C&I”) applications to generate power and heat and/or cooling to reduce facility operating costs. Flex Turbines can simultaneously provide backup power capability to improve resiliency and keep operations running through utility power outages. Moreover, Flex Turbines are capable of generating power on industrial fuels that might otherwise be wasted, further improving C&I operating margins.

•

Enabling Emerging Clean Technology:   Efficient use of thermal energy is the key to energy efficiency in many of today’s most promising alternative fuel technologies, such as solid oxide fuel cells for power generation technologies, for green hydrogen production, and for certain heat as energy storage applications. We believe our Flex Heat Recovery products enable these green technologies to be more cost competitive with conventional forms of energy production.

Products

•

Turbine Solutions:   Flex Turbines provide scalable, modular on-site power to both off-grid and grid dependent environments.

•

Heat Recovery Solutions:   Flex Heat Recovery systems have been used in a broad array of applications, from the extension of the range of turbine powered destroyers in the British Navy, to large scale fuel cell applications for power generation, to being prototyped into key components in the oncoming hydrogen economy, such as solid oxide fuel cells.

Our Market Opportunity

We believe that the world is looking for cleaner, reliable electrical power alternatives both to replace existing sources and to provide electrical power where electricity is not available or reliable. Additionally, we believe the adoption of new emerging technologies and fuels will expand our opportunities to grow.

In 2020, approximately 4.0 trillion kilowatt-hours (“kwh”) were generated from utility-scale facilities, of which 40% comprised natural gas, 19% coal, 20% nuclear, 20% renewables and 1% petroleum and others. Natural gas is one of the most abundant and available sources of clean energy as market trends such as the electrification of vehicles and the phasing out of coal-fired plants becomes more commonplace.

Power generation from fossil fuels and the associated release of CO2 as a byproduct has been shown to be a contributing factor to global climate change. The world continues to rely on technology advances combined with best practices to reduce greenhouse gas emissions.

The following trends have increased onsite, lesser emissions power demand from customers in a growing number of markets, and we expect them to continue to do so:

•

Continued growth in electricity demand, including for transportation

•

Decarbonization efforts to mitigate climate change peril, including carbon taxes

2

•

Natural gas as replacement for coal and oil-fired equipment and processes

•

Secular shift to distributed generation to assure power quality and avoid the cost of expanding aging and inefficient transmission infrastructure

•

Emergence of zero or low pollution alternative sources of power in the hydrogen economy, including fuel cells, solar and wind power

•

A drive for energy efficiency causing many industries to look for ways to eliminate wasted energy consumption

We believe that these trends will expand the market opportunity for Flex Turbine solutions and Flex Heat Recovery systems.

Our Growth Strategy

Our chief objective is to be a primary provider of clean, affordable and reliable energy. In order to accomplish this, we intend to:

•

Accelerate growth in underpenetrated markets and expand our geographic footprint.   We believe the total market opportunity for modular, onsite power remains significantly under-penetrated in the U.S. The flexibility and reach of our leasing model, coupled with our scalable turbine packages, allow us to increase market penetration and enter new markets quickly and efficiently. We plan to strengthen our existing relationships and identify new sub-sectors to accelerate our growth. We will seek to enter new markets and geographies over time, both in the U.S. and internationally, where climate, demand for clean energy and regulatory policies position turbine power generation as an economically compelling alternative to centralized electric utilities.

•

Continued deployment of our turbine fleet and heat recovery solutions to our customers.   We believe that integrated energy systems enhance the reliability, resiliency and predictability of turbine-generated electricity in certain markets, increasing the overall value proposition to customers. We expect demand for the Flex Turbine with on-board hot water heat exchanger, our combined heat and power (“CHP”) solution, to increase over time. We also expect continued requests by our customers to integrate our energy systems with existing energy storage (e.g. photovoltaic battery cells) to provide additional resiliency.

•

Broaden and enhance service offerings.   We provide ongoing monitoring and service as a standard component of our leasing agreements. We believe there is significant market demand for long-term protection plans for customers who have chosen to finance or purchase systems rather than lease them, and we will strive to capture a significant share of this market. We plan to expand our green energy product and service offerings to provide further cost savings to our customers and optimize the performance of existing traditional processes.

•

Increase Inventory to Shorten Delivery Times.   Flex Turbines currently are built upon order with a six or more month lead time from order to completion. By investing in additional inventory levels and building certain sub-assemblies in advance, we believe we can substantially shorten the time to delivery and thereby improve our appeal to customers searching for prompt energy solutions.

Summary Risk Factors

Our business is subject to numerous risks and uncertainties, including those in the section captioned “Risk Factors” and elsewhere in this prospectus. These risks include, but are not limited to, the following:

•

If we fail to retain existing customers, derive revenue from existing customers consistent with historical performance or acquire new customers cost-effectively, our business could be adversely affected. We are subject to substantial customer concentration. In times of market surplus, our rental prices are subject to enhanced market pressure.

3

•

The volatility in the price of oil affects the growth rate of new oil wells coming online. This commodity price volatility may adversely affect the demand for our products and services and negatively impact our results of operations.

•

Our products involve a lengthy sales cycle, and we may not anticipate sales levels appropriately, which could adversely affect our results of operations.

•

We have limited operating history with our line of heat recovery products and, as a result, if our estimates of product efficacy, maintenance and repair costs or useful life are inaccurate our business and financial results could be harmed.

•

The majority of turbines we sell or lease currently run with natural gas as the primary input fuel. As a fossil-fuel based solution, natural gas power generation products are subject to a heightened risk of regulation and to changes in our customers’ energy procurement policies.

•

We currently rely on a limited number of suppliers for certain parts and equipment to build our products, and we may not be able to find replacements or immediately transition to alternative suppliers, which could adversely affect our business, financial condition and results of operation.

•

Our credit facility subjects FLPS and its subsidiaries to financial and other restrictive covenants. These restrictions may limit our operational or financial flexibility and could subject us to potential defaults under the credit facility. In addition, any default could result in foreclosure.

•

Our substantial indebtedness could limit our opportunities for growth.

•

The distributed generation market is highly competitive. Competing solutions for distributed energy include renewables such as solar, wind and storage, gas-fired reciprocating engines, fuel cells and other gas turbines, any or all which might be perceived as superior to our technology, for economic, ecological or other reasons.

•

We anticipate that some portion of our future products and performance will rely on the adoption and availability of hydrogen gas as a fuel source and an insufficient supply of hydrogen could negatively affect our sales growth.

•

We anticipate engineering our products to run on fuel blends with a greater percentage of hydrogen. However, if we are unsuccessful or if there is an insufficient supply of hydrogen, our sales growth could be adversely affected.

•

If we are unable to attract and retain key employees and hire qualified management, technical, engineering, and sales personnel, our ability to compete and successfully grow our business could be harmed.

•

Our management has expressed substantial doubt about our ability to continue as a going concern without additional capital investment.

•

We have identified material weaknesses in our internal control over financial reporting and our information technology environment. We may identify additional material weaknesses in the future that may cause us to fail to meet our reporting obligations or result in material misstatements of our combined consolidated financial statements. If we fail to remediate any material weaknesses or if we fail to establish and maintain effective control over financial reporting, investors may lose confidence in our ability to provide reliable and timely financial reports and the value of our common stock may decline.

•

At many of our customers’ oil production sites, we utilize the abundant associated gas that is otherwise flared as our primary input fuel. Should midstream infrastructure be put into place that allows the associated gas to be processed and transported to end markets, it would curtail our volume of input fuel for onsite power generation and adversely affect our costs or ability to meet the customer’s power generation demand.

•

Our largest stockholder, FPS, has a series of senior secured notes that are currently due in full at December 31, 2022, that if not extended or renegotiated, could cause FPS to sell shares of our common stock, which could adversely affect our stock price.

4

•

FPS’ Series B and Series B-1 Units have redemption rights that, if exercised, could cause FPS to sell shares of our common stock to pay for the redemption, which could adversely affect our stock price.

Corporate History, Contribution Transaction and SAFE Transaction

On April 2, 2008, FlexEnergy, LLC was initially formed in Delaware in connection with a contribution of certain thermal oxidizer technology assets. Assets related to the thermal oxidizer technology were later contributed to a wholly owned subsidiary, Flex Power Generation, Inc., and all of the outstanding shares of Flex Power Generation, Inc. were distributed to the stockholders of FEI as a special dividend on November 13, 2012.

On December 31, 2010, (i) FEI was converted from FlexEnergy, LLC, (ii) FlexEnergy Energy Systems, Inc. (“FEES”) was incorporated as a wholly owned subsidiary of FEI, and (iii) FEES purchased from Ingersoll Rand Energy Systems Corporation certain assets relating to the development, manufacture, sale and service of turbines.

On January 8, 2014, FEI, FlexEnergy Holdings, LLC and FlexEnergy Merger Sub, Inc. entered into an Agreement and Plan of Merger whereby (i) each then outstanding share of stock and stock option of FEI was converted into a corresponding ownership unit and ownership unit option of FlexEnergy Holdings, LLC, and (ii) FlexEnergy Holdings, LLC became the sole stockholder of FEI at that time.

On December 31, 2015, FPS was formed in Delaware in connection with the contributions of all of the outstanding shares of stock of FEI and all of the outstanding membership interests of FLPS. As a result of the associated transactions, FEI and FLPS became wholly owned subsidiaries of FPS.

On December 31, 2020, FGS was formed in Delaware. On or prior to the closing of this offering FPS intends to contribute all of its assets, which consist solely of 100% equity interests in FEI and FLPS, to FGS, which will result in FEI and FLPS becoming wholly owned subsidiaries of FGS. The diagram below shows our corporate structure after completion of the Contribution Transaction and the SAFE Transaction.

Following the completion of the Contribution Transaction and the SAFE Transaction, and assuming no exercise of the underwriter’s over-allotment exercise, the number of shares of common stock of FGS owned by FPS, RNS and TRF and thus outstanding prior to this offering will be 9,687,878 shares of common stock. The following diagram assumes no exercise of the underwriter’s over-allotment option no exercise of the Warrants being offered by this prospectus, and no exercise of the underwriter’s warrant.

5

Corporate Information

Our principal executive offices are located at 112 Corporate Drive, Portsmouth, NH 03801. Our telephone number is (603) 430-7000. The address of our website is www.flexenergy.com. The information on or that can be accessed through our website is not incorporated by reference into this prospectus, and you should not consider any such information as part of this prospectus or in deciding whether to purchase our securities.

6

Implications of Being an Emerging Growth Company and a Smaller Reporting Company

We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. We will remain an emerging growth company until the earlier of (1) the last day of the year following the fifth anniversary of the consummation of this offering, (2) the last day of the year in which we have total annual gross revenue of at least $1.07 billion, (3) the last day of the year in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which would occur if the market value of our common stock held by non-affiliates exceeded $700,000,000 as of the last business day of the second fiscal quarter of such year or (4) the date on which we have issued more than $1 billion in non-convertible debt securities during the prior three-year period. An emerging growth company may take advantage of specified reduced reporting requirements and is relieved of certain other significant requirements that are otherwise generally applicable to public companies. As an emerging growth company:

•

we are presenting herein only two years of audited combined consolidated financial statements and related management’s discussion and analysis of financial condition and results of operations;

•

we will avail ourselves of the exemption from the requirement to obtain an attestation report from our auditors on the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002 (“Sarbanes Oxley”);

•

we will provide less extensive disclosure about our executive compensation arrangements; and

•

we will not be required to hold stockholder non-binding advisory votes on executive compensation or golden parachute arrangements.

In addition, under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until those standards apply to private companies. We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.

We are also a smaller reporting company as defined under federal securities laws. We may continue to be a smaller reporting company so long as either (i) the market value of our stock held by non-affiliates is less than $250,000,000 or (ii) our annual revenue was less than $100,000,000 during the most recently completed fiscal year and the market value of our stock held by non-affiliates is less than $700,000,000. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. For so long as we remain a smaller reporting company, we are permitted to rely on exemptions from certain disclosure and other requirements that are applicable to other public companies that are not smaller reporting companies.

As a result, the information that we provide to our stockholders may be different than the information you might receive from other public reporting companies in which you hold equity interests.

Implications of Being a Controlled Company

After the Contribution Transaction and prior to the completion of this offering, FPS will own 100% of our common stock and, after completion of this offering, FPS will own approximately 74.93 % of our common stock, assuming an offering price of $9.00 per Unit, which is the midpoint of the range on the cover page of this prospectus, assuming no exercise of the underwriter’s over-allotment option and assuming no exercise of the Warrants being offered by this prospectus. As a result, we will be a “controlled company” within the meaning of Nasdaq corporate governance standards because more than 50% of our voting common stock is owned by FPS. For further information on the implications of this distinction, see “Risk Factors – Risk Factors Relating to Ownership of Our Common Stock – We are a “controlled company” within the meaning of the rules of Nasdaq and, as a result, will qualify for, and may rely on, exemptions from certain corporate governance requirements.”

7

THE OFFERING

Securities we are offering

2,222,222 Units, each consisting of one share of our common stock, par value $0.0001 per share, and one warrant (the “Warrants”) to purchase one share of our common stock at an exercise price equal to $     (110% of the initial public offering price per Unit) per share, exercisable on the third anniversary of the issuance date, and subject to certain adjustments and cashless exercise provisions as described herein.

Common stock to be outstanding immediately after this offering

11,910,100 shares

Underwriter’s over-allotment option

We have granted the underwriter a 30 day option to purchase up to 333,333 additional shares of our common stock and/or Warrants to purchase 333,333 additional shares of common stock from us in any combination thereof. Because the Warrants will not be listed on a national security exchange or other nationally recognized trading market, the underwriter will be unable to satisfy any over-allotment of shares and Warrants without exercising the underwriter’s over-allotment option with respect to the Warrants. However, because our common stock is publicly traded, the underwriter may satisfy some or all of the over-allotment of shares of our common stock, if any, by purchasing shares in the open market and will have no obligation to exercise its over-allotment option with respect to our comon stock.

Use of proceeds

We estimate that the net proceeds from the sale of the Units in this offering will be approximately $14,875,000, based upon the initial public offering price of $9.00 per Unit (which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus), after deducting the underwriting discount and estimated offering expenses payable by us.

The principal purposes of this offering are to increase our financial flexibility, create a public market for our common stock and to facilitate future access to the public equity markets for us and our stockholders. We currently intend to use the net proceeds from this offering for next generation product development, to expand our fleet to support our Energy-as-a-Service (“EaaS”) model, to expand our sales force, to pay down outstanding borrowings under our credit facility, for working capital and other general corporate purposes. We may use a portion of the net proceeds to acquire complementary businesses or technologies. However, we do not have agreements or commitments for any acquisitions at this time. If the underwriter exercises its over-allotment option, we intend to use the net proceeds thereof to redeem shares of our common stock that were transferred to RNS and TRF in connection with the SAFE Transaction. See “Use of Proceeds” for additional information.

Dividend policy

We currently do not intend to declare or pay any cash dividends in the foreseeable future. Any determination to pay dividends on our capital stock will be at the discretion of our board of directors, subject to applicable laws, and will depend on the terms of our financing arrangements, our financial condition, results of operations, capital requirements, general business conditions, contractual restrictions and other factors that our board of directors considers relevant. See “Dividend Policy” for additional information.

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Risk factors

See “Risk Factors” beginning on page 13 and the other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our securities.

Proposed trading symbol

Our common stock has been approved for listing on Nasdaq under the symbol “FLXE” subject to official notice of issuance. We do not intend to apply for any listing of the Warrants on Nasdaq or any other securities exchange or nationally recognized trading system, and we do not expect a market to develop for the Warrants.

Lock-up

We and our directors, officers and principal stockholder have agreed with the underwriter not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our common stock or securities convertible into common stock for a period of 180 days after the date of this prospectus. See “Underwriting” for additional information.

The total number of shares of our common stock that will be outstanding after this offering excludes shares of common stock to be reserved for future grant or issuance under our proposed 2021 Incentive Award Plan (“2021 Plan”), which will become effective in connection with the completion of this offering. The number of shares available for grant under the 2021 Plan will be 10% of the fully-diluted number of shares outstanding after completion of this offering, including the Warrants, the over-allotment shares and/or Warrants, the underwriter’s warrant and the shares reserved for issuance under the 2021 Plan.

Except as otherwise indicated, all information in this prospectus assumes:

•

the completion of the Contribution Transaction;

•

no exercise by the underwriter of its over-allotment option to purchase additional shares and/or Warrants;

•

no exercise of the Warrants being offered by this Prospectus; and

•

no exercise of the underwriter’s warrant.

After giving effect to the Contribution Transaction and the SAFE Transaction, FPS, RNS and TRF will own 9,687,878 shares of our common stock.

9

SUMMARY HISTORICAL COMBINED CONSOLIDATED FINANCIAL DATA

FGS was formed in December 2020 and does not have historical financial data. The historical financial data presented in this prospectus is the historical combined consolidated financial data of FEI and FLPS, our wholly-owned subsidiaries upon completion of the Contribution Transaction. The summary historical financial data for the years ended December 31, 2020 and 2019 are derived from the audited combined consolidated financial statements of FEI and FLPS for those periods, which are included elsewhere in this prospectus. The summary historical financial data as of September 30, 2021 and for the nine months ended September 30, 2021 and 2020 are derived from the unaudited condensed combined financial statements of FEI and FLPS for those periods, which are included elsewhere in this prospectus.

You should read this data together with the combined consolidated financial statements of FEI and FLPS and related notes, as well as the information under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included elsewhere in this prospectus. Our historical results are not necessarily indicative of our future results.

​	Years Ended December 31,						Nine Months Ended September 30,
(in thousands)	2020			2019			2021			2020
Statement of Operations and Comprehensive Loss Data:	​	​	​	​	​	​	​	​	​	​	​	​
Revenue	​	​	​	​	​	​	​	​	​	​	​	​
Turbine leasing fleet	​	$	17,838	​	$	16,833	​	$	11,144	​	$	14,304
Turbine service on sold product	​	​	2,213	​	​	2,824	​	​	3,431	​	​	1,617
Manufactured product	​	​	3,276	​	​	5,716	​	​	3,712	​	​	3,276
Total revenue	​	$	23,327	​	$	25,373	​	$	18,287	​	$	19,197
Cost of revenue	​	​	​	​	​	​	​	​	​	​	​	​
Turbine leasing fleet (excluding depreciation of fleet turbines)	​	$	4,884	​	$	5,442	​	$	4,279	​	$	3,714
Turbine service on sold product	​	​	1,691	​	​	2,797	​	​	2,254	​	​	1,292
Manufactured product	​	​	5,789	​	​	9,531	​	​	5,651	​	​	5,419
Depreciation of fleet turbines	​	​	5,007	​	​	4,713	​	​	3,357	​	​	4,003
Total cost of revenue	​	$	17,371	​	$	22,483	​	$	15,541	​	$	14,428
Operating expenses	​	​	​	​	​	​	​	​	​	​	​	​
Selling, general and administrative	​	$	11,826	​	$	12,400	​	$	10,318	​	$	8,596
Research and development	​	​	120	​	​	237	​	​	98	​	​	126
Total operating expenses	​	$	11,946	​	$	12,637	​	$	10,416	​	$	8,722
Operating loss	​	$	(5,990)	​	$	(9,747)	​	$	(7,670)	​	$	(3,953)
Other income (expense)	​	​	​	​	​	​	​	​	​	​	​	​
Interest expense	​	$	(1,114)	​	$	(992)	​	$	(792)	​	$	(876)
Other income (expense), net	​	​	31	​	​	(159)	​	​	2,562	​	​	(10)
Total other income (expense), net	​	$	(1,083)	​	$	(1,151)	​	$	1,770	​	$	(886)
Loss before income taxes	​	$	(7,073)	​	$	(10,898)	​	$	(5,900)	​	$	(4,839)
Income tax expense	​	​	(31)	​	​	(7)	​	​	(308)	​	​	(5)
Net loss	​	$	(7,104)	​	$	(10,905)	​	$	(6,208)	​	$	(4,844)
Other comprehensive gain (loss), net of tax	​	​	​	​	​	​	​	​	​	​	​	​
Foreign currency translation adjustments	​	$	443	​	$	185	​	$	(66)	​	$	(17)
Total other comprehensive gain (loss), net of tax	​	$	443	​	$	185	​	$	(66)	​	$	(17)
Comprehensive loss	​	$	(6,661)	​	$	(10,720)	​	$	(6,274)	​	$	(4,861)
EBITDA	​	$	1,114	​	$	(3,712)	​	$	371	​	$	1,207
Adjusted EBITDA	​	$	1,209	​	$	(3,457)	​	$	(1,653)	​	$	1,260

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​	As of September 30, 2021
(in thousands)	Actual			As Adjusted(1)
Balance Sheet Data	​	​	​	​	​	​
Cash	​	$	1,474	​	$	16,349
Working capital(2)	​	$	11,935	​	$	26,810
Total assets	​	$	50,970	​	$	65,845
Line of credit	​	$	22,917	​	$	22,917
Total liabilities	​	$	29,172	​	$	29,172
Total stockholder’s equity	​	$	21,798	​	$	36,673

(1)

On an as adjusted basis to give effect to the issuance and sale of 2,222,222 Units in this offering at an assumed initial public offering price of $9.00 per Unit (which is the midpoint of the price range set forth on the cover page of this prospectus) after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

(2)

Working capital is defined as total current assets minus total current liabilities.

Non-GAAP Financial Measures

In addition to our financial results determined in accordance with generally accepted accounting principles (“GAAP”), we believe “EBITDA” and “Adjusted EBITDA”, non-GAAP measures, are useful in evaluating our operating performance. We use these financial measures to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding facility relocation expenses, equity-based compensation, restructuring costs and forgiveness of the PPP loans, which are unusual or non-cash charges and thus not indicative of our historical business and results of operations or of our outlook. In particular, we believe that the use of Adjusted EBITDA is helpful to our investors as it is a metric used by management in assessing the health of our business and our operating performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as a tool for comparison. A reconciliation is provided below for our non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measure and the reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure, and not to rely on any single financial measure to evaluate our business.

EBITDA and Adjusted EBITDA

We believe EBITDA and Adjusted EBITDA are key performance measures used by our management to assess our operating performance. Because Adjusted EBITDA facilitates internal comparisons of our historical operating performance on a more consistent basis, we use this measure for business planning purposes and in evaluating acquisition opportunities.

We calculate EBITDA as net income (loss), plus (i) depreciation and amortization expense, (ii) interest expense and (iii) income tax expense. We define Adjusted EBITDA as EBITDA plus or minus (i) equity-based compensation expense and (ii) certain non-cash charges and unusual or non-recurring charges or income that we do not view as representative of our ongoing operations.

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The following table presents a reconciliation of EBITDA and Adjusted EBITDA from the most comparable GAAP measure, net income (loss), for each of the years ended December 31, 2020 and 2019 and for the nine months ended September 30, 2021 and 2020:

​	Year Ended December 31,						Nine Months Ended September 30
(in thousands)	2020			2019			2021			2020
Net Loss	​	$	(7,104)	​	$	(10,905)	​	$	(6,208)   (4,844)	​	$
Depreciation and amortization	​	​	7,073	​	​	6,194	​	​	5,479	​	​	5,170
Interest expense, net	​	​	1,114	​	​	992	​	​	792	​	​	876
Provision for income taxes	​	​	31	​	​	7	​	​	308	​	​	5
EBITDA	​	$	1,114	​	$	(3,712)	​	$	371	​	$	1,207
One-time non-operating facility relocation expenses(1)	​	​	25	​	​	185	​	​	301	​	​	—
PPP loan forgiveness	​	​	—	​	​	—	​	​	(2,378)	​	​	—
Equity-based compensation	​	​	70	​	​	70	​	​	53	​	​	53
Adjusted EBITDA	​	$	1,209	​	$	(3,457)	​	$	(1,653)	​	$	1,260

(1)

Represents non-recurring out of pocket expenses incurred in moving our heat recovery-focused facility.

Some of the limitations of EBITDA and Adjusted EBITDA include (i) these non-GAAP measures do not properly reflect capital commitments to be paid in the future, and (ii) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and EBITDA and Adjusted EBITDA do not reflect these capital expenditures. Our non-GAAP measures may not be comparable to similarly titled measures of other companies because they may not calculate them in the same manner as we calculate, the measure, limiting its usefulness as a comparative measure. In evaluating EBITDA and Adjusted EBITDA, you should be aware that in the future we will incur expenses similar to the adjustments in this presentation. Our presentation of EBITDA and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these expenses or any unusual or non-recurring items. EBITDA and Adjusted EBITDA should not be considered as an alternative to loss before benefit from income taxes, net loss, earnings per share, or any other performance measures derived in accordance with U.S. GAAP. When evaluating our performance, you should consider adjusted our non-GAAP measures alongside other financial performance measures, including our net loss and other GAAP results.

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RISK FACTORS

The following section discusses material risks and uncertainties that could adversely affect our business and financial condition. Investing in our securities involves substantial risks. You should carefully consider the following risk factors, as well as all of the other information contained in this prospectus, including “Management’s Discussion and Analysis of the Financial Condition and Results of Operations” and the combined consolidated financial statements and related notes thereto included elsewhere in this prospectus, before deciding to invest in our common stock. Additional risks and uncertainties that we are unaware of may also become important factors that adversely affect our business. The occurrence of any of the following risks, or additional risks that we are unaware of, could adversely affect our business, strategies, prospects, financial condition, results of operations and cash flows. In that case, the market price of our common stock could decline, and you could lose all or part of your investment.

Risk Factors Relating to our Business and Industry

If we fail to retain existing customers, derive revenue from existing customers consistent with historical performance or acquire new customers cost-effectively, our business could be adversely affected. We are subject to substantial customer concentration.

Our success, and our ability to increase revenues and operate profitably, depends in part on our ability to retain and keep existing customers engaged so that they continue to purchase or lease equipment from us, and to acquire new customers cost-effectively. We intend to continue to expand our customer base as part of our growth strategy. If we fail to retain existing customers and to attract and retain new customers, our business, financial condition and results of operations could be adversely affected. Our three largest customers accounted for approximately 14%, 14% and 10% of total revenue for the nine months ended September 30, 2021. Our two largest customers accounted for approximately 23% and 17% of total revenue for the nine months ended September 30, 2020. In 2020, our three largest customers generated 23%, 14% and 10%, respectively, of our total revenue, and in 2019, our largest customer generated approximately 28% of our total revenue. Three customers accounted for 17%, 14% and 13% of our accounts receivable balance as of September 30, 2021. Two customers accounted for 15% and 14%, respectively, of our accounts receivable balance as of December 31, 2020. One customer accounted for 32% of our accounts receivable balance as of December 31, 2019. Accordingly, we are subject to customer concentration risk in the form of non-renewal of terminating lease contracts, which can be brought on by financial distress, aggressive pricing offers from our competitors, or merger and acquisition activity that is beyond our control. If one of our largest customers elects not to renew or extend existing lease contracts or insists upon price concessions, we could realize a substantial loss of lease revenue from a single customer until the point where we can identify new opportunities to redeploy these available turbine units elsewhere, which could adversely affect our business, financial condition and results of operations. In certain instances, we face the financial burden of de-installation, transportation and cost of redeployment.

The volatility in the price of oil affects the growth rate of new oil wells coming online. This commodity price volatility may adversely affect the demand for our products and services and negatively impact our results of operations.

The majority of our turbines since inception have been deployed in the oil and gas (“O&G”) sector to oil production sites requiring onsite power generation. Our addressable market in this sector is largely defined by the existing oil wells in production, along with new oil wells coming online. During the prolonged low price environment in 2016-2017, and more recently the sharp price decline beginning in a second low price environment between March 2020 and January 2021, we experienced reduced demand from our customer base for power generation equipment, resulting in a reduction in sales of new turbine units, and a decrease in our total lease deployment count. Significant decreases in the price of oil typically result in a reduction of the number of new wells coming online in a given time period, which in turn decreases and/or defers the need for incremental power generation equipment over that time.

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Our products involve a lengthy sales cycle, and we may not anticipate sales levels appropriately, which could adversely affect our results of operations.

A portion of our revenue and associated production volume in a given quarter and year comes from turbines we sell outright to our customers as a capital purchase. The sale of our turbine products typically involves a significant commitment of capital by customers, which can result in typical delays associated with large capital expenditures. Delays for placing purchase orders can come from a number of sources, including an extensive review of all competing sources of self-generation, the need to procure outside financing, and delays and uncertainties imposed from the local utilities regarding interconnect permitting requirements. For these and other reasons, the sales cycle associated with our products can be lengthy and subject to a number of significant risks over which we have little or no control. We plan our production and inventory levels based on internal forecasts of customer demand, which is highly unpredictable and can fluctuate substantially. If sales in any period fall significantly below anticipated levels, our financial condition, results of operations and cash flow would suffer.

We have limited operating history with our line of heat recovery products and, as a result, if our estimates of product efficacy, maintenance and repair costs or useful life are inaccurate our business and financial results could be harmed.

Although our heat recovery technology has historically been an important element of our turbines, the external sale of our heat recovery products independently from our turbines began in 2017 and therefore we do not have a long operating history with these products. As a result, we do not have sufficient historical data to prove efficacy and maintenance and repair costs over a long period of use and any estimates regarding long-term product life or repair and replacement costs may prove to be incorrect. If incorrect, we may incur additional design and product development costs to achieve desired product performance.

Additionally, we have sold heat exchangers to only a limited number of customers. In order for our heat recovery products to achieve broader market acceptance, we will need to further develop these products, produce them in large quantities cost effectively, and market and sell them in greater quantities. If we are unsuccessful, our profitability will be adversely affected.

The majority of turbines we sell or lease currently run with natural gas as the primary input fuel. As a fossil-fuel based solution, natural gas power generation products are subject to a heightened risk of regulation and to changes in our customers’ energy procurement policies.

The production of CO2 has been shown to be a contributing factor to global climate change. Our turbines running on natural gas do produce CO2. As such, we may be negatively impacted by CO2 related changes in applicable laws, regulations, ordinances, rules, or the requirements of the incentive programs on which we and our customers currently rely. Changes (or a failure to recognize the benefit of our technology as one means to maintain reliable and resilient electric service with a lower greenhouse gas emission profile) in any of the laws, regulations, ordinances, or rules that apply to our installations and new technology could make it illegal or more costly for us or our customers to install and operate our gas turbines on particular sites, thereby negatively affecting our ability to deliver cost savings to customers, or we could be prohibited from completing new installations or continuing to operate existing projects. Certain municipalities in California have already banned the use of distributed generation products that utilize fossil fuel. Additionally, our customers’ and potential customers’ energy procurement policies may prohibit or limit their willingness to procure gas turbines. Our business prospects may be negatively impacted if we are prevented from completing new installations or our installations become more costly as a result of laws, regulations, ordinances, or rules applicable to our gas turbines, or by our customers’ and potential customers’ energy procurement policies.

We currently rely on a limited number of suppliers for certain parts and equipment to build our products and we may not be able to find replacements or immediately transition to alternative suppliers, which could adversely affect our business, financial condition and results of operation.

We currently rely on a limited number of suppliers, and in some instances, a single supplier, for certain equipment and components to build our products. If demand for the equipment or components necessary

14

to build our products increases or our suppliers face financial distress or bankruptcy, they may not be able to provide the equipment or components on schedule or at current prices. For example, steel is the principal raw material used in manufacturing our systems. The price of steel has historically fluctuated on a cyclical basis and has often depended on a variety of factors which we have no control over. If our suppliers are unable to provide the raw materials and components needed to build our products on schedule or at current prices, we may need to seek other suppliers, which may adversely affect our revenues or increase our costs.

In order to reduce manufacturing lead times and ensure adequate component supply, we enter into agreements with certain suppliers that allow them to procure inventories based upon certain criteria. Due to the complexity of some of our components, we may not timely find alternate suppliers, if at all. If we fail to accurately anticipate customer demand, an oversupply of parts could result in excess or obsolete inventories, which could adversely affect our business. Additionally, if we fail to correctly anticipate our internal supply requirements, an undersupply of parts could limit our production capacity. Our inability to meet volume commitments with suppliers could affect the availability or pricing of our parts and components. A reduction or interruption in supply, a significant increase in price of one or more components or a decrease in demand of products could adversely affect our business and operations and could adversely affect our customer relationships. Financial problems of suppliers on whom we rely could limit our supply of components or increase our costs.

In addition, suppliers may de-prioritize our orders if another larger customer places orders with them. Due to our volume of purchases, we typically are unable to take advantage of any bulk volume pricing. Also, we cannot guarantee that any of the parts or components that we purchase will be of adequate quality or that the prices we pay for the parts or components will not increase. Inadequate quality of products from suppliers could interrupt our ability to supply quality products to our customers in a timely manner. Additionally, defects in materials or products supplied by our suppliers that are not identified before our products are placed in service by our customers could result in higher warranty costs and damage to our reputation. We also outsource certain of our components internationally, which may subject us to delays in delivery because of regulations associated with the import/export process, delays in transportation or regional instability.

We have cash payments due under FEI incentive plans on January 1, 2023 and January 1, 2026, which might require us to use funds that we would otherwise use for other purposes, such as operations, growth or distribution.

Our subsidiary, FEI, has a 2013 Equity Incentive Plan (the “2013 Plan”) that provides cash payment awards. The payments under the 2013 Plan have been frozen and there will be no further grants made under the 2013 Plan. Under the 2013 Plan, an aggregate payout of $0.6 million is due to the participants on the earlier of January 1, 2023 or a Change of Control (as defined in the 2013 Plan). FEI also has a 2016 Target Incentive Plan (the “2016 Plan”) that provides for fixed potential cash payouts totaling $3.2 million. The payments under the 2016 Plan are only due to the participants if a Change in Control (as defined in the 2016 Plan) that constitutes a Qualifying Sale (as defined in the 2016 Plan) occurs on or before the earlier of January 1, 2026 or a Termination Transaction (as defined in the 2016 Plan). If payments are due under the 2016 Plan, they must be paid within 60 days after the Change in Control (as defined in the 2016 Plan) that constitutes a Qualifying Sale (as defined in the 2016 Plan). At the time these payments come due, we may have more pressing needs for this cash, such as working capital, debt reduction or investment in growth and expansion. Use of this cash to make these payouts at inopportune times could impede our growth and stress our cash position, adversely affecting our results of operations. Our obligations to pay the amounts may also reduce the proceeds otherwise payable to our stockholders in the event of or following a Change of Control (as defined in the 2013 Plan) or a Change in Control (as defined in the 2016 Plan).

We are exposed to the credit risk of our customers, and any material nonpayment or nonperformance by our customers could adversely affect our financial results.

During times of significant oil price shocks or sustainably low oil prices, some of our leasing customers face significant financial hardship whereby it becomes increasingly difficult to stay current with the monthly operating payments for the provision of our services. Likewise, our C&I customers have varying levels of financial strength. In cases where C&I customers opt to make the capital invested into a self-generation

15

project, the required investment can be substantial relative to the business’ operations and revenue base, and in many cases it requires outside financing to be secured. This can result in delays and nonperformance in our customers’ ability to make the agreed scheduled progress payment against the executed purchase order, production build and delivery of our gas turbines going towards the self-generation project.

Further, our heat recovery modules are custom designed to meet the specific operating requirements and specific performance goals of our customers. With this customization comes inherent risk of designing a solution specific to a given customer since there is very little secondhand value in the finished product should the customer be unable to pay on time or in full. The typical production cycle between purchase and completion and delivery of a module can be six to eighteen months, with defined payment milestones. Should a customer face financial hardship over the course of this long build cycle, we may incur financial losses should milestone payments not be made on time or loss of revenue should the customer not be able to make full payment and take delivery of the finished heat exchanger module.

Our credit procedures and policies may not be adequate to fully reduce customer credit risk. If we are unable to adequately assess the creditworthiness of existing or future customers or unanticipated deterioration in their creditworthiness, any resulting increase in nonpayment or nonperformance by them and our inability to re-market or otherwise use our equipment could adversely affect our financial results.

Variations in the spread between available fuel for self-power generation and otherwise available electricity prices, may adversely affect our revenue, profitability, cash flows and growth.

Our economic value proposition to our C&I customers is premised on the financial savings they would achieve by self-generating a portion of the electricity and heat that they would otherwise receive from their utilities. This value proposition is subject to risk in at least three ways:

First, our turbine products typically run on natural gas as the input fuel. Unless our units are run on available, waste gas or some alternative fuel source (e.g. propane or hydrogen), an increase in the price of natural gas will produce less cost savings for our customers. Therefore, the economic value of our power generation products depends largely on the spread between natural gas fuel and electricity prices or other alternative distributed generation solutions. While electricity rates have historically increased steadily every year in most states in the U.S., declining electric utility rates would adversely affect the savings produced by self-generation by increasing the payback period for customers who invest the upfront capital in their onsite generation plant. Similarly, increased prices or greater variability in the price of natural gas could adversely affect the predicted cost savings of a self-generation project and, due in part to the unpredictable nature of the cost savings, could cause our customers to forego the investment into producing their own onsite energy.

Second, electric utilities could offer rate reductions to its C&I customers, in response to the competition from distributed energy solutions, including from us. If electric utilities offer price concessions that result in lower or more predictable utility bills over time, C&I customers may find that the cost savings generated by our products may be less than the cost savings generated by these price concessions.

Third, we compete with alternative distributed generation solutions, including gas-fueled engines, gas-fueled fuel cells and renewable sources of energy such as wind and solar power. If the cost of alternative distributed generation solutions decline in the future, particularly for baseload distributed energy solutions such as the pairing of intermittent solar power and battery storage solutions, then the potential cost savings produced by these alternative distributed generation solutions could be greater than the potential cost savings products by our products.

Utility companies may resist the adoption of distributed generation and could impose customer fees or interconnection requirements on our customers that could make our products less desirable.

Electric utilities may impose measures that make it more difficult for its customers to decrease their reliance on the utility by self-generating a portion of its energy. The vast majority of our customers who utilize our gas turbines for self-generation for a portion of their baseload power still rely on the utility for

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additional power supply in a given month. The local electric utility may impose “departing load,” “standby,” or other charges, including power factor charges, on our customers in connection with their acquisition of our gas turbines, the amounts of which are outside of our control and which may have a material impact on the economic benefit of our gas turbines to our customers.

In some instances, an interconnect permit is required at the outset of the project installation. Based on the varying requirements of the local utilities around interconnection, the associated cost and timing can be unpredictable and in some cases unviable for the self-generation project to move forward into operation.

The distributed generation market is highly competitive. Competing solutions for distributed energy include renewables such as solar, wind and storage, gas-fired reciprocating engines, fuel cells and other gas turbines, any or all which might be perceived as superior to our technology, for economic, ecological or other reasons.

Within our O&G addressable market, we face competition from other technologies that can provide remote, onsite power in what is typically an off-grid application. The most direct competition to our oilfield leasing solution are regional rental businesses that own and operate a fleet of diesel and gas reciprocating engines. Competing rental companies include Gravity, Baseline, Mesa, Moser and Aggreko. The OEM equipment providers of these engines are large, well established companies such as Caterpillar, Cummins, MAN and Doosan. While we believe we have a differentiating and superior technology in our proprietary turbine technology for various remote oilfield power applications, competing rental companies in partnership with their large engine OEM providers have extensive manufacturing, field service and financial resources that creates intense competition in the form of large available supply capacity and highly competitive pricing to our customer base.

Within our CHP addressable market for the C&I sector, we face intense competition from a wide variety of distributed generation sources that can allow businesses to self-generate a portion of their energy demand. These competing solutions include diesel and gas-fueled reciprocating engines, fuel cells and other small-scale gas turbines. They also include intermittent renewable energy such as solar and wind power, which traditionally cannot provide 24/7 baseload power to commercial and industrial customers. However, the adoption of battery storage technology paired with intermittent renewables could emerge as a viable and proven baseload self-generation solution in the future and could thus become direct competition to our baseload energy solution. Our competitors include several well-known companies that have substantially greater resources than we do and have established manufacturing and global field service organizations.

Our failure to adequately protect our intellectual property rights could impair our ability to compete effectively or defend ourselves from litigation, which could harm our business, financial condition, and results of operations.

Our success depends, in part, on our ability to protect our intellectual property. We rely primarily on patent, trademark, and trade secret laws, as well as confidentiality and non-disclosure agreements, and other contractual protections, to protect our technologies and proprietary know-how, all of which offer only limited protection. The steps we have taken to protect our intellectual property rights may not be adequate to prevent the misappropriation, infringement, or other violation of our proprietary information or intellectual property rights, and our ability to prevent misappropriation, infringement, or other violation is uncertain, particularly in countries outside of the U.S.

We have eight issued U.S. patents (expiring generally between 2022 and 2037), 15 patents issued in foreign countries (expiring generally between 2024 and 2037), and one patent application pending internationally. There can be no assurance that the patent application will issue as a granted patent, and even if it does issue, the patent claims may be insufficient to prevent third parties from utilizing our technologies. We cannot assure you that the scope of the rights granted to us will be meaningful or provide us with any commercial advantage. The failure of our patents to adequately protect our technology might make it easier for our competitors to offer similar products or technologies. Further, our foreign patent protection is less comprehensive than our U.S. patent protection and may not protect our intellectual property rights in some countries where our products are sold or may be sold in the future. Many U.S.-based companies have encountered substantial third-party intellectual property infringement in foreign countries.

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Even if foreign patents are granted, effective enforcement in foreign countries may not be available. We have ceased using certain of our patents that we no longer view as being useful.

We believe that the success of our business depends more on proprietary technology, information and processes, and know-how than on our patents or trademarks. Much of our proprietary information and technology related to manufacturing processes is not patented and may not be patentable. As such, we generally rely on trade secret protection with respect to our processes and software. While we believe our technology is difficult to reverse engineer, we cannot assure you that our competitors will not be able to do so.

In addition, we also rely on contractual protections with our customers, suppliers, distributors, employees, and consultants, and we implement security measures designed to protect our trade secrets and know-how. However, we cannot assure you that we have entered into these agreements with every such party, that these contractual protections and security measures will not be breached, that we will have adequate remedies for a breach, or that our customers, suppliers, distributors, employees, or consultants will not assert rights to intellectual property or damages arising out of these contracts.

We may in the future need to initiate infringement claims or litigation in order to try to protect or enforce our intellectual property rights. Litigation, whether we are a plaintiff or a defendant, can be expensive and time-consuming and may divert the efforts of our management and other personnel, which could harm our business, whether or not the litigation results in a determination favorable to us. Litigation also puts our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing. Further, any enforcement of our patents or other intellectual property may provoke third parties to assert counterclaims against us. If we are unable to meaningfully protect our proprietary rights or if third parties independently develop or gain access to our or similar technologies, our business, financial condition, results of operations, reputation, and competitive position could be harmed.

Our products are exposed to operating conditions that may require us to repair and replace critical components ahead of their scheduled replacement cycle, which adds cost that we must cover under the terms of our purchase warranties, service care contracts and leasing contracts.

As our fleet of rental equipment ages, the cost of maintaining that equipment, if not replaced within a certain period of time, generally increases. Determining the optimal age for our rental fleet equipment is subjective and requires considerable estimates by management. We have made estimates regarding the relationship between the age of our rental fleet equipment, and the maintenance and repair costs, and the market value of used equipment. Our future operating results could be adversely affected because our maintenance and repair costs may be higher than estimated and market values of used equipment may fluctuate.

In addition, our products are exposed to operating conditions that may require us to repair and replace critical components ahead of scheduled replacement times, which increases our operating costs. We are required by our service care contracts, leasing contracts, and product warranty to repair and replace these components if they are covered by the terms of the applicable contract or warranty and we incur the full costs of repair or replacement. While we have improved our products with each successive generation and while our service care and leasing contracts have restrictions on misuse of our products, there is no guarantee that these maintenance and repair costs will consistently be at or below budgeted amounts.

Our turbine products use inherently dangerous, flammable fuels, and operate at high temperatures and speeds, each of which could subject our business to product liability claims.

Our business exposes us to potential product liability claims that are inherent in products that operate at high temperatures and/or speeds or use hydrogen. Our products utilize fuels such as natural gas. The fuels we use are combustible and may be toxic. In addition, our turbine products operate at high voltage, temperatures, speeds, and pressure and also use corrosive material, which could expose us to potential liability claims. Although we have incorporated a robust design and redundant safety features in our turbine products, we cannot guarantee that there will not be accidents. Any accidents involving our products or other hydrogen-using products could materially impede widespread market acceptance and demand for our

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products. In addition, we might be held responsible for damages beyond the scope of our insurance coverage. We also cannot ensure you that we will be able to maintain adequate insurance coverage on acceptable terms.

We anticipate engineering our products to run on fuel blends with a greater percentage of hydrogen. However, if we are unsuccessful or if there is an insufficient supply of hydrogen, our sales growth could be adversely affected.

We believe our turbines can currently run on a fuel blend comprising up to 30% hydrogen, and we plan to engineer our turbines to accept fuel blends containing higher percentages of hydrogen, including accepting only hydrogen. As such, we are currently dependent upon, and in the future expect to be more dependent upon, the availability of cost-effective hydrogen fuel blends for the profitable commercialization of our products and services. If these fuels are not readily available or if their prices are such that energy produced by our products costs more than energy provided by other sources, then our products could be less attractive to potential users and our products’ value proposition could be negatively affected. There may be an insufficient supply of hydrogen for this market that could negatively affect our sales and deployment of our products and services. In addition, while we believe we have the engineering capabilities to succeed in developing and manufacturing turbines that can accept only hydrogen as a fuel source, we are unable to adequately forecast the timing and cost requirements in order to sell these products to our customers. We may also ultimately be unable to develop and manufacture products that are suitable for customers. There can be no assurances that we achieve market acceptance of these products, or that products and technologies developed by others will not render our products or technologies obsolete or uncompetitive.

Our field service operations are subject to environmental and occupational health and safety laws and regulations, as well as safety requirements outlined in customer MSAs, that may expose us to material costs and liabilities.

Many of our oilfield customers require us to execute their Master Service Agreement (“MSA”) before entering into any leasing or service care contracts. These MSAs and other agreements typically require that we follow strict safety protocol while conducting onsite operations, maintain sufficient insurance levels, and in some cases agree to a maximum amount of liquidated damages. In addition to the environmental and safety requirements of our customers, we must also adhere to federal, state and local environmental and safety measures across our field service operations. Environmental laws impose obligations and liability for the cleanup of properties affected by hazardous substance spills or releases. These liabilities can be imposed on the parties generating or disposing of such substances or the operator of the affected property, often without regard to whether the owner or operator knew of, or was responsible for, the presence of hazardous substances. Accordingly, we may become liable, either contractually or by operation of law, for remediation costs even if a contaminated property is not currently owned or operated by us, or if the contamination was caused by third parties during or prior to our ownership or operation of the property.

We may not be in strict compliance with all federal, state and local environmental and occupational health and safety laws and regulations at all times. We are subject to potentially material civil or criminal fines or penalties if we fail to comply with any of these requirements. We have made and will continue to make capital and other expenditures in order to comply with these laws and regulations. However, the requirements of these laws and regulations are complex, change frequently, and could become more stringent in the future. It is possible that these requirements will change or that liabilities will arise in the future in a manner that could adversely affect our business, financial condition and results of operations.

If we are unable to attract and retain key employees and hire qualified management, technical, engineering, and sales personnel, our ability to compete and successfully grow our business could be harmed.

We believe that our success and our ability to reach our strategic objectives are highly dependent on the contributions of our key management, technical, engineering, and sales personnel, including Mark Schnepel, our President and Chief Executive Officer, Wes Kimmel, our Chief Financial Officer, and Doug Baltzer, our Chief Commercial Officer. This executive management team has been primarily responsible for determining the strategic direction of our business and for executing its growth strategy and is integral to our brand, culture, product development and the reputation it enjoys with suppliers, distributors, customers

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and business partners. In particular, Mr. Schnepel’s involvement in the development and redesign of the turbine is a key component of our technological durability. In addition, Mr. Schnepel and Mr. Baltzer are the primary sales and marketing contacts for our customers.

We cannot assure you that we will be able to successfully attract and retain senior leadership necessary to grow our business. Furthermore, there is increasing competition for talented individuals in our field. Any such departure could be viewed in a negative light by investors and analysts, which may cause the price of our common stock to decline. The loss of the services of any of our key employees could disrupt our operations, delay the development and introduction of our products and services and negatively impact our business, relationship with key customers and suppliers, branding, creative strategies, prospects, and operating results, as we may not be able to find suitable individuals to replace them on a timely basis, if at all. We do not currently carry key-person life insurance for any of our management team.

Our management has expressed substantial doubt about our ability to continue as a going concern without additional capital investment.

The combined consolidated financial statements have been prepared as though we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We have incurred operating losses and negative cash flows from operations since inception. As of September 30, 2021, we had an accumulated deficit of approximately $138.36 million. Management expects to continue to incur operating losses and negative cash flows from operations for the remainder of 2022. We have financed our operations to date with proceeds from equity infusions from FPS and drawing down on our credit facility.

If we are unable to successfully complete this offering, we will need to create alternate financing or operational plans to continue as a going concern. There can be no assurance that such alternate financing, if available, can be obtained on acceptable terms. If we are unable to obtain such alternate financing, future operations would need to be scaled back or discontinued.

Accordingly, these factors raise substantial doubt about our ability to continue as a going concern within one year after the date the combined consolidated financial statements are issued. The combined consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.

We might not be able to utilize a significant portion of our net operating loss carryforwards and research and development tax credit carryforwards.

As of September 30, 2021, we had significant U.S. federal and state net operating loss (“NOL”) carryforwards and U.S. federal and state research and development tax credit carryforwards. These net operating loss and U.S. federal tax credit carryforwards could expire unused and/or be unavailable to offset future income tax liabilities. In addition, under Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50% change, by value, in its equity ownership over a three-year period, the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes to offset its post-change income may be limited. We performed a Section 382 analysis as of December 31, 2020 to determine if an ownership change has occurred. It has been preliminarily determined that ownership changes occurred under these rules, and an annual limitation on the use of pre-ownership change NOL carryforwards and certain other losses and/or credits has been applied. The preliminary analysis indicates $48.4 million of federal net operating loss carryforwards as of December 31, 2020 will expire unutilized. In addition, we may experience ownership changes in the future as a result of subsequent shifts in our stock ownership, some of which may be outside of our control and which could further limit our ability to utilize NOL carryforwards.

On March 27, 2020, the CARES Act was signed into law as a result of the COVID-19 pandemic. The new legislation includes a number of income tax provisions applicable to individuals and businesses. In addition, governments around the world have enacted or implemented various forms of tax relief measures in

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response to the economic conditions in the wake of the COVID-19 pandemic. Although, due to our historical net operating losses incurred in the U.S., the CARES Act did not have a material impact on our combined consolidated financial statements as of December 31, 2020 and September 30, 2021, we continue to examine the elements of the CARES Act and other changes in tax laws and regulations and the impact they may have on us in the future.

Our operating history is characterized by net losses. We anticipate further losses and we may never become profitable.

Since inception, we have incurred annual operating losses. We expect this trend to continue until we can sell a sufficient number of units and achieve a cost structure to become profitable. We have made, and expect to continue making, significant investments to further develop and expand our technology suite and broaden our product base. These investments may not result in increased revenue or growth on a timely basis or at all. Even if we do achieve profitability, we may be unable to increase our sales and sustain or increase our profitability in the future.

Our rental fleet is subject to residual value risk upon disposition.

The market value of any given piece of rental equipment could be less than its depreciated value at the time it is sold. The market value of used rental equipment depends on several factors, including:

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the market price for new equipment of a like kind;

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wear and tear on the equipment relative to its age;

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the time of year that it is sold (prices are generally higher during the construction season);

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worldwide and domestic demands for used equipment;

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the supply of used equipment on the market; and

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general economic conditions.

We include in operating income the difference between the sales price and the depreciated value of an item of equipment sold. We cannot assure you that used equipment selling prices will not decline. Any significant decline in the selling prices for used equipment could adversely affect our business, financial condition, results of operations or cash flows.

We have identified material weaknesses in our internal control over financial reporting and our information technology environment. We may identify additional material weaknesses in the future that may cause us to fail to meet our reporting obligations or result in material misstatements of our combined consolidated financial statements. If we fail to remediate any material weaknesses or if we fail to establish and maintain effective control over financial reporting, investors may lose confidence in our ability to provide reliable and timely financial reports and the value of our common stock may decline.

Pursuant to Section 404 of Sarbanes Oxley, we will in the future be required to include in our annual reports on Form 10-K our assessment of the effectiveness of our internal controls over financial reporting. This assessment will include disclosure of any material weaknesses identified by our management in our internal controls over financial reporting. We may in the future identify material weaknesses in our internal controls over financial reporting that we have not discovered to date. If we cannot adequately maintain the effectiveness of our internal controls over financial reporting, we might be subject to sanctions or investigation by regulatory authorities, such as the SEC. Any such action could adversely affect our financial results and the market price of our securities.

As a private emerging growth company, we have not been required to document and test our internal controls over financial reporting nor was our management required to certify the effectiveness of internal controls and our auditors were not required to opine on the effectiveness of their internal control over financial reporting. Ensuring that we have adequate internal financial and accounting controls and procedures

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in place to produce accurate financial statements on a timely basis is a costly and time-consuming effort. Our accounting and finance department is small, with limited expertise in the areas of financial reporting and SEC requirements. Thus, we have a need for additional resources within the accounting and finance functions due to the requirement to produce timely financial information and to ensure the level of segregation of duties customary for a U.S. public company. We have identified material weaknesses in our internal financial and accounting controls and procedures, including an insufficient complement of resources with an appropriate level of accounting knowledge, experience and training commensurate with our structure and financial reporting requirements and ineffective information technology controls related to access security, segregation of duties and governance of financial systems. Furthermore, we do not have a formal risk assessment or fraud risk assessment and therefore, have not designed controls to mitigate risks to the business. We have assessed the deficiencies in controls and have concluded that we need to implement an enterprise resource planning information management system to provide for greater depth and breadth of functionality and effectively manage our business data, communications, supply chain, order entry and fulfillment, inventory and warehouse management, financial reporting and other business processes. Further, we have identified the need to implement additional information technology systems to ensure that an authorized user can only access privileges necessary to perform his or her assigned duties and prevent improper segregation of duties. The actions we have taken and plans we expect to pursue are subject to continued implementation, subject to the availability of qualified professionals. While we have plans to remediate these weaknesses, we cannot assure you that we will be able to do so.

Even after establishing internal controls, our management does not expect that our internal controls ever will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. No evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within our company will have been detected. Our failure to remediate the material weaknesses identified above or the identification of additional material weaknesses in the future, could adversely affect our ability to report financial information, including our filing of quarterly or annual reports with the SEC on a timely and accurate basis. Moreover, our failure to remediate the material weaknesses identified above or the identification of additional material weaknesses could prohibit us from producing timely and accurate financial statements, which may adversely affect our the market price of shares of our common stock and we may be unable to maintain compliance with Nasdaq listing requirements.

We need to implement an Enterprise Resource Planning (“ERP”) system. Significant additional costs, cost overruns and delays in connection with the implementation of an ERP system may adversely affect results of operations.

We do not have a current ERP system and we are in the process of implementing one company-wide. This is a lengthy and expensive process that will result in a diversion of resources from other operations. Any disruptions, delays or deficiencies in the design and/or implementation of the new ERP system, particularly any disruptions, delays or deficiencies that impact operations, could adversely affect our ability to run and manage our business effectively.

The implementation of an ERP system has involved and will continue to involve substantial expenditures on system hardware and software, as well as design, development and implementation activities. There can be no assurance that other cost overruns relating to the ERP system will not occur. Our business and results of operations may be adversely affected if we experience operating problems, additional costs, or cost overruns during the ERP implementation process.

At many of our customers’ oil production sites, we utilize the abundant associated gas that is otherwise flared as our primary input fuel. Should midstream infrastructure be put into place that allows the associated gas to be processed and transported to end markets, it would curtail our volume of input fuel for onsite power generation and adversely affect our costs or ability to meet the customer’s power generation demand.

The increased annual volumes of flaring recorded in the upstream O&G industry in recent years is in large part due to oil production – and the byproduct associated petroleum gas that comes from oil

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production – outpacing the ability to build the appropriate amount of midstream gas infrastructure required to gather, process and transport the associated petroleum gas to commercial markets. Should the substantial upfront investment be made to expand midstream gas infrastructure and in effect provide a greater outlet for the associated petroleum gas, it could curtail the supply of onsite fuel we use to power our customers’ operations and adversely affect our operating costs.

We focus geographically in areas of oil producing regions where grid power is unreliable, insufficient or absent altogether. The buildout and expansion of utility power over time may lead to certain customers opting to connect their production sites to utility power should it becomes available and sufficient to meet the onsite demand.

The demand for onsite power generation for oil production wells can be both temporary and long-term in nature. While often times we can provide power generation to a new wellsite more quickly than power can be made available to the wellsite from the local electricity grid, we face the threat of the utility grid expanding geographically over time to reach the wellsite power demand. Given the long-term nature of multi-well oil pads that can expect to produce oil for well over a decade, regional utilities may be incentivized to invest in transmission and distribution upgrades to their system in order to compete for the supply of power to these well sites.

Risk Factors Relating to Financing Matters

Our credit facility subjects FLPS and its subsidiaries to financial and other restrictive covenants. These restrictions may limit our operational or financial flexibility and could subject us to potential defaults under the credit facility. In addition, any default could result in foreclosure.

On February 8, 2019, FLPS entered into a senior secured revolving credit facility with Texas Capital Bank, National Association (“TCB”). We subsequently amended and restated our original revolving credit facility by entering into a Third Amendment to Credit Agreement, dated December 22, 2020 (“Credit Facility”) to add Flex Leasing Power and Service ULC, a Canadian unlimited liability company, an indirect wholly-owned subsidiary of FLPS (“FLPS Canada” and together with FLPS, the “Borrowers”) as an additional borrower. The commitment amount is for $30.0 million and borrowing availability is based on a borrowing base calculation of eligible assets and other conditions. Interest is defined based on a tiered leverage ratio and an applicable margin of (i) 1.50% to 2.00% above the base rate for base rate loans, or (ii) 2.50% to 3.00% above the adjusted Eurodollar rate for Eurodollar rate loans. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation – Liquidity and Capital Resources – Senior Secured Credit Facility.” As of September 30, 2021, borrowings outstanding under the Credit Facility amounted to $22.9 million.

The Credit Facility requires the Borrowers to make monthly interest payments. Should the Borrowers’ cash flow from operations be negatively impacted in a significant manner, they may not have sufficient cash available to cover interest payments, which would trigger an event of default unless otherwise cured. The Credit Facility matures on February 8, 2024 at which point the amount outstanding is due in full, unless the Borrowers refinance the Credit Facility prior to this date, which they may not be successful in executing. The Credit Facility is secured by a first priority lien on substantially all of the assets of the Borrowers, and guaranteed by FPS and Flex Power Co., a wholly-owned subsidiary of FLPS. If the Borrowers are unable to repay amounts outstanding under the Credit Facility, TCB could foreclose on the collateral granted thereunder to secure the indebtedness.

The Borrowers are subject to financial covenants of a maximum leverage ratio and minimum fixed charge coverage ratio to be tested quarterly. As of December 31, 2020 and as of March 31, 2021, the Borrowers’ leverage ratio was in excess of the maximum leverage ratio permitted under the Credit Facility. In connection with an exercise of the Borrowers’ equity cure right under the Credit Facility, TCB has waived any event of default with respect to this noncompliance. Should they fail to comply with the quarterly maintenance covenants, remedies would need to be implemented in order to avoid an event of default, including equity cure rights or a waiver by TCB, which we cannot guarantee will be granted. As of September 30, 2021, the Borrowers were in compliance with financial covenants. The Borrowers are also subject to certain negative covenants, including restrictions on their ability to incur additional indebtedness,

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create liens, pay dividends, make certain investments or material changes in their business, engage in transactions with affiliates, conduct asset sales or otherwise dispose of the Borrowers’ assets. These restrictions may limit their operational or financial flexibility and could lead to potential defaults under the Credit Facility, which could result in foreclosure. In anticipation of the Contribution Transaction and this offering, we are in the process of negotiating a modification to the Credit Facility. As part of this modification, we expect that FGS will become an additional guarantor with respect to the Credit Facility subject to the same obligations and restrictions applicable to FPS thereunder, but that FGS will not otherwise be subject to the covenants and restrictions applicable to the Borrowers.

The Borrowers are also subject to routine asset appraisal that factors into the borrowing base calculation of the Credit Facility. Should the Borrowers’ outstanding indebtedness exceed the borrowing base at any point in time, the amount of indebtedness in excess of the borrowing base will become due immediately, and the Borrowers may not have sufficient liquidity to make required repayment at that time.

Our substantial indebtedness could limit our opportunities for growth.

We have a significant amount of indebtedness outstanding. As of September 30, 2021, we had total outstanding indebtedness of approximately $23.1 million, consisting of $22.9 million outstanding under the Credit Facility with TCB and $0.2 million in capital lease obligations. As of September 30, 2021, there was borrowing availability under the Credit Facility of approximately $3.2 million.

Our substantial indebtedness could have important consequences. For example, it could:

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increase our vulnerability to general adverse economic, industry and competitive conditions;

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require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions and other general corporate purposes;

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limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

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place us at a competitive disadvantage compared to our competitors that have less debt; and

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limit our ability to obtain additional financing for working capital, capital expenditures, acquisitions or general corporate purposes.

We expect to use cash flow from operations and borrowings under the Credit Facility to meet our current and future financial obligations, including funding our operations, debt service and capital expenditures. Our ability to make these payments depends on our future performance, which will be affected by financial, business, economic and other factors, many of which we cannot control. Our business may not generate sufficient cash flow from operations in the future, which could result in our inability to repay indebtedness, or to fund other liquidity needs. If we do not have enough capital, we may be forced to reduce or delay our business activities and capital expenditures, sell assets, obtain additional debt or equity capital or restructure or refinance all or a portion of our debt, including the Credit Facility, on or before maturity. We cannot make any assurances that we will be able to accomplish any of these alternatives on terms acceptable to us, or at all. In addition, the terms of existing or future indebtedness, including the Credit Facility, may limit our ability to pursue any of these alternatives.

Variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.

Borrowings under the Credit Facility are at variable rates of interest and expose us to interest rate risk. As such, our results of operations are sensitive to movements in interest rates. There are many economic factors outside our control that have in the past and may, in the future, impact rates of interest including publicly announced indices that underlie the interest obligations related to a certain portion of our debt. Currently, a portion of our outstanding borrowings under the Credit Facility are borrowed at LIBOR plus an applicable margin and it is unclear how increased regulatory oversight and changes in the method for

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determining LIBOR may affect our results of operations or financial conditions. LIBOR is an interest rate benchmark used as a reference rate for a wide range of financial transactions, including derivatives and loans. In July 2017, the United Kingdom’s Financial Conduct Authority, which regulates LIBOR, announced that it intends to stop compelling banks to submit LIBOR rates after 2021. On November 30, 2020, ICE Benchmark Administration (“IBA”), the administrator of LIBOR, with the support of the United States Federal Reserve and the United Kingdom Financial Conduct Authority, announced plans to consult on ceasing publication of USD LIBOR on December 31, 2021 for only the one week and two month USD LIBOR tenors, and on June 30, 2023 for all other USD LIBOR tenors. While this announcement extends the transition period to June 2023, the United States Federal Reserve concurrently issued a statement advising banks to stop new USD LIBOR issuances by the end of 2021. At this time, no consensus exists as to what rate or rates may become accepted alternatives to LIBOR, and it is impossible to predict whether and to what extent banks will continue to provide LIBOR submissions to the administrator of LIBOR, whether LIBOR rates will cease to be published or supported before or after 2021 or whether any additional reforms to LIBOR may be enacted. At this time, we cannot predict the future impact of a departure from LIBOR as a reference rate. The expected discontinuation of LIBOR may require us to amend the Credit Facility. Also, factors that impact interest rates include governmental monetary policies, inflation, recession, changes in unemployment, the money supply, international disorder and instability in domestic and foreign financial markets. If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our results of operations would be adversely impacted.

The agreement governing FPS’ Series B Preferred Units restricts our business and our ability to engage in certain corporate and financial transactions or in other businesses.

Under the terms of FPS’ Series B Preferred Unit issuance, FPS has agreed to certain covenants that our board believes restricts our ability to do business and enter into certain financial transactions, including restricting FPS’ and our ability to incur, guarantee or otherwise permit to exist any indebtedness for borrowed money that is senior in right of payment to the Series B Preferred Units other than senior indebtedness in an amount not to exceed $50.0 million. As of September 30, 2021, the amount of senior indebtedness (as defined therein) totaled approximately $50.0 million, thus restricting our ability to incur any additional senior indebtedness. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation – Liquidity and Capital Resources – Series B and B-1 Preferred Equity at FlexEnergy Power Solutions, LLC.”

Risk Factors Relating to Ownership of Our Common Stock

Our largest stockholder, FPS, has a series of senior secured notes that are currently due in full at December 31, 2022, that if not extended or renegotiated, could cause FPS to sell shares of our common stock, which could adversely affect our stock price.

Since December 2015, FPS has entered into multiple funding rounds with the holders (the “FPS Noteholders”) of senior secured promissory notes issued by FPS (the “Notes”). As part of the Contribution Transaction, FPS will pledge its shares of FGS in favor of the FPS Noteholders and we will agree not to grant any further security interests in our or our subsidiaries’ assets so long as the Notes are outstanding, except for certain permitted encumbrances similar in nature to those permitted under the Credit Facility, without the prior written consent of FPS.

As of September 30, 2021, the total amount outstanding under the Notes was $26.7 million. All Notes are due and payable in full on December 31, 2022, unless extended or refinanced prior to this date, which FPS may not be successful in executing. If the Notes are not extended, refinanced or repaid prior to December 31, 2022, FPS may be forced to sell sufficient shares of our common stock to pay the amount outstanding under the Notes, which could cause the trading price of our common stock to decline significantly and possibly below the offering price. Similarly, if FPS is unable to repay the amount outstanding under the Notes, the FPS Noteholders could foreclose on and sell sufficient shares of our common stock to pay the amount outstanding under the Notes, which could cause the trading price of our common stock to decline significantly and possibly below the offering price.

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FPS’ Series B and Series B-1 Units have redemption rights that, if exercised, could cause FPS to sell shares of our common stock to pay for the redemption, which could adversely affect our stock price.

FPS’ Series B Units may be called for redemption by the holders at any time by delivering written notice to FPS. The aggregate redemption price for FPS’ Series B Units is $38.3 million as of September 30, 2021. FPS’ Series B-1 Units may be called for redemption by the holders at any time by delivering written notice to FPS. The aggregate redemption price for FPS’ Series B-1 Units is $18.3 million as of September 30, 2021. Following a redemption notice, FPS must use commercially reasonable efforts, as soon as is reasonably possible, to redeem the Series B or Series B-1 Units, as applicable. If the holders of FPS’ Series B or Series B-1 Units exercise their redemption rights, FPS may be required to sell sufficient shares of our common stock (after the expiration of the lock-up period described in “Shares Eligible for Future Sale” and subject to Rule 144) to pay the redemption price. If not redeemed within 180 days, the Series B accrual rate of 12% and Series B-1 accrual rate of 8%, as applicable, incrementally increase by up to an additional 3%. If FPS sells substantial amounts of our common stock (for example, if all or large numbers of the Series B and Series B-1 Units are called for redemption) the trading price of our common stock could decline significantly and could decline below the offering price.

After this offering, voting control with respect to our company will remain concentrated in the hands of FPS. FPS will continue to be able to exercise significant influence on us.

Following the completion of the offering, FPS is expected to hold 74.9% of our total outstanding common stock, or 72.9% if the over-allotment option is exercised in full. As such, FPS will have significant control over the election of the members of our board of directors and thereby may significantly influence our policies and operations, including the appointment of management, future issuances of our common stock or other securities, the payment of dividends, if any, the incurrence or modification of debt, amendments to our amended and restated certificate of incorporation (“Certificate of Incorporation”) and our amended and restated bylaws (“Bylaws”), and the entering into of extraordinary transactions, and FPS’s interests may not in all cases be aligned with those of other stockholders.

In the event of a conflict between our interests and the interests of FPS, we have adopted policies and procedures, specifically a Code of Ethics and Business Conduct and, included in our Audit Committee Charter, a Related Party Transactions Policy, to identify, review, consider and approve these conflicts of interest. In general, if an affiliate of a director, executive officer or significant stockholder, including FPS, intends to engage in a transaction involving our company, that director, executive officer or significant stockholder must report the transaction for consideration and approval by our audit committee. However, there are no assurances that our efforts and policies to eliminate the potential impacts of conflicts of interest will be effective.

This concentrated control will limit your ability to influence corporate matters for the foreseeable future and potentially in perpetuity. This concentrated control could also discourage a potential investor from acquiring our common stock and might harm the market price of our common stock. We cannot predict whether this concentrated control will result in a lower or more volatile market price of our common stock or in adverse publicity or other adverse consequences.

We are a “controlled company” within the meaning of the rules of Nasdaq and, as a result, will qualify for, and may rely on, exemptions from certain corporate governance requirements.

Following the completion of this offering, FPS will continue to own in excess of 50% of the voting power of our outstanding share capital. As a result, we are a “controlled company” within the meaning of the corporate governance standards of Nasdaq. Under the rules of Nasdaq, a company of which more than 50% of the outstanding voting power is held by an individual, group or another company is a “controlled company” and is exempt from certain stock exchange corporate governance requirements, including:

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the requirement that a majority of the board of directors consists of independent directors;

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the requirement that a listed company have a nominating and governance committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;

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the requirement that a listed company have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and

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the requirement for an annual performance evaluation of the nominating and governance committee and compensation committee.

We currently have a board composed entirely of independent directors (for all purposes other than audit committee independence requirements) and thus our nominating and corporate governance and compensation committees are composed entirely of independent directors. If we decide to avail ourselves of any of the controlled company exemptions, you would not have the same protections afforded to stockholders of companies that are subject to all of the stock exchange corporate governance requirements.

Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management, and limit the market price of our common stock.

Provisions in our Certificate of Incorporation and Bylaws, as well as provision of the DGCL, may have the effect of delaying or preventing a change of control or changes in our management. Our Certificate of Incorporation and Bylaws include provisions that:

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authorize our board of directors to issue, without further action by the stockholders, shares of undesignated preferred stock with terms, rights, and preferences determined by our board of directors that may be senior to our common stock;

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once FPS no longer holds at least 50% of the voting power of the Company, require that any action to be taken by our stockholders be effectuated at a duly called annual or special meeting and not by written consent;

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specify that special meetings of our stockholders can be called only by our board of directors, the Chairman of our board of directors, or our Chief Executive Officer;

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establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors;

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prohibit cumulative voting in the election of directors;

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provide that vacancies on our board of directors may be filled by a majority of directors then in office, even if less than a quorum; and

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once FPS no longer holds at least 50% of the voting power of the Company, require the approval of our board of directors or the holders of at least 66 2/3% of our outstanding shares of capital stock to amend our Bylaws and certain provisions of our Certificate of Incorporation.

These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors, which is responsible for appointing the members of our management. Any delay or prevention of a change of control transaction or changes in our management could cause our stock price to decline.

For as long as we are an emerging growth company, we will not be required to comply with certain reporting requirements, including those relating to accounting standards and disclosure about our executive compensation, that apply to other public companies.

We are classified as an “emerging growth company” under the JOBS Act. For as long as we are an emerging growth company, which may be up to five full fiscal years, unlike other public companies, we will not be required to, among other things: (i) provide an auditor’s attestation report on management’s assessment of the effectiveness of our system of internal control over financial reporting pursuant to Section 404(b) of Sarbanes Oxley; (ii) comply with any new requirements if adopted by the PCAOB requiring mandatory audit

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firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer; (iii) provide certain disclosures regarding executive compensation required of larger public companies; or (iv) hold nonbinding advisory votes on executive compensation. In addition, since we are an emerging growth company that is a newly public company, we will not be required to provide management’s assessment of the effectiveness of our system of internal control over financial reporting until we are required to file our Form 10-K.

We may remain an emerging growth company until December 31, 2026, although we will lose that status sooner if we have more than $1.07 billion of revenues in a fiscal year, have more than $700.0 million in market value of our common stock held by non-affiliates, or issue more than $1.0 billion of non-convertible debt over a three-year period. To the extent that we rely on any of the exemptions available to emerging growth companies, you will receive less information about our executive compensation and internal control over financial reporting than issuers that are not emerging growth companies. If some investors find our common stock to be less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

As a “smaller reporting company,” certain reduced disclosure and other requirements will be available to us after we are no longer an emerging growth company.

We are also a “smaller reporting company” pursuant to the Exchange Act. Some of the reduced disclosure and other requirements available to us as a result of the JOBS Act may continue to be available to us after we are no longer an emerging growth company pursuant to the JOBS Act but remain a “smaller reporting company” pursuant to the Exchange Act. As a “smaller reporting company” we are not required to: (i) have an auditor report regarding our internal controls of financial reporting pursuant to Section 404(b) of Sarbanes Oxley; (ii) present more than two years audited financial statements in our registration statement and annual reports on Form 10-K and present selected financial data in such registration statements and annual reports; (iii) make risk factor disclosures in our annual reports of Form 10-K; and (iv) make certain otherwise required disclosures in our annual reports on Form 10-K and quarterly reports on Form 10-Q.

We have not been managed as a public company, and our current resources may not be sufficient to fulfill our public company obligations.

As a privately held company, we had not been required to comply with a number of corporate governance and financial reporting practices and policies required for a public company listed on a national stock exchange. As a public, listed company, we will incur significant legal, accounting and other expenses that we were not required to incur in the recent past, particularly after we are no longer an “emerging growth company,” as defined under the JOBS Act. In addition, new and changing laws, regulations and standards relating to corporate governance and public disclosure, including the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”) and the rules and regulations promulgated and to be promulgated thereunder, as well as under Sarbanes Oxley, the JOBS Act, and the rules and regulations of the SEC and Nasdaq have created uncertainty for public companies and increased the costs and the time that our board of directors and management will need to devote to complying with these rules and regulations. We expect these rules and regulations to increase our legal and financial compliance costs and lead to a diversion of management time and attention from revenue-generating activities.

Furthermore, the need to establish the corporate infrastructure necessary for a public, listed company may divert management’s attention from implementing our growth strategy, which could prevent us from improving our business, results of operations and financial condition. We have made, and will continue to make, changes to our internal control over financial reporting, accounting systems disclosure controls and procedures, auditing functions and other procedures related to public reporting in order to meet our reporting obligations as a public company.

Nasdaq may delist our common stock from trading on its exchange, which could adversely affect the market liquidity of our common stock, limit investors’ ability to make transactions in our common stock and adversely affect our ability to raise additional funds.

We cannot assure you that our common stock will continue to be listed on Nasdaq after this offering. In order to continue listing our common stock on Nasdaq, we must maintain certain financial, distribution

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and share price levels. Generally, following our initial public offering, we must maintain a minimum amount in stockholders’ equity (generally $2.5 million) and a minimum number of holders of our common stock (generally 300 public holders).

If Nasdaq delists our common stock from trading on its exchange and we are not able to list our securities on another national securities exchange, we and our stockholders could face significant material adverse consequences, including:

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a limited availability of market quotations for our securities;

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reduced liquidity for our securities;

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a determination that our common stock is “penny stock” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our common stock;

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a limited amount of news and analyst coverage; and

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a decreased ability to issue additional securities or obtain additional financing in the future.

We have no present intention to pay dividends on our common stock in the foreseeable future and, consequently, your only opportunity to achieve a return on your investment during that time is if the price of our common stock, as applicable, appreciates.

We have never declared or paid any cash dividends on our common stock and we have no present intention to pay dividends in the foreseeable future. Any recommendation by our board of directors to pay dividends will depend on many factors, including our financial condition (including losses carried forward), results of operations, legal requirements and other factors. If the price of our common stock declines before we pay dividends, you will incur a loss on your investment, without the likelihood that this loss will be offset in part or at all by potential future cash dividends.

Further, although the Credit Facility does not prohibit us from declaring or paying dividends, the Credit Facility does prohibit FLPS from making further distributions to us unless certain conditions are met (see Note 11 to our Notes to Combined Consolidated Financial Statements included elsewhere in this prospectus). FLPS is currently our primary source of positive operating cash flow. As such, if the conditions are not met and FLPS is prohibited from making further distributions to us, then any cash available at FLPS cannot be passed along to you in the form of dividends.

Future sales of common stock by us, FPS, RNS or TRF could depress the market price of our common stock.

If we, FPS, RNS or TRF issues, sells, or indicates an intent to issue or sell, substantial amounts of common stock in the public market after the 180-day contractual lock-up and other legal restrictions on resale discussed in this prospectus lapse, the trading price of our common stock could decline significantly and could decline below the offering price. Upon completion of this offering, all of the outstanding shares of common stock other than those sold in this offering are subject to the 180-day contractual lock-up referred to above. The underwriter may permit us, FPS, RNS or TRF to issue or sell shares prior to the expiration of the lock-up agreements. See “Underwriting.”

After the lock-up agreements pertaining to this offering expire, 9,678,878 additional shares will be eligible for sale in the public market, all of which shares are or will be held by FPS, RNS or TRF and will be subject to volume limitations under Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”). In addition, shares reserved for future issuance under our equity incentive plan will become eligible for sale in the public market in the future, subject to certain legal and contractual limitations.

After expiration of the 180-day lock-up period and upon our eligibility to use Form S-3 for secondary offerings, FPS, RNS or TRF may request that shares of our common stock issued to them in the Contribution Agreement or transferred to them in the SAFE Transaction be registered for public resale. If FPS, RNS or

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TRF sells a significant number of shares of our common stock through such a resale registration, the price of our common stock could be adversely affected.

Following this offering, we intend to file one or more registration statements with the SEC covering shares available for future issuance under our 2021 Plan. Upon effectiveness of those registration statements, any shares subsequently issued under our 2021 Plan will be eligible for sale in the public market, except to the extent that they are restricted by the lock-up agreements referred to above and subject to compliance with Rule 144 in the case of our affiliates. Sales of a large number of the shares issued under our 2021 Plan in the public market could adversely affect the market price of our common stock.

See “Shares Eligible for Future Sale” for a more detailed description of sales that may occur in the future. If these additional shares are sold, or if it is perceived that they will be sold, in the public market, the trading price of our common stock could decline substantially.

Our Certificate of Incorporation includes a forum selection clause, which could discourage claims or limit stockholders’ ability to make a claim against us, our directors, officers, other employees or stockholders.

Our Certificate of Incorporation includes a forum selection clause. Our Certificate of Incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall, to the fullest extent permitted by law, be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring any: (i) derivative action or proceeding brought on our behalf; (ii) action asserting a claim of breach of fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders; (iii) action asserting a claim against us, our directors, officers or employees arising pursuant to any provision of the Delaware General Corporation Law (“DGCL”) or our Certificate of Incorporation or Bylaws; or (iv) action asserting a claim against us, our directors, officers or employees governed by the internal affairs doctrine, except for, as to each of (i) through (iv) above, any claim (A) as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following the determination), (B) that is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or (C) for which the Court of Chancery does not have subject matter jurisdiction. Unless we consent in writing to the selection of an alternative forum, the federal district courts of the U.S. shall be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under federal securities laws, including the Securities Act. We note however, that there is uncertainty as to whether a court would enforce this provision and that investors cannot waive compliance with federal securities laws and the rules and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. This forum selection clause may discourage claims or limit stockholders’ ability to submit claims in a judicial forum that they find favorable and may result in additional costs for a stockholder seeking to bring a claim. While we believe the risk of a court declining to enforce this forum selection clause is low, if a court were to determine the forum selection clause to be inapplicable or unenforceable in an action, we may incur additional costs in conjunction with our efforts to resolve the dispute in an alternative jurisdiction, which could have a negative impact on our results of operations and financial condition. Notwithstanding the foregoing, the forum selection clause will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the U.S. shall be the sole and exclusive forum.

As a new investor, you will experience immediate and substantial dilution in the book value of the shares that you purchase in this offering.

The public offering price is substantially higher than the as adjusted net tangible book value per share of our common stock immediately following this offering based on the total value of our tangible assets less our total liabilities. Therefore, if you purchased Units in this offering at an assumed public offering price of $9.00 per Unit, which is the midpoint of the range set forth on the cover page of this prospectus, you would experience an immediate dilution of $5.94 per share, the difference between the price per share you pay for our common stock and our as adjusted net tangible book value per share as of September 30, 2021, after

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giving effect to the issuance by us of 2,222,222 Units in this offering, which assumes no exercise of the Warrants being sold in this offering, no exercise of the underwriter’s option to purchase additional shares and/or Warrants from us, and no exercise of the underwriter’s warrant. You will experience additional dilution if we issue additional shares below the public offering price. For a further description of the dilution that you will experience immediately after this offering, see “Dilution.”

We will incur significantly increased costs as a result of operating as a public company, and our management will be required to devote substantial time to compliance efforts.

We will incur significant legal, accounting, insurance and other expenses as a result of being a public company. Dodd-Frank and Sarbanes Oxley, as well as related rules implemented by the SEC, have required changes in corporate governance practices of public companies. In addition, rules that the SEC is implementing or is required to implement pursuant to Dodd-Frank are expected to require additional change. We expect that compliance with these and other similar laws, rules and regulations, including compliance with Section 404 of Sarbanes Oxley, will substantially increase our expenses, including legal and accounting costs, and make some activities more time-consuming and costly. We also expect these laws, rules and regulations to make it more expensive for us to obtain director and officer liability insurance, and it may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage, which may make it more difficult for us to attract and retain qualified persons to serve on the board of directors or as officers. Although the JOBS Act may, for a limited period of time, somewhat lessen the cost of complying with these additional regulatory and other requirements, we nonetheless expect a substantial increase in legal, accounting, insurance and certain other expenses in the future, which will negatively impact our results of operations and financial condition.

General Risk Factors

The ongoing effects of the COVID-19 pandemic could adversely affect our business, financial condition, results of operations, or cash flows.

In March 2020, we began to monitor the global effects of “COVID-19,” an infectious disease caused by Severe Acute Respiratory Syndrome Coronavirus 2 (“SARS CoV-2”) that was first detected in December 2019. The World Health Organization characterized COVID-19 as a pandemic on March 11, 2020. Thereafter, most U.S. states imposed “stay-at-home” orders on their populations to slow the spread of COVID-19. Governments, public institutions, and other organizations in countries and localities throughout the world have taken and are continuing to take certain emergency measures to combat the spread of COVID-19, including implementation of restrictions on travel and orders that restrict the operations of institutions such as schools and businesses.

In addition, due to domestic and international governmental orders restricting certain activities in response to COVID-19, we have experienced, and may in the future experience, COVID-19 related delays from certain vendors and suppliers, which, in turn, has caused delays in the build out of our leasing fleet and could cause delays in the manufacturing and installation of our products and adversely impact our cash flows and results of operations including revenue. To date, we have been able to offset any delays, but in the future, it may not be possible to find replacement products or supplies, and ongoing delays could affect our business and growth. The ultimate impact of the COVID-19 pandemic is highly uncertain and subject to change. We do not yet know the full extent of potential impacts on our business, the alternative energy industry or the global economy as a whole. However, these effects could adversely impact our business, financial condition, results of operations, or cash flows.

Expanding operations internationally could expose us to risks.

Although we currently operate primarily in the U.S., we will seek to expand our business internationally. Our primary focus around international expansion involves identifying key oil producing regions where we can scale an installed base of turbine fleet, either in the form of leasing units or selling and servicing an installed base in collaboration with a local channel partner. Managing any international expansion will

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require additional resources. Any expansion internationally could subject our business to risks associated with international operations, including:

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conformity with applicable business customs, including translation into foreign languages and associated expenses;

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lack of availability of government incentives and subsidies;

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challenges in arranging, and availability of, financing for our customers;

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difficulties in staffing and managing foreign operations in an environment of diverse culture, laws, and customers, and the increased travel, infrastructure, and legal and compliance costs associated with international operations;

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installation challenges that we have not encountered before, which may require the development of a unique model for each country;

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compliance with multiple, potentially conflicting and changing governmental laws, regulations, and permitting processes including environmental, banking, employment, tax, privacy, and data protection laws and regulations such as the EU Data Privacy Directive;

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compliance with U.S. and foreign anti-bribery laws including the Foreign Corrupt Practices Act;

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difficulties in collecting payments in foreign currencies and associated foreign currency exposure; restrictions on repatriation of earnings;

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compliance with potentially conflicting and changing laws of taxing jurisdictions where we conduct business and compliance with applicable U.S. tax laws as they relate to international operations, the complexity and adverse consequences of these tax laws, and potentially adverse tax consequences due to changes in these tax laws; and

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regional economic and political conditions.

As a result of these risks, any potential future international expansion efforts that we may undertake may not be successful.

We are subject to cyber security risks. If a cyber security incident occurs, we could suffer information theft, data corruption, operational disruption and our business and results of operations could be harmed.

Our customers, and our industry generally, have become more dependent on digital and connected technologies to conduct business. We depend on digital and connected technologies to monitor our turbines, perform many of our services and to process and record financial and operating data, among other things. We also expect to increase our dependence on these technologies as we expand our EaaS offerings. Ensuring the secure and reliable processing, maintenance and transmission of this data is important to our operations and our customers. As cyber security incidents (including deliberate attacks) have increased in number, scope, and sophistication, energy assets (and related networks) may become the targets of more incidents. Our technologies, systems and networks, and those of our customers, vendors, suppliers and other business partners, may become the target of cyberattacks or information security breaches that could result in the loss or destruction of proprietary and other information, or other disruption of business operations. In addition, while we depend on certain business partners to store certain information regarding our customers and employees, these third parties may be a target of cyberattacks or information security breaches that could result in the unauthorized release, gathering, monitoring, or misuse of sensitive information. Our recourse against these business partners, if any, may be limited. In addition, we, our customers, vendors, and/or business partners may be unable to detect certain breaches (such as unauthorized surveillance) for an extended period of time. Our systems and controls for protecting against cyber security risks, and those used by our business partners, may be insufficient. The loss, misuse, destruction, unauthorized release, gathering, or monitoring of sensitive information result in significant financial losses, loss of customers and business opportunities, reputation damage, litigation (including any damages awarded), regulatory fines, penalties or intervention, reimbursement or other compensatory costs, or otherwise adversely affect our

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business, financial condition or results of operations. We will likely be required to expend additional resources to continue to modify or enhance our protective measures or to investigate and remediate any vulnerability to cyber security incidents. The reliability and capacity of our systems is critical to our operations. Any difficulties in implementing or integrating new systems or enhancing current systems, or any material disruption in our information technology systems or systems could have an adverse effect on our business and results of operations.

There has been no prior active market for our common stock and an active and liquid market for our common stock may fail to develop, which could harm the market price of our common stock.

Prior to this offering, there has been no active public market for our common stock. Although we have applied to list our common stock on Nasdaq, an active trading market for our common stock may never develop or be sustained following this offering. The initial public offering price of our common stock will be based and determined through negotiations between us and the underwriter. This initial public offering price may not be indicative of the market price of our common stock after this offering. In the absence of an active trading market for our common stock, investors may not be able to sell their common stock at or above the initial public offering price or at the time that they would like to sell.

The market price of our equity securities may be volatile, and purchasers of our common stock could incur substantial losses.

The market price for our common stock may be volatile. The stock market in general and the market for green energy in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, investors may not be able to sell their common stock at or above the price originally paid for the security. The market price for our common stock may be influenced by many factors, including:

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actual or anticipated fluctuations in our financial condition and operating results;

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actual or anticipated changes in our growth rate relative to our competitors;

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competition from existing products or new products that may emerge;

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announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations, or capital commitments;

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failure to meet or exceed financial estimates and projections of the investment community or that we provide to the public;

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issuance of new or updated research or reports by securities analysts;

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fluctuations in the valuation of companies perceived by investors to be comparable to us;

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share price and volume fluctuations attributable to inconsistent trading volume levels of our shares;

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additions or departures of key management or scientific personnel;

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disputes or other developments related to proprietary rights, including patents, litigation matters, and our ability to obtain patent protection for our technologies;

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changes in laws or regulations applicable to our products;

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changes to electric utility policies;

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announcement or expectation of additional debt or equity financing efforts;

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sales of our common stock by us, our insiders or our other stockholders; and

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general economic and market conditions.

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These and other market and industry factors may cause the market price and demand for our common stock to fluctuate substantially, regardless of our actual operating performance, which may limit or prevent investors from readily selling their common stock and may otherwise negatively affect the liquidity of our common stock.

If securities or industry analysts do not publish research or publish inaccurate research or unfavorable research about our business, the price of our common stock and trading volume could decline.

The trading market for our common stock depends in part on the research and reports that securities or industry analysts publish about us or our business. If no or few securities or industry analysts cover our company, the trading price for our common stock would be negatively impacted. If one or more of the analysts who covers us downgrades our common stock or publishes incorrect or unfavorable research about our business, the price of our common stock would likely decline. If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, or downgrades our common stock, demand for our common stock could decrease, which could cause the price of our common stock or trading volume to decline.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance and expectations. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “may”, “will”, “should”, “expects”, “plans”, “anticipates”, “could”, “intends”, “target”, “projects”, “contemplates”, “believes”, “estimates”, “predicts”, “potential”, “opportunity”, “confident” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements contained in this prospectus include, but are not limited to, statements about:

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our future financial performance and results of operations;

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our growth plans;

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our business plan and our ability to manage our growth effectively;

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the effects of competition in our market and our ability to compete effectively;

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our plans to use the proceeds from this offering;

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estimates of our expenses, future revenues, capital requirements, our needs for additional capital and our ability to obtain additional capital;

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our ability to attract and retain qualified directors, employees and key personnel;

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future acquisitions of or investments in complementary companies;

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the effects of trends on, and fluctuations in, our results of operations;

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research and development activities;

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sales expectations;

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sources for components and parts;

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federal, state and local government regulations;

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industry and economic conditions applicable to us;

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the efficiency, reliability and environmental advantages of our products and their need for maintenance;

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market advantage;

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customer satisfaction;

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the value of using our products;

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our ability to achieve economies of scale;

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anticipation of product supply requirements;

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listing requirements;

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our turbine and heat exchanger technologies;

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the utilization of our products;

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the introduction of new technology;

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our production capacity;

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international markets;

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protection of intellectual property;

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cybersecurity threats;

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the adequacy of our facilities;

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dividends;

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business strategy;

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capital expenditures;

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liquidity;

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amortization expense of intangibles;

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cost of warranties;

•

equity-based compensation;

•

recently issued accounting standards;

•

market risk;

•

interest rate sensitivity;

•

the Jobs Act;

•

the effects of the COVID-19 pandemic; and

•

the effects of inflation.

We have based the forward-looking statements contained in this prospectus primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, prospects, business strategy and financial needs. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, assumptions and other factors described in the section captioned “Risk Factors” and elsewhere in this prospectus. These risks are not exhaustive. Other sections of this prospectus include additional factors that could adversely impact our business and financial performance. Furthermore, new risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this prospectus. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this prospectus, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

You should read this prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement of which this prospectus forms a part with the understanding that our actual future results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

The forward-looking statements made in this prospectus relate only to events as of the date on which such statements are made. We undertake no obligation to update any forward-looking statements after the date of this prospectus or to conform such statements to actual results or revised expectations, except as required by law.

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USE OF PROCEEDS

We estimate that our net proceeds from the sale of our securities in this offering will be approximately $14.88 million, assuming an initial public offering price of $9.00 per Unit, which is the midpoint of the range set forth on the cover page of this prospectus, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

A $1.00 increase (decrease) in the assumed initial public offering price of $9.00 per Unit would increase (decrease) the net proceeds to us from this offering by approximately $2.07 million, assuming that the number of shares offered, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions. Each increase (decrease) of 1.0 million Units in the number of Units offered by us in this offering, as set forth on the cover page of this prospectus, would increase (decrease) the net proceeds to us from this offering by approximately $8.37 million, assuming the assumed initial public offering price per share remains the same and after deducting estimated underwriting discounts and commission.

The principal purposes of this offering are to increase our financial flexibility, create a public market for our common stock, and facilitate future access to the public equity markets. We intend to use approximately $8.50 million of the net proceeds from this offering to expand our fleet of equipment for lease and expand into new C&I markets, approximately $5.00 million for heat exchanger product development and to expand our sales force, and approximately $1.00 million for hydrogen development. We intend to use the remainder of the net proceeds from this offering, if any, for working capital and general corporate purposes. We may also use a portion of the net proceeds from this offering to acquire, license, or invest in products, technologies or businesses that are complementary to our business. However, we currently have no agreements or commitments to complete any such transaction. If the underwriter exercises its over-allotment option, we intend to use the full amount of the net proceeds thereof to redeem shares of our common stock that were transferred to RNS and TRF in connection with the SAFE Transaction.

Our expected use of net proceeds from this offering represents our current intentions based upon our present plans and business condition. As of the date of this prospectus, we cannot predict with complete certainty all of the particular uses for the net proceeds to be received upon the closing of this offering or the actual amounts that we will spend on the uses set forth above.

Our management will have broad discretion in the application of the net proceeds from this offering, and investors will be relying on the judgment of our management regarding the application of those net proceeds. The timing and amount of our actual expenditures will be based on many factors, including cash flows from operations and the anticipated growth of our business. Pending the uses described above, we plan to invest the net proceeds from this offering in short-term, interest-bearing obligations, investment-grade instruments, certificates of deposit, or direct or guaranteed obligations of the U.S. government.

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DIVIDEND POLICY

We do not anticipate declaring or paying any cash dividends on our capital stock in the foreseeable future. Any future determination to declare and pay cash dividends, if any, will be made at the discretion of our board of directors and will depend on a variety of factors, including applicable laws, our financial condition, results of operations, contractual restrictions, capital requirements, business prospects, general business or financial market conditions, and other factors our board of directors may deem relevant. In addition, our ability to pay cash dividends is indirectly restricted by the terms of the agreements governing the Credit Facility, which prohibits our subsidiary, FLPS, from making distributions to us. See “Risk Factors –  Risk Factors Relating to our Business and Industry – We have no present intention to pay dividends on our common stock in the foreseeable future and, consequently, your only opportunity to achieve a return on your investment during that time is if the price of our common stock, as applicable, appreciates.” Our ability to pay cash dividends on our capital stock in the future may also be limited by the terms of any preferred securities we may issue or agreements governing any additional indebtedness we may incur.

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CAPITALIZATION

The following table sets forth our cash and capitalization as of September 30, 2021:

•

on an actual basis; and

•

on an as adjusted basis to give effect to the Contribution Transaction and to the issuance and sale of 2,222,222 Units in this offering at an assumed initial public offering price of $9.00 per Unit (which is the midpoint of the range set forth on the cover page of this prospectus), after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming no exercise of the underwriter’s over-allotment option and no exercise of the Warrants beings sold in this offering.

The as adjusted information below is illustrative only, and our capitalization following the completion of this offering will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing. You should read this information in conjunction with our combined consolidated financial statements and the related notes included elsewhere in this prospectus and the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and other financial information contained in this prospectus.

​	As of September 30, 2021
​	Actual			As Adjusted
​	(in thousands)
Cash	​	$	1,474	​	$	16,349
Line of credit	​	​	22,917	​	​	22,917
Notes payable, net of current portion	​	​	—	​	​	—
Capital leases, net of current portion	​	​	92	​	​	92
Preferred stock, par value $0.0001 per share; no shares authorized, issued and outstanding, actual; 5,000,000 shares authorized, no shares issued or outstanding, as adjusted	​	​	—	​	​	—
Common stock, par value $0.0001 per share 100,000,000 shares authorized, 0 shares issued and outstanding, actual; 100,000,000 shares authorized, 11,910,100 shares issued and outstanding, as adjusted	​	​	—	​	​	1
Net parent investment	​	​	159,677	​	​	159,677
Additional paid-in capital	​	​	—	​	​	14,874
Accumulated deficit	​	​	(138,356)	​	​	(138,356)
Accumulated other comprehensive income	​	​	477	​	​	477
Total stockholder’s equity	​	$	21,798	​	$	36,673
Total capitalization	​	$	44,807	​	$	59,682

The information in the table above excludes shares of our common stock that will become available for future issuance under our 2021 Plan, which will become effective in connection with the completion of this offering.

Each $1.00 increase or decrease in the assumed initial public offering price of $9.00 per Unit (which is the midpoint of the range set forth on the cover page of this prospectus) would increase or decrease each of cash, total stockholder’s equity and total capitalization on an as adjusted basis by approximately $2.07 million, assuming the number of Units offered, as set forth on the cover page of this prospectus, remains the same, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

Each 1,000,000 Unit increase or decrease in the number of Units offered in this offering would increase or decrease each of cash, total stockholder’s equity and total capitalization on an as adjusted basis by approximately $8.37 million, assuming that the price per Unit for the offering remains at $9.00 (which is the midpoint of the range set forth on the cover page of this prospectus), and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

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DILUTION

If you invest in our common stock in this offering, your interest will be immediately diluted to the extent of the difference between the initial public offering price per Unit in this offering and the net tangible book value per share of our common stock after this offering.

Our historical net tangible book value as of September 30, 2021 was $0.00, or $0.00 per share of our common stock. Historical net tangible book value represents the amount of total tangible assets less total liabilities, and historical net tangible book value per share represents net tangible book value divided by the number of shares of our common stock outstanding as of September 30, 2021.

Our pro forma net tangible book value as of September 30, 2021 was $21.59 million, or $2.23 per share of our common stock. Pro forma net tangible book value represents the amount of our total tangible assets less our total liabilities, after giving effect to the Contribution Transaction. Pro forma net tangible book value per share represents pro forma net tangible book value divided by the total number of shares of our common stock outstanding as of September 30, 2021, after giving effect to the Contribution Transaction.

After giving further effect to the sale of 2,222,222 Units in this offering at an assumed initial public offering price of $9.00 per Unit, the midpoint of the range set forth on the cover page of this prospectus, and after deducting the underwriting discount and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value as of September 30, 2021 would have been approximately $36.46 million, or $3.06 per share. This represents an immediate increase in pro forma as adjusted net tangible book value of $0.83 per share to the existing stockholder and an immediate dilution of $5.94 per share to new investors. The following table illustrates this per share dilution:

Assumed initial public offering price per share	​	​	$	9.00
Historical net tangible book value per share as of September 30, 2021	$	0.00	​
Pro forma increase in net tangible book value per share as of September 30, 2021	$	2.23	​
Pro forma net tangible book value per share as of September 30, 2021	$	2.23	​
Increase in pro forma net tangible book value per share attributable to investors purchasing Units in this offering	$	0.83	​
Pro forma as adjusted net tangible book value per share after this offering	$	3.06	​
Dilution per share to investors in this offering	​	​	$	5.94

A $1.00 increase (decrease) in the assumed initial public offering price of $9.00 per Unit, the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease), our pro forma as adjusted net tangible book value per share after this offering by $0.17, and would increase (decrease) dilution per share to new investors in this offering by $0.83, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the underwriting discount and estimated offering expenses payable by us. Similarly, each increase (decrease) of 1.0 million Units in the number of Units offered by us would increase (decrease) our as adjusted net tangible book value per share after this offering by approximately $0.41 per share and decrease (increase) the dilution to new investors by approximately $0.41 per share, assuming that the assumed initial public offering price remains the same, and after deducting the underwriting discount and estimated offering expenses payable by us.

The following table shows, as of September 30, 2021, after giving effect to the Contribution Transaction, the number of shares of common stock purchased from us, the total consideration paid to us and the price paid per share by the existing stockholders and by new investors purchasing Units in this offering an assumed initial public offering price of $9.00 per Unit, before deducting the underwriting discount and estimated offering expenses payable by us, and assuming no exercise of the underwriter’s over-allotment option and no exercise of the Warrants being sold in this offering (in thousands, except per share amounts and percentages):

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​	Shares Purchased				Total Consideration					Average Price Per Share
​	Number		Percent		Amount			Percent
Existing stockholders	​	9,687,878	​	81.3%	​	$	126,500,000	​	86.3%	​	$	13.06
New investors	​	2,222,222	​	18.7%	​	$	20,000,000	​	13.7%	​	$	9.00
Total	​	11,910,100	​	100%	​	$	146,500,000	​	100%	​	$	12.30

A $1.00 increase (decrease) in the assumed initial public offering price of $9.00 per Unit, which is the midpoint of the range set forth on the cover page of this prospectus, would increase (decrease) the total consideration paid by new investors and total consideration paid by all stockholders by approximately $2.07 million, assuming that the number of Units offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the underwriting discount and estimated offering expenses payable by us. Similarly, each increase (decrease) of 1.0 million Units in the number of Units offered by us would increase (decrease) the total consideration paid by new investors and total consideration paid by all stockholders by approximately $8.37 million, assuming that the assumed initial public offering price remains the same, and after deducting the underwriting discount and estimated offering expenses payable by us.

The above table and discussion includes 9,687,878 shares of common stock outstanding as of September 30, 2021, after giving effect to the Contribution Transaction, and excludes, as of September 30, 2021, shares of common stock reserved for future grant or issuance under our 2021 Plan, which will become effective in connection with the completion of this offering.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our combined consolidated financial statements and related notes included elsewhere in this prospectus. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed below and elsewhere in this prospectus, particularly under the headings “Special Note Regarding Forward-Looking Statements” and “Risk Factors.”

Our Predecessors and FlexEnergy Green Solutions Inc.

FGS was formed in December 2020 and does not have historical financial data. The historical financial data discussed in this Management’s Discussion and Analysis of Financial Condition and Results of Operations are those of FEI and FLPS and their consolidated subsidiaries. After the completion of the Contribution Transaction, FEI and FLPS will be wholly-owned subsidiaries of FGS.

Basis of Presentation

The combined consolidated financial statements include the consolidated accounts of FEI, the accounts of its wholly-owned subsidiaries FEES and FlexEnergy Support Services, Inc., the consolidated accounts of FLPS, and the accounts of its wholly-owned subsidiary Flex Power Co. Flex Power Co. includes the accounts of its wholly-owned subsidiary FLPS Canada. Our combined consolidated financial statements have been prepared in accordance with U.S. GAAP.

Overview

We provide turbine power generation and heat recovery products to C&I customers focused on improving their performance, increasing energy efficiency, and reducing their carbon footprint. We believe we are the premier manufacturer and project operator of 300 kW to 1.3 MW, ultra-clean, highly reliable gas turbines and custom-fit heat recovery products. We were founded in December of 2010 upon the acquisition of our small gas turbine product from Ingersoll Rand Energy Systems, which was developed beginning in 1996 and commercialized in the 2000’s. Key personnel including a leading team of turbine engineers joined our business, along with the acquisition of manufacturing operations and intellectual property. Beginning in 2012, we launched our lease offering and began building out our field service operations, focusing on offering our turbine product for power generation in the North American oilfield market. Beginning in 2017, we began selling our industrial heat recovery products. With our established leasing and field service infrastructure paired with original equipment manufacturing, engineering expertise and proprietary technology, we believe we have a differentiated, vertically integrated business model that is unique to the distributed power industry.

Our product offering includes 333 kW and 1.3MW gas turbine units and customized heat recovery products. Our clean, reliable gas turbines convert waste gas into useful energy and reduce CO2 and NOx emissions. As of September 30, 2021, our turbine products have approximately 8.8 million run hours of operations including 4.9 million run hours within our lease fleet, and have demonstrated a 99% uptime performance. Our heat recovery products enable improved heat transfer to minimize energy waste and consumption.

We have delivered approximately 122 MW of installed capacity of our Flex Turbine product into the market through both direct sales and leasing our turbine fleet which we own and operate for the life of the asset. Our lease fleet currently comprises approximately 49 MW of installed capacity, which has accumulated since inception in 2012 at a compounded annualized growth rate of 31%.

Our Primary Applications

We believe we are in a strong position to grow our business amid the transition towards more sustainable, lower carbon sources of energy. We believe this energy transition will include:

•

Long-term, sustainable growth in electric demand

•

Efforts for industries and individual companies to reduce carbon emissions and air pollution

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•

Energy efficiency playing a major role in decarbonization efforts

•

Ongoing secular shift to distributed power generation

We have proven solutions that are well supported by the above trends. Primary applications of our proven solutions include:

Converting Waste Gas to Useful Energy:

•

The Flex Turbine can run on waste fuels such as methane from landfills and CO2 heavy field gas from oil producing wells down to 350 BTUs, as well as synthetic gasses such as ethane produced in the refining process with up to 2,500 BTUs to produce reliable, distributed electricity.

•

Our current and future customer base under this vertical are predominantly represented by North American independent oil producers, global supermajors and midstream gas companies who desire our turbine products.

Improving Traditional Processes:

•

Flex Heat Recovery products incorporate the most effective high temperature, high pressure heat exchanger technology. They have a smaller footprint than competing systems due to their design efficiency, making them ideal for space constrained applications. They are currently being evaluated for the next generation of carbon capture technology, multiple fuel cell applications, and emissions reduction projects.

•

Our current and future customer base under this vertical are predominantly represented by the companies in the U.S. C&I sector who desire our turbine products as well as original manufacturers who produce fuel cells, internal combustion engines, and gas turbines and who desire our heat recovery products.

Enabling Emerging Clean Technology:

•

Efficient use of thermal energy is the key to energy efficiency in many of today’s most promising alternative fuel technologies, such as solid oxide fuel cells for power generation, traditional fuel cell technology for power, green hydrogen production, and certain heat as energy storage applications, like molten salt. We believe our Flex Heat Recovery products enable these green technologies to be more cost competitive with conventional forms of energy production.

•

Our current and future customer base under this vertical are predominantly represented by manufacturers of fuel cells, internal combustion engines and gas turbines who desire our heat recovery products.

Our Customer Base and Demand for our Products

We believe the current and future demand for our products will be underpinned by sustainable, growing demand from our Converting Waste Gas to Useful Energy vertical and augmented by emerging demand for our heat recovery products to improve industrial processes and enable new clean technologies.

The majority of demand for our product to date has come from oil producers who require highly reliable onsite power solutions at their well sites that often do not have reliable access to utility power. Our Flex Turbine’s unique ability to run on a wide range of unprocessed field gas that is often otherwise burned off by flaring - along with very low maintenance, high up-time performance and cyclic load handling - has driven customers to our power generation solution. As further described below, our zero capex leasing solution and direct field service support are paramount to our success of winning and retaining new business. We expect our growth in this market vertical will be driven primarily by the following:

•

Sustained drilling of new oil wells in our core North American market

•

Expansion of our proven solution to very large international flare gas to power project opportunities

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•

Heightened efforts for oil producers to seek solutions to reduce carbon emissions across their operations, including a concerted focus on significantly reducing levels of upstream flaring.

In addition, we serve and expect additional demand from the C&I sector for our Flex Turbines. While overall revenue from our Flex Heat Recovery products comprised less than 10% of total revenue for the year-ended December 31, 2020 and for the nine months ended September 30, 2021, we expect to grow revenue from these products as we believe customers will demand heat recovery products that improve traditional processes and help enable emerging clean technology.

Revenue Generation under our EaaS Business Model

Under our EaaS business model, we have accumulated an asset base that represents a modern fleet of long-lived power generation assets. Since 2012, we have offered customers the option of purchasing our manufactured product or entering into an equipment leasing contract. We have experienced strong annualized growth of our turbine leasing fleet, predominantly to North American oil producers who largely prefer to lease or rent power generation equipment for wellsite power as opposed to purchasing generation equipment within their annual capital budgets. We believe this zero-capex solution for our customer base extends beyond our O&G vertical and into the C&I sector where customers are not only increasingly self-generating their own power but, we believe, also want a power solution that replicates a consistent monthly utility bill. At the same time, we also believe our EaaS leasing solution is beneficial to our stakeholders because we own and operate our bespoke generation asset in a manner that generates attractive life cycle returns on our underlying capital investment. Because we own, operate and directly maintain our asset at customer sites, we have gained a tremendous amount of field learning knowledge. In coordination between our field service, manufacturing and engineering teams, this field learning and operating data retention has translated into both exceptional uptime to our customers as well as solutions that can significantly extend the life of our turbine asset base. Included in a customer’s monthly lease rate is also the service of the unit from our trained service technicians.

In addition to our EaaS offering, we have customers who prefer to make a capital investment in their power generation asset through direct purchases of our manufactured products. This includes both our gas turbine products and our heat recovery products. Many of our customers, particularly those in the U.S., enter into a long-term service agreement in addition to purchasing equipment, while other customers instead prefer to have their purchased equipment serviced on a time-and-materials basis. Together the long-term service agreements, the time and materials that we charge our third-party customers and commissioning services make up our service revenue.

Costs of Conducting Our Business

The principal costs associated with operating our business are:

•

Cost of revenues (excluding turbine fleet depreciation)

•

Depreciation associated with our rental fleet

•

Selling, general and administrative expenses

•

Interest expense

Cost of revenues (excluding turbine fleet depreciation) include:

•

Cost of Turbine Leasing Fleet, which includes the direct cost of field service personnel and consumable spare parts allocated to maintaining our leasing turbines

•

Cost of Turbine Service on Sold Product, which includes the direct cost of field service personnel and consumable spare parts allocated to maintaining our aftermarket service arrangements of customer purchased turbines; and

•

Cost of Manufactured Product, which includes the cost of manufacturing the equipment sold, including material and manufacturing labor and overhead. Since acquiring the manufacturing

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operations in 2010, our available throughput volume has exceeded our actual volume of turbine production on an annual basis. In recent years we have taken measures to reduce our production and associated costs down to a more suitable level that we believe fulfills the measured demand coming from our turbine leasing fleet and third-party customers. We have begun to realize further cost reductions in 2021 by consolidating our two production facilities to a single facility. This facility will be the single point of production for both the continued growth of our turbine installed base as well as what we believe will be emerging demand for our heat recovery products in future years.

Our depreciation expense consists of the depreciation expense related to our own turbine assets. These assets are depreciated over a 10 year period.

Our selling, general and administrative expenses primarily consist of salaries expense, marketing expense and professional services, including legal expenses.

Interest expense primarily represents monthly interest paid under our asset-back financing arrangement as further described below in “Liquidity and Capital Resources.”

How We Evaluate our Operations

We use a variety of qualitative, operational and financial metrics to assess our performance. Among other measures, management considers (i) the size of our turbine leasing fleet (ii) revenue, (iii) EBITDA and (iv) Adjusted EBITDA.

Size of our lease fleet

We believe the continued growth of our turbine leasing fleet is an important indicator of current and future financial performance, given the proven and sustainable revenue stream as well as the opportunity to realize cost efficiencies within our cost of turbine leasing with additional growth of the underlying asset base. We measure the size of our lease fleet in the form of total megawatts based on the combined installed capacity our turbine units as well as the number of turbine units in the fleet.

Revenue

We analyze our revenue by comparing actual quarterly and annual revenue to our internal projections for a given period and to prior periods to assess our performance.

EBITDA and Adjusted EBITDA

We view EBITDA and Adjusted EBITDA as important indicators of performance. We define EBITDA as net income (loss), plus (i) depreciation and amortization expense, (ii) interest expense and (iii) income tax expense. We define Adjusted EBITDA as EBITDA plus or minus (i) equity-based compensation expense and (ii) certain non-cash charges and unusual or non-recurring charges or income that we do not view as representative of our ongoing operations.

Factors Impacting Comparability of Our Financial Results

Public Company Expenses

Upon completion of this offering, we expect to incur direct, incremental general and administrative (“G&A”) expenses as a result of being a publicly traded company, including, but not limited to, costs associated with hiring new personnel, implementation of compensation programs that are competitive with our public company peer group, annual and quarterly reports to stockholders, tax return preparation, independent auditor fees, investor relations activities, registrar and transfer agent fees, additional legal fees, incremental director and officer liability insurance costs and incremental independent director compensation. These direct, incremental G&A expenses are not included in our historical results of operations.

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We Will Incur Additional Taxes as a Result of being a “C” Corporation

Prior to the completion of the Contribution Transaction, the results of operations of the business (comprised of the businesses of FEI and FLPS) were consolidated into the financial statements of FPS, a limited liability company taxed as a partnership. Upon completion of the Contribution Transaction, the operations of the business will be conducted under FGS, a “C” corporation for tax purposes. Thus, once we have become profitable and have fully utilized all net operating loss carry forwards available to us, we anticipate significant increases in income tax expenses for periods after the completion of the Contribution Transaction. See “Management’s Discussion and Analysis of Financial Condition and Results of Operation – Income Taxes.”

Effects of COVID-19

Demand and pricing in the oil and gas markets fell significantly due to the COVID-19 pandemic and an increase in global oil supply driven by disagreements with respect to oil pricing between Russia and members of OPEC. The effects of the COVID-19 pandemic continued to drive reduced demand leading to volatility in prices during 2020 and the first nine months of 2021. This commodity price volatility adversely affected demand for our products and services and negatively impacted our results of operations during 2020 and the first nine months of 2021.

Going Concern

The combined consolidated financial statements have been prepared as though we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We have incurred operating losses and negative cash flows from operations since inception. As of September 30, 2021, we have an accumulated deficit of approximately $138.36 million. Management expects to continue to incur operating losses and negative cash flows. We have financed our operations to date with proceeds from equity infusions from FPS and from debt financings.

We will need to raise additional capital in order to continue to fund operations. We believe we will be able to obtain additional capital through equity financings or other arrangements to fund operations; however, there can be no assurance that such additional financing, if available, can be obtained on acceptable terms. If we are unable to obtain such additional financing, future operations would need to be scaled back or discontinued.

Accordingly, these factors raise substantial doubt about our ability to continue as a going concern within one year after the date the combined consolidated financial statements are issued. The combined consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.

Results of Operations

Comparison of the Years Ended December 31, 2020 and 2019

The following table sets forth our results of operations for the years ended December 31, 2020 and 2019.

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​	Years Ended December 31,
(in thousands)	2020			2019
​	(FEI and FLPS)
Statement of Operations and Comprehensive Loss Data:	​	​	​	​	​	​
Revenue	​	​	​	​	​	​
Turbine leasing fleet	​	$	17,838	​	$	16,833
Turbine service on sold product	​	​	2,213	​	​	2,824
Manufactured product	​	​	3,276	​	​	5,716
Total revenue	​	$	23,327	​	$	25,373
Cost of revenue	​	​	​	​	​	​
Turbine leasing fleet (excluding depreciation of fleet turbines)	​	$	4,884	​	$	5,442
Turbine service on sold product	​	​	1,691	​	​	2,797
Manufactured product	​	​	5,789	​	​	9,531
Depreciation of fleet turbines	​	​	5,007	​	​	4,713
Total cost of revenue	​	$	17,371	​	$	22,483
Operating expenses	​	​	​	​	​	​
Selling, general and administrative	​	$	11,826	​	$	12,400
Research and development	​	​	120	​	​	237
Total operating expenses	​	$	11,946	​	$	12,637
Operating loss	​	$	(5,990)	​	$	(9,747)
Other income (expense)	​	​	​	​	​	​
Interest expense	​	$	(1,114)	​	$	(992)
Other (expense) income, net	​	​	31	​	​	(159)
Total other income (expense), net	​	$	(1,083)	​	$	(1,151)
Loss before income taxes	​	$	(7,073)	​	$	(10,898)
Income tax provision	​	​	(31)	​	​	(7)
Net loss	​	$	(7,104)	​	$	(10,905)
Other comprehensive gain, net of tax	​	​	​	​	​	​
Foreign currency translation adjustments	​	$	443	​	$	185
Total other comprehensive gain, net of tax	​	$	443	​	$	185
Comprehensive loss	​	$	(6,661)	​	$	(10,720)
EBITDA	​	$	1,114	​	$	(3,712)
Adjusted EBITDA	​	$	1,209	​	$	(3,457)

Size of our lease fleet

Our lease fleet has increased by 4 MW of installed capacity, or 9%, to 49 MW at December 31, 2020 compared to 45 MW of installed capacity at December 31, 2019. This increase was due to the additions of newbuild turbine assets that were manufactured and made field-ready during 2020.

Revenue

Turbine Leasing Fleet.   Our turbine leasing fleet revenue increased $1.01 million, or 6%, to $17.84 million for the year ended December 31, 2020 compared to $16.83 million for the year ended December 31, 2019. This increase was primarily due to strong demand and a 12% increase in average annual deployments for turbines under leasing contracts across our customer base.

Turbine Service on Sold Product.   Our turbine service on sold product revenue decreased $0.61 million, or 22%, to $2.21 million for the year ended December 31, 2020 compared to $2.82 million for the

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year ended December 31, 2019. This decrease was primarily due to customers of sold manufactured product deferring or cancelling anticipated major component overhauls performed on a time and materials basis amid economic uncertainty and travel restrictions throughout the majority of 2020. Such time and materials revenue decreased $0.68 million, or 47%, to $0.75 million for the year ended December 31, 2020 compared to $1.43 million for the year ended December 31, 2019.

Manufactured Product.   Our manufactured product revenue decreased $2.44 million, or 43%, to $3.28 million for the year ended December 31, 2020 compared to $5.72 million for the year ended December 31, 2019. This decrease was primarily due to the fact that we de-expedited the production of new turbines under executed purchase orders, both to address the needs of our customers and to decrease our production levels given disruptions within our supply chain amid larger economic uncertainty.

Cost of Revenues

Turbine Leasing Fleet.   Our cost of turbine leasing fleet decreased $0.56 million, or 10%, to $4.88 million for the year ended December 31, 2020 compared to $5.44 million for the year ended December 31, 2019. This decrease was primarily due to proactive measures across our field operations to reduce cost such as travel, overtime and spare parts purchases.

Turbine Service on Sold Product.   Our cost of turbine service on sold product decreased $1.11 million, or 40%, to $1.69 million for the year ended December 31, 2020 compared to $2.80 million for the year ended December 31, 2019. This decrease was primarily due to customers of sold manufactured product deferring or cancelling anticipated major component overhauls performed on a time and materials basis amid economic uncertainty and travel restrictions throughout the majority of 2020.

Manufactured Product.   Our cost of manufactured product decreased $3.74 million, or 39%, to $5.79 million for the year ended December 31, 2020 compared to $9.53 million for the year ended December 31, 2019. This decrease was primarily due to the corresponding reduction in product sales caused by the fact that we de-expedited the production of new turbine under executed purchase orders, both to address the needs of our customers and also decrease our production levels given disruptions within our supply chain amid larger economic uncertainty. The annual cost of our direct manufacturing labor and overhead decreased $1.50 million, or 26%, to $4.23 million for the year ended December 31, 2020 compared to $5.73 million for the year ended December 31, 2019.

Depreciation of Fleet Turbines.   Our cost of depreciation of fleet turbines increased $0.29 million, or 6%, to $5.00 million for the year ended December 31, 2020 compared to $4.71 million for the year ended December 31, 2019. This increase was primarily due to the increase in the size of our fleet.

Operating Expenses

Selling, General and Administrative Expenses.   Selling, general and administrative expenses (“SG&A”) decreased $0.57 million, or 5%, to $11.83 million for the year ended December 31, 2020 compared to $12.40 million for the year ended December 31, 2019. This decrease was primarily due to a series of cost reduction measures implemented beginning in the second quarter of 2020 in response to the economic uncertainty caused by the COVID-19 pandemic.

We expect SG&A expenses to increase considerably in future periods as a result of being a public company. Please see “Risk Factors – Risk Factors Relating to Ownership of Our Common Stock – We will incur significantly increased costs as a result of operating as a public company, and our management will be required to devote substantial time to compliance efforts.”

Research and Development.   Research and development expenses decreased $0.12 million, or 49%, to $0.12 million for the year ended December 31, 2020 compared to $0.24 million for the year ended December 31, 2019. This decrease was primarily due to the suspension of research and development spending beginning in the second quarter of 2020 in response to the economic uncertainty caused by the COVID-19 pandemic.

48

Other income (expense)

Interest Expense.   Interest expense increased $0.12 million, or 12%, to $1.11 million for the year ended December 31, 2020 compared to $0.99 million for the year ended December 31, 2019. This increase was primarily due to higher average balances on our line of credit during the year ended December 31, 2020.

Other Income (Expense).   Other income increased $0.19 million to $0.03 million for the year ended December 31, 2020 compared to $(0.16) million for the year ended December 31, 2019. This increase was primarily due to expenses incurred for facility relocation in 2019 that were not incurred in 2020.

Income Tax Provision

Prior to the closing of this offering, the results of operations of the business (comprised of the businesses of FEI and FLPS) were consolidated into the financial statements of FPS, a limited liability company taxed as a partnership. After the closing of this offering, the operations of the business will be conducted under FGS, a “C” corporation for tax purposes. Thus, once we have become profitable and have fully utilized all NOL carryforwards available to us, we anticipate significant increases in income tax expenses for periods after the closing of this offering.

At December 31, 2020, we had federal, state and foreign NOL carryforwards of $106.85 million, $78.22 million and $0.22 million, respectively, which will expire, if unused, beginning in 2031, 2026 and 2035, respectively; provided that federal NOLs generated post-Tax Cuts and Jobs Act (“the Tax Act”) for the tax years ended December 31, 2018 and thereafter ($29.48 million at December 31, 2020) do not expire.

Our NOL utilization could be limited under Internal Revenue Code Section 382 due to certain ownership changes that have occurred and that may occur in the future. Our preliminary analysis indicates that $48.40 million of our NOLs will expire unutilized. See “Risk Factors – Risk Factors Relating to our Business and Industry – We might not be able to utilize a significant portion of our net operating loss carryforwards and research and development tax credit carryforwards.” and Note 10 to our Notes to Combined Consolidated Financial Statements included elsewhere in this prospectus.

Net Loss

Net loss decreased $3.81 million, or 35%, to $7.10 million for the year ended December 31, 2020 compared to $10.91 million for the year ended December 31, 2019, primarily due to the decreases in cost of revenue discussed above.

Foreign Currency Translation Adjustments

Foreign currency translation adjustments increased $0.26 million, or 139%, to $0.44 million for the year ended December 31, 2020 compared to $0.19 million for the year ended December 31, 2019.

Comprehensive Loss

Comprehensive loss decreased $4.06 million, or 38%, to $6.66 million for the year ended December 31, 2020 compared to $10.72 million for the year ended December 31, 2019, primarily due to the decreases in cost of revenue discussed above.

Adjusted EBITDA

Adjusted EBITDA increased $4.67 million to $1.21 million for the year ended December 31, 2020 compared to $(3.46) million for the year ended December 31, 2019. The increase was primarily due to an increase in Flex Turbine lease fleet revenue coupled with decreases in cost of revenue and operating expenses resulting from a series of cost reduction measures implemented to preserve our liquidity amid the greater economic uncertainty resulting from the COVID-19 pandemic.

49

Comparison of the Nine Months Ended September 30, 2021 and 2020

​	Nine Months Ended September 30,
(in thousands)	2021			2020
Statement of Operations and Comprehensive Loss Data:	​			​
Revenue	​	​	​	​	​	​
Turbine leasing fleet	​	$	11,144	​	$	14,304
Turbine service on sold product	​	​	3,431	​	​	1,617
Manufactured product	​	​	3,712	​	​	3,276
Total revenue	​	$	18,287	​	$	19,197
Cost of revenue	​	​	​	​	​	​
Turbine leasing fleet (excluding depreciation of fleet turbines)	​	$	4,279	​	$	3,714
Turbine service on sold product	​	​	2,254	​	​	1,292
Manufactured product	​	​	5,651	​	​	5,419
Depreciation of fleet turbines	​	​	3,357	​	​	4,003
Total cost of revenue	​	$	15,541	​	$	14,428
Operating expenses	​	​	​	​	​	​
Selling, general and administrative	​	$	10,318	​	$	8,596
Research and development	​	​	98	​	​	126
Total operating expenses	​	$	10,416	​	$	8,722
Operating loss	​	$	(7,670)	​	$	(3,953)
Other income (expense)	​	​	​	​	​	​
Interest expense	​	$	(792)	​	$	(876)
Other (expense) income, net	​	​	2,562	​	​	(10)
Total other income (expense), net	​	$	1,770	​	$	(886)
Loss before income taxes	​	$	(5,900)	​	$	(4,839)
Income tax provision	​	​	(308)	​	​	(5)
Net loss	​	$	(6,208)	​	$	(4,844)
Other comprehensive gain (loss), net of tax	​	​	​	​	​	​
Foreign currency translation adjustments	​	$	(66)	​	$	(17)
Total other comprehensive gain (loss), net of tax	​	$	(66)	​	$	(17)
Comprehensive loss	​	$	(6,274)	​	$	(4,861)
EBITDA	​	$	371	​	$	1,207
Adjusted EBITDA .	​	$	(1,653)	​	$	1,260

Size of our lease fleet

Our lease fleet has increased by 2 MW of installed capacity, or 4%, to 49 MW at September 30, 2021 compared to 47 MW of installed capacity at September 30, 2020. This increase was due to the additions of newbuild turbine assets that were manufactured and made field-ready during the fourth quarter of 2020.

Revenue

Turbine Leasing Fleet.   Our turbine leasing fleet revenue decreased $3.16 million, or 22%, to $11.14 million for the nine months ended September 30, 2021 compared to $14.30 million for the nine months ended September 30, 2020. This decrease was primarily due to a 17% decrease in average monthly deployments for turbines under leasing contracts across our customer base, following a record high level of average monthly deployments set in the first nine months of 2020.

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Turbine Service on Sold Product.   Our turbine service on sold product revenue increased $1.81 million, or 112%, to $3.43 million for the nine months ended September 30, 2021 compared to $1.62 million for the nine months ended September 30, 2020. This increase was primarily due to customers of sold manufactured product resuming anticipated major component overhauls performed on a time and materials basis amid increased economic certainty and an ease on travel restrictions. Such time and materials revenue increased $1.12 million or 200% to $1.68 million for the nine months ended September 30, 2021 compared to
$0.56 million for the nine months ended September 30, 2020.

Manufactured Product.   Our manufactured product revenue increased $0.44 million, or 13%, to $3.71 million for the nine months ended September 30, 2021 compared to $3.28 million for the nine months ended September 30, 2020. This increase was primarily due to the resumption of manufacturing activity following our plant relocation and consolidation project completed in the first quarter of 2021. This resumption of activity included manufactured product sales of $2.4 million in the third quarter of 2021 made to marquis customers in our high-target C&I regional markets of New York City and Southern California.

Cost of Revenues

Turbine Leasing Fleet.   Our cost of turbine leasing fleet increased $0.57 million, or 15%, to $4.28 million for the nine months ended September 30, 2021 compared to $3.71 million for the nine months ended September 30, 2020. This increase was primarily due to an increased level of travel, overtime and spare parts purchasing resulting from resuming more normalized field operations versus the restrictions put into place during the first nine months of 2020 amid the COVID-19 outbreak.

Turbine Service on Sold Product.   Our cost of turbine service on sold product increased $0.96 million, or 74%, to $2.25 million for the nine months ended September 30, 2021 compared to $1.29 million for the nine months ended September 30, 2020. This increase was primarily due to customers of sold manufactured product resuming anticipated major component overhauls performed on a time and materials basis amid increased economic uncertainty and an ease on travel restrictions.

Manufactured Product.   Our cost of manufactured product increased $0.23 million, or 4%, to $5.65 million for the nine months ended September 30, 2021 compared to $5.42 million for the nine months ended September 30, 2020. This slight increase was primarily due to an increase in turbine material costs, partially offset by the realization of lower operating cost in the form of rent, utilities and other expenses associated with the consolidation of our operating facilities into one central location and where all turbines, heat recovery products and aftermarket refurbishment takes place. The cost of our direct manufacturing labor and overhead decreased $0.85 million, or 26%, to $2.41 million for the nine months ended September 30, 2021 compared to $3.26 million for the nine months ended September 30, 2020.

Depreciation of Fleet Turbines.   Our cost of depreciation of fleet turbines decreased $0.65 million, or 16%, to $3.36 million for the nine months ended September 30, 2021 compared to $4.00 million for the nine months ended September 30, 2020. This decrease was primarily due to a 17% decrease in average monthly deployments for turbines under leasing contracts across our customer base, following a record high level of average monthly deployments set in the first nine months of 2020.

Operating Expenses

Selling, General and Administrative Expenses.   SG&A expenses increased $1.72 million, or 20%, to $10.32 million for the nine months ended September 30, 2021 compared to $8.60 million for the nine months ended September 30, 2020. This increase was primarily due to increased depreciation recorded as operating expenses for units not currently deployed and a series of cost reduction measures implemented beginning in the second quarter of 2020 in response to the economic uncertainty caused by the COVID-19 pandemic. During 2021, these cost reduction measures were lifted.

We expect SG&A expenses to increase considerably in future periods as a result of being a public company. Please see “Risk Factors — Risk Factors Relating to Ownership of Our Common Stock — We will

51

incur significantly increased costs as a result of operating as a public company, and our management will be required to devote substantial time to compliance efforts.”

Research and Development.   Research and development expenses decreased $0.03 million, or 22%, to $0.10 million for the nine months ended September 30, 2021 compared to $0.13 million for the nine months ended September 30, 2020. This decrease was primarily due to a deferral of certain research and development initiatives into fiscal year 2022.

Other income (expense)

Interest Expense.   Interest expense decreased $0.09 million, or 9%, to $0.79 million for the nine months ended September 30, 2021 compared to $0.88 million for the nine months ended September 30, 2020. This decrease was primarily due to lower average balances on our line of credit during the nine months ended September 30, 2021.

Other Income (Expense).   Other income (expense) increased $2.57 million to $2.56 million for the nine months ended September 30, 2021 compared to $(0.01) million for the nine months ended September 30, 2020. This increase was primarily due to the forgiveness of the PPP loans during the second quarter of 2021, which resulted in a gain on forgiveness of debt of $2.38 million.

Net Loss

Net loss increased $1.36 million, or 28%, to $6.21 million for the nine months ended September 30, 2021 compared to $4.84 million for the nine months ended September 30, 2020, primarily due to a series of cost reduction measures implemented beginning in the second quarter of 2020 in response to the economic uncertainty caused by the COVID-19 pandemic that were lifted in 2021, and a decline in turbine leasing revenue, partially offset by $2.38 million of other income related to forgiveness of the PPP loan described above.

Foreign Currency Translation Adjustments

Foreign currency translation gain (loss) adjustments decreased $0.05 million, or 288%, to $(0.07) million for the nine months ended September 30, 2021 compared to $(0.02) million for the nine months ended September 30, 2020.

Comprehensive Loss

Comprehensive loss increased $1.41 million, or 29%, to $6.27 million for the nine months ended September 30, 2021 compared to $4.86 million for the nine months ended September 30, 2020, for the reasons set forth in “Net Loss” above.

Adjusted EBITDA

Adjusted EBITDA decreased $2.91 million to $(1.65) million for the nine months ended September 30, 2021 compared to $1.26 million for the nine months ended September 30, 2020. The decrease was primarily due to the adjustment for the forgiveness of the PPP loans during the second quarter of 2021, which had reduced our net loss, a decline in turbine leasing revenue, and an increase in costs due to the restoration of cost reduction measures that were implemented as a result of the COVID-19 pandemic.

Comparison of Non-GAAP Financial Measures

We view EBITDA and Adjusted EBITDA as important indicators of performance. We define EBITDA as net income (loss), plus (i) depreciation and amortization expense, (ii) interest expense and (iii) income tax expense. We define Adjusted EBITDA as EBITDA plus or minus (i) equity-based compensation expense and (ii) certain non-cash charges and unusual or non-recurring charges or income that we do not view as representative of our ongoing operations.

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We believe that our presentation of EBITDA and Adjusted EBITDA will provide useful information to investors in assessing our financial condition and results of operations. Net income is the GAAP measure most directly comparable to EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA should not be considered alternatives to net income or loss presented in accordance with GAAP. Because EBITDA and Adjusted EBITDA may be defined differently by other companies in our industry, our definitions of EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures of other companies, thereby diminishing their utility. The following table presents a reconciliation of EBITDA and Adjusted EBITDA to net loss for each of the periods indicated.

​	Year Ended December 31,						Nine Months Ended September 30,
(in thousands)	2020			2019			2021			2020
Net Loss	​	$	(7,104)	​	$	(10,905)	​	$	(6,208)	​	$	(4,844)
Depreciation and amortization	​	​	7,073	​	​	6,194	​	​	5,479	​	​	5,170
Interest expense, net	​	​	1,114	​	​	992	​	​	792	​	​	876
Income tax provision	​	​	31	​	​	7	​	​	308	​	​	5
EBITDA	​	$	1,114	​	$	(3,712)	​	$	371	​	$	1,207
One-time facility relocation expenses(1)	​	​	25	​	​	185	​	​	301	​	​	—
Equity-based compensation	​	​	70	​	​	70	​	​	53	​	​	53
PPP loan forgiveness	​	​	0	​	​	0	​	​	(2,378)	​	​	—
Adjusted EBITDA	​	$	1,209	​	$	(3,457)	​	$	(1,653)	​	$	1,260

(1)

Represents non-recurring out of pocket expenses incurred in moving our heat recovery-focused facility.

Some of the limitations of EBITDA and Adjusted EBITDA include (i) these non-GAAP measures do not properly reflect capital commitments to be paid in the future, and (ii) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and EBITDA and Adjusted EBITDA do not reflect these capital expenditures. Our non-GAAP measures may not be comparable to similarly titled measures of other companies because they may not calculate them in the same manner as we calculate, the measure, limiting its usefulness as a comparative measure. In evaluating EBITDA and Adjusted EBITDA, you should be aware that in the future we will incur expenses similar to the adjustments in this presentation. Our presentation of EBITDA and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these expenses or any unusual or non-recurring items. EBITDA and Adjusted EBITDA should not be considered as an alternative to loss before benefit from income taxes, net loss, earnings per share, or any other performance measures derived in accordance with U.S. GAAP. When evaluating our performance, you should consider adjusted our non-GAAP measures alongside other financial performance measures, including our net loss and other GAAP results.

Quarterly Results of Operations

The following tables set forth selected unaudited quarterly statement of operations data for each of the seven fiscal quarters ended September 30, 2021. The information for each of these quarters has been prepared in accordance with GAAP on the same basis as our audited historical consolidated financial information included elsewhere in this prospectus and includes, in the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary for the fair statement of the results of operations for these periods. This data should be read in conjunction with our consolidated financial information and the related notes included elsewhere in this prospectus. These quarterly results are not necessarily indicative of our results of operations to be expected for any future period.

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(in thousands)

Three Months Ended

March 31, 2020

June 30, 2020

September 30, 2020

December 31, 2020

March 31, 2021

June 30, 2021

September 30, 2021

Revenue

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Turbine leasing fleet

​

$

5,364

​

$

4,661

​

$

4,279

​

$

3,534

​

$

3,493

​

$

3,779

​

$

3,872

Turbine service on sold product

​

​

589

​

​

531

​

​

497

​

​

596

​

​

1,052

​

​

549

​

​

1,830

Manufactured product

​

​

1,634

​

​

24

​

​

1,618

​

​

—

​

​

73

​

​

1,203

​

​

2,436

Total revenue

​

​

7,587

​

​

5,216

​

​

6,394

​

​

4,130

​

​

4,618

​

​

5,531

​

​

8,138

Cost of revenue

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Turbine leasing fleet (excluding depreciation of fleet turbines)

​

​

1,412

​

​

1,150

​

​

1,152

​

​

1,170

​

​

1,478

​

​

1,489

​

​

1,312

Turbine service on sold product

​

​

486

​

​

475

​

​

331

​

​

399

​

​

787

​

​

320

​

​

1,147

Manufactured product

​

​

2,394

​

​

1,064

​

​

1,961

​

​

370

​

​

889

​

​

1,641

​

​

3,121

Depreciation of fleet turbines

​

​

1,386

​

​

1,380

​

​

1,237

​

​

1,004

​

​

1,057

​

​

1,110

​

​

1,190

Total cost of revenue

​

​

5,678

​

​

4,069

​

​

4,681

​

​

2,943

​

​

4,211

​

​

4,560

​

​

6,770

Gross profit

​

​

1,909

​

​

1,147

​

​

1,713

​

​

1,187

​

​

407

​

​

971

​

​

1,368

Total operating expenses

​

​

3,268

​

​

2,764

​

​

2,690

​

​

3,224

​

​

3,606*

​

​

3,648*

​

​

3,162

Operating loss

​

​

(1,359)

​

​

(1,617)

​

​

(977)

​

​

(2,037)

​

​

(3,199)

​

​

(2,677)

​

​

(1,794)

Interest expense

​

​

(338)

​

​

(327)

​

​

(211)

​

​

(238)

​

​

(269)

​

​

(270)

​

​

(253)

Other (expense) income, net

​

​

(27)

​

​

78

​

​

(61)

​

​

41

​

​

68

​

​

2,465

​

​

29

Loss before income taxes

​

​

(1,724)

​

​

(1,866)

​

​

(1,249)

​

​

(2,234)

​

​

(3,400)

​

​

(482)

​

​

(2,018)

Income tax provision

​

​

(2)

​

​

(2)

​

​

(1)

​

​

(26)

​

​

(60)

​

​

(118)

​

​

(130)

Net loss

​

$

(1,726)

​

$

(1,868)

​

$

(1,250)

​

$

(2,260)

​

$

(3,460)

​

$

(600)

​

$

(2,148)

*

Operating expenses have been recasted to reflect the deal costs paid by FPS on behalf of FGS for legal, accounting and other fees.

Quarterly Revenue Trends

Turbine leasing fleet revenue represents a recurring stream of revenue generation from our fleet of
long-lived turbine assets, and makes up the majority of our total revenue base. Turbine service on sold product is a combination of recurring revenue from long-term fixed care maintenance agreements as well as one-time, time and materials refurbishments and upgrades of customer-owned units deployed, the latter of which can fluctuate depending on our customers’ desire for refurbishments and upgrades. Lastly, while the majority of our turbine production over the last several years has been dedicated to building turbines to
add into our own lease fleet, we have allocated a minority portion of our manufacturing capacity for third-party sales for a series of marquis, often repeat customers in high-target C&I markets that have a preference to purchase our turbines outright along with entering into a long-term service care agreement. Therefore, such manufactured product revenue can fluctuate quarter to quarter depending on the one-time revenue recognition of these turbines and heat recovery unit sales. Turbine lease fleet revenue in the quarter ended September 30, 2021 increased for the third consecutive quarter versus the preceding quarter due to an increased level of lease unit deployment and underpinned by increased demand for sustainable, reliable remote power generation solutions from our customer base. Total revenue for the quarter ended September 30, 2021 of $8.14 million represented a 47% increase versus the preceding quarter and the highest quarterly level of revenue generation since the beginning of 2020.

Quarterly Gross Profit Trends

Gross profit fluctuated between $0.41 million and $1.91 million during the periods presented and was $1.37 million for the quarter ended September 30, 2021. Gross profit generation is dependent upon the revenue mix between turbine leasing fleet, turbine service on sold product and manufactured product, with

54

turbine leasing fleet and service on sold product generating positive gross profit contributions and manufactured product generating negative gross profit contribution for each quarter over the time period. We expect that continued economies of scale from a growing installed base of company-owned and customer-owned units will have a positive impact of gross profit contributions levels of turbine leasing fleet and turbine service on sold product. Along similar lines, it is our expectation that an increased level of manufacturing capacity of third-party turbines, coupled with a growing production base of heat recovery units, and the associated economies of scale of a manufacturing cost base that has a significant fixed cost component, will generate a positive gross contribution of manufactured product in the future. Gross profit margin fluctuated between 9% and 29% during the periods presented and was 17% for the quarter ended September 30, 2021.

Liquidity and Capital Resources

Overview

Since the acquisition of the turbine product and manufacturing operations from Ingersoll Rand in December of 2010 and the subsequent inception of the leasing operations in 2012, our business has been funded by a combination of cash from the FPS Noteholders via the Notes (whereby FPS contributed the cash received from the Notes to FEI and FLPS as capital), the Credit Facility, the PPP loans and proceeds from the SAFE Transaction (which were also contributed by FPS to FEI and FLPS as capital). The primary uses of this capital have been to invest in the growth of our turbine leasing fleet, support manufacturing operations and engineering efforts including turbine and heat exchanger product development.

As further described below, since the equity contribution of FLPS and FEI to the newly formed parent FPS on January 1, 2016, the Notes were funded over the years 2016, 2017 and 2018 to support the expansion of the leasing business into new geographies and manufacturing operations. As of September 30, 2021, the amount outstanding under the Notes payable by FPS were approximately $26.66 million, including $20.24 million of principal and $6.42 million of accrued interest. In 2019, with what we believed to be an appropriate level of scale of our turbine lease fleet, we closed on the Credit Facility to support the continued growth of the fleet. As of September 30, 2021, total borrowings under the Credit Facility totaled approximately $22.92 million. See “Risk Factors – Risk Factors Relating to Financing Matters – Our substantial indebtedness could limit our opportunities for growth.”

A key underpinning of our business plan has been to scale the fleet of our long-lived turbine assets to the level where the associated revenue streams of leasing and service fully cover our operating activities. Furthermore, depending on market conditions we can flexibly scale up or down our manufacturing operations, including newbuild leasing turbines, and not have any direct impact to our ability to generate revenue off our existing installed base. We successfully executed this strategy during the year ended December 31, 2020, realizing an increase year-over-year in revenue attributed to our installed base – namely the combination of revenue from turbine leasing fleet and turbine service on sold product – while significantly reducing operating costs, primarily in our production operations, and significantly reducing outgoing cash flow expenditures on new turbine inventory amid the challenging macroeconomic environment. We have maintained this modest level of turbine production in 2021, during which our production plans were set at a fixed level of fulfilling executed orders for third party customers in our target C&I markets of New York City, Southern California and South Korea. Absent a surge in top-line leasing demand or new sources of funding, we currently anticipate returning to a moderately increased level of newbuild turbine production for the full fiscal year 2022 representing a combination of (i) additional third party orders from C&I customers and (ii) additional turbines into our own lease fleet, which we expect to execute with our current sources of liquidity.

As described in “Use of Proceeds,” we intend to invest newly raised equity capital into the further growth of our turbine leasing fleet, development new turbine products that enlarges our applicable market reach, and expand our heat exchanger offering.

As of September 30, 2021, total available liquidity was $4.65 million, including $1.47 million of balance sheet cash and $3.18 million of available commitments under the Credit Facility and the Notes.

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Cash Flows

The following table sets forth a summary of our cash flows for the years ended December 31, 2020 and 2019 and the nine months ended September 30, 2021 and 2020:

​	Year Ended December 31,						Nine Months Ended September 30,
(in thousands)	2020			2019			2021			2020
Net cash provided by (used in) operating activities	​	$	(6,275)	​	$	(14,848)	​	$	814	​	$	(4,548)
Net cash (used in) investing activities	​	​	(1,077)	​	​	(3,231)	​	​	(667)	​	​	(564)
Net cash provided by (used in) financing activities	​	​	6,889	​	​	18,823	​	​	(265)	​	​	7,342
Foreign currency translation adjustments	​	​	165	​	​	81	​	​	(110)	​	​	30
Net increase (decrease) in cash	​	$	(298)	​	$	825	​	$	(228)	​	$	2,260

Operating Activities

For the year ended December 31, 2020, $6.28 million of cash was used in operating activities, compared to $14.85 million for the year ended December 31, 2019, a net cash flow increase of $8.57 million. The increase in operating cash flow was primarily attributable to the 35% decrease in net loss to $(7.10) million for the year ended December 31, 2020 compared to $(10.91) million for the year ended December 31, 2019, along with a reduction in inventory spending for newbuild leasing fleet turbines during the year ended December 31, 2020 based on uncertain demand for additional turbine fleet capacity as well as the de-expedition of our production operations.

For the nine months ended September 30, 2021, net cash provided by (used in) operating activities was $0.81 million, compared to $(4.55) million for the nine months ended September 30, 2020, a net cash flow increase of $5.36 million. The increase in operating cash flow was primarily attributable to favorable changes in deferred revenue and inventories in addition to a significantly lower volume of inventory purchases as a result of our plant relocation project during the first nine months of 2021.

Investing Activities

For the year ended December 31, 2020, $1.08 million of cash was used in investing activities, compared to $3.23 million for the year ended December 31, 2019, a net cash flow increase of $2.15 million. The increase in investing cash flow was primarily attributable to a reduction in discretionary purchases of new property and equipment.

For the nine months ended September 30, 2021, $0.67 million of cash was used in investing activities, compared to $0.57 million for the nine months ended September 30, 2020, a net cash flow decrease of $0.10 million. The decrease in investing cash flow was primarily attributable to a slight increase in discretionary purchases of new property and equipment.

Financing Activities

For the year ended December 31, 2020, cash provided by financing activities was $6.89 million, compared to $18.82 million for the year ended December 31, 2019, a net cash flow decrease of $11.93 million. The decrease in financing cash flow was primarily attributable to a significant reduction in credit line advances in fiscal year 2020 in response to the greater economic uncertainty brought on by the COVID-19 pandemic.

For the nine months ended September 30, 2021, cash provided by (used in) financing activities was $(0.27) million, compared to $7.34 million for the nine months ended September 30, 2020, a net cash flow decrease of $7.61 million. The decrease in financing cash flow was primarily attributable to $2.38 million in proceeds from the PPP loans received in the first nine months of 2020 and to paydowns made in the first nine months of 2021 on our Credit Facility.

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Foreign Currency Translation Adjustments

For the year ended December 31, 2020, the effects of foreign currency translation adjustments to cash totaled $0.17 million, compared to $0.08 million for the year ended December 31, 2019, a net cash flow increase of $0.09 million.

For the nine months ended September 30, 2021, the effects of foreign currency translation adjustments to cash totaled $(0.11) million, compared to $0.03 million for the nine months ended September 30, 2020, a net cash flow decrease of $0.14 million.

Senior Secured Credit Facility

On February 8, 2019, FLPS entered into the Credit Facility with TCB, which was subsequently amended and restated on December 22, 2020 to add FLPS Canada as a borrower. The initial commitment amount is for $30.00 million and availability under the Credit Facility is based on a borrowing base calculation of eligible assets and other conditions. The Credit Facility is backed by a first priority lien of substantially all of the assets of FLPS, and the maturity date of the Credit Facility is February 8, 2024. Interest is defined based on a tiered leverage ratio and an applicable margin of (i) 1.50% to 2.00% above the base rate for base rate loans, or (ii) 2.50% to 3.00% above the adjusted Eurodollar rate for Eurodollar rate loans.

The Borrowers are subject to financial covenants of a maximum leverage ratio and minimum fixed charge coverage ratio to be tested quarterly. The Borrowers are in compliance with the Credit Facility’s financial covenants as of September 30, 2021.

The Borrowers are also subject to certain negative covenants, including restrictions on their ability to incur additional indebtedness, create liens, pay dividends, make certain investments or material changes in their business, engage in transactions with affiliates, conduct asset sales or otherwise dispose of the Borrowers’ assets. In anticipation of the Contribution Transaction and this offering, we are in the process of negotiating a modification to the Credit Facility. As part of this modification, we expect that FGS will become an additional guarantor with respect to the Credit Facility subject to the same obligations and restrictions applicable to FPS thereunder, but that FGS will not otherwise be subject to the covenants and restrictions applicable to the Borrowers.

Between January 2020 and September 2021, FLPS entered into a series of amendments to the Credit Facility whereby (i) the borrowing base was amended to include certain non-turbine field equipment, (ii) certain terms within the borrowing base definition of accounts receivables relating to investment grade and non-investment grade customers were modified, (iii) FLPS ULC was added as an additional borrower under the Credit Facility, (iv) annualized EBITDA used to calculate the quarterly financial covenants was increased, (v) the availability under the revolving credit facility was reduced by $3.50 million, and (vi) the due date of the FLPS financial statements to be delivered to TCB was modified.

On December 10, 2021, FLPS entered into the Fifth Amendment to the Credit Facility. Under the terms of the amendment, modifications were made to allow for the pending contribution and transactions contemplated by this offering and included related clauses regarding transaction expenses related to this offering and mandatory prepayments in connection with the proceeds received from this offering. In addition, the availability limitation entered into under the Fourth Amendment was removed and further definitions were added to the Credit Facility regarding intercompany transactions.

As of September 30, 2021, borrowings outstanding under the Credit Facility totaled approximately $22.92 million and availability based on the borrowing base totaled approximately $3.18 million. This amount includes $10.00 million of permitted distributions funded in 2019 that was used to redeem a portion of the outstanding Notes. Additional uses of capital for borrowings under the Credit Facility have been for working capital purposes, including the investment into the production of new-build turbine leasing units.

Paycheck Protection Program Loans

On April 14, 2020, FLPS entered into a Promissory Note with TCB pursuant to which TCB made a loan to FLPS under the PPP offered by the SBA in a principal amount of approximately $0.99 million

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pursuant to the CARES Act. On May 7, 2021, this loan was forgiven by the SBA. On May 6, 2020, FEES entered into a Promissory Note with BofA as the lender pursuant to which BofA made a loan to FEES under the PPP offered by the SBA in a principal amount of approximately $1.36 million pursuant to the CARES Act. On June 17, 2021, this loan was forgiven by the SBA.

The proceeds from the PPP loans were to be used to pay for payroll costs, including salaries, commissions, and similar compensation, group health care benefits and paid leaves, rent, utilities and interest on certain other outstanding debt.

Notes at FlexEnergy Power Solutions, LLC

Between December 2015 and July 2021, FPS issued the Notes to the FPS Noteholders who together, along with their affiliates, account for a majority of FPS’ voting securities and representation of its board of directors. The cash received from the Notes was contributed as capital to FEI and FLPS. The Notes have a maturity date of December 31, 2022.

Under the terms of the Credit Facility, FPS funded permitted payments in fiscal year 2019 of $10.00 million with all proceeds used to redeem a portion of the Notes totaling approximately $7.76 million of principal and $2.24 million of accrued interest. A portion of this $10.00 million was re-contributed when FPS issued an additional $7.80 million and $0.80 million in Notes in years 2019 and 2020, respectively for working capital purposes. FPS issued an additional $1.95 million in Notes during the nine months ended 2021 for working capital purposes.

SAFE Transaction

On August 16, 2021, FPS entered into the SAFE Transaction with RNS and TRF whereby, between August 16, 2021 and December 2, 2021 RNS paid or agreed to pay $2.00 million and TRF paid or agreed to pay $3.50 million to FPS in exchange for the right to receive from FPS, a number of the shares of FGS common stock issued to FPS in the Contribution Transaction equal to the amount invested divided by 80% of the issuance price per Unit in this offering. In consideration of the contribution by FPS of the SAFE proceeds to the capital of FEI and FLPS, FGS will redeem any shares transferred to RNS and TRF up to the full amount of the over-allotment net proceeds at a price per share equal to the price per Unit in this offering. If this offering does not occur, then the SAFE will automatically convert and RNS and TRF will each receive the right to receive from FPS equity in FLPS representing percentage economic and ownership interest equal to (A) 36.67% multiplied by (B) a fraction, (I) the numerator of which is the Funded Amount (as defined in the SAFE), and (II) the denominator of which is $5,500,000.

Series B and B-1 Preferred Equity at FlexEnergy Power Solutions, LLC

Under the terms of FPS’ Series B Preferred Unit issuance, FPS has agreed to certain covenants that restrict FPS’ and our ability to materially change our business and enter into certain enumerated financial transactions. Under the terms governing the Series B Units, FPS shall not permit to exist any indebtedness for borrowed money that is senior in right of payment to the Series B Preferred Units other than senior indebtedness (as defined therein) in an amount not to exceed $50.00 million. As defined therein, senior indebtedness does not include any amounts outstanding under our PPP loans, but does include the aggregate amount outstanding under the Notes. As of September 30, 2021, the amount of senior indebtedness as defined therein totaled $50.0 million, thus restricting our ability to incur any additional senior indebtedness. The boards of FPS and FGS view this covenant as limiting our ability to raise additional indebtedness that is senior in priority to the Series B Preferred Units.

Critical Accounting Estimates

While our significant accounting policies are described in more detail in the notes to our combined consolidated financial statements appearing elsewhere in this prospectus, we believe the following accounting policies used in the preparation of our combined consolidated financial statements require the most significant judgments and estimates.

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Revenue Recognition

Our revenue consists of lease revenue and the sales of products, parts, accessories and service. Lease revenue consists mainly of lease agreements which provide for monthly lease payments. These lease agreements are classified as operating-type leases and the revenue generated from the monthly lease payments is recognized over the rental term.

All our revenue relates to contracts with customers. Our accounting contracts are from purchase orders or purchase orders combined with purchase agreements. Our revenue is recognized on a point-in-time basis and over time. For the sale of new turbines and heat exchanger products, we satisfy our performance obligations based on the contractual terms with our customers. For our leasing, commissioning and maintenance services, we have performance obligations that are satisfied over time. See Note 4 to our Notes to Combined Consolidated Financial Statements included elsewhere in this prospectus for additional information related to revenue policies.

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BUSINESS

Our Company

We are an energy focused technology company that designs, manufactures, sells and leases cost-effective energy solutions that lower our customers’ environmental footprint, often by making useable energy from sources of fuel or heat otherwise overlooked or wasted. We do this through two different types of highly engineered products. First, our Flex Turbines offer a reliable source for distributed or grid connected electrical power, capable of being fired by a wide variety of gaseous fuels from waste gas from landfills and natural gas flaring to higher BTU fuels such as propane and synthetic gas. Leasing and sales of Flex Turbines presently represent the majority of our operations and revenues. Flex Turbines provide our customers with solutions to gain independence over their electricity generation and minimize overall reliance on the grid. Second, we offer heat recovery products that are integral to promising emerging power technologies, such as high efficiency fuel cells for power generation that can be fueled by hydrogen or natural gas. Our Flex Heat Recovery products are in the early stages of commercialization, and presently constitute a small but increasingly growing and important portion of our operations and revenues as the future of energy generation emerges.

Our focus is on providing proven technology and support that enables reliable, efficient and economic green energy solutions. Our business consists of leasing and service of our Flex Turbines supported by a vertically integrated OEM with some direct-sales of manufactured products. As of September 30, 2021, we have amassed over 8.8 million hours of field runtime on our turbine fleet with over 122 MW shipped, of which 49 MW make up our lease fleet. This balance of core competencies in turbine power and heat recovery with current cash flow generation helps fund growth of our technology suite and expansion of applications into new and existing markets. The primary applications of our technology include: converting waste gas to useful energy, improving traditional processes and enabling emerging clean technology. We are actively expanding into other key markets for which our products are well suited, and we are confident in generating opportunities in additional geographic markets and product extensions into different applications.

We serve a diverse range of customers in the global O&G, transportation, power, and C&I end markets. Our primary focus is on base load, distributed, electric generation using Flex Turbines, with the technology base to expand in additional untapped end-markets.

On December 31, 2010, as part of a spin-out transaction, we purchased from Dresser-Rand (now Ingersoll Rand) certain assets in order to finish the development of a 4th generation 333 kW turbine and to commercialize the turbine offering. From 1996 through 2010, Ingersoll Rand invested over $250 million to develop a downsized replica of its 2 MW KG2 turbine (first launched as a 250 kW model) as a way to penetrate the small-scale industrial remote power market.

In 2013, we initiated a business transformation in response to the O&G industry’s downturn by creating FLPS, and transitioned from an original equipment manufacturer (“OEM”) sales model to an EaaS model. O&G production requires substantial amounts of electrical power to run subsurface pumps and other equipment. Much of the recent development of O&G in the U.S. is remote and not served by the country’s electrical grid. Flex Turbines are a well-suited source of the needed power for O&G production because they operate more than 99% of the time in extreme conditions, require little maintenance and can run on untreated field gas, which is otherwise typically flared as waste. While customers valued the enhanced uptime and environmental benefits of using waste gas instead of flaring it, the consequences of the O&G industry downturn made companies more hesitant to use scarce capital resources to purchase electrical generating equipment like Flex Turbines. Instead, energy companies were resorting to renting diesel generators for power production despite the resulting added pollution and lower operating time.

This led us to determine that our customers would more easily enjoy the benefits of our product offering if they could access clean electricity-on-demand as a service. With FLPS’ leasing options, customers can lease capacity or purchase the amount of power they actually used, with no up-front capital expenditure. Through this EaaS program, we deploy Flex Turbines for electricity-on-demand, which in the case of our O&G customers is powered exclusively by the available on-site field gas, which would otherwise be flared. The

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cost of our lease service option remains less than most customers typically pay for diesel fuel alone (not to mention the cost of renting the generators).

For the nine months ended September 30, 2021, our three largest customers generated 14%, 14% and 10%, respectively of total revenue. In 2020, our three largest customers generated 23%, 14% and 10%, respectively, of our total revenue, and in 2019, our largest customer generated approximately 28% of our total revenue. Three customers accounted for 17%, 14% and 13%, respectively, of our accounts receivable balance as September 30, 2021. Two customers accounted for 15% and 14%, respectively, of our accounts receivable balance as of December 31, 2020. One customer accounted for 32% of our accounts receivable balance as of December 31, 2019. Accordingly, we are subject to customer concentration risk in the form of non-renewal or termination of lease contracts. For additional information, see “Risk Factors – Risk Factors Relating to our Business and Industry – If we fail to retain existing customers, derive revenue from existing customers consistent with historical performance or acquire new customers cost-effectively, our business could be adversely affected. We are subject to substantial customer concentration.”

Since the inception of FLPS, leasing has provided customers with higher uptimes in production and eliminated more than 1,000,000 tons of CO2. This turnkey, clean power solution makes it easier for customers to adopt our clean energy solution. We are adaptive to individual site issues and differences, supplying modular accessories such as fuel skids, switchgears, filters and other non-turbine apparatuses to projects based on their needs. The EaaS solution allows for broader exposure to markets that need to lower electricity costs, increase efficiency, decrease pollution and access on-demand, 24/7 base load power generation.

Each of our gas turbines consists primarily of a turbine engine, gear box, combustor and recuperator (collectively, a “Flex Turbine”). We refer to all of our deployable Flex Turbines together as our “turbine fleet.” Our 162 unit, 49 MW turbine fleet accelerates an independence from the energy grid in 10 MW and under applications including the following selling points:

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Flexible:   Wide fuel tolerance using natural gases, oilfield flare gases, biogas, etc.

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Rugged and Resilient:   Generally runs 24/7 in harsh environments and weather

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Sustainable:   California Air Resources Board certified clean emission standards

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Scalable:   Modularity and mobility to match changing power needs

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Adaptable:   Standalone microgrids and integration with storage and renewables

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Reliable:   Proven performance of high up-time, low maintenance long-lived assets (high uptime, 99%+)

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Cogeneration:   CHP increases efficiency and savings, meeting California’s strict Air Quality Management District standards

Competitive Environmental Advantages vs. Industry Standard/Alternatives.   Flex Turbine power generation provides scalable, modular, on-site power to both off-grid environments and grid dependent environments. Diesel generators remain the industry standard in most remote, off-grid applications that are often home to extreme conditions (weather, temperature, etc.). Diesel, however, is more carbon intensive relative to natural gas, emitting on average 161 pounds of CO2 per million BTU (“mmbtu”) in comparison to 117 pounds of CO2 per mmbtu, respectively. Not only can natural gas turbines reduce emissions because of its fuel flexibility, many times the Flex Turbine eliminates 100% of the diesel pollution by converting the gas that would otherwise have been flared into power that would have otherwise been produced by a diesel generator.

Customer Service and Customization.   As an organization we are highly customer-centric. We have a service organization in place that responds 24/7 to support our customers. Our engineers act as consultants to our customers to meet their needs. We size our solution to each job by linking our Flex Turbines together in custom site configurations for each customer application. Our sense of urgency, especially in the leasing business, enables us to maintain very high uptimes. Our Flex Heat Recovery solutions do not try to force a

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customer’s application to conform to our design. Rather, our design is easily fitted to a customer’s specific application. We are a well-equipped manufacturing organization. Because we do not out-source manufacturing, we can make modifications to meet customer needs and produce service parts more quickly.

Flex Heat Recovery Solutions.   The technologies developed in our Flex Heat Recovery business supply critical components to the Flex Turbine. Namely, the Flex Recuperator is a proprietary high temperature and high-pressure heat exchanger that recovers waste heat in industrial processes into the energy cycle, thus significantly improving operating efficiency and reducing carbon emissions. Because our heat recovery technology was so effective in the Flex Turbine, we began investigating other markets in which the technology could be used to harvest wasted heat energy in high pressure and high temperature applications. Flex Heat Recovery products have been used in a broad array of applications, from the extension of the range of turbine powered destroyers in the British Navy, and in large scale fuel cell applications for power generation, to being prototyped into key components in the oncoming hydrogen economy, such as solid oxide fuel cells. Flex Heat Recovery products that we have developed include:

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Plate-Fin: Modular, counter flow (high efficiency), low pressure drop, high flow, high temperature designs;

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Fin-Tube: High efficiency counter flow, compact (1/4 size of a typical Shell & Tube), high pressure, 100% welded construction, high temperature, low pressure drop designs; and

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Chevron: Highly configurable and scalable, low pressure drop, high temperature, primary surface design is material efficient (no expensive fin) designs.

Competitive Advantage of Flex Heat Recovery Solutions Technology

Power Generation – Improve efficiency and reduce CO2 emissions

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Various gas turbines – Up to 28-50% increase in fuel efficiency and lower emissions

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Nuclear power – Air to air heat exchangers to enhance reactor safety

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Biogas to energy projects – Enables thermal storage and power generation from low grade biogases

Fuel Cells – Improve efficiency and reduce CO2 emissions

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Molten carbonate fuel cells – Up to 30% increase in fuel efficiency and reduced emissions

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Solid oxide fuel cells – Up to 30% increase in fuel efficiency and reduced emissions

Energy Efficiency Projects

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Air preheating from waste heat energy for industrial processes – Reduces fuel and energy costs by recycling waste heat

Emissions Reduction Projects

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Exhaust heat reduction for treatment – Reduces cost of emissions control

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Carbon capture – Enables emissions reduction technologies that generate a return on investment

Automotive

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Combustion-based range extender for electric vehicles – Up to 28-50% increase in fuel efficiency and lower emissions

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Split cycle reciprocating engines – Up to 20% increase in fuel efficiency of diesel engines and corresponding emissions reduction

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Our Industry

Natural gas is a compelling fuel for power production, as global economies seek cleaner alternatives to coal-fired and oil-fired power plants to fill the gap in demand not currently met by renewable energy sources. In 2020, approximately 4.0 trillion kwh were generated from utility-scale facilities, of which 40% comprised natural gas, 19% coal, 20% nuclear, 20% renewables and 1% petroleum and others.

The production of CO2 has been shown to be a contributing factor to global climate change. However, while the current generation of our gas turbines running on natural gas does produce some CO2, the amount produced by Flex Turbines is only a fraction of that produced by other forms of U.S. combustion power generation. Regardless, we may occasionally be negatively impacted by CO2-related changes in applicable laws, regulations, ordinances, rules, or the requirements of the incentive programs on which we and our customers currently rely.

Today approximately 70% of the world’s electricity is consumed by 10 countries and 850 million people. Approximately 11% of the world’s population currently lack access to electricity, according to the International Energy Agency’s 2019 World Energy Outlook. According to the IEA, as economic development worldwide spurs demand for electricity, approximately 10.0 million MWh of incremental power is expected to be needed by 2040. Further, we believe that many countries around the world, keenly focused on economics as well as the environment, will increasingly look to natural gas to displace environmentally dirtier fuels such as heavy fuel oil (HFO), automotive diesel oil (ADO), and coal that are used to generate power, particularly if natural gas is cheaper than these fuels.

The same can be said for the U.S. as its consumers continue to rely heavily on the grid for access to electricity, with the assumption that a given demand region is within close proximity to utility facilities. Furthermore, the reliability of electric utilities according to EIA’s System Average Interruption Duration Index (SAIDI), or the total time an average customer experiences non-momentary interruptions lasting longer than five minutes, has ranged between 3 and 8 hours per customer since 2013. In 2018, U.S. electricity customers averaged power outages of 5.8 hours per customer.

We believe the power industry’s future will be shaped by the mega-trends that favor the development of highly reliable, low pollution, distributed power systems and alternative energy sources that should drive demand for highly efficient Flex Turbines, Flex Heat Recovery solutions and other components of our technology suite. We believe our product offerings will be further instrumental in mega-trends such as:

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Continued growth in electricity demand, including for transportation

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Decarbonization efforts to mitigate climate change peril, including carbon taxes

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Natural gas as replacement for coal and oil-fired equipment and processes

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Secular shift to distributed generation to assure power quality and avoid the cost of expanding aging and inefficient transmission infrastructure

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Emergence of zero or low pollution alternative sources of power in the hydrogen economy, including fuel cells, solar and wind power

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A drive for energy efficiency causing every industry to look for ways to eliminate wasted energy consumption

Primary Applications

Converting Waste Gas to Useful Energy

The Flex Turbine can produce reliable, distributed electricity by running on waste fuels such as methane from landfills and CO2 heavy field gas from oil producing wells down to 350 BTUs, as well as synthetic gasses such as ethane produced in the refining process with up to 2,500 BTUs.

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Improving Traditional Processes

Flex Heat Recovery solutions are most effective in high temperature, high pressure environments. These systems have a smaller footprint due to their design efficiency, making them ideal for retrofitting existing facilities. They are currently being evaluated by potential customers for the next generation of carbon capture technology, multiple fuel cell applications, and emissions reduction projects.

Enabling Clean Technology

We see efficient use of thermal energy as the key to energy efficiency in many of today’s most promising alternative fuel technologies, such as solid oxide fuel cells for power generation, traditional fuel cell technology for power, green hydrogen production, and certain heat as energy storage applications, like molten salt. We have sold Flex Heat Recovery production or prototype systems for each of these energy alternatives. In addition, components of the Flex Turbine have been integrated with renewable energy projects that provide heat from external sources to power the turbine and produce energy.

Our Market Opportunity

We believe that the world is looking for cleaner, reliable electrical power alternatives both to replace existing sources and to provide electrical power where electricity is not available or reliable. Additionally, we believe the adoption of new emerging technologies and fuels will expand our opportunities to grow.

In 2020, approximately 4.0 trillion kwh were generated from utility-scale facilities, of which 40% comprised natural gas, 19% coal, 20% nuclear, 20% renewables and 1% petroleum and others. Natural gas is one of the most abundant and available sources of clean energy as market trends such as the electrification of vehicles and the phasing out of coal-fired plants becomes more commonplace.

Power generation from fossil fuels and the associated release of CO2 as a byproduct has been shown to be a contributing factor to global climate change. The world continues to rely on technology advances combined with best practices to reduce greenhouse gas emissions.

The following trends have increased onsite, lesser emissions power demand from customers in a growing number of markets, and we expect them to continue to do so:

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Continued growth in electricity demand, including for transportation

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Decarbonization efforts to mitigate climate change peril, including carbon taxes

•

Natural gas as replacement for coal and oil-fired equipment and processes

•

Secular shift to distributed generation to assure power quality and avoid the cost of expanding aging and inefficient transmission infrastructure

•

Emergence of zero or low pollution alternative sources of power in the hydrogen economy, including fuel cells, solar and wind power

•

A drive for energy efficiency causing many industries to look for ways to eliminate wasted energy consumption

We believe that these trends will expand the market opportunity for Flex Turbine solutions and Flex Heat Recovery systems.

Our Growth Strategy

Our chief objective is to be a primary provider of clean, affordable and reliable energy. In order to accomplish this, we intend to:

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Accelerate growth in underpenetrated markets and expand our geographic footprint.   We believe the total market opportunity for modular, onsite power remains significantly under-penetrated in

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the U.S. The flexibility and reach of our leasing model, coupled with our scalable turbine packages, allow us to increase market penetration and enter new markets quickly and efficiently. We plan to strengthen our existing relationships and identify new sub-sectors to accelerate our growth. We will seek to enter new markets and geographies over time, both in the U.S. and internationally, where climate, demand for clean energy and regulatory policies position turbine power generation as an economically compelling alternative to centralized electric utilities.

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Continued deployment of our turbine fleet and heat recovery solutions to our customers.    We believe that integrated energy systems enhance the reliability, resiliency and predictability of turbine-generated electricity in certain markets, increasing the overall value proposition to customers. We expect demand for the Flex Turbine with on-board hot water heat exchanger, our combined heat and power (“CHP”) solution, to increase over time. We also expect continued requests by our customers to integrate our energy systems with existing energy storage (e.g. photovoltaic battery cells) to provide additional resiliency.

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Broaden and enhance service offerings.   We provide ongoing monitoring and service as a standard component of our leasing agreements. We believe there is significant market demand for long-term protection plans for customers who have chosen to finance or purchase systems rather than lease them, and we will strive to capture a significant share of this market. We plan to expand our green energy product and service offerings to provide further cost savings to our customers and optimize the performance of existing traditional processes.

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Increase Inventory to Shorten Delivery Times.   Flex Turbines currently are built upon order with a six or more month lead time from order to completion. By investing in additional inventory levels and building certain sub-assemblies in advance, we believe we can substantially shorten the time to delivery and thereby improve our appeal to customers searching for prompt energy solutions.

Competition

Our Flex Turbines broadly compete with existing technologies, including diesel generators, used in the generation of distributed power. Some of our competitors who produce distributed generation technology and products are large, well-capitalized companies with a global presence, significant brand recognition, economies of scale, and substantial product development, distribution, and marketing resources.

In remote locations, our Flex Turbines compete primarily with traditional internal combustion engine generators, such as those manufactured by Caterpillar, GE-Jenbacher, and Cummins, and provided by these companies as well as others such as Gravity, Moser, United Rentals, Aggreko and Baseline. These engine generators are a well-established technology and are often used as a lower-cost remote power or co-generation solution. These engines, however, have disadvantages that may outweigh the benefits, including relatively high emissions, high maintenance costs, higher levels of low frequency noise emissions, and require significant downtime for routine maintenance. In contrast, the Flex Turbine operating on natural gas, either pipeline or well gas, produces low levels of emissions, requires very limited routine maintenance, is sound-attenuated to 62 dba and has demonstrated a 99% uptime.

Where available, the cost of purchasing electricity from the electric utility grid is usually lower than acquiring the same amount of energy through a distributed generation technology. Utilities may charge customers using a distributed generation technology additional fees to connect to their grids, which distributed generation customers typically do when grid access is available. That said, where grid electricity is very expensive or where the utility grid is occasionally unreliable (particularly in remote or extreme environments), a distributed generation solution may be a viable and economic solution for many customers. In addition to the engine generator providers above, other turbine providers such as Capstone, OPRA and Siemens also provide solutions. Reasons why our Flex Turbine may be chosen include low emissions, a wide range of fuel acceptance, high reliability, low maintenance, and owned service response infrastructure. Additionally, we can provide additional economic value to our customers who repurpose or reuse wasted gas or heat for heating, cooling, dehumidification, and other uses with a heat recovery solution added to the Flex Turbine.

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In the future, our Flex Turbines will likely compete with other distributed generation technologies, including solar-powered and wind powered microgrids, as well as emerging technologies like fuel cells. Solar and wind generation face the challenge of unreliable weather conditions and may require the use of storage technologies in order to mitigate the intermittent power generation. However, storage technology may not be sufficient to completely supplement the inconsistent power generated. Fuels cells and other emerging energy alternatives face the challenges of cost, performance and durability. Our Flex Turbine produces constant low emission electricity that is available 24/7 and has demonstrated 99% uptime performance.

We believe Flex Turbine competitive advantages include:

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Clean – low emissions, CARB approved

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Reliable – low maintenance (one 8-hour scheduled maintenance per year)

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Wide Fuel Tolerance – pipeline to well gas, propane, high H2S gas

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High Uptime – 99% uptime proven over 8 million operating hours

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Scalable – can operate individually or in parallel

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Valuable – high uptime maximizes customer revenue

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Zero Capex Leasing Solution – leasing model allows customers to limit capital expenditures

Flex Heat Recovery products compete against the products of other companies providing heat exchangers to the high temperature, high pressure heat transfer industry, including Alfa Laval, Mezzo Technologies, Munters and Sumitomo. Traditional heat exchanger companies fall into two broad categories: those that supply standard products and designs whereby customers fit a standard exchanger to their application and those that engineer specific one-off exchangers for specific customer applications. The standard product approach provides low costs with design inefficiencies such as size, shape and the custom approach provides optimal design at high cost. We have developed proprietary Flex Heat Recovery products that address both cost and configuration. Our solution provides a proprietary standard and scalable approach that also provides a customized solution for each customer’s application. This approach is especially important for developing technologies in the emerging hydrogen economy. These technologies include solid oxide fuel cells (SOFC) and molten carbonate fuel cells (MCFC). Existing and alternative energy technologies also benefit from custom heat exchanger solutions to drive peak efficiency. These applications include: internal combustion engines, large and small gas turbine recuperation, combine heat and power projects, and emissions reduction equipment. In each application, customers typically value compactness, thermal efficiency, and custom designs over price and lead-time.

Flex Heat Recovery solutions competitive advantages include:

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Very high temperature, high pressure capability

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Low pressure drop

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Highly efficient design

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Customizable to meet customer needs

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Scalable

Employees

As of November 30, 2021, we had 104 full-time employees. Of those, 7 employees are engaged in commercial functions (including sales and marketing), 60 employees are engaged in customer service, and 14 employees are engaged in engineering functions (including field support, production support and research and development). None of our employees are represented by labor unions or covered by collective bargaining agreements. We consider our relationship with our employees to be good.

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Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and additional employees. The principal purposes of our equity incentive plans are to attract, retain and motivate selected employees, consultants and directors through the granting of equity-based compensation awards. For more information regarding our equity incentive plans, see “Executive Compensation – Equity Compensation.”

Intellectual Property

We believe that neither we nor our competitors can achieve a significant proprietary position on the basic technologies currently used in turbine systems. As such, we generally rely on trade secret protection with respect to our processes or software, such as our manufacturing processes, specific software applications related to our O&G customers, and with respect to core technology in our heat exchanger business. We also believe, however, that our technology, components and manufacturing processes are difficult to reverse engineer. We have eight issued U.S. patents (expiring generally between 2022 and 2037), 15 patents issued in other countries (expiring generally between 2024 and 2037), and one patent application pending internationally. As discussed above, Ingersoll Rand invested over $250 million from 1996 through 2010 on certain technology development and this investment has contributed to developing our intellectual property portfolio and trade secrets, in particular regarding our software applications related to our O&G customers, among other things. Our issued patents and pending patent applications generally relate to combustor, recuperator, core engine, heat exchanger, and gearbox technologies.

In general, our employees are party to agreements providing that all inventions, whether patented or not, made or conceived while being our employee, which are related to or result from work or research that we perform, will remain our sole and exclusive property. In addition, we also rely on contractual protections with our customers, suppliers, and distributors, in addition to our security measures, to protect our trade secrets and know-how.

We made the strategic decision to focus our patent portfolio on those patents that we believe will be beneficial to our business and, as a result, have ceased using certain patents that we believe will have no or limited use. Please see section captioned “Risk Factors – Risk Factors Relating to our Business and Industry – Our failure to adequately protect our intellectual property rights could impair our ability to compete effectively or defend ourselves from litigation, which could harm our business, financial condition, and results of operations” for further discussion regarding our intellectual property.

Engineering

Because the clean energy technology industry is characterized by its early state of adoption, our ability to compete successfully is heavily dependent upon our ability to ensure a continual and timely flow of competitive products, services, and technologies to the marketplace. We continue to engineer and develop new products and technologies and to enhance existing products in the areas of cost, size, weight, and in supporting service solutions in order to drive commercialization.

Facilities

We recently completed the relocation of our manufacturing and office space from a single facility in Portsmouth, New Hampshire where approximately 48 of our employees were located. We relocated our office space to our new corporate headquarters at 112 Corporate Drive, Portsmouth, New Hampshire, and our manufacturing capabilities have been relocated to our facility located in Dover, New Hampshire.

We also lease office space and service facilities in various locations described below. These facilities together comprise approximately 96,010 square feet of space. On December 23, 2020, we signed a new lease for 5,800 square feet of space for our new Portsmouth, New Hampshire corporate headquarters. The lease term began in February 2021 and expires in June 2024. Our current lease for our Dover facility was entered into in January 2019 and expires in June 2027. In addition to our corporate headquarters, we lease office space located in Greenwood Village, Colorado. Our current lease for our Greenwood Village facility was entered into in May 2018 and expires in September 2023. We also have service facilities located in

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(i) Odessa, Texas; (ii) Alexander, North Dakota; and (iii) Grand Prairie, Alberta, Canada. Our current lease for our Odessa facility was entered into in August 2019 and expires in August 2024. Our current lease for our Alexander facility was entered into in May 2016 and is currently on a month to month basis. Our current lease for our Grand Prairie facility was entered into in January 2016 and expires in December 2026. We believe our facilities are adequate to support our business for at least the next twelve months.

Legal Proceedings

From time to time, we are involved in legal proceedings or subject to claims arising in the ordinary course of our business. Although the results of legal proceedings and claims cannot be predicted with certainty, we are not currently party to any legal proceedings the outcome of which, in the opinion of our management, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, financial condition or cash flows. In a situation where the outcome of a legal proceeding would be adverse to our interests, we anticipate that most payments we may be required to make in connection therewith would be adequately covered by our existing insurance policies.

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MANAGEMENT

Executive Officers and Directors

The following table sets forth information about our executive officers and directors, as of November 30, 2021:

Name	Age	Position(s)
Executive Officers	​	​
Mark Schnepel	46	Chief Executive Officer
Wes Kimmel	38	Chief Financial Officer
Doug Baltzer	52	Chief Commercial Officer
Non-Employee Directors	​	​
Thomas Denison	61	Director
Patrick Connelly	46	Director
George Walker	64	Director

Executive Officers

Mark Schnepel has been the President of FEES since 2013. Concurrently with the completion of the Contribution Transaction, Mr. Schnepel will assume the role of President and Chief Executive Officer of FGS. He brings more than 20 years of manufacturing and development experience in the turbo machinery industry. He first joined the Ingersoll Rand Energy Systems turbine business in 2000 and transitioned with us when we purchased that business in 2011. His responsibilities have included: product engineering, test engineering, lab operations, manufacturing operations, procurement, business development, and field service. Prior to Ingersoll-Rand and our company, Mr. Schnepel worked as a production engineer for the Tech-Ceram Corporation, a high-volume electronics package manufacturer. He is based in Portsmouth NH. Mr. Schnepel received a B.S. in Mechanical Engineering from Union College.

Doug Baltzer has been the President of FLPS since 2013. Concurrently with the completion of the Contribution Transaction, Mr. Baltzer will assume the role of President and Chief Commercial Officer of FGS. He is responsible for our growth initiatives, business development and overall commercial management. Mr. Baltzer has over 27 years of experience in senior management positions. His roles have ranged from Regional Manager, National Director and President at companies including Northland Power Service, Aggreko, FEI and FLPS. Over the past 15 years, he has been involved in five start-up companies and has helped raise more than $75 million in venture capital to support each company’s growth goals. Mr. Baltzer received a B.S. in Business and Finance from Tabor College and an Executive M.B.A. from the University of Denver.

Wes Kimmel has been the Chief Financial Officer and Secretary of FEES since 2013. Concurrently with the completion of the Contribution Transaction, Mr. Kimmel will assume the role of Chief Financial Officer, Treasurer and Secretary of FGS. Prior to joining us, he was Vice President of RNS Capital Partners, a private equity firm with a significant indirect equity stake in our company. While at RNS Capital Partners, Mr. Kimmel worked closely with our management on internal finance, fundraising, sales and marketing plans, and strategic initiatives. Prior to RNS Capital Partners, he was an associate at First Reserve Corporation, an energy-focused private equity firm, where he helped manage the firm’s investments in power generation and oilfield services. Prior to First Reserve Corporation, Mr. Kimmel worked in both the Mergers & Acquisitions group and Leveraged Finance group at Morgan Stanley. He graduated Phi Beta Kappa from Washington and Lee University with majors in Economics and American History.

Non-Employee Directors

George Walker is the Chairman of our board of directors and our lead independent director. From July 2014 until April 2020 he was the Chief Executive Officer of Cahill Services, LLC, a Houston-based

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provider of specialty rental services to customers in the O&G, refining, industrial, petrochemicals, utilities and related industries. Since March 2020, Mr. Walker has also served as the Chairman of the board of directors of Cahill Services, LLC. With more than 35 years of domestic and international expertise in the industrial service sector Mr. Walker is practiced in dealing with all aspects of commercial business development in both mature and developing markets. Mr. Walker retired from Aggreko LLC in July 2014 after 27 years, where he served as President of the North American region and Executive Director on the Main Board of Aggreko PLC. He had been a part of or led the acquisition of more than ten companies during his years at Aggreko. Mr. Walker received a Bachelor of Business Administration degree in Finance from the University of Texas.

Thomas Denison is a 30-year participant in the private equity energy business. He is currently and since 2010 has been the managing partner of RNS Capital Partners, a closely held, private equity firm with portfolio companies in technology, energy and service businesses. Prior to co-founding RNS Capital Partners, Mr. Denison served ten years as managing director and general counsel for First Reserve Corporation, an energy-focused private equity firm. Mr. Denison joined First Reserve Corporation after an 11-year career with Gibson, Dunn & Crutcher, LLP. He was a partner in the firm at the time of his departure. Mr. Denison holds a Bachelor of Science degree from the University of Denver in Business, and a Juris Doctorate from the University of Virginia School of Law.

Patrick Connelly is a Co-Managing Partner of Amberjack Capital Partners, a Houston based private equity firm that provides growth equity capital and strategic support to innovative companies serving the infrastructure, industrial and energy industries. Before joining Amberjack Capital Partners, Mr. Connelly invested in numerous oilfield service companies in the U.S. and Canada through his work as a Managing Director at SCF Partners, an energy focused private equity fund. Mr. Connelly’s career began as active duty infantry officer in the US Army, serving in leadership roles during multiple overseas assignments. Mr. Connelly received a Bachelor of Science degree from the U.S. Military Academy at West Point, a Master of Public Administration from Harvard’s Kennedy School of Government, and a Master of Business Administration from Harvard Business School.

Board Composition and Leadership Structure

Our board of directors is composed of three directors, all of whom are independent directors (other than for purposes of audit committee independence requirements). All of our independent directors are highly accomplished and experienced business leaders in their respective fields, who have demonstrated leadership in significant enterprises and are familiar with board processes. Each of our directors holds a one-year term of office until our next annual meeting of stockholders and serves until his or her successor is duly elected and qualified or until his or her earlier death, resignation, retirement, disqualification or removal.

George Walker serves as our lead independent director. As lead independent director, George Walker presides over executive sessions of our independent directors, and performs such additional duties as our board of directors may otherwise determine and delegate. As a result, we believe that the lead independent director can help ensure the effective independent functioning of our board of directors in its oversight responsibilities.

Board Oversight of Risk

Our board of directors has an active role, as a whole and also at the committee level, in overseeing the management of our risks. Our board of directors is responsible for general oversight of risks and regular review of information regarding our risks, including credit risks, liquidity risks and operational risks. The compensation committee is responsible for overseeing the management of risks relating to our executive compensation plans and arrangements. The audit committee is responsible for overseeing the management of risks relating to accounting matters and financial reporting. The nominating and corporate governance committee is responsible for overseeing the management of risks associated with the independence of our board of directors and potential conflicts of interest. Although each committee is responsible for evaluating certain risks and overseeing the management of such risks, our entire board of directors is regularly

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informed through discussions from committee members about such risks. Our board of directors believes its administration of its risk oversight function has not negatively affected the board of directors’ leadership structure.

Code of Ethics

We have adopted a Code of Ethics applicable to our directors, executive officers and employees that complies with the rules and regulations of Nasdaq. Upon the completion of this offering, a copy of the Code of Ethics will be available on our website at www.flexenergy.com and will be provided without charge upon request to us in writing at 112 Corporate Drive, Portsmouth, NH 03801. We intend to disclose any amendments to or waivers of certain provisions of our Code of Ethics in a Current Report on Form 8-K.

Board Committees

The standing committees of our board of directors currently include an audit committee, a compensation committee, and a nominating and corporate governance committee. Each of the committees report to the board of directors as they deem appropriate and as the board of directors may request. The composition, duties and responsibilities of these committees are set forth below.

Audit Committee

Our audit committee consists of Messrs. Walker, Denison and Connelly. The board of directors has determined that Mr. Walker is independent under Nasdaq listing standards and Rule 10A-3(b)(1) under the Exchange Act. The chairperson of our audit committee is George Walker. The board of directors has determined that Patrick Connelly is an “audit committee financial expert” within the meaning of SEC regulations. Our board of directors has also determined that each member of the audit committee has the requisite financial expertise required under the applicable requirements of Nasdaq. In arriving at this determination, the board of directors has examined each audit committee member’s scope of experience and the nature of their employment in the corporate finance sector.

In accordance with Rule 10A-3(b)(1)(iv) under the Exchange Act, within 90 days from the effectiveness of the registration statement of which this prospectus is a part, the audit committee will consist of a majority of independent directors (for purposes of Rule 10A-3(b)(1)), and within one year from the effectiveness of the registration statement of which this prospectus is a part, the audit committee will consist solely of independent directors.

The primary purpose of the audit committee is to discharge the responsibilities of the board of directors with respect to our accounting, financial, and other reporting and internal control practices and to oversee our independent registered accounting firm. Specific responsibilities of our audit committee include:

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selecting a qualified firm to serve as the independent registered public accounting firm to audit our financial statements;

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helping to ensure the independence and performance of the independent registered public accounting firm;

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discussing the scope and results of the audit with the independent registered public accounting firm, and reviewing, with management and the independent accountants, our interim and year-end operating results;

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developing procedures for employees to submit concerns anonymously about questionable accounting or audit matters;

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reviewing policies on risk assessment and risk management;

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reviewing related party transactions;

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•

obtaining and reviewing a report by the independent registered public accounting firm at least annually, that describes our internal quality-control procedures, any material issues with such procedures, and any steps taken to deal with such issues when required by applicable law; and

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approving (or, as permitted, pre-approving) all audit and all permissible non-audit service to be performed by the independent registered public accounting firm.

Compensation Committee

The compensation committee consists of Messrs. Walker, Denison and Connelly. Our Board has determined each member is a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act. The chairperson of the compensation committee is George Walker. The primary purpose of the compensation committee is to discharge the responsibilities of the board of directors to oversee our compensation policies, plans and programs and to review and determine the compensation to be paid to our executive officers, directors and other senior management, as appropriate. Specific responsibilities of the compensation committee will include:

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reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, if any is paid by us, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation;

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reviewing and approving on an annual basis the compensation, if any is paid by us, of all of our other officers;

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reviewing on an annual basis our executive compensation policies and plans;

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implementing and administering our incentive compensation equity-based remuneration plans;

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assisting management in complying with our proxy statement and annual report disclosure requirements;

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approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees;

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if required, producing a report on executive compensation to be included in our annual proxy statement; and

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reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.

Nominating and Corporate Governance Committee

Our nominating and corporate governance committee consists of Messrs. Walker, Denison and Connelly. Our board of directors has determined each member is independent under Nasdaq listing standards. The chairperson of our nominating and corporate governance committee is George Walker. Specific responsibilities of the compensation committee will include:

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making recommendations to our board of directors regarding candidates for directorships;

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making recommendations to our board of directors regarding the size and composition of our board of directors;

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overseeing our corporate governance policies and reporting; and

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making recommendations to our board of directors concerning governance matters.

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EXECUTIVE COMPENSATION

Summary Compensation Table

The following table presents summary information regarding the total compensation awarded to, earned by, and paid to our principal executive officer and each of our named executive officers during fiscal years 2020 and 2021. These individuals are our named executive officers for 2020 and 2021:

Name and Principal Position	Fiscal Year		Salary(1) ($)		Bonus(2) ($)		Equity Awards ($)		Non-Equity Incentive Plan Compensation ($)		All Other Compensation ($)		Total ($)
Mark Schnepel Chief Executive Officer	​	2021	​	270,000	​	26,583	​	—	​	—	​	—	​	296,583
	​	2020	​	253,005	​	28,417	​	—	​	—	​	—	​	281,422
Wes Kimmel Chief Financial Officer	​	2021	​	270,000	​	31,417	​	—	​	—	​	—	​	301,417
	​	2020	​	236,512	​	33,583	​	—	​	—	​	—	​	270,095
Doug Baltzer Chief Commercial Officer	​	2021	​	270,000	​	—	​	—	​	—	​	—	​	270,000
	​	2020	​	246,672	​	70,000	​	—	​	—	​	—	​	316,672

(1)

The amounts report for fiscal year 2020 represent salary actually paid during 2020. In direct response to the uncertainties arising from the COVID-19 pandemic on the Company’s operations, the base salaries for Mark Schnepel and Wes Kimmel were subject to temporary salary reductions during 2020. The base salaries that otherwise would have been payable to Mark Schnepel and Wes Kimmel were $262,141 and $245,082 respectively.

(2)

The amounts reported for fiscal years 2020 and 2021 represent the discretionary bonus amounts earned and awarded to our named executive officers in 2020.

Equity Compensation

FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan

Our 2021 Plan was adopted by our board of directors in October 2021 and amended in December 2021, and will be approved by our stockholder in connection with the Contribution Transaction. The 2021 Plan allows the compensation committee to make equity-based incentive awards to our officers, employees, directors, and other key persons, including consultants.

Authorized Shares.   We will reserve a number of shares of our common stock for the issuance of awards under the 2021 Plan equal to 10% of the number of shares outstanding on a fully-diluted basis after completion of this offering, and including the over-allotment option shares, the shares underlying the Warrants, the shares underlying the underwriter’s warrant, and the shares available for issuance under the 2021 Plan. This number will be subject to adjustment in the event of a stock split, stock dividend, or other change in our capitalization. The shares we issue under the 2021 Plan will be authorized but unissued shares or shares that we reacquire. The shares of common stock underlying any awards that are forfeited, cancelled, held back upon exercise or settlement of an award to satisfy the exercise price or tax withholding, reacquired by us prior to vesting, satisfied without the issuance of stock, expire, or are otherwise terminated, other than by exercise, under the 2021 Plan will be added back to the shares of common stock available for issuance under the 2021 Plan.

Non-Employee Director Limit.   Our 2021 Plan contains a limitation whereby the value of all awards under our 2021 Plan and all other cash compensation paid by us to (i) any non-employee director in any fiscal year may not exceed $350,000, and (ii) any non-employee chair of the board of directors, the Audit Committee, the Compensation Committee or the Nominating and Governance Committee in any fiscal year may not exceed $500,000.

Administration.   The 2021 Plan will be administered by our compensation committee. Our compensation committee will have full power to select, from among the individuals eligible for awards, the

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individuals to whom awards will be granted, to make any combination of awards to participants, and to determine the specific terms and conditions of each award, subject to the provisions of the 2021 Plan.

Eligibility.   Persons eligible to participate in the 2021 Plan will be those employees, non-employee directors and consultants, as selected from time to time by our compensation committee at its discretion.

Options.   The 2021 Plan permits the granting of both options to purchase common stock intended to qualify as incentive stock options under Section 422 of the Code and options that do not so qualify. The option exercise price of each option will be determined by our compensation committee but may not be less than 100% of the fair market value of our common stock on the date of grant unless the option is granted as a substitute award in assumption of, or in substitution for, outstanding awards previously granted by an entity that we acquire. The term of each option will be fixed by our compensation committee and may not exceed ten years from the date of grant. Our compensation committee will determine at what time or times each option may be exercised.

Stock Appreciation Rights.   Our compensation committee may award stock appreciation rights subject to conditions and restrictions it determines. Stock appreciation rights entitle the recipient to shares of common stock, or cash, equal to the value of the appreciation in our stock price over the exercise price. The exercise price may not be less than 100% of the fair market value of our common stock on the date of grant. The term of each stock appreciation right will be fixed by our compensation committee and may not exceed ten years from the date of grant. Our compensation committee will determine at what time or times each stock appreciation right may be exercised.

Restricted Stock and Restricted Stock Units.   Our compensation committee may award restricted shares of common stock and restricted stock units to participants subject to conditions and restrictions it determines. These conditions and restrictions may include the achievement of certain performance goals and/or continued employment with us through a specified vesting period.

Other Equity-Based Awards.   Our compensation committee may make other equity-based or equity-related awards not otherwise described by the terms of the 2021 Plan.

Dividend Equivalents.   A dividend equivalent is the right to receive payments in cash or in stock, based on dividends with respect to shares of stock. Dividend equivalents may be granted to participants in tandem with another award or as freestanding awards.

Change in Control.   The 2021 Plan provides that upon the effectiveness of a transaction that affects our common stock (including a “Change in Control,” as defined in the 2021 Plan, a recapitalization, stock split, reverse stock split, spin-off, reorganization, or similar transaction) or any unusual or infrequent event that affects us, an affiliate, or our financial statements or the financial statements of an affiliate, our compensation committee may, without limitation, provide (i) for the substitution or assumption of awards under the 2021 Plan, (ii) that options or stock appreciation rights that would not otherwise become exercisable prior to the Change in Control will be exercisable as to all common shares subject thereto and that any options or stock appreciation rights not exercised prior to the consummation of the Change in Control will terminate and be of no further force and effect as of the consummation of the Change in Control, and/or (iii) for the canceling any one or more outstanding awards and causing to be paid to the holders thereof, in cash, common stock, other securities or other property, or any combination thereof, the value of the awards, if any, as determined by our compensation committee, among other things.

Amendment.   Our board of directors may amend or discontinue the 2021 Plan and our compensation committee can amend or cancel outstanding awards for purposes of satisfying changes in law or any other lawful purpose, but no such action may adversely affect rights under an award without the holder’s consent. Certain amendments to the 2021 Plan will require the approval of our stockholders.

No awards may be granted under the 2021 Plan after the date that is ten years from the date of stockholder approval of the 2021 Plan. No awards under the 2021 Plan have been made as of the filing date of this registration statement.

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FlexEnergy, Inc. 2016 Target Incentive Plan

FEI adopted the 2016 Plan in October 2016. The 2016 Plan provides for the grant of cash payment awards, payable upon satisfaction of a performance condition (i.e. the occurrence of a Qualifying Sale constituting a Change in Control of FEI (as these terms are defined in the 2016 Plan)) and a service vesting condition (i.e. the vesting of an award based on continuous service). Under the 2016 Plan, cash payment awards of $3,248,821 in aggregate have been granted, and we do not expect there will be any further awards under the 2016 Plan. There is no settlement payment of an award under the 2016 Plan unless and until there is a Qualifying Sale which also constitutes a Change in Control of FEI (as these terms are defined in the 2016 Plan) prior to the earlier of a Termination Transaction (as defined in the 2016 Plan) or the termination of the 2016 Plan or January 1, 2026. To constitute a Qualifying Sale, a sale or series of sales of assets or ownership must result in the holders of Series A Units of FPS receiving more than $64.00 per Series A Unit. A total of 1,000,000 Series A Units are currently issued and outstanding.

FlexEnergy, Inc. 2013 Equity Incentive Plan

FEI adopted the 2013 Plan in January 2013. Payments under the 2013 Plan have been frozen and there will be no further grants made under the 2013 Plan. Under the 2013 Plan, an aggregate payment of $633,040 is due to the participants on the earlier of January 1, 2023 or a Change of Control of FEI (as defined in the 2013 Plan).

Other Elements of Compensation

401(k) Plan

We maintain a tax-qualified 401(k) retirement plan for all employees who satisfy certain eligibility requirements, including requirements relating to age. We match any contributions made by our employees (up to 6% of an employee’s wages), including executives. We temporarily suspended our matching contribution from June 2020 through December 2020, but have resumed this matching contribution as of January 1, 2021. We intend for our 401(k) plan to qualify under Section 401(a) and 501(a) of the Code so that contributions by employees to our 401(k) plan, and income earned on those contributions, are not taxable to employees until withdrawn from our 401(k) plan.

Executive Compensation Arrangements

We have entered into an executive employment agreement with Mr. Schnepel, which becomes effective upon the closing of this offering, under which Mr. Schnepel will (i) serve as President and Chief Executive Officer of FGS, (ii) serve as President and Chief Executive Officer of FEES, (iii) receive a base salary of $295,500, (iv) be eligible for an annual target bonus equal to 50% of base salary, (v) receive a number of shares of common stock of FGS after the one year anniversary of the consummation of this offering equal to 1.2% of the total number of shares available under the 2021 Plan, provided certain conditions are met; and (vi) after the consummation of this offering, receive a recommendation by FEES to the board of directors of FGS that he receive a stock option award to purchase a number of shares of common stock of FGS equal to 10.0% of the total number of shares available under the 2021 Plan. Mr. Schnepel was originally promoted to President and Chief Executive Officer of FEES in 2013.

We have entered into an executive employment agreement with Mr. Kimmel, which becomes effective upon the closing of this offering, under which Mr. Kimmel will (i) serve as Chief Financial Officer, Treasurer and Secretary of FGS, (ii) serve as Chief Financial Officer and Secretary of FEES, (iii) receive a base salary of $295,500, (iv) be eligible for an annual target bonus equal to 50% of base salary, (v) receive a number of shares of common stock of FGS after the one year anniversary of the consummation of this offering equal to 2.5% of the total number of shares available under the 2021 Plan, provided certain conditions are met; and (vi) after the consummation of this offering, receive a recommendation by FEES to the board of directors of FGS that he receive a stock option award to purchase a number of shares of common stock of FGS equal to 11.5% of the total number of shares available under the 2021 Plan. Mr. Kimmel was originally promoted to Chief Financial Officer and Secretary of FEES in 2013.

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We have entered into an executive employment agreement with Mr. Baltzer, which becomes effective upon the closing of this offering, under which Mr. Baltzer will (i) serve as President and Chief Commercial Officer of FGS, (ii) serve as President of FLPS, (iii) receive an annual base salary of $295,500, (iv) be eligible for an annual target bonus equal to 50% of base salary, (v) receive a number of shares of common stock of FGS after the one year anniversary of the consummation of this offering equal to 1.2% of the total number of shares available under the 2021 Plan, provided certain conditions are met; and (vi) after the consummation of this offering, receive a recommendation by FEES to the board of directors of FGS that he receive a stock option award to purchase a number of shares of common stock of FGS equal to 10.0% of the total number of shares available under the 2021 Plan. Mr. Baltzer was originally employed as President of FLPS in 2013.

Each named executive is also eligible to participate in, and receive one or more grants under, the 2021 Plan in addition to those described above. Additionally, from time to time, our board of directors may approve annual bonuses for our named executives based on individual performance, company performance, or as otherwise determined to be appropriate.

Under the terms of each named executive’s employment agreement, the term of the executive’s employment continues until terminated by the executive or by us. Upon termination, each named executive will be entitled to accrued base salary and any unpaid expense reimbursements.

Potential Payments upon Termination

If we terminate a named executive’s employment without Cause outside of the six-month period immediately before or after a Change of Control or the executive terminates his employment for Good Reason (as the terms are defined in the executive’s employment agreement), then the executive will be entitled to accrued base salary and any unpaid expense reimbursements, plus (i) cash severance equal to six months of the executive’s base salary paid over a six-month period or, (ii) if we elect to extend the executive’s post-employment non-competition obligations from six months to 12 months, then cash severance equal to 12 months of the executive’s base salary paid over a 12-month period.

Alternatively, a named executive will be entitled to accrued base salary and any unpaid expense reimbursements, plus cash severance equal to 12 months of the executive’s base salary paid over a 12-month period if we terminate the executive’s employment without Cause during the six-month period immediately before or after a Change of Control.

Each named executive’s employment agreement conditions any payment of severance upon execution, effectiveness and irrevocability of a General Release (as defined in the executive’s employment agreement).

Outstanding Cash Awards at Fiscal Year-End

The following table summarizes the amounts under the 2016 Plan and 2013 Plan for each named executive officer as of December 31, 2020 that will payable on the terms of the respective plan:

Name	Award Date	Plan	Cash Award(1)
Mark Schnepel	February 6, 2013	2013 Plan	​	$	108,542
​	October 27, 2016	2016 Plan	​	$	958,310
Wes Kimmel	June 30, 2014	2013 Plan	​	$	35,442
​	October 27, 2016	2016 Plan	​	$	764,558
Doug Baltzer	—	2013 Plan	​	$	0
​	—	2016 Plan	​	$	0

(1)

As discussed above, under the 2013 Plan, an aggregate payout of $633,040 will be due to the participants upon the earlier of January 1, 2023 or a Change of Control (as defined in the 2013 Plan). Also, under the 2016 Plan an aggregate payout of $3,248,821 will become due to the participants if (and only if) a Change in Control (as defined in the 2016 Plan) that constitutes a Qualifying Sale (as defined in the 2016 Plan) occurs on or prior to on January 1, 2026.

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Director Compensation

We do not currently have a formal policy with respect to compensating our non-employee directors for service as directors, except that our 2021 Plan contains a limitation whereby the value of all awards under our 2021 Plan and all other cash compensation paid by us to (i) any non-employee director in any fiscal year may not exceed $350,000, and (ii) any non-employee chair of the board of directors, the Audit Committee, the Compensation Committee or the Nominating and Governance Committee in any fiscal year may not exceed $500,000. We have entered into a board chairperson compensation agreement with Mr. Walker, pursuant to which he received an initial retainer fee of $93,750 on December 15, 2021, will receive quarterly retainer fees of $31,250 at the end of each calendar quarter that commenced on December 31, 2021, and will be reimbursed for expenses incurred in connection with his service. Mr. Walker is also eligible to participate in, and receive one or more grants under, our 2021 Plan. Following the consummation of this offering, we anticipate that directors who are not also officers or employees of FGS will receive compensation for their service on our board of directors and committees thereof. The amount and form of this compensation has not yet been determined. Each non-employee director will be reimbursed for out-of-pocket expenses incurred in connection with attending board and committee meetings.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Related Party Transactions

Thomas Denison and Patrick Connelly are each affiliated with entities (including RNS and TRF) that have invested in FPS, our sole stockholder prior to this offering as a result of the Contribution Transaction. These affiliated entities of Messrs. Denison and Connelly together hold a controlling interest in FPS and also hold some of the Notes that are currently due in full as of December 31, 2022. See “Risk Factors – Risk Factors Relating to Ownership of Our Common Stock – Our largest stockholder, FPS, has a series of senior secured notes that are currently due in full at December 31, 2022, that if not extended or renegotiated, could cause FPS to sell shares of our common stock, which could adversely affect our stock price.”

George Walker holds preferred units of FPS representing less than 1% of the fully diluted equity capital of FPS.

Debt

As discussed more fully in “Risk Factors – Risk Factors Relating to Ownership of Our Common Stock – Our largest stockholder, FPS, has a series of senior secured notes that are currently due in full at December 31, 2022, that if not extended or renegotiated, could cause FPS to sell shares of our common stock, which could adversely affect our stock price,” since December 2015, FPS has entered into the Notes (whereby FPS contributed the cash received from the Notes to FEI and FLPS as capital) that, as of September 30, 2021, have an aggregate amount outstanding of $26.66 million. The Notes accrue interest in amounts ranging from 8% to 12% per annum and are due and payable in full on December 31, 2022. Further, in connection with the Contribution Transaction, FPS will pledge its shares of FGS in favor of the FPS Noteholders.

FPS’ Series B Preferred Units

As discussed more fully in “Risk Factors – Risk Factors Relating to Ownership of Our Common Stock – The agreement governing FPS’ Series B Preferred Units restricts our business and our ability to engage in certain corporate and financial transactions or in other businesses” and “Risk Factors – Risk Factors Relating to Ownership of Our Common Stock– FPS’ Series B and Series B-1 Units have redemption rights that, if exercised, could cause FPS to sell shares of our common stock to pay for the redemption, which could adversely affect our stock price”, FPS’ Series B Units may be called for redemption by a holder at any time by delivering written notice to FPS. The aggregate redemption price for FPS’ Series B Units is $38.30 million as of September 30, 2021. FPS’ Series B-1 Units may be called for redemption by a holder at any time by delivering written notice to FPS. The aggregate redemption price for FPS’ Series B-1 Units is $18.33 million as of September 30, 2021. In addition, under the terms of FPS’ Series B Preferred Units, FPS has agreed to certain covenants that our board believes restrict our ability to do business and enter into certain financial transactions.

SAFE Transaction

On August 16, 2021, FPS entered into the SAFE Transaction with RNS and TRF whereby, between August 16, 2021 and December 2, 2021 RNS paid or agreed to pay $2.00 million and TRF paid or agreed to pay $3.50 million to FPS in exchange for the right to receive from FPS a number of the shares of FGS common stock issued to FPS in the Contribution Transaction equal to the amount invested divided by 80% of the issuance price per Unit in this offering. In consideration of the contribution by FPS of the SAFE proceeds to the capital of FEI and FLPS, FGS will redeem any shares transferred to RNS and TRF up to the full amount of the over-allotment net proceeds for a price per share equal to the price per Unit in this offering. If this offering does not occur, then the SAFE will automatically convert and RNS and TRF will each receive the right to receive from FPS equity in FLPS representing percentage economic and ownership interest equal to (A) 36.67% multiplied by (B) a fraction, (I) the numerator of which is the Funded Amount (as defined in the SAFE), and (II) the denominator of which is $5,500,000.

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Registration Rights Agreement

In connection with the Contribution Transaction, we will enter into a Registration Rights Agreement (the “Registration Rights Agreement”) with FPS, RNS and TRF which provides certain registration rights to FPS, RNS and TRF and pursuant to which we are obligated, upon request from FPS, RNS or TRF (but subject to customary limitations provide for in the Registration Rights Agreement) to register for resale under the Securities Act the shares of our common stock issued to FPS in the Contribution Transaction. Subject to certain exceptions, we will bear all expenses of each registration pursuant to the Registration Rights Agreement, other than Selling Expenses (as defined in the Registration Rights Agreement).

Our Relationship with FPS

As a result of the Contribution Transaction, FGS will become a wholly owned subsidiary of FPS. Following this offering, we expect that FPS will continue to hold at least 74.9% of our outstanding common stock for the foreseeable future (assuming no exercise of the underwriter’s over-allotment option and no exercise of the Warrants sold in this offering), and as a result FPS will continue to have significant influence over our business. For additional information regarding our relationship with FPS, see “Risk Factors – Risk Factors Relating to Ownership of Our Common Stock – After this offering, voting control with respect to our company will remain concentrated in the hands of FPS. FPS will continue to be able to exercise significant influence on us” and “Risk Factors – Risk Factors Relating to Ownership of Our Common Stock – We are a “controlled company” within the meaning of the rules of Nasdaq and, as a result, will qualify for, and may rely on, exemptions from certain corporate governance requirements.”

Indemnification Agreements and Directors’ and Officers’ Liability Insurance

Section 145 of the Delaware General Corporation Law authorizes the board of directors of a corporation to grant, and authorizes a court to award, indemnity to officers, directors and other corporate agents.

Our Certificate of Incorporation contains provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for breach of the fiduciary duty of care, but will be liable for monetary damages for the following:

•

any breach of their duty of loyalty to our company or our stockholders;

•

any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

•

unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or

•

any transaction from which they derived an improper personal benefit.

Any amendment to, or repeal of, these provisions will not eliminate or reduce the effect of these provisions in respect of any act, omission or claim that occurred or arose prior to that amendment or repeal. If the Delaware General Corporation Law is amended to provide for further limitations on the personal liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent permitted by the Delaware General Corporation Law.

In addition, our Certificate of Incorporation and Bylaws provide that we will indemnify and hold harmless, to the fullest extent permitted by the Delaware General Corporation Law, any director or officer who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “proceeding”), by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the corporation or, while a director or officer of the corporation, is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or of a partnership, joint

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venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys’ fees and other amounts) reasonably incurred. The foregoing rights to indemnification generally do not apply to a proceeding initiated by a director or officer unless the proceedings were approved by our board of directors, the indemnification is required by law or the director or officer is seeking enforcement of the indemnification and advancement rights. Our Certificate of Incorporation and our Bylaws will also provide that we must pay the expenses (including attorneys’ fees) incurred by a director or officer in defending any proceeding in advance of its final disposition, provided that such payment of expenses in advance of the final disposition of the proceeding will be made only upon receipt of an undertaking by such director or officer to repay all amounts advanced if it is ultimately determined that the director or officer is not entitled to be indemnified.

Further, we have entered into or will enter into indemnification agreements with each of our directors and executive officers that may be broader than the specific indemnification provisions contained in the Delaware General Corporation Law. These indemnification agreements require us, among other things, to indemnify our directors and executive officers against liabilities that may arise by reason of their status or service. These indemnification agreements also require us to advance all expenses incurred by the directors and executive officers prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in any such action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding. We believe that these agreements are necessary to attract and retain qualified individuals to serve as directors and executive officers.

The limitation of liability and indemnification provisions that are expected to be included in our Certificate of Incorporation, Bylaws and in indemnification agreements that we have entered into or will enter into with our directors and executive officers may discourage stockholders from bringing a lawsuit against our directors and executive officers for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against our directors and executive officers, even though an action, if successful, might benefit us and other stockholders. Further, a stockholder’s investment may be adversely affected to the extent that we pay the costs of settlement and damage awards against directors and executive officers as required by these indemnification provisions. At present, we are not aware of any pending litigation or proceeding involving any person who is or was one of our directors, officers, employees or other agents or is or was serving at our request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, for which indemnification is sought, and we are not aware of any threatened litigation that may result in claims for indemnification.

We plan to obtain insurance policies under which, subject to the limitations of the policies, coverage is provided to our directors and executive officers against loss arising from claims made by reason of breach of fiduciary duty or other wrongful acts as a director or executive officer, including claims relating to public securities matters, and to us with respect to payments that may be made by us to these directors and executive officers pursuant to our indemnification obligations or otherwise as a matter of law.

Certain of our non-employee directors may, through their relationships with their employers, be insured and/or indemnified against certain liabilities incurred in their capacity as members of our board of directors.

The underwriting agreement filed as Exhibit 1.1 to the registration statement of which this prospectus is a part will provide for indemnification by the underwriter of us and our officers and directors for certain liabilities arising under the Securities Act or otherwise.

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PRINCIPAL STOCKHOLDERS

The following table and footnotes below sets forth information regarding the beneficial ownership of shares of our common stock as of November 30, 2021 for:

•

each person known by us to beneficially own more than 5% of our common stock;

•

each of the directors and named executive officers individually; and

•

all of our directors and executive officers as a group.

The number of shares beneficially owned by each stockholder is determined under rules of the SEC and includes voting or investment power with respect to securities. Under these rules, beneficial ownership includes any shares as to which the individual or entity has sole or shared voting power or investment power. In computing the number of shares beneficially owned by an individual or entity and the percentage ownership of that person, shares of common stock subject to options, warrants or other rights held by that person that are currently exercisable or will become exercisable within 60 days after November 30, 2021 are considered outstanding, although these shares are not considered outstanding for purposes of computing the percentage ownership of any other person.

We have based our calculation of the percentage of beneficial ownership prior to this offering on 9,687,878 shares of common stock presumed to be outstanding as of November 30, 2021 after giving effect to the Contribution Transaction. For more information about estimated number of shares outstanding, see “Dilution.” We have based our calculation of the percentage of beneficial ownership after this offering on the sale of 2,222,222 Units in this offering excluding any potential purchases in this offering by the persons and entities named in the table below.

Except as otherwise indicated in the footnotes below, the address of each beneficial owner is c/o FlexEnergy Green Solutions, Inc, 112 Corporate Drive, Portsmouth, NH 03801.

​

​

​

​

Beneficial Ownership After the Offering

​

Beneficial Ownership Before this Offering

Number of Shares Being Offered

Assuming No Exercise of the Underwriter’s Option

Assuming the Underwriter’s Option is Exercised in Full

Name of beneficial owner

Shares

%

Shares

%

Shares

%

5% Stockholder

​

​

​

​

​

​

​

​

​

​

​

​

​

​

FlexEnergy Power Solutions, LLC(1)

​

9,687,878

​

100%

​

—

​

8,923,989(2)

​

74.9%

​

8,923,989

​

72.9%

Directors and Named Executive Officers

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Mark Schnepel

​

—

​

—

​

—

​

—

​

—

​

—

​

—

Wes Kimmel

​

—

​

—

​

—

​

—

​

—

​

—

​

—

Doug Baltzer

​

—

​

—

​

—

​

—

​

—

​

—

​

—

George Walker

​

—

​

—

​

—

​

—

​

—

​

—

​

—

Thomas Denison(3)

​

—

​

—

​

—

​

277,778

​

2.3%

​

165,051

​

1.4%

Patrick Connelly(4)

​

—

​

—

​

—

​

486,111

​

4.1%

​

288,838

​

2.5%

All executive officers and directors together as a group (6 persons)(1)

​

—

​

—

​

—

​

763,889

​

6.4%

​

453,889

​

3.9%

(1)

The Managers of FPS are Thomas Denison and Patrick Connelly, each of whom may be deemed to have shared voting and investment power over the shares of our common stock owned by FPS. Messrs. Denison and Connelly disclaim beneficial ownership with respect to any of the shares held by FPS for which they would not otherwise be deemed to be beneficial owners.

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(2)

After giving effect to transfers required by the SAFE Transaction.

(3)

Represents shares that will be owned by RNS if the underwriter’s over-allotment option is not exercised or, if the over-allotment option is exercised in full, the number of shares remaining after the net proceeds are used to redeem the shares. Mr. Denison is the manager of RNS and has sole voting and investment power over any shares that will be owned by RNS. Mr. Denison disclaims beneficial ownership with respect to any of the shares held by RNS for which he would not otherwise be deemed to be a beneficial owner.

(4)

Represents shares that will be owned by TRF if the underwriter’s over-allotment option is not exercised or, if the over-allotment option is exercised in full, the number of shares remaining after the net proceeds are used to redeem the shares. Mr. Connelly is a manger of TRF and has shared voting and investment power over any shares that will be owned by TRF. Mr. Connelly disclaims beneficial ownership with respect to any of the shares held by TRF for which he would not otherwise be deemed to be a beneficial owner.

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DESCRIPTION OF CAPITAL STOCK

General

Our authorized capital stock consists of 100,000,000 shares of common stock, par value $0.0001 per share, and 5,000,000 shares of preferred stock, par value $0.0001 per share.

The following description of our capital stock and provisions of our Certificate of Incorporation and Bylaws are summaries and are qualified by reference to our Certificate of Incorporation and Bylaws. Copies of these documents will be filed with the Securities and Exchange Commission as exhibits to our registration statement, of which this prospectus forms a part.

Common Stock

Immediately prior to the closing of this offering, there will be 9,687,878 shares of our common stock outstanding and held of record by one stockholder, assuming the completion of the Contribution Transaction immediately prior to the completion of this offering.

Voting Rights

Holders of our common stock are entitled to one vote per share of common stock. Holders of shares of common stock will vote together as a single class on all matters (including the election of directors) submitted to a vote of stockholders. We do not provide for cumulative voting for the election of directors in our Certificate of Incorporation.

Economic Rights

Dividends.   Subject to preferences that may apply to shares of preferred stock outstanding at the time, if any, the holders of outstanding shares of our common stock are entitled to receive dividends out of funds legally available if our board of directors, in its discretion, determines to issue dividends and only then at the times and in the amounts that our board of directors may determine. See “Dividend Policy” for more information. Any dividend or distributions paid or payable to the holders of shares of common stock will be paid pro rata, on an equal priority, pari passu basis.

Right to Receive Liquidation Distributions.   Upon our dissolution, liquidation or winding-up, the assets legally available for distribution to our stockholders will be distributable ratably among the holders of our common stock, subject to prior satisfaction of all outstanding debt and liabilities and the preferential rights and payment of liquidation preferences, if any, on any outstanding shares of preferred stock.

Preferred Stock

Under the terms of our Certificate of Incorporation, our board of directors is authorized to direct us to issue shares of preferred stock in one or more series without stockholder approval. Our board of directors has the discretion to determine the rights, preferences, designations, powers and restrictions, including voting powers, dividend rights, conversion and redemption rights and liquidation preferences, of each series of preferred stock.

The purpose of authorizing our board of directors to issue preferred stock and determine its rights and preferences is to eliminate delays associated with a stockholder vote on specific issuances. The issuance of preferred stock could adversely affect the voting power of holders of our common stock and the likelihood that such holders will receive dividend payments and payments upon liquidation. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions, future financings and other corporate purposes, could have the effect of making it more difficult for a third party to acquire, or could discourage a third party from seeking to acquire, a majority of our outstanding voting stock. Upon the closing of this offering, there will be no shares of preferred stock outstanding, and we have no present plans to issue any shares of preferred stock.

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Warrant Agent

The Warrants will be issued in registered form under a warrant agent agreement (the “Warrant Agent Agreement”) between us and our warrant agent, American Stock Transfer & Trust Company, LLC (the “Warrant Agent”). The material provisions of the Warrants are set forth herein and a copy of the Warrant Agent Agreement has been filed as an exhibit to the Registration Statement on Form S-1, of which this prospectus forms a part. The Company and the Warrant Agent may amend or supplement the Warrant Agent Agreement without the consent of any holder for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained therein or adding or changing any other provisions with respect to matters or questions arising under the Warrant Agent Agreement as the parties thereto may deem necessary or desirable and that the parties determine, in good faith, shall not adversely affect the interest of the Warrant holders. All other amendments and supplements to the Warrant Agent Agreement shall require the vote or written consent of holders of at least 50.1% of the Warrants.

Warrants Offered Hereby

The Warrants entitle the registered holder to purchase one share of our common stock at a price equal to $           (110% of initial public offering price per Unit) per share, subject to adjustment as discussed below, terminating on the third anniversary of the issuance date.

The exercise price and number of shares of common stock issuable upon exercise of the Warrants may be adjusted in certain circumstances, including in the event of a stock dividend, extraordinary dividend on or recapitalization, reorganization, merger or consolidation.

The Warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the Warrant Agent, with the exercise form attached to the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price, by certified or official bank check payable to us, for the number of warrants being exercised. The Warrant holders do not have the rights or privileges of holders of common stock and any voting rights until they exercise their Warrants and receive shares of common stock. After the issuance of shares of common stock upon exercise of the Warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by stockholders.

No Warrants will be exercisable for cash unless at the time of the exercise a prospectus or prospectus relating to common stock issuable upon exercise of the Warrants is current and the common stock has been registered or qualified or deemed to be exempt under the securities laws of the state of residence of the holder of the warrants. Under the terms of the Warrant Agent Agreement, we have agreed to use our best efforts to maintain a current prospectus or prospectus relating to common stock issuable upon exercise of the Warrants until the expiration of the Warrants. Additionally, the market for the Warrants may be limited if the prospectus or prospectus relating to the common stock issuable upon exercise of the Warrants is not current or if the common stock is not qualified or exempt from qualification in the jurisdictions in which the holders of such Warrants reside. In no event will the registered holders of a Warrant be entitled to receive a net-cash settlement in lieu of physical settlement in shares of our common stock.

No fractional shares of common stock will be issued upon exercise of the Warrants. If, upon exercise of the Warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, round down to the nearest whole number the number of shares of common stock to be issued to the Warrant holder. If multiple Warrants are exercised by the holder at the same time, we will aggregate the number of whole shares issuable upon exercise of all the Warrants.

The price of the Warrants has been arbitrarily established by us and the Underwriter after giving consideration to numerous factors, including but not limited to, the pricing of the Units in this offering. No particular weighting was given to any one aspect of those factors considered. We have not performed any method of valuation of the Warrants.

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Choice of Forum

Our Certificate of Incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for: (1) any derivative action or proceeding brought on our behalf; (2) any action asserting a claim of breach of a fiduciary duty by any of our directors, officers, or stockholders owed to us or our stockholders; (3) any action arising pursuant to any provision of the Delaware General Corporation Law, our Certificate of Incorporation or our Bylaws; or (4) any action asserting a claim against us governed by the internal affairs doctrine, except for, as to each of (1) through (4) above, any claim (A) as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or (C) for which the Court of Chancery does not have subject matter jurisdiction. If an action is brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel. Although we believe this provision benefits us by providing increased consistency in the application of law in the types of lawsuits to which it applies, a court may determine that this provision is unenforceable, and to the extent it is enforceable, the provision may have the effect of discouraging lawsuits against our directors and officers.

Unless we consent in writing to the selection of an alternative forum, the federal district courts of the U.S. shall be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act. Under Section 22 of the Securities Act, federal and state courts have concurrent jurisdiction over all suits brought to enforce any duty or liability created by the Securities Act, and stockholders cannot waive compliance with the federal securities laws and the rules and regulations thereunder. Accordingly, there is uncertainty as to whether a court would enforce such a forum selection provision as written in connection with claims arising under the Securities Act. Notwithstanding the foregoing, the forum selection clause will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the U.S. shall be the sole and exclusive forum. This choice of forum provision has important consequences for our stockholders. See “Risk Factors –Risk Factors Relating to Ownership of Our Common Stock– Our Certificate of Incorporation includes a forum selection clause, which could discourage claims or limit stockholders’ ability to make a claim against us, our directors, officers, other employees or stockholders.”

Anti-takeover Provisions

Stockholder Action; Special Meeting of Stockholders

So long as FPS holds stock representing at least 50% of the voting power in our company, stockholder action may be taken by written or electronic consent to action at a meeting, and stockholders holding a majority in voting power of all then-outstanding shares of capital stock of FGS entitled to vote generally in the election of directors may request that a special meeting of stockholders be called.

Our Certificate of Incorporation provides that, at any time after FPS ceases to hold at least 50% of the voting power in our company, (i) any action required or permitted to be taken by our stockholders must be effected at a duly called annual or special meeting of our stockholders and may not be effected by any consent in writing by our stockholders, and (ii) except as otherwise required by law, special meetings of our stockholders can only be called by the chair of our board of directors or by the secretary upon the direction of our board of directors.

Amendment of Charter and Bylaws

Certain provisions of our Certificate of Incorporation and our Bylaws require the approval of a majority of the then authorized directors in order for our board of directors to amend or repeal certain provisions of our Certificate of Incorporation or our Bylaws or, at any time after FPS ceases to hold at least 50% of the voting power in our company, the approval of the holders of at least 66 2/3% of the voting power of all outstanding shares of voting stock is required in order for our stockholders to amend certain

85

provisions of our Certificate of Incorporation or our Bylaws. Prior to the time that FPS ceases to hold at least 50% of the voting power in our company, the Certificate of Incorporation and Bylaws may be amended with the consent of the holders of at least 50% of the voting power of all then outstanding stock of FGS entitled to vote generally in the election of directors. This provision will have the effect of making it more difficult to amend certain provisions of our Certificate of Incorporation or our Bylaws.

Authorized but Unissued Shares

The authorized but unissued shares of our common stock and preferred stock are available for future issuance without stockholder approval, subject to any limitations imposed by the listing standards of Nasdaq. These additional shares may be used for a variety of corporate finance transactions, acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved common stock and preferred stock could make more difficult or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise.

The foregoing provisions of our Certificate of Incorporation and Bylaws could discourage potential acquisition proposals and could delay or prevent a change in control. These provisions are intended to enhance the likelihood of continuity and stability in the composition of our board of directors and in the policies formulated by our board of directors and to discourage certain types of transactions that may involve an actual or threatened change of control. These provisions are designed to reduce our vulnerability to an unsolicited acquisition proposal. However, these provisions could have the effect of discouraging others from making tender offers for our shares and, as a consequence, they also may inhibit fluctuations in the market price of our common stock that could result from actual or rumored takeover attempts. These provisions also may have the effect of preventing changes in our management or delaying or preventing a transaction that might benefit you or other minority stockholders.

Transfer Agent and Registrar

Upon completion of this offering, the transfer agent and registrar for our common stock will be American Stock Transfer & Trust Company, LLC. The address of the transfer agent and registrar is 6201 15th Avenue, Brooklyn, NY 11219.

Limitations of Liability and Indemnification

See the section captioned “Certain Relationships and Related Party Transactions – Indemnification Agreements and Directors’ and Officers’ Liability Insurance.”

Listing

Our common stock has been approved for listing on Nasdaq under the symbol “FLXE” subject to official notice of issuance.

We do not intend to apply for any listing of the Warrants on Nasdaq or any other securities exchange or nationally recognized trading system, and we do not expect a market for the Warrants to develop.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for our common stock, and we cannot predict the effect, if any, that market sales of shares of our common stock or the availability of shares of our common stock for sale will have on the market price of our common stock prevailing from time to time. Future sales of our common stock in the public market, or the availability of such shares for sale in the public market, could adversely affect market prices prevailing from time to time. As described below, only a limited number of shares of our common stock will be available for sale shortly after this offering due to contractual and legal restrictions on resale. Nevertheless, sales of our common stock in the public market after such restrictions lapse, or the perception that those sales may occur, could adversely affect the prevailing market price at that time and our ability to raise equity capital in the future.

Following the completion of this offering, 11,910,100 (12,243,433 if the underwriter’s over-allotment option is exercised in full) shares of common stock will be outstanding. Of these outstanding shares, all of the shares of our common stock sold in this offering will be freely tradable, except that any shares purchased in this offering by our affiliates, as that term is defined in Rule 144 under the Securities Act, would only be able to be sold in compliance with the Rule 144 limitations described below.

The remaining outstanding shares of our common stock not sold in this offering will be deemed “restricted securities” as defined in Rule 144 under the Securities Act. Restricted securities may be sold in the public market only if they are registered or if they qualify for an exemption from registration under Rule 144 under the Securities Act, which rule is summarized below. All of our executive officers, directors and holders of substantially all of our capital stock and securities exercisable or convertible into our capital stock have entered into lock-up agreements with the underwriter under which they have agreed, subject to specific exceptions, not to sell any of our stock for 180 days following the date of this prospectus. As a result of these agreements and subject to the provisions of Rule 144, shares of our common stock will be available for sale in the public market as follows:

•

beginning on the date of this prospectus, all 2,222,222 shares of our common stock sold in this offering will be immediately available for sale in the public market; and

•

beginning 181 days after the date of this prospectus, the remaining 9,687,878 shares of our common stock will be eligible for sale in the public market from time to time thereafter, subject in some cases to the volume and other restrictions of Rule 144, as described below, but subject to the rights of FPS, RNS and TRF to have some or all of their shares registered for resale – see “Registration Rights Agreement” below.

Lock-Up Agreements

We, all of our directors and officers, FPS, RNS and TRF have agreed or will agree that, without the prior written consent of Roth Capital Partners, during the period from the date of this prospectus and ending on the date 180 days after the date of this prospectus, we and they will not, among other things:

•

offer, pledge, sell, contract to sell, grant any option to purchase, make any short sale or otherwise dispose of any shares of common stock, options or warrants to purchase shares of our common stock or any securities convertible into or exercisable or exchangeable for shares of our common stock; or

•

in our case, file any registration statement with the SEC relating to the offering of any shares of common stock or any securities convertible into or exercisable or exchangeable for common stock; or

•

in the case of our directors, officers and other holders of our securities, make any demand for exercise of any rights with respect to the registration of any securities.

This agreement is subject to certain exceptions. See “Underwriting” below for additional discussion.

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Rule 144

In general, under Rule 144 as currently in effect, once we have been subject to the public company reporting requirements of Section 13 or Section 15(d) of the Exchange Act for at least 90 days, a person who is not deemed to have been one of our affiliates for purposes of the Securities Act at any time during the 90 days preceding a sale and who has beneficially owned the shares of our common stock proposed to be sold for at least six months is entitled to sell those shares without complying with the manner of sale, volume limitation or notice provisions of Rule 144, subject to compliance with the public information requirements of Rule 144. If such a person has beneficially owned the shares proposed to be sold for at least one year, including the holding period of any prior owner other than our affiliates, then that person would be entitled to sell those shares without complying with any of the requirements of Rule 144.

In general, under Rule 144, as currently in effect, our affiliates or persons selling shares of our common stock on behalf of our affiliates are entitled to sell upon expiration of the lock-up agreements described above, within any three-month period, a number of shares that does not exceed the greater of:

•

1% of the number of shares of our capital stock then outstanding, which will equal             shares immediately after this offering; or

•

the average weekly trading volume of our common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to that sale.

Sales under Rule 144 by our affiliates or persons selling shares of our common stock on behalf of our affiliates are also subject to manner of sale provisions and notice requirements and to the availability of current public information about us.

Registration Rights Agreement

In connection with the Contribution Transaction and the SAFE Transaction, we entered into the Registration Rights Agreement with FPS, RNS and TRF, which provides certain registration rights to FPS , RNS and TRF and pursuant to which we are obligated, upon request from FPS, RNS or TRF (but subject to customary limitations provide for in the Registration Rights Agreement) to register for resale under the Securities Act the shares of our common stock issued to FPS in the Contribution Transaction or transferred to RNS and TRF pursuant in the SAFE Transaction. Subject to certain exceptions, we will bear all expenses of each registration pursuant to the Registration Rights Agreement, other than Selling Expenses (as defined in the Registration Rights Agreement).

Registration Statement with Respect to our 2021 Plan

We intend to file a registration statement on Form S-8 under the Securities Act promptly after the completion of this offering to register shares of our common stock reserved for future issuance under our 2021 Plan. The registration statement on Form S-8 is expected to become effective immediately upon filing, and shares of our common stock covered by the registration statement will then become eligible for sale in the public market, subject to the Rule 144 limitations applicable to affiliates, vesting restrictions and any applicable lock-up agreements. See “Executive Compensation – Equity Compensation” for a description of our equity incentive plans.

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MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES
TO NON-U.S. HOLDERS OF OUR SECURITIES

The following discussion is a summary of the material U.S. federal income tax consequences to Non-U.S. Holders (as defined below) of the purchase, ownership and disposition of our common stock and Warrants issued pursuant to this offering, but does not purport to be a complete analysis of all potential tax effects. The effects of other U.S. federal tax laws, such as estate and gift tax laws, and any applicable state, local or non-U.S. tax laws are not discussed. This discussion is based on the U.S. Internal Revenue Code of 1986, as amended (the “Code”), Treasury Regulations promulgated thereunder, judicial decisions, and published rulings and administrative pronouncements of the U.S. Internal Revenue Service (the “IRS”), in each case in effect as of the date hereof. These authorities may change or be subject to differing interpretations. Any such change or differing interpretation may be applied retroactively in a manner that could adversely affect a Non-U.S. Holder of our common stock or Warrants. We have not sought and will not seek any rulings from the IRS regarding the matters discussed below. There can be no assurance the IRS or a court will not take a contrary position to that discussed below regarding the tax consequences of the purchase, ownership and disposition of our common stock or Warrants.

This discussion is limited to Non-U.S. Holders that hold our common stock or Warrants as a “capital asset” within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion does not address all U.S. federal income tax consequences relevant to a Non-U.S. Holder’s particular circumstances, including the impact of the Medicare contribution tax on net investment income. In addition, it does not address consequences relevant to Non-U.S. Holders subject to special rules, including, without limitation:

•

U.S. expatriates and former citizens or long-term residents of the U.S.;

•

persons subject to the alternative minimum tax;

•

persons holding our common stock or Warrants as part of a hedge, straddle or other risk reduction strategy or as part of a conversion transaction or other integrated investment;

•

banks, insurance companies, and other financial institutions;

•

brokers, dealers or traders in securities;

•

“controlled foreign corporations,” “passive foreign investment companies,” and corporations that accumulate earnings to avoid U.S. federal income tax;

•

partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes (and investors therein);

•

tax-exempt organizations or governmental organizations;

•

persons deemed to sell our common stock or Warrants under the constructive sale provisions of the Code;

•

persons who hold or receive our common stock or Warrants pursuant to the exercise of any employee stock option or otherwise as compensation;

•

tax-qualified retirement plans;

•

“qualified foreign pension funds” as defined in Section 897(l)(2) of the Code and entities all of the interests of which are held by qualified foreign pension funds; and

•

persons subject to special tax accounting rules as a result of any item of gross income with respect to the stock being taken into account in an applicable financial statement.

If an entity treated as a partnership for U.S. federal income tax purposes holds our common stock or Warrants, the tax treatment of a partner in the partnership will depend on the status of the partner, the activities of the partnership and certain determinations made at the partner level. Accordingly, partnerships

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holding our common stock or Warrants and the partners in such partnerships should consult their tax advisors regarding the U.S. federal income tax consequences to them.

THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. INVESTORS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF OUR COMMON STOCK OR WARRANTS ARISING UNDER THE U.S. FEDERAL ESTATE OR GIFT TAX LAWS OR UNDER THE LAWS OF ANY STATE, LOCAL OR NON-U.S. TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY.

Definition of a Non-U.S. Holder

For purposes of this discussion, a “Non-U.S. Holder” is any beneficial owner of our common stock or Warrants that is neither a “U.S. person” nor an entity treated as a partnership for U.S. federal income tax purposes. A U.S. person is any person that, for U.S. federal income tax purposes, is or is treated as any of the following:

•

an individual who is a citizen or resident of the U.S.;

•

a corporation created or organized under the laws of the U.S., any state thereof, or the District of Columbia;

•

an estate, the income of which is subject to U.S. federal income tax regardless of its source; or

•

a trust that (1) is subject to the primary supervision of a U.S. court and the control of one or more “United States persons” ​(within the meaning of Section 7701(a)(30) of the Code), or (2) has a valid election in effect to be treated as a United States person for U.S. federal income tax purposes.

Distributions

As described in the section captioned “Dividend Policy,” we do not anticipate declaring or paying dividends to holders of our common stock in the foreseeable future. However, if we do make distributions of cash or property on our common stock, such distributions will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Amounts not treated as dividends for U.S. federal income tax purposes will constitute a return of capital and first be applied against and reduce a Non-U.S. Holder’s adjusted tax basis in its common stock, but not below zero. Any excess will be treated as capital gain and will be treated as described below under “– Sale or Other Taxable Disposition.”

Subject to the discussion below on effectively connected income, dividends paid to a Non-U.S. Holder of our common stock will be subject to U.S. federal withholding tax at a rate of 30% of the gross amount of the dividends (or such lower rate specified by an applicable income tax treaty, provided the Non-U.S. Holder furnishes a valid IRS Form W-8BEN or W-8BEN-E (or other applicable documentation) certifying qualification for the lower treaty rate). A Non-U.S. Holder that does not timely furnish the required documentation, but that qualifies for a reduced treaty rate, may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS. Non-U.S. Holders should consult their tax advisors regarding their entitlement to benefits under any applicable income tax treaty.

If dividends paid to a Non-U.S. Holder are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment in the United States to which the dividends are attributable), the Non-U.S. Holder will be exempt from the U.S. federal withholding tax described above. To claim the exemption, the Non-U.S. Holder must furnish to the applicable withholding agent a valid IRS Form W-8ECI, certifying that the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States.

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Any such effectively connected dividends will be subject to U.S. federal income tax on a net income basis at the regular graduated rates. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on the effectively connected dividends, as adjusted for certain items. Non-U.S. Holders should consult their tax advisors regarding any applicable tax treaties that may provide for different rules.

Sale or Other Taxable Disposition

A Non-U.S. Holder will not be subject to U.S. federal income tax on any gain realized upon the sale or other taxable disposition of our common stock or Warrants unless:

•

the gain is effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment in the United States to which such gain is attributable);

•

the Non-U.S. Holder is a nonresident alien individual present in the United States for 183 days or more during the taxable year of the disposition and certain other requirements are met; or

•

our common stock or Warrants constitutes a U.S. real property interest (“USRPI”) by reason of our status as a U.S. real property holding corporation (“USRPHC”) for U.S. federal income tax purposes.

Gain described in the first bullet point above generally will be subject to U.S. federal income tax on a net income basis at the regular graduated rates. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on the effectively connected gain, as adjusted for certain items.

Gain described in the second bullet point above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty), which may be offset by U.S. source capital losses of the Non-U.S. Holder (even though the individual is not considered a resident of the United States), provided the Non-U.S. Holder has timely filed U.S. federal income tax returns with respect to the losses.

With respect to the third bullet point above, we believe we currently are not, and do not anticipate becoming, a USRPHC. Because the determination of whether we are a USRPHC depends, however, on the fair market value of our USRPIs relative to the fair market value of our non-U.S. real property interests and our other business assets, there can be no assurance we currently are not a USRPHC or will not become one in the future. Even if we are or were to become a USRPHC, gain arising from the sale or other taxable disposition by a Non-U.S. Holder of our common stock will not be subject to U.S. federal income tax if our common stock is “regularly traded,” as defined by applicable Treasury Regulations, on an established securities market, and the Non-U.S. Holder owned, actually and constructively, 5% or less of our common stock throughout the shorter of the five-year period ending on the date of the sale or other taxable disposition or the Non-U.S. Holder’s holding period.

Non-U.S. Holders should consult their tax advisors regarding potentially applicable income tax treaties that may provide for different rules.

Exercise of a Warrant

In general, a non-U.S. holder will not recognize gain or loss for U.S. federal income tax purposes upon exercise of a Warrant, except to the extent the non-U.S. holder receives a cash payment for any such fractional share that would otherwise have been issuable upon exercise of the Warrant which will be treated as a sale subject to the rules described under “Sale or Other Disposition” above. The non-U.S. holder will take a tax basis in the shares acquired on the exercise of a Warrant equal to the exercise price of the Warrant. The non-U.S. holder’s holding period in the shares of our common stock acquired on exercise of the Warrant will begin on the date of exercise of the Warrant, and will not include any period for which the non-U.S. holder held the Warrant.

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Expiration of a Warrant

Expiration of Warrants will be treated as if the non-U.S. holder sold or exchanged the Warrants and recognized a capital loss equal to the non-U.S. holder’s tax basis in the Warrants. However, a non-U.S. holder will not be able to utilize a loss recognized upon expiration of a Warrant against the non-U.S. holder’s U.S. federal income tax liability unless the loss is effectively connected with the non-U.S. holder’s conduct of a trade or business within the United States (and, if an income tax treaty applies, is attributable to a permanent establishment in the United States) or is treated as a U.S.-source loss and the non-U.S. holder is present 183 days or more in the taxable year of disposition and certain other conditions are met.

Certain Adjustments to the Warrants and Payments in Respect of the Warrants

Under Section 305 of the Code, an adjustment to the number of shares of common stock that will be issued on the exercise of the Warrants, or an adjustment to the exercise price of the Warrants, may be treated as a constructive distribution to a non-U.S. Holder of the Warrants if, and to the extent that, such adjustment has the effect of increasing such non-U.S. Holder’s proportionate interest in our “earnings and profits” or assets, depending on the circumstances of such adjustment (for example, if such adjustment is to compensate for a distribution of cash or other property to our shareholders). Adjustments to the exercise price of Warrants made pursuant to a bona fide reasonable adjustment formula that has the effect of preventing dilution of the interest of the non-U.S. Holder of the Warrants generally should not be considered to result in a constructive distribution. Such constructive distribution would be treated as a dividend, return of capital or capital gain as described under the heading “Distributions” above. Any such constructive distribution would be taxable whether or not there is an actual distribution of cash or other property.

Information Reporting and Backup Withholding

Payments of dividends on our common stock will not be subject to backup withholding, provided the applicable withholding agent does not have actual knowledge or reason to know the holder is a United States person and the holder either certifies its non-U.S. status, such as by furnishing a valid IRS Form W-8BEN, W-8BEN-E or W-8ECI, or otherwise establishes an exemption. However, information returns are required to be filed with the IRS in connection with any dividends on our common stock paid to the Non-U.S. Holder, regardless of whether any tax was actually withheld. In addition, proceeds of the sale or other taxable disposition of our common stock or Warrants within the United States or conducted through certain U.S.-related brokers generally will not be subject to backup withholding or information reporting, if the applicable withholding agent receives the certification described above and does not have actual knowledge or reason to know that such holder is a United States person, or the holder otherwise establishes an exemption. Proceeds of a disposition of our common stock or Warrants conducted through a non-U.S. office of a non-U.S. broker generally will not be subject to backup withholding or information reporting.

Copies of information returns that are filed with the IRS may also be made available under the provisions of an applicable treaty or agreement to the tax authorities of the country in which the Non-U.S. Holder resides or is established.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a Non-U.S. Holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS.

Additional Withholding Tax on Payments Made to Foreign Accounts

Withholding taxes may be imposed under Sections 1471 to 1474 of the Code (such Sections commonly referred to as the Foreign Account Tax Compliance Act, or “FATCA”) on certain types of payments made to non-U.S. financial institutions and certain other non-U.S. entities. Specifically, a 30% withholding tax may be imposed on dividends on, or gross proceeds from the sale or other disposition of, our common stock or Warrants paid to a “foreign financial institution” or a “non-financial foreign entity” ​(each as defined in the Code), unless (1) the foreign financial institution undertakes certain diligence and reporting obligations, (2) the non-financial foreign entity either certifies it does not have any “substantial United States owners”

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(as defined in the Code) or furnishes identifying information regarding each substantial United States owner, or (3) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in (1) above, it must enter into an agreement with the U.S. Department of the Treasury requiring, among other things, that it undertake to identify accounts held by certain “specified United States persons” or “United States-owned foreign entities” ​(each as defined in the Code), annually report certain information about such accounts, and withhold 30% on certain payments to non-compliant foreign financial institutions and certain other account holders. Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the United States governing FATCA may be subject to different rules.

Under the applicable Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of dividends on our common stock, and will apply to payments of gross proceeds from the sale or other disposition of such stock on or after January 1, 2020.

Prospective investors should consult their tax advisors regarding the potential application of withholding under FATCA to their investment in our common stock or Warrants.

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UNDERWRITING

We have entered into an underwriting agreement with Roth Capital Partners, LLC (referred to herein as the “underwriter”). Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to the underwriter, and the underwriter has agreed to purchase, Units from us. We have been approved to list our common stock on the Nasdaq Stock Market under the symbol “FLXE” subject to official notice of issuance.

Pursuant to the terms and subject to the conditions contained in the underwriting agreement, we have agreed to sell to the underwriter, and the underwriter has agreed to purchase from us, all of the Units offered under this prospectus.

The underwriting agreement provides that the obligation of the underwriter to purchase the Units offered by this prospectus is subject to certain conditions. The underwriter is obligated to purchase all of the Units offered hereby if any of the Units are purchased.

We have granted the underwriter an option, exercisable for 30 days from the date of this prospectus, to purchase up to 333,333 additional shares of common stock at the public offering price per share, less underwriting discounts and commissions, and/or additional Warrants to purchase up to 333,333 shares of common stock at the public offering price to cover over-allotments, if any, in connection with the Units offered by this prospectus; however, the underwriter may only exercise the option once.

Discount, Commissions and Expenses

The underwriter proposes to offer to the Units purchased pursuant to the underwriting agreement to the public at the public offering price set forth on the cover page of this prospectus and to certain dealers at that price less a concession not in excess of $       per Unit. After this offering, the public offering price and concession may be changed by the underwriter. No such change shall change the amount of proceeds to be received by us as set forth on the cover page of this prospectus.

In connection with the sale of the Units to be purchased by the underwriter, the underwriter will be deemed to have received compensation in the form of underwriting commissions and discounts. The underwriter’s commissions and discounts will be 7.0% of the gross proceeds of this offering, or $       per Unit, based on the public offering price per Units set forth on the cover page of this prospectus.

We have also agreed to reimburse the underwriter at closing for legal expenses incurred by it in connection with the offering up to a maximum of $400,000.

The following table shows the underwriting discounts and commissions payable to the underwriter by us in connection with this offering (assuming both the exercise and non-exercise of the over-allotment option to purchase additional Units):

​	Per Unit(1)				Total
​	Without Over- allotment		With Over- allotment		Without Over- allotment		With Over- allotment
Public offering price	​	$	​	$	​	$	​	$
Underwriting discount	​	$	​	$	​	$	​	$

(1)

Does not include the underwriter’s warrant.

Underwriter’s Warrant

We have also agreed to issue to the underwriter’s warrant to purchase a number of our shares of common stock equal to an aggregate of 2.5% of the shares of common stock sold in this offering. The underwriter’s warrant will have an exercise price equal to 120% of the initial public offering price of the shares

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of common stock sold in this offering and may be exercised on a cashless basis. The underwriter’s warrant is not redeemable by us, becomes exercisable 180 days from the effective date of the registration statement of which this prospectus forms a part and will expire on the third anniversary of the effective date. The underwriter’s warrant will provide for adjustment in the number and price of the underwriter’s warrant (and the shares of common stock underlying the underwriter’s warrant) in the event of recapitalization, merger or other fundamental transaction. The underwriter’s warrant and the underlying shares of common stock have been deemed compensation by FINRA and are therefore subject to FINRA Rule 5110(e)(1). In accordance with FINRA Rule 5110(e)(1), neither the underwriter’s warrant nor any shares of our common stock issued upon exercise of the underwriter’s warrant may be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative, put, or call transaction that would result in the effective economic disposition of the securities by any person for a period of 180 days immediately following the date of effectiveness or commencement of sales of the offering pursuant to which the underwriter’s warrant are being issued, except as set forth in FINRA Rule 5110(g)(2).

No Public Market

Prior to this offering, there has not been a public market for our common stock or Warrants and the public offering price for our common stock and Warrants will be determined through negotiations between us and the underwriter. Among the factors to be considered in these negotiations will be prevailing market conditions, our financial information, market valuations of other companies that we and the representative believe to be comparable to us, estimates of our business potential, the present state of our development and other factors deemed relevant.

No assurance can be given that the initial public offering price will correspond to the price at which our common stock and Warrants will trade in the public market subsequent to this offering or that an active trading market for our common stock and Warrants will develop and continue after this offering.

Indemnification

Pursuant to the underwriting agreement, we have agreed to indemnify the underwriter against certain liabilities, including liabilities under the Securities Act, or to contribute to payments that the underwriter or such other indemnified parties may be required to make in respect of those liabilities.

Lock-up Agreements

We have agreed not to (i) offer, pledge, issue, sell, contract to sell, purchase, contract to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock; (ii) enter into any swap or other arrangement that transfers, in whole or in part, any of the economic consequences of ownership of shares of common stock; or (iii) file any registration statement with the Securities Exchange Commission relating to the offering of any shares of our common stock or any securities convertible into or exercisable or exchangeable for shares of our common stock, without the prior written consent of the underwriter for a period of 180 days following the date of this prospectus (the “Lock-up Period”). This consent may be given at any time without public notice. These restrictions on future issuances are subject to exceptions for (i) the issuance of shares of our common stock sold in this offering, (ii) the issuance of shares of our common stock upon the exercise of outstanding options or warrants and the vesting of restricted stock awards or units, (iii) the issuance of employee stock options not exercisable during the Lock-up Period and the grant, redemption or forfeiture of restricted stock awards or restricted stock units pursuant to our equity incentive plans or as new employee inducement grants and (iv) the issuance of common stock or warrants to purchase common stock in connection with mergers or acquisitions of securities, businesses, property or other assets, joint ventures, strategic alliances, equipment leasing arrangements or debt financing.

In addition, FPS, RNS, TRF and each of our directors and executive officers has entered into a lock-up agreement with the underwriter. Under the lock-up agreements, the directors and executive officers may not, directly or indirectly, sell, offer to sell, contract to sell, or grant any option for the sale (including any short sale), grant any security interest in, pledge, hypothecate, hedge, establish an open “put equivalent position”

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(within the meaning of Rule 16a-1(h) under the Securities Exchange Act of 1934, as amended), or otherwise dispose of, or enter into any transaction which is designed to or could be expected to result in the disposition of, any shares of our common stock or securities convertible into or exchangeable for shares of our common stock, or publicly announce any intention to do any of the foregoing, without the prior written consent of the underwriter, for a period of 180 days from the closing date of this offering. This consent may be given at any time without public notice. These restrictions on future dispositions by our directors and executive officers are subject to exceptions for (i) one or more bona fide gift transfers of securities to immediate family members who agree to be bound by these restrictions, (ii) transfers of securities to one or more trusts for bona fide estate planning purposes, and (iii) private transfers by FPS to TRF and RNS and redemption by us of shares transferred to TRF and RNS in order to satisfy obligations under the SAFE Transaction. Each officer and director shall be immediately and automatically released from all restrictions and obligations under the lock up agreement in the event that he or she ceases to be a director or officer of our company and has no further reporting obligations under Section 16 of the Exchange Act.

Electronic Distribution

This prospectus may be made available in electronic format on websites or through other online services maintained by the underwriter or by its affiliates. In those cases, prospective investors may view offering terms online and prospective investors may be allowed to place orders online. Other than this prospectus in electronic format, the information on the underwriter’s website or our website and any information contained in any other websites maintained by the underwriter or by us is not part of this prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or the underwriter in its capacity as underwriter, and should not be relied upon by investors.

Price Stabilization, Short Positions and Penalty Bids

In connection with the offering the underwriter may engage in stabilizing transactions, over-allotment transactions, syndicate covering transactions and penalty bids in accordance with Regulation M under the Exchange Act:

•

Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum.

•

Over-allotment involves sales by the underwriter of shares in excess of the number of shares the underwriter is obligated to purchase, which creates a syndicate short position. The short position may be either a covered short position or a naked short position. In a covered short position, the number of shares over-allotted by the underwriter is not greater than the number of shares that it may purchase in the over-allotment option. In a naked short position, the number of shares involved is greater than the number of shares in the over-allotment option. The underwriter may close out any covered short position by either exercising its over-allotment option and/or purchasing shares in the open market.

•

Syndicate covering transactions involve purchases of the common stock in the open market after the distribution has been completed in order to cover syndicate short positions. In determining the source of shares to close out the short position, the underwriter will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which it may purchase shares through the over-allotment option. A naked short position occurs if the underwriter sells more shares than could be covered by the over-allotment option. This position can only be closed out by buying shares in the open market. A naked short position is more likely to be created if the underwriter is concerned that there could be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in the offering.

•

Penalty bids permits the underwriter to reclaim a selling concession from a syndicate member when the common stock originally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions.

96

These stabilizing transactions, syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market price of our common stock or preventing or retarding a decline in the market price of the common stock. As a result, the price of our common stock may be higher than the price that might otherwise exist in the open market. These transactions may be discontinued at any time.

Neither we nor the underwriter make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of our shares of common stock. In addition, neither we nor the underwriter make any representation that the underwriter will engage in these transactions or that any transaction, if commenced, will not be discontinued without notice.

Offer restrictions outside the U.S.

Other than in the United States, no action has been taken by us or the underwriter that would permit a public offering of the securities offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to this offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.

Australia

This prospectus is not a disclosure document under Chapter 6D of the Australian Corporations Act, has not been lodged with the Australian Securities and Investments Commission and does not purport to include the information required of a disclosure document under Chapter 6D of the Australian Corporations Act. Accordingly, (i) the offer of the securities under this prospectus is only made to persons to whom it is lawful to offer the securities without disclosure under Chapter 6D of the Australian Corporations Act under one or more exemptions set out in section 708 of the Australian Corporations Act, (ii) this prospectus is made available in Australia only to those persons as set forth in clause (i) above, and (iii) the offeree must be sent a notice stating in substance that by accepting this offer, the offeree represents that the offeree is such a person as set forth in clause (i) above, and, unless permitted under the Australian Corporations Act, agrees not to sell or offer for sale within Australia any of the securities sold to the offeree within 12 months after its transfer to the offeree under this prospectus.

Canada

The securities may be sold in Canada only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the securities must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable securities laws. Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for particulars of these rights or consult with a legal advisor. Pursuant to section 3A.3 of National Instrument 33-105 Underwriting Conflicts (NI 33-105), the underwriter is not required to comply with the disclosure requirements of NI33-105 regarding underwriter conflicts of interest in connection with this offering.

European Economic Area – Belgium, Germany, Luxembourg and Netherlands

The information in this document has been prepared on the basis that all offers of securities will be made pursuant to an exemption under the Directive 2003/71/EC (“Prospectus Directive”), as implemented

97

in Member States of the European Economic Area (each, a “Relevant Member State”), from the requirement to produce a prospectus for offers of securities.

An offer to the public of securities has not been made, and may not be made, in a Relevant Member State except pursuant to one of the following exemptions under the Prospectus Directive as implemented in that Relevant Member State:

•

to legal entities that are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;

•

to any legal entity that has two or more of (i) an average of at least 250 employees during its last fiscal year; (ii) a total balance sheet of more than €43,000,000 (as shown on its last annual unconsolidated or consolidated financial statements) and (iii) an annual net turnover of more than €50,000,000 (as shown on its last annual unconsolidated or consolidated financial statements);

•

to fewer than 100 natural or legal persons (other than qualified investors within the meaning of Article 2(1)(e) of the Prospectus Directive) subject to obtaining our prior consent or any underwriter for any such offer; or

•

in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of securities shall require us to publish a prospectus pursuant to Article 3 of the Prospectus Directive.

United Kingdom

Neither the information in this document nor any other document relating to the offer has been delivered for approval to the Financial Services Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets Act 2000, as amended (“FSMA”)) has been published or is intended to be published in respect of the securities. This document is issued on a confidential basis to “qualified investors” ​(within the meaning of section 86(7) of FSMA) in the United Kingdom, and the securities may not be offered or sold in the United Kingdom by means of this document, any accompanying letter or any other document, except in circumstances which do not require the publication of a prospectus pursuant to section 86(1) FSMA. This document should not be distributed, published or reproduced, in whole or in part, nor may its contents be disclosed by recipients to any other person in the United Kingdom.

Any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) received in connection with the issue or sale of the securities has only been communicated or caused to be communicated and will only be communicated or caused to be communicated in the United Kingdom in circumstances in which section 21(1) of FSMA does not apply us.

In the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience in matters relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 (“FPO”), (ii) who fall within the categories of persons referred to in Article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise be lawfully communicated (together “relevant persons”). The investments to which this document relates are available only to, and any invitation, offer or agreement to purchase will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

98

LEGAL MATTERS

Rutan & Tucker, LLP, Irvine, California will pass upon the validity of the Units and the common stock and Warrants underlying the Units being offered by this prospectus. K&L Gates LLP, Irvine, California is acting as counsel to the underwriter.

EXPERTS

The combined consolidated financial statements of FlexEnergy Inc. and Flex Leasing Power & Services, LLC as of December 31, 2020 and 2019 and for each of the years in the two-year period ended December 31, 2020 included in this prospectus have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein (which report expresses an unqualified opinion on the financial statements and includes an explanatory paragraph referring to the Company’s ability to continue as a going concern). Such financial statements have been so included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

The balance sheet of FlexEnergy Green Solutions, Inc. as of December 31, 2020 included in this prospectus has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein. Such balance sheet has been included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the shares of our common stock offered by this prospectus. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement, some of which is contained in exhibits to the registration statement as permitted by the rules and regulations of the SEC. For further information with respect to us and our common stock, we refer you to the registration statement, including the exhibits filed as a part of the registration statement. Statements contained in this prospectus concerning the contents of any contract or any other document are not necessarily complete. If a contract or document has been filed as an exhibit to the registration statement, please see the copy of the contract or document that has been filed. Each statement in this prospectus relating to a contract or document filed as an exhibit is qualified in all respects by the filed exhibit. You may obtain copies of this information by mail from the Public Reference Section of the SEC, 100 F Street, N.E., Room 1580, Washington, D.C. 20549, at prescribed rates. You may obtain information on the operation of the public reference rooms by calling the SEC at 1-800-SEC-0330. The SEC also maintains a website that contains reports, proxy statements and other information about issuers, like us, that file electronically with the SEC. The address of that website is www.sec.gov.

As a result of this offering, we will become subject to the information and reporting requirements of the Exchange Act and, in accordance with this law, will file periodic reports, proxy statements and other information with the SEC. These periodic reports, proxy statements and other information will be available for inspection and copying at the public reference facilities and website of the SEC referred to above. We also maintain a website at www.flexenergy.com where, upon completion of this offering, you may access these materials free of charge as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. The information on or that can be accessed through our website is not a part of this prospectus and the inclusion of our website address in this prospectus is an inactive textual reference only.

99

INDEX TO FINANCIAL STATEMENTS

Audited Combined Consolidated Financial Statements
Fiscal Years Ended December 31, 2020 and 2019

Balance Sheets of FlexEnergy Green Solutions, Inc.	​
Report of Independent Registered Public Accounting Firm	F-2
Balance Sheets	F-3
Notes to Balance Sheets	F-4
Combined Consolidated Financial Statements of FlexEnergy, Inc. And Flex Leasing Power & Services, LLC	​
Report of Independent Registered Public Accounting Firm	F-5
Combined Consolidated Balance Sheets	F-6
Combined Consolidated Statements of Operations and Comprehensive Loss	F-7
Combined Consolidated Statements of Stockholder’s Equity	F-8
Combined Consolidated Statements of Cash Flows	F-9
Notes to Combined Consolidated Financial Statements	F-10

Unaudited Condensed Combined Consolidated Financial Statements
Nine Months Ended September 30, 2021 and September 30, 2020

Condensed Combined Consolidated Financial Statements of FlexEnergy, Inc. And Flex Leasing Power & Services, LLC	​
Condensed Combined Consolidated Balance Sheets (unaudited)	F-27
Condensed Combined Consolidated Statements of Operations and Comprehensive Loss (unaudited)	F-28
Condensed Combined Consolidated Statements of Stockholder’s Equity (unaudited)	F-29
Condensed Combined Consolidated Statements of Cash Flows (unaudited)	F-30
Notes to Condensed Combined Consolidated Financial Statements (unaudited)	F-31

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholder and the Board of Directors of FlexEnergy Green Solutions, Inc.

Opinion on the Financial Statements

We have audited the accompanying combined consolidated balance sheet of FlexEnergy Green Solutions, Inc. (the “Company”) as of December 31, 2020, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Deloitte & Touche LLP

Hartford, CT
June 4, 2021

We have served as the Company’s auditor since 2020.

F-2

FLEXENERGY GREEN SOLUTIONS, INC.

CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)

​	September 30, 2021			December 31, 2020
​	(unaudited)			​	​	​
ASSETS	​	​	​	​	​	​
CURRENT ASSETS	​	​	​	​	​	​
Cash	​	$	0	​	$	0
TOTAL CURRENT ASSETS	​	​	0	​	​	0
TOTAL ASSETS	​	$	0	​	$	0
LIABILITIES AND STOCKHOLDER’S EQUITY	​	​	​	​	​	​
TOTAL LIABILITIES	​	$	0	​	$	0
STOCKHOLDER’S EQUITY	​	​	​	​	​	​
Retained earnings	​	$	0	​	$	0
TOTAL STOCKHOLDER’S EQUITY	​	​	0	​	​	0
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY	​	$	0	​	$	0

See accompanying notes to the Consolidated Balance Sheet.

F-3

FLEXENERGY GREEN SOLUTIONS, INC

NOTES TO CONSOLIDATED BALANCE SHEETS

1.   Organization and Summary of Significant Accounting Policies

Organization

FlexEnergy Green Solutions, Inc. (the “Company”) is a Delaware corporation formed on December 31, 2020 that will not have any operating activity until the contribution of equity interests from FlexEnergy Power Solutions, LLC (“FPS”) of FlexEnergy, Inc and Flex Leasing Power & Service, LLC, known collectively as the Contribution Transaction. Accordingly, we believe that a discussion of the results of FlexEnergy Green Solutions, Inc would not be meaningful for the periods covered by these financial statements prior to the Contribution Transaction.

The Company and its subsidiaries are an energy focused technology company that designs, manufactures, sells and leases cost-effective energy solutions that lower its customers’ environmental footprint, often by making useable energy from sources of fuel or heat otherwise overlooked or wasted. The Company’s business consists of leasing and service of the Company’s gas-powered Flex Turbines supported by a vertically integrated original equipment manufacturing (“OEM”) with some direct sales of manufactured products. Leasing and service allows the Company to monetize emerging clean technologies via its Flex Turbine and Flex Heat Recovery products, with consistent revenues and cash flow.

The Company intends to file a Registration Statement on Form S-1 with the Securities and Exchange Commission with respect to an initial public offering of its stock.

2.   Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts have been eliminated upon consolidation. Subsequent events have been evaluated through the date the financial statements were issued.

The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) as contained within the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC).

F-4

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholder and the Board of Directors of FlexEnergy Green Solutions, Inc., FlexEnergy, Inc. and the Board of Managers of Flex Leasing Power & Service, LLC

Opinion on the Financial Statements

We have audited the accompanying combined consolidated balance sheets of FlexEnergy, Inc. and Flex Leasing Power & Service, LLC (the “Company”) as of December 31, 2020 and 2019, the related combined consolidated statements of operations and comprehensive loss, stockholder’s equity and cash flows, for each of the two years in the period ended December 31, 2020, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company has suffered recurring losses and sustained negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Deloitte & Touche LLP

Hartford, CT
June 4, 2021

We have served as the Company’s auditor since 2020.

F-5

FLEXENERGY, INC. AND FLEX LEASING POWER & SERVICES, LLC AND SUBSIDIARIES

COMBINED CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2020 AND 2019
(DOLLARS IN THOUSANDS)

​	December 31, 2020			December 31, 2019
Assets	​	​	​	​	​	​
Current assets	​	​	​	​	​	​
Cash	​	$	1,702	​	$	2,000
Accounts receivable, net of allowance of $45 and $60, respectively	​	​	2,416	​	​	2,940
Inventories, net	​	​	13,659	​	​	13,571
Prepaid expenses and other current assets	​	​	497	​	​	475
Total current assets	​	​	18,274	​	​	18,986
Long-term assets	​	​	​	​	​	​
Property and equipment, net	​	​	36,506	​	​	37,105
Deferred financing costs, net of amortization	​	​	630	​	​	792
Other non-current assets	​	​	166	​	​	98
Intangible assets, net	​	​	336	​	​	504
Total long-term assets	​	$	37,638	​	$	38,499
Total assets	​	$	55,912	​	$	57,485
Liabilities and stockholder’s equity	​	​	​	​	​	​
Current liabilities	​	​	​	​	​	​
Accounts payable	​	$	1,328	​	$	2,775
Accrued expenses	​	​	2,003	​	​	2,336
Deferred revenues	​	​	1,849	​	​	1,794
Current portion of notes payable	​	​	1,300	​	​	—
Current portion of capital lease obligations	​	​	148	​	​	174
Other current liabilities	​	​	214	​	​	403
Total current liabilities	​	​	6,842	​	​	7,482
Long-term liabilities	​	​	​	​	​	​
Capital leases, net of current portion	​	​	173	​	​	301
Line of credit	​	​	26,658	​	​	22,274
Notes payable, net of current portion	​	​	1,052	​	​	—
Other non-current liabilities	​	​	492	​	​	422
Total long-term liabilities	​	$	28,375	​	$	22,997
Total liabilities	​	$	35,217	​	$	30,479
Commitments and contingencies (see note 13)	​	​	​	​	​	​
Stockholder’s equity	​	​	​	​	​	​
Net parent investment	​	$	152,273	​	$	151,473
Accumulated other comprehensive income	​	​	543	​	​	100
Accumulated deficit	​	​	(132,121)	​	​	(124,567)
Total stockholder’s equity	​	$	20,695	​	$	27,006
Total liabilities and stockholder’s equity	​	$	55,912	​	$	57,485

The accompanying notes are an integral part of these Combined Consolidated Financial Statements.

F-6

FLEXENERGY, INC. AND FLEX LEASING POWER & SERVICES, LLC AND SUBSIDIARIES

COMBINED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(DOLLARS IN THOUSANDS)

​	Year Ended December 31,
​	2020			2019
Revenue	​	​	​	​	​	​
Turbine leasing fleet	​	$	17,838	​	$	16,833
Turbine service on sold product	​	​	2,213	​	​	2,824
Manufactured product	​	​	3,276	​	​	5,716
Total revenue	​	​	23,327	​	​	25,373
Cost of revenue	​	​	​	​	​	​
Turbine leasing fleet (excluding depreciation of fleet turbines)	​	​	4,884	​	​	5,442
Turbine service on sold product	​	​	1,691	​	​	2,797
Manufactured product	​	​	5,789	​	​	9,531
Depreciation of fleet turbines	​	​	5,007	​	​	4,713
Total cost of revenue	​	​	17,371	​	​	22,483
Operating expenses	​	​	​	​	​	​
Selling, general and administrative	​	​	11,826	​	​	12,400
Research and development	​	​	120	​	​	237
Total operating expenses	​	​	11,946	​	​	12,637
Operating loss	​	​	(5,990)	​	​	(9,747)
Other income (expense)	​	​	​	​	​	​
Interest expense	​	​	(1,114)	​	​	(992)
Other income (expense), net	​	​	31	​	​	(159)
Total other income (expense), net	​	​	(1,083)	​	​	(1,151)
Loss before income taxes	​	​	(7,073)	​	​	(10,898)
Income tax expense	​	​	(31)	​	​	(7)
Net loss	​	$	(7,104)	​	$	(10,905)
Other comprehensive loss	​	​	​	​	​	​
Foreign currency translation adjustments	​	​	443	​	​	185
Total other comprehensive loss	​	​	443	​	​	185
Comprehensive loss	​	$	(6,661)	​	$	(10,720)

The accompanying notes are an integral part of these Combined Consolidated Financial Statements.

F-7

FLEXENERGY, INC. AND FLEX LEASING POWER & SERVICES, LLC AND SUBSIDIARIES

COMBINED CONSOLIDATED STATEMENTS OF STOCKHOLDER’S EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(DOLLARS IN THOUSANDS)

​

Net Parent Investment

Accumulated Other Comprehensive Income (Loss)

Accumulated Deficit

Total Stockholder’s Equity

Balance at January 1, 2019

​

$

143,673

​

$

(85)

​

$

(103,662)

​

$

39,926

Contributions

​

​

7,800

​

​

—

​

​

—

​

​

7,800

Distributions

​

​

—

​

​

—

​

​

(10,000)

​

​

(10,000)

Foreign currency translation adjustments

​

​

—

​

​

185

​

​

—

​

​

185

Net loss

​

​

—

​

​

—

​

​

(10,905)

​

​

(10,905)

Balance at December 31, 2019

​

$

151,473

​

$

100

​

$

(124,567)

​

$

27,006

Contributions

​

​

800

​

​

—

​

​

—

​

​

800

Distributions

​

​

—

​

​

—

​

​

(450)

​

​

(450)

Foreign currency translation adjustments

​

​

—

​

​

443

​

​

—

​

​

443

Net loss

​

​

—

​

​

—

​

​

(7,104)

​

​

(7,104)

Balance at December 31, 2020

​

$

152,273

​

$

543

​

$

(132,121)

​

$

20,695

The accompanying notes are an integral part of these Combined Consolidated Financial Statements.

F-8

FLEXENERGY, INC. AND FLEX LEASING POWER & SERVICES, LLC AND SUBSIDIARIES

COMBINED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
(DOLLARS IN THOUSANDS)

​	Year Ended December 31,
​	2020			2019
Cash Flows from Operating Activities	​	​	​	​	​	​
Net income (loss)	​	$	(7,104)	​	$	(10,905)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:	​	​	​	​	​	​
Depreciation and amortization of property and equipment	​	​	6,716	​	​	5,892
Amortization of deferred financing costs	​	​	189	​	​	134
Amortization of intangible assets	​	​	168	​	​	168
Bad debt expense	​	​	300	​	​	36
Loss / (gain) on disposal of property and equipment	​	​	(58)	​	​	21
Changes in operating assets and liabilities:	​	​	​	​	​	​
Accounts receivable	​	​	224	​	​	(670)
Inventories	​	​	(4,804)	​	​	(9,952)
Prepaid expenses and other current assets	​	​	(53)	​	​	(1,668)
Other non-current assets	​	​	(68)	​	​	(36)
Accounts payable	​	​	(1,447)	​	​	(359)
Accrued expenses	​	​	(306)	​	​	113
Deferred revenues	​	​	55	​	​	2,007
Other current liabilities	​	​	(157)	​	​	301
Other non-current liabilities	​	​	70	​	​	70
Net Cash Used in Operating Activities	​	$	(6,275)	​	$	(14,848)
Cash Flows from Investing Activities	​	​	​	​	​	​
Purchases of property and equipment	​	​	(1,120)	​	​	(3,269)
Proceeds from disposal of property and equipment	​	​	43	​	​	38
Net Cash Used in Investing Activities	​	$	(1,077)	​	$	(3,231)
Cash Flows from Financing Activities	​	​	​	​	​	​
Distribution to parent	​	$	(450)	​	$	(10,000)
Contribution from parent	​	​	800	​	​	7,800
Proceeds from notes payable	​	​	2,352	​	​	—
Advances on line of credit	​	​	4,330	​	​	22,274
Deferred financing costs	​	​	—	​	​	(926)
Payments on capital leases	​	​	(143)	​	​	(325)
Net Cash (Used in) Provided by Financing Activities	​	$	6,889	​	$	18,823
Effects of Exchange Rate Changes on Cash	​	$	165	​	$	81
Net Increase / (Decrease) in Cash	​	$	(298)	​	$	825
Cash – Beginning	​	$	2,000	​	$	1,175
Cash – Ending	​	$	1,702	​	$	2,000
Supplemental Disclosure	​	​	​	​	​	​
Interest paid in cash	​	$	997	​	$	852
Taxes paid in cash	​	​	12	​	​	9
Non-Cash Investing Activities	​	​	​	​	​	​
Net transfers from inventory to property and equipment	​	$	4,717	​	$	8,231
Property and equipment acquired through capital leases	​	​	—	​	​	489

The accompanying notes are an integral part of these Combined Consolidated Financial Statements.

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NOTES TO COMBINED CONSOLIDATED FINANCIAL STATEMENTS

(DOLLARS IN THOUSANDS)

NOTE 1 — NATURE OF OPERATIONS

The combined consolidated financial statements include the combined accounts of FlexEnergy, Inc. (“FEI”) and Flex Leasing Power & Service LLC (“FLPS”), collectively referred to as “the Company”. The Company is headquartered in Portsmouth, New Hampshire with field offices in Colorado, North Dakota, Texas and Canada.

On January 1, 2016, FlexEnergy Power Solutions, LLC (“FPS”) was formed to hold FEI and FLPS. FEI manufactures the GT333 kilowatt turbine, the larger GT1300 kilowatt turbine (“Flex Turbine”) and stand-alone heat recovery products (“Flex Heat Recovery products”). FLPS provides a rental and leasing offering of the turbine generator, particularly in the North America oilfield market. Flex Leasing Power and Services, ULC (“FLPS ULC”), which is wholly-owned by Flex Power Co., is a Canadian entity that supports expansion into the Canadian market. Flex Power Co. is a wholly-owned subsidiary of FLPS.

On December 31, 2020, FPS formed FlexEnergy Green Solutions, Inc. (“FGS”) to be its wholly-owned subsidiary. FPS intends to contribute all of its assets, which consist solely of 100% equity interests in FEI and FLPS, to FGS in exchange for 100% of the equity interests in FGS, which will result in FGS becoming a wholly-owned subsidiary of FPS, and FEI and FLPS becoming wholly-owned subsidiaries of FGS.

The Company is an energy focused technology company that designs, manufactures, sells and leases cost-effective energy solutions that lower its customers’ environmental footprint, often by making useable energy from sources of fuel or heat otherwise overlooked or wasted. The Company’s business consists of leasing and service of the Company’s gas-powered Flex Turbines supported by a vertically integrated original equipment manufacturing (“OEM”) with some direct sales of manufactured products. Leasing and service allows the Company to monetize emerging clean technologies via its Flex Turbine and Flex Heat Recovery products, with consistent revenues and cash flow.

The Company’s Flex Turbines offer a reliable source for distributed or grid connected electrical power, capable of being fired by a wide variety of gaseous fuels from waste gas from landfills and natural gas flaring to higher BTU fuels such as propane and synthetic gas. Leasing and sales of Flex Turbines presently represent the bulk of the Company’s operations and revenues. Flex Turbines provide the Company’s customers with solutions to gain independence over their electricity generation and minimize overall reliance on the grid. In addition, the Company’s Flex Heat Recovery products are integral to promising emerging power sources, such as fuel cells for electrical power.

The Company serves a diverse range of customers in the global oil and gas (“O&G”),transportation, power, and commercial and industrial (“C&I”) end markets. The Company’s primary focus is on base load, distributed, electric generation using Flex Turbines, with the technology base to expand in additional untapped end-markets.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying combined consolidated financial statements include the accounts of FEI and its wholly owned subsidiaries and FLPS and its wholly owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. The Company’s combined consolidated financial statements were prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and include the assets, liabilities, revenues and expenses of all controlled subsidiaries.

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USE OF ESTIMATES

The preparation of the Company’s combined consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the combined consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Significant items subject to such estimates and assumptions include accounting for the accounts receivable allowance, the valuation of long-lived assets including intangible assets with finite lives, useful lives of long-lived assets such as property, equipment and intangible assets, valuation allowances for deferred income tax assets, inventory obsolescence, and exposure related to warranty and other contingent liabilities. Actual results could differ from those estimates.

SEGMENT INFORMATION

The Company is considered to be a single reporting segment. The Company’s chief operating decision makers (“CODM”), the Chief Executive Officer, the Chief Financial Officer and the Chief Commercial Officer, review financial information presented on a combined consolidated basis for purposes of allocating resources and evaluating financial performance. The business activities of this reporting segment are the engineering, production, sales and leasing of its proprietary energy efficient Flex Turbines and Flex Heat Recovery products, and related parts and service.

The Company conducts its business through various offices and facilities located throughout the U.S. and Canada. All the Company’s revenues were to external customers in 2020 and 2019. Of the sales in 2020, $19,960 were sales to the U.S., $2,874 to Canada, and $493 to non-North America countries. Long-lived assets held in the U.S. and Canada at December 31, 2020 were $28,203 and $9,435 respectively. Of the sales in 2019, $23,822 were sales to the U.S., $1,466 to Canada, and $85 to non-North America countries. Long-lived assets held in the U.S. and Canada at December 31, 2019 were $33,435 and $5,064, respectively.

ACCOUNTS RECEIVABLE

Accounts receivable are recorded at the invoiced amount and do not bear interest. Accounts receivable are stated at the amount the Company expects to collect from balances outstanding at year end and represent amounts billed to customers and not yet collected, and are recorded when the right to consideration becomes unconditional. Based on the Company’s evaluation of uncollected accounts receivable at the end of each year, bad debts are provided for using an allowance for doubtful accounts method. The evaluation considers historical trends to identify receivables that the Company believes may be uncollectible. The allowance for bad debt was $45 and $60 as of December 31, 2020 and 2019, respectively.

INVENTORY

Inventory at FEI consists primarily of parts, components, and work in progress for the manufacture and repair of the Flex Turbine and Flex Heat Recovery products. Inventory at FLPS consists primarily of parts, components and turbines that are currently ready for or are being prepared for first time use. Once a turbine has been placed into service, the inventory is transferred to property and equipment. Inventoried parts and components are mainly used for commissioning and/or repairing the turbines. Inventory is valued at the lower of cost or net realizable value and is determined on a the first in, first out (“FIFO”) cost method.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets ranging from three to ten years. Expenditures for repairs and maintenance are charged to expense as incurred, whereas major betterments are capitalized as additions to property and equipment.

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The estimated useful lives used in computing depreciation of property and equipment are as follows:

Asset	Life
Turbines and other equipment	10 years
Leasehold improvements	Shorter of lease term or 10 years
Machinery and equipment	3-7 years
Furniture and fixtures	7 years
Fieldwork equipment	5 years
Computer equipment and software	3-5 years
Vehicles	4-5 years

Leasehold improvements are amortized using the straight-line method over the lesser of the term of the lease or the estimated useful life of the asset. Depreciation of assets leased to customers in the amount of $5,007 and $4,713, for the years ended December 31, 2020 and 2019, respectively is recorded to cost of revenue. All other depreciation, amounting to $1,709 and $1,179, for the years ended December 31, 2020 and 2019, respectively, is recorded to operating expenses within the accompanying combined consolidated statements of operations and comprehensive loss. The Company’s depreciation and amortization expense of property and equipment were $6,716 and $5,892 for the years ended December 31, 2020 and 2019, respectively.

INTANGIBLE ASSETS

Intangible assets, consisting of acquired patents, are presented at cost, net of accumulated amortization. Intangible assets are amortized over their estimated useful life of ten years on a straight-line basis. The Company continues to invest in its intellectual property portfolio and is actively filing for patent protection for its technology in both the U.S. and abroad. The costs, including legal, associated with compiling and filing patent applications are charged to selling, general, and administrative expenses as incurred.

IMPAIRMENT OF LONG-LIVED ASSETS

Long-lived assets such as property and equipment and intangible assets with finite lives are tested for impairment whenever events or circumstances indicate that the carrying amount may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount is not recoverable on an undiscounted cash flow basis, impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models and third-party independent appraisals, as considered necessary. The Company believes that there were no events or changes in circumstances that would trigger an impairment analysis for the years ended December 31, 2020 and 2019.

REVENUE RECOGNITION

The Company’s revenue consists of turbine leasing fleet revenue, the sales of manufactured Flex Turbine and Flex Heat Recovery products, and service revenues on sold product. Revenue is recognized upon transfer of control of the promised goods or the Company’s performance of the services to its customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services.

The Company excludes sales tax collected from customers from revenue in its combined consolidated statements of operations and comprehensive loss.

Significant Judgments — Contracts with Multiple Performance Obligations

A performance obligation is a promise in a contract with a customer to transfer products or services that are distinct. Determining whether products and services are distinct performance obligations that

F-12

should be accounted for separately or combined as one unit of accounting may require significant judgment. The Company enters into contracts with its customers to manufacture Flex Turbines and Flex Heat Recovery products and provides certain products, parts, and accessories, collectively referred to as “products.” The Company will also provide services associated with these products and parts including commissioning and maintenance services, collectively referred to as “services.” These services are distinct and separate contractual arrangements.

Contracts may contain multiple products within the same agreement. However, each product is distinct as they are sold separately and revenue is only recorded when the individual product is completed and control of the product is transferred. Service contracts, and services noted within such contracts, are similar in that each service is distinct. Each service is explicitly stated in the contracts where the Company provides maintenance repairs and labor services in exchange for a fixed-rate per month per turbine. Revenue from maintenance service contracts is recognized over the term of the contract at the agreed upon monthly service fee as defined in the contract, while commissioning revenue is recognized at the agreed upon commissioning fee amount as defined within the contract once the Flex Turbine is installed and begins generating energy for the customer. The maintenance service contracts and commissioning revenue are each considered distinct and separated from other obligations in the contract since (i) the customer is able to benefit from the good or service separately or together with other resources made available through the arrangement and (ii) the services are each separately identifiable from the others provided in the contract.

Once distinct performance obligations are identified within a contract, the Company allocates the transaction price to each performance obligation on a relative standalone selling price (“SSP”) basis. The SSP is the price at which the Company would sell a promised product or service separately to a customer.

Turbine Leasing Fleet

Turbine leasing fleet revenue consists of revenue generated on the Company’s owned fleet of Flex Turbines and owned ancillary field equipment that supports the turbines fleet’s generation in the field. It primarily consists of recurring monthly revenue associated with executed rental agreements (“Generator Rental Agreements”) where the Company is the lessor to the third-party customers. Leases can cover multiple Flex Turbine units and explicitly assert the monthly lease payment due over the length of the agreement (typically 12-36 months). Revenue is recognized over time over the duration of the lease, which represents the Company’s obligation to the customer. All current leases are classified as operating leases. Additionally, there are no “rent increases” contained within any of the Company’s current leasing agreements and lease payments are due to the Company in exchange for the use of the Flex Turbine generator and coverage for routine maintenance and monitoring. These agreements typically include preventative and regular maintenance costs embedded within the lease payment (“executory costs”) over the term of the agreement. Such executory costs are considered non-lease components with revenue recognized on a straight-line basis. Lease and non-lease revenue is distinct between the fee to use Flex Turbine and the amount that covers continuous remote monitoring and maintenance. Turbine leasing fleet revenue also includes (i) commissioning of leased units (ii) one-off billings to customers for repairs of leased Flex Turbine units outside the scope of the rental agreement and (iii) the rental of owned ancillary field assets such as standby diesel generators and automatic transfer switches.

Manufactured Product Sales

The Company’s standard terms of sales of new Flex Turbines and Flex Heat Recovery products to channel partners and direct end-users include transfer of title, care, custody and control of the goods at the point of shipment, payment terms ranging from full payment in advance of shipment to payment in 90 days, no right of return or exchange, and no post-shipment performance obligations except for standard warranties provided on the products and parts sold. The Company offers standard assurance type warranty that its products and parts sold will operate free of material defects and function for a period of the greater of 18 months from delivery or 12 months from commissioning of the unit. Once the standard warranty expires, customers have the option to purchase service/maintenance coverage at a fixed rate. Revenue is recognized upon transfer of control of the promised goods to the Company’s customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods. Title and risk of loss or

F-13

damage to products passes to the purchaser of newly manufactured Flex Turbines and Flex Heat Recovery products upon production test completion and tender of delivery to the carrier at the Company’s U.S. manufacturing facility. The Company recognizes revenue in certain circumstances before product delivery occurs (commonly referred to as bill-and-hold transactions). Revenue from bill-and-hold transactions is recognized when all specific requirements for transfer of control under a bill-and-hold arrangement have been met which include, among other things, a request from the customer that the product be held for future delivery. For these bill-and-hold arrangements, the associated product inventory is identified separately as belonging to the customer and is ready for physical transfer.

Service on Sold Product

Service performed by the Company consists primarily of commissioning and maintenance services on units sold to third-party customers. Customers with purchased units in operation that are out of warranty will contact the Company for replacement parts on their turbine generators such as a replacement engine. Once the customer agrees to the pricing and terms for the service order and places a purchase order, the Company will deliver the parts to the customer, recognizing revenue once the performance obligation is met.

Contracts for services are initiated through Service Request Orders (“SROs”), related to a combination of parts and labor. Like parts only, the Company will provide the customer with a quote for the service work and once accepted, will work to satisfy the transaction’s performance obligations and recognized revenue once parts are shipped and/or services have been rendered.

Service revenue also relates to commissioning Flex Turbines sold to third-party customers at the customers’ sites. This is a separate performance obligation from the purchase order to manufacture Flex Turbines. Typically, commissioning of manufactured units takes place within two months of tender for shipment, but can be delayed for up to several months based on when the customer submits its request for commissioning of the units and the commissioning takes place.

Lastly, the Company also provides maintenance service contracts on the existing installed base of Flex Turbines sold to its third-party customers. The maintenance service contracts are agreements to perform certain services to maintain a product for a specified period of time. Service revenue derived from maintenance service contracts is explicitly for the months covered and recognized over time on a straight-line basis over the length of the contract period, which represents the Company’s obligation to the customer.

Practical Expedient

The Company applies a practical expedient to expense costs as incurred for costs to obtain a contract when the amortization period would have been one year or less. These costs are recorded within selling, general and administrative expenses.

INCOME TAXES

FLPS is taxed as a disregarded entity for U.S. federal tax purposes, and the operations are not subject to U.S. federal income tax other than the operations that are conducted through taxable subsidiaries. FLPS may incur income taxes that are subject to withholding requirements related to certain of operations within Canada and other foreign countries in which the Company operates. FEI and Flex Power Co. income taxes are accounted for utilizing the asset and liability approach. Under this method, deferred tax assets and liabilities are recognized for the anticipated future tax consequences attributable to differences between the combined consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred amounts are measured using enacted tax rates expected to apply to taxable income in the year those temporary differences are expected to be recovered or settled.

In assessing the realizability of the deferred income tax assets, including net operating loss and state tax credit carryforwards, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon evaluating both positive and negative evidence in making this assessment, of which

F-14

management determined the need for a valuation allowance on all net deferred tax assets. Further, the Company recognizes interest expense (income) and penalties on uncertain tax positions and income tax deficiencies (refunds) in income tax expense in the accompanying combined consolidated statements of operations and comprehensive loss.

In January 2018, the FASB released guidance on the accounting for tax on the global intangible low-taxed income (“GILTI”) provisions of the Act. The GILTI provisions impose a tax on foreign income in excess of a deemed return on tangible assets of foreign corporations. The guidance indicates that either accounting for deferred taxes related to GILTI inclusions or to treat any taxes on GILTI inclusions as period costs are both acceptable methods subject to an accounting policy election. As of December 31, 2018, the Company elected to account for GILTI as a period cost in the year the tax is incurred.

FOREIGN CURRENCY TRANSACTIONS

The financial statements of an international subsidiary, FLPS ULC, are translated into the functional reporting currency of the Company (USD) using the exchange rate in effect at each balance sheet date for assets and liabilities. Revenues and expenses were translated to USD at the average exchange rate for the period. Resulting currency translation adjustments are recorded as a component of accumulated other comprehensive loss through the cumulative translation adjustment (“CTA”) account. Foreign exchange transaction gains and losses are recorded in the combined consolidated statements of operations and comprehensive loss in other income (expense), net.

The Company cannot guarantee that the current exchange rate will remain steady; therefore, there is a possibility that the Company could post the same amount of profit for comparable periods and because of the fluctuating exchange rate, actually post higher or lower profit depending on the exchange rate of Canadian Dollar (“CAD”) converted to USD on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice.

PRODUCT WARRANTY

The Company provides for the estimated cost of product warranties at the time revenue is recognized. Warranty terms are for the greater of 18 months from delivery or 12 months from commissioning of the unit, to repair or replace any defective component in equipment supplied by the Company. The provision for product warranty is based primarily on historical rates, sales history and other considerations. The provision for product warranty was $90 and $276 for 2020 and 2019, respectively, and is reported within the classification of manufactured product cost of revenue in the accompanying combined consolidated statements of operations and comprehensive loss. Accrued product warranties were $526 and $644 for the years ended December 31, 2020 and 2019, respectively, and are reported within accrued expenses in the accompanying combined consolidated balance sheet.

RESEARCH AND DEVELOPMENT

Research and development costs are expensed as incurred and reported in research and development costs in the accompanying combined consolidated statements of operations and comprehensive loss. Costs were $120 and $237 for the years ended December 31, 2020 and 2019, respectively.

RECENT ACCOUNTING PRONOUNCEMENTS

Emerging growth company

The Company is an “emerging growth company” as defined in the Jumpstart Our Business Startups Act (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies.

Effective January 1, 2019, the Company adopted Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (“ASC 606”). The standard applies to all contracts with customers,

F-15

except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements and financial instruments. The Company adopted the new revenue standard using the modified retrospective method in accordance with ASC 606 on January 1, 2019.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ASU 2016-02” or “Topic 842”). The purpose of ASU 2016-02 is to provide financial statement users a better understanding of the amount, timing, and uncertainty of cash flows arising from leases. The adoption of ASU 2016-02 will result in the recognition of a right-of-use asset and a lease liability for all leases. New disclosure requirements include qualitative and quantitative information about the amounts recorded in the financial statements. In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842), which provides additional implementation guidance on the previously issued ASU 2016-02 Leases (Topic 842). ASU 2016-02 requires a lessee to recognize assets and liabilities on the balance sheet for all leases with lease terms greater than 12 months. ASU 2016-02 requires a modified retrospective transition by means of a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year in which the guidance is effective with the option to elect certain practical expedients and accounting policy elections. ASU 2016-02 will be effective for the Company for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. ASU 2020-05 extended the adoption to fiscal years beginning after December 15, 2021, with interim periods within fiscal years beginning after December 15, 2022. The Company is currently evaluating the impact of the adoption of this update on its combined consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326) (“ASU 2016-13” or “Topic 326”), which requires that all financial assets measured at amortized cost to be evaluated for current expected credit losses. Under the new guidance, immediate recognition of credit losses expected over the life of a financial instrument is required. The pronouncement eliminates the incurred credit loss impairment methodology and replaces it with an expected credit loss concept based on historical experience, current conditions, and reasonable and supportable forecasts. Early adoption is permitted. Topic 326 requires a modified retrospective approach by recording a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. ASU 2016-13 will be effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently evaluating the impact of the adoption of this update on its combined consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to intraperiod tax allocation, interim period income tax calculation methodology, and the recognition of deferred tax liabilities for outside basis differences. It also simplifies certain aspects of accounting for franchise taxes and clarifies the accounting for transactions that results in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for us the first quarter of fiscal 2021. There were no significant income tax implications to the Company’s tax provision as a result of the change in guidance.

In March of 2020, the FASB issued ASU 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASC 848, Reference Rate Reform) (“ASU 2020-04” or “Topic 848”) which provides guidance for contract modifications and certain hedging relationships associated with the transition from reference rates that are expected to be discontinued. The guidance provides optional expedients and exceptions for applying GAAP to contracts or other transactions affected by reference rate reform if certain criteria are met. The guidance was issued on March 12, 2020 and may be applied prospectively through December 31, 2022. The Company is evaluating applicable contracts and transactions to determine whether to elect the optional guidance. The adoption of this standard is not expected to have a material impact on the Company’s combined consolidated financial statements.

NOTE 3  — GOING CONCERN

The accompanying combined consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company’s financial position and operating results raise substantial doubt about its ability to continue as a going concern within one year after the date of the

F-16

combined consolidated financial statements are issued. The Company has sustained net losses of $7,104 and $10,905 for the years ended December 31, 2020 and 2019, respectively, has sustained negative cash flow from operations of $6,275 and $14,848 for the years ended December 31, 2020 and 2019, respectively and has an accumulated deficit of $132,121 as of December 31, 2020. The ability of the Company to continue as a going concern is dependent upon (i) expanding operations, (ii) obtaining additional capital and (iii) reducing operating expenses and/or selling existing turbine assets should this be required to preserve liquidity. Management’s plan in this regard is to implement the Company’s business plan and to secure additional funds through equity or debt financing. There can be no assurance that such alternate financing, if available, can be obtained on acceptable terms. The combined consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 4 — REVENUE RECOGNITION

Disaggregation of Revenue

The Company disaggregates revenue from contracts with customers by product type. The Company believes that this aggregates the payor types by nature, amount, timing, and uncertainty of its revenue streams. The following table summarizes the Company’s disaggregated revenues for the years ended December 31, 2020 and 2019:

​	2020			2019
Manufactured product	​	$	3,276	​	$	5,716
Turbine service on sold product	​	​	2,213	​	​	2,824
Total non-lease revenue	​	$	5,489	​	$	8,540
Turbine leasing fleet revenue	​	​	17,838	​	​	16,833
Total revenue	​	$	23,327	​	$	25,373

Contract Balances

Contract liabilities consist of advance payments for goods as well as deferred revenue on service obligations and extended warranties. All of the Company’s deferred revenue is included in current liabilities under deferred revenue.

The following is a summary of the Company’s contract balances as of December 31, 2020 and 2019:

​	2020			2019
Turbine leasing fleet	​	$	1,548	​	$	2,318
Turbine service on sold product	​	​	318	​	​	376
Manufactured product	​	​	442	​	​	—
Other	​	​	153	​	​	306
Total trade accounts receivable	​	$	2,461	​	$	3,000
Contract assets	​	$	2,461	​	$	3,000
Allowance for doubtful accounts	​	​	(45)	​	​	(60)
Total trade accounts receivable, net	​	$	2,416	​	$	2,940

The amount of revenue recognized that was included in the deferred revenue on service obligations and extended warranty balance at the beginning of 2020 and 2019 was $193 and $58, respectively.

At December 31, 2020 and 2019, the Company had $1,849 and $1,794, respectively, of remaining performance obligations, which are included in deferred revenue. The Company expects to recognize approximately 100% of its remaining performance obligations as of December 31, 2020 as revenue during 2021. The Company recognized 100% of its remaining performance obligations as of 2019 as revenue during 2020.

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Bill-and-Hold Revenue

Certain customer arrangements consist of bill-and-hold characteristics under which the criteria for transfer of control is met, including the passing of title and significant risk and reward of ownership to the customers. Therefore, the customers are able to direct the use of the bill-and-hold inventory while the Company retains physical possession of the product until it is installed at a customer site at a point in time in the future. Revenue recognized in a bill-and-hold arrangement for the years ended December 31, 2020 and 2019 was $3,235 and $0, respectively.

Lessor Revenue

The Company’s lessor portfolio includes only operating leases. The following table presents future operating lease payments under non-cancellable lease arrangements to be received as of December 31, 2020:

Years ended December 31,	​	​
2021	$	7,912
2022	​	491
Total	$	8,403

NOTE 5 — INVENTORY

Inventory is stated at the lower of cost or net realizable value and consisted of the following as of December 31, 2020 and 2019:

​	2020			2019
Raw materials	​	$	9,367	​	$	9,804
Work in process	​	​	935	​	​	1,315
Finished goods	​	​	3,357	​	​	2,452
Total inventories, net	​	$	13,659	​	$	13,571

NOTE 6 — PROPERTY AND EQUIPMENT

Property and equipment consisted of the following as of December 31, 2020 and 2019:

​	2020			2019
Turbines and other equipment	​	$	61,973	​	$	57,416
Machinery and equipment	​	​	5,146	​	​	5,432
Leasehold improvements	​	​	782	​	​	2,447
Fieldwork equipment	​	​	4,032	​	​	4,339
Computer equipment and software	​	​	1,074	​	​	855
Vehicles	​	​	274	​	​	308
Furniture and fixtures	​	​	540	​	​	603
Property, plant and equipment, gross	​	$	73,821	​	$	71,400
Accumulated depreciation	​	​	(38,432)	​	​	(34,295)
Construction in progress	​	​	1,117	​	​	—
Property, plant and equipment, net	​	$	36,506	​	$	37,105

The Company has equipment that is used by customers under lease arrangements. The remaining property and equipment are used by the Company for the manufacture of machines and related assets. Depreciation expense for equipment used by customers under lease arrangements was $5,007 and $4,713 for

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the years ended December 31, 2020 and 2019, respectively. The gross asset cost and accumulated depreciation for equipment used by customers under lease arrangements as of December 31, 2020 were $36,518 and $15,117, respectively. As of December 31, 2019, the gross asset cost and accumulated depreciation for equipment used by customers under lease arrangements were $52,942 and $22,117, respectively. The Company recognized a gain on disposal of property and equipment of $58 for the year ended December 31, 2020 and a loss on disposal of property and equipment of $21 for the year ended December 31, 2019.

NOTE 7 — INTANGIBLE ASSETS

Intangible assets consisted of the following as of December 31, 2020 and 2019:

​	2020			2019
Patents	​	$	1,680	​	$	1,680
Accumulated amortization	​	​	(1,344)	​	​	(1,176)
Intangible assets, net	​	$	336	​	$	504

Definite-lived intangible assets had a weighted-average remaining useful life of 2.0 years and 3.0 years as of December 31, 2020 and 2019, respectively.

The amortization of intangible assets was $168 for each of the years ended December 31, 2020 and 2019. The estimated annual amortization expense based on the intangible asset balance for the next two years as of December 31, 2020:

Year ending December 31,	​	​
2021	$	168
2022	​	168
Total	$	336

NOTE 8 — DEFERRED REVENUE

Deferred revenue consists of billed amounts collected in advance from various customers for service obligations and deposits on future orders. The durations of the service agreements range between 12 and 120 months. Customer deposits on future orders are non-interest bearing and non-refundable. Deferred revenue was $1,849 and $1,794 at December 31, 2020 and 2019 respectively.

NOTE 9 — LEASES

The Company is obligated under operating leases for locations and apartments in New Hampshire, Colorado, North Dakota, Texas and Canada. Minimum rent payments under operating leases are recognized on a straight-line basis over the term of the related leases. In December 2020, the Company entered into a lessee sublease agreement with Pioneer New Hampshire LLC for approximately 5,800 rentable square feet of office space in Portsmouth, New Hampshire. This lease, which was entered into when the Company vacated its previous Portsmouth office space, expires in June 2024 with options to renew for up to an additional six years. In January 2019, the Company entered into a lease agreement for warehouse and manufacturing space in Dover, New Hampshire, with approximate monthly payments of $19 which expires in May 2024. There are no future minimum lease payment obligations after May 2024. The Company is also obligated under capital lease obligations related to vehicles and forklifts. Depreciation on these assets is recorded on a straight-line basis over the term of the lease and is included within depreciation expense. Minimum rent payments under operating leases are recognized on a straight-line basis over the term of the lease. The Company recorded rental expense of $2,117 and $2,038 related to the leases for the years ended December 31, 2020 and 2019, respectively.

In January 2020, FLPS entered into the First Amendment to Office Lease (the “First Amendment”) with GPI Plaza Tower, LP to acquire approximately 1,978 of additional rentable square feet for the Colorado

F-19

office space as provided in the original Office Lease dated February 19, 2018. The lease term is approximately 5.5 years and is approximately $301 per year.

The future minimum lease payments under the Company’s capital and operating leases were as follows as of December 31, 2020:

Year ended December 31,	Capital Leases			Operating Leases
2021	​	$	153	​	$	1,363
2022	​	​	136	​	​	1,063
2023	​	​	58	​	​	866
2024	​	​	—	​	​	398
Total future minimum lease obligation	​	$	347	​	$	3,690
Less interest on capital leases	​	​	(26)	​	​	​
Net present value of capital lease obligations	​	$	321	​	​	​
Less current portion	​	​	(148)	​	​	​
Capital lease obligations, long term	​	$	173	​	​	​

NOTE 10 — INCOME TAXES

The income tax expense is composed of the following for the years ended December 31, 2020 and 2019:

​	2020			2019
Current	​	​	​	​	​	​
Federal	​	$	—	​	$	—
State	​	​	31	​	​	7
Foreign	​	​	—	​	​	—
Total current	​	$	31	​	$	7
Deferred	​	​	​	​	​	​
Federal	​	$	—	​	$	—
State	​	​	—	​	​	—
Foreign	​	​	—	​	​	—
Total deferred	​	​	​	​	​	​
Total income tax expense	​	$	31	​	$	7

The reconciliation of the Company’s effective taxes to the statutory federal income taxes is as follows for the years ended December 31, 2020 and 2019:

​	2020				2019
Income tax at statutory rate	​	$	(1,485)	21.0%	​	$	(2,289)	21.0%
State income taxes net of federal benefit	​	​	(435)	6.1%	​	​	(729)	6.7%
Income taxed at partnership level	​	​	207	(2.9)%	​	​	297	(2.7)%
Foreign rate differential	​	​	(57)	0.8%	​	​	13	(0.1)%
Permanent differences	​	​	29	(0.4)%	​	​	33	(0.3)%
State rate change	​	​	692	(9.8)%	​	​	228	(2.1)%
Valuation allowance	​	​	962	(13.6)%	​	​	2,132	(19.6)%
Other	​	​	118	(1.6)%	​	​	322	(2.9)%
Provision for income taxes	​	$	31	(0.4)%	​	$	7	0.0%

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The effective tax rate for the years ended December 31, 2020 and 2019 differs from the statutory federal tax rate primarily due to state income taxes, and the valuation allowance being applied to the federal and state deferred tax assets.

Significant components of the Company’s deferred tax assets consist of the following as of December 31, 2020 and 2019:

​	2020			2019
Net operating loss carryforwards	​	$	17,095	​	$	16,201
Interest limitation carryforward	​	​	8	​	​	4
Reserves and accrued expenses	​	​	641	​	​	633
Intangibles	​	​	102	​	​	89
Inventory	​	​	627	​	​	635
Gross deferred tax assets	​	$	18,473	​	$	17,562
Valuation allowance	​	​	(17,857)	​	​	(16,896)
Net deferred tax assets	​	$	616	​	$	666
Fixed assets	​	$	(616)	​	$	(666)
Gross deferred tax liabilities	​	$	(616)	​	$	(666)
Net deferred tax asset	​	$	—	​	$	—

Management believes that it is more likely than not the Company will not realize all the tax benefits of the deferred tax assets within the allowable carryforward period. Therefore, an appropriate valuation allowance has been provided. The valuation allowance as of December 31, 2019 primarily relates to U.S. federal and state deferred tax assets. The increase in the valuation allowance during the year ended December 31, 2020 was $961.

At December 31, 2020, the Company had federal, state and foreign net operating loss carryforwards of $106,855, $78,223 and $219, respectively, which will expire, if unused, beginning in 2031, 2026, and 2035 respectively. The federal net operating losses of $29,481 generated post-Tax Cuts and Jobs Act (“the Tax Act”) for the tax years ended December 31, 2018 and thereafter have an indefinite carryforward period and do not expire.

The Company’s ability to utilize net operating loss (“NOL”) carryforwards and other tax attributes to reduce future federal taxable income is subject to potential limitations under Internal Revenue Code Section 382 (“Section 382”) and its related tax regulations. The utilization of these attributes may be limited if certain ownership changes by 5% stockholders (as defined in Treasury regulations pursuant to Section 382) and the effects of stock issuances by the Company during any three-year period result in a cumulative change or more than 50% in the beneficial ownership of the Company.

The Company performed a Section 382 analysis to determine if an ownership change has occurred. It has been preliminarily determined that ownership changes occurred under these rules, and an annual limitation on the use of pre-ownership change NOL carryforwards and certain other losses and/or credits has been applied. The preliminary analysis indicates $48,398 of federal net operating loss carryforwards will expire unutilized. The Company has adjusted deferred tax asset accordingly.

In addition, certain future transactions regarding the Company’s equity, including the cumulative effects of small transactions as well as transactions beyond the Company’s control, could cause an ownership change and therefore a potential limitation on the annual utilization of their deferred tax assets.

For the year ended December 31, 2020, the Company has reflected an uncertain tax liability of $3 associated with tax positions taken on the Company’s historic tax returns. Interest and penalties, to the extent there are any, are included in income tax expense. As a result of historic losses, there was no interest or penalties accrued during or for the year ended December 31, 2020.

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A reconciliation of the beginning and ending amounts of unrecognized tax benefits were as follows:

Unrecognized tax benefits January 1, 2020	$	3
Gross decrease for tax positions of prior year	​	—
Gross increase for tax positions of current year	​	—
Unrecognized tax benefits December 31, 2020	$	3

The Company is subject to taxation in the United States and various state and foreign jurisdictions. The Company currently does not have any tax examinations in progress nor has it had any tax examinations since its inception. All of the Company’s tax years will remain open for examination by federal and state authorities for three and four years, respectively, from the date of utilization of any net operating losses and tax credits.

On December 22, 2017, the 2017 U.S. Tax Act was signed into law. The Tax Act reduced tax rates and modified certain policies, credits, and deductions and modified certain international tax provisions. The Tax Act reduced the federal corporate tax rate from a maximum of 35 percent to a flat 21 percent rate for tax years beginning after December 31, 2017. As such, the federal statutory rate was 21 percent for the year ended December 31, 2020.

The Tax Act also includes provisions for certain foreign-sourced earnings referred to as Global Intangible Low-Taxed Income (“GILTI”), Foreign Derived Intangible Income (“FDII”) and Base Erosion and Anti-abuse Tax (“BEAT”). None of which had an impact on the Company for the current period.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) was enacted into law. The CARES Act is aimed at providing emergency relief and health care for individuals and businesses affected by the COVID-19 pandemic. The CARES Act, among other things, includes provisions related to refundable payroll tax credits, deferral of the employer portion of social security payments, expanded net operating loss application, modifications to the net interest deduction limitations, and technical corrections to tax depreciation methods for qualified improvement property. The Company has completed its assessment of the impact of the legislation, and there is no significant impact to the combined consolidated financial statements due to the valuation allowance in the US.

As of December 31, 2020, the Company had no accumulated undistributed foreign earnings as Canada has historical losses. No additional income taxes have been provided for any remaining undistributed foreign earnings not subject to the transition tax, or any additional outside basis difference inherent in these entities, as these amounts continue to be indefinitely reinvested in foreign operations.

NOTE 11 — INDEBTEDNESS

Debt consisted of the following as of December 31, 2020 and 2019:

​	2020			2019
Line of credit	​	$	26,658	​	$	22,274
Note payable	​	​	2,352	​	​	—
Total debt	​	$	29,010	​	$	22,274
Less current debt	​	​	(1,300)	​	​	—
Total long-term debt	​	$	27,710	​	$	22,274

Line of Credit

On February 8, 2019, FLPS entered into a senior secured revolving credit facility (“the Credit Agreement”) with Texas Capital Bank, National Association (“TCB”). The initial commitment amount is for $30,000 and availability under the Credit Agreement is based on a borrowing base calculation of eligible

F-22

assets and other conditions. The facility is backed by a first priority lien on substantially all of the assets of FLPS, and the maturity date of the facility is February 8, 2024. The facility contains various covenants that limits the Company’s ability to, among other things, make restricted payments. Interest is defined based on a tiered leverage ratio and an applicable margin of (i) 1.50% to 2.00% above the base rate for base rate loans, or (ii) 2.50% to 3.00% above the adjusted Eurodollar rate for Eurodollar rate loans. Leverage ratio means as of the last day of the last fiscal month of each fiscal quarter, the ratio of (i) all debt and (ii) annualized EBITDA. Base Rate means, for any day, the highest of (a) Prime Rate; (b) the sum of the Federal Funds Rate for the day plus half of one percent (0.50%); and (c) the adjusted Eurodollar Rate for the day plus one percent (1.00%). FLPS is charged a commitment fee based on the daily average unused portion of the revolving credit facility, and that fee ranges from 0.225% to 0.475% per daily average. Additionally, FLPS is charged a letter of credit fee of between 2.50% and 3.00% per quarter with respect to the amount of letters of credit issued under the revolving credit facility. The applicable margin for loans, the commitment fee and the letter of credit fee set forth above will vary quarterly based on the Company’s leverage ratio. Based on the leverage ratio applicable at December 31, 2020, the margin and base rate were 3.00% and 1.44%, respectively; the commitment fee for the unused portion of the revolving credit facility was 0.225%; and the letter of credit fee was 3.00%. FLPS is subject to financial covenants of a maximum leverage ratio and minimum fixed charge coverage ratio to be tested quarterly. The maximum permitted leverage ratio is 3.50 to 1.00. The minimum fixed charge coverage ratio is 1.25 to 1.00. For the quarter ended December 31, 2020, the Company had an event of non-compliance with respect to the leverage ratio.

On February 12, 2021, the Company entered into a Limited Waiver of Leverage Ratio (the “Waiver”) with TCB pursuant to which the foregoing default event under the Credit Agreement was waived. In consideration of the waiver, (i) the Company agreed to pay TCB a fee of $22 upon execution of the Waiver, (ii) the Company made a $1,500 EBITDA equity contribution to FLPS (the “Waiver Contribution”), and (iii) FLPS made a $1,500 prepayment of its obligations to TCB under the Credit Agreement (the “Prepayment”). The Waiver also amended the Credit Agreement to increase the annualized EBITDA used to calculate the quarterly financial covenants, as well as decrease the availability under the revolving credit facility, by the amount of the Waiver Contribution. FPS contributed $1,500 to the Company to fund the Waiver Contribution and Prepayment made to TCB.

Gross borrowings outstanding under this revolving credit facility amounted to $26,658 and $22,274 as of December 31, 2020 and 2019, respectively. This amount includes $10,000 of permitted distributions taken in 2019 as further described in Note 14. The Company incurred $27 in financing costs related to amendments to its existing revolving credit facility in 2020. In addition, financing costs were incurred in 2019 in relation to securing the revolving credit facility, which amounted to $926. These financing costs were capitalized under deferred financing costs on the combined consolidated balance sheet. Deferred financing costs are amortized to interest expense over the term of the agreement using the effective interest method. Amortization expense was $189 and $134 for the years ended December 31, 2020 and 2019, respectively.

On January 27, 2020, FLPS entered into an amendment to the Credit Agreement (“First Amendment”) and First Amendment to Pledge and Security Agreement with TCB. Under the terms of the amendment, the borrowing base was amended to include certain non-turbine field equipment which was previously not included.

On August 28, 2020, FLPS entered into the Second Amendment to Credit Agreement with TCB. Under the terms of the amendment, certain terms within the borrowing base definition of accounts receivables relating to investment grade and non-investment grade customers were modified.

On December 21, 2020, FLPS entered into the Third Amendment to Credit Agreement with TCB. Under the terms of the amendment, FLPS ULC was added as an additional loan party to the Credit Agreement. As of December 31, 2020 and 2019, the amounts available for drawdown were $1,429 and $7,726, respectively.

PPP Loans

In 2020, the Company entered into loan agreements under the Small Business Administration (the “SBA”) Paycheck Protection Program (“PPP”) enabled by the CARES Act. On April 14, 2020, TCB

F-23

entered into a note with FLPS and agreed to make available to FLPS a loan in the amount of $991. On May 6, 2020, Bank of America, N.A. (“Bank of America”) entered into a note with FEI and agreed to make available to FEI a loan in the amount of $1,361 (together, the “PPP Loans”). The PPP Loans bear interest at a rate per annum of 1.00%. The term of the PPP Loans are two years, ending April 14, 2022 and May 6, 2022, respectively.

The PPP Loans may be forgiven partially or in full if the funding received is used for payroll costs, interest on mortgages, rent, and utilities, provided that at least 60% of the forgiven amount has been used for payroll costs. Forgiveness is based on the Company maintaining, or quickly rehiring employees and maintaining applicable salary levels and is subject to the approval of the SBA. The PPP Loans are recorded as current portion of notes payable and notes payable, net of current portion on the accompanying combined consolidated balance sheets at December 31, 2020.

The Company used the proceeds to support qualifying expenses such as payroll costs, rent and utilities in accordance with the relevant terms and conditions of the CARES Act.

In 2021, the Company applied for forgiveness on its PPP Loans. The Company will account for forgiveness on the PPP Loans in accordance with ASC 470 – Debt (“ASC 470”) and record a gain on extinguishment of debt on its combined consolidated financial statements and related footnote disclosures, provided the forgiveness is approved by the SBA.

Future minimum principal payments due on the line of credit and PPP Loans are as follows as of December 31, 2020:

For the year ending December 31,	​	​
2021	$	1,300
2022	​	1,052
2023	​	—
2024	​	26,658
Total future principal payments	$	29,010

NOTE 12 — CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS

The Company’s three largest customers accounted for approximately 23%, 14%, and 10% of total revenue for the year ended December 31, 2020. In 2019, sales to the Company’s largest customer amounted to 28% of its total revenue. As of December 31, 2020, two customers accounted for 15% and 14% of the accounts receivable balance. As of December 31, 2019, one customer accounted for 32% of the accounts receivable balance. No single supplier accounted for more than 10% of the total cost of revenue for the years ended December 31, 2020 and 2019.

Cash could potentially subject the Company to concentrations of credit risk. However, because the Company maintains its cash with high-quality, accredited financial institutions, such funds are subject to minimal credit risk. The Company may maintain balances with financial institutions in excess of federally insured limits. The Company has not experienced any losses historically in these accounts and believes it is not exposed to significant credit risk in its cash.

NOTE 13 — COMMITMENTS AND CONTINGENCIES

Litigation and Legal Proceedings

Any material legal, tax or regulatory proceedings regarding matters arising in the ordinary course of business, which involve the Company’s assessment to determine the probability of whether a loss will occur and, if probable, its best estimate of probable loss. The Company records and discloses losses when these losses are probable and reasonably estimable, and discloses matters when losses are probable but not estimable

F-24

or when losses are reasonably possible. Legal costs related to the defense of loss contingencies are expensed as incurred. The Company is not currently involved in legal proceedings that could reasonably be expected to have a material adverse effect on our business, prospects, financial condition or results of operations.

Guarantees and Indemnifications

Between December 2015 and December 31, 2019, FPS issued a series of promissory notes with various investors that together, along with FPS’ affiliates, account for a majority of FPS’ voting equity and representation of its board of directors (the “Investor Notes”). The Investor Notes bear interest at an annualized rate ranging between 8.0% and 12.0% and are pre-payable without penalty at any time. The Investor Notes have a maturity date of June 30, 2022. FPS has the option to receive monthly interest in cash or to accrue monthly interest.

Prior to the closing of the Credit Agreement in February 2019, the Investor Notes were secured by a first priority lien of all assets of the Company and its subsidiaries. In connection with closing of the Credit Agreement, all noteholders of the Investor Notes entered into a Subordination and Intercreditor Agreement with TCB whereby all Investor Notes currently in place, and all future Investor Notes in substantially the same form, were from thereon secured by a second priority lien of all assets of FLPS and its subsidiaries, while the Investor Notes retained their first priority lien in all assets of all other existing and future subsidiaries of FPS.

NOTE 14 — RELATED PARTY TRANSACTIONS

The Company distributed $450 and $10,000, respectively, to FPS during the years ended December 31, 2020 and 2019. In addition, during the years ended December 31, 2020 and 2019, $800 and $7,800, respectively, were re-contributed to the Company for working capital purposes. There are no terms and conditions associated with the repayment of either of these amounts. The contributions were recorded within the Company’s net parent investment at December 31, 2020 and 2019.

NOTE 15 — EMPLOYEE BENEFIT PLAN

The Company sponsors defined contribution 401(k) plans covering substantially all of its employees. The plans entitle employees, almost immediately after their start date, to make voluntary contributions to the plans. Contributions cannot exceed the maximum amount allowed under applicable provisions of the Internal Revenue Code (the “Code”). The Company provided a matching contribution of 100% up to 6% of base salary. Employees are vested in the matching contributions immediately. The Company’s contributions to the plans amounted to approximately $342 and $609 for the years ended December 31, 2020 and 2019, respectively.

NOTE 16 — INCENTIVE PLANS

FlexEnergy, Inc. 2013 Equity Incentive Plan

On January 1, 2013, FEI implemented a long-term compensation incentive plan under which employees, officers, directors and other individuals providing services to FEI are eligible to receive cash payment awards (the “2013 Plan”). The values of each eligible payment under the 2013 Plan has been fixed through the amendment made on October 27, 2016 and there will be no further grants made. No forfeitures have been recognized under the 2013 Plan. An aggregate payout of $633 is due to the participants on the earlier of January 1, 2023 or when certain change in control terms (as provided below) are met. Under the 2013 Plan, a “Change in Control” will have occurred if a single shareholder or shareholder group obtains effective control of FEI, or upon a liquidation or dissolution. The weighted average contractual life remaining is 1.94 years for options outstanding and exercisable. The liability of $492 and $422 are recorded within Other non-current liabilities on the accompanying combined consolidated balance sheets as of December 31, 2020 and 2019, respectively. Share-based compensation expense was $70 and $71 for the 2013 Incentive Plan during the years ended December 31, 2020 and 2019, respectively, and was recorded in selling, general and administrative operating expenses on the accompanying combined consolidated statements of operations and comprehensive loss.

F-25

FlexEnergy, Inc. 2016 Target Incentive Plan (Participation Plan)

On October 27, 2016, FEI adopted the 2016 Target Incentive Plan (the “2016 Plan”), which provides for the grant of cash payment awards totaling $3,249 to certain officers and employees, payable upon satisfaction of a performance condition (i.e. the occurrence of a Change in Control, as defined) and a service vesting condition (i.e. the vesting of an award based on continuous service) . Any payments due under the 2016 Plan are required to be paid within 60 days following a Change in Control (as defined) that constitutes a Qualifying Sale. Under the 2016 Plan, a “Change in Control” will have occurred if a single shareholder or shareholder group obtains effective control of FPS or acquires 50% or more than the fair market value of its assets.

Under the 2016 Plan, cash payment awards of $3,249 in aggregate were granted in October 2016, and the Company does not expect there will be any further awards. There is no settlement payment of an award under the 2016 Plan unless and until there is a Qualifying Sale which also constitutes a Change in Control of FEI prior to the earlier of a Termination Transaction or the termination of the 2016 Plan on January 1, 2026. The payments under the 2016 Plan are only due to the participants if certain change in control terms are met on or before the earlier of January 1, 2026. To constitute a Qualifying Sale, a sale or series of sales of assets or ownership must result in the holders of Series A Units of FPS receiving more than $64.00 per Series A Unit. A total of 1,000,000 Series A Units are currently issued and outstanding. The change in control term is a performance condition and therefore the Company does not accrue or recognize any compensation cost until such event is considered probable. No compensation cost has been recognized on these awards to date as the event is not considered probable.

NOTE 17 — SUBSEQUENT EVENTS

The Company has evaluated subsequent events through June 4, 2021, the date these combined consolidated financial statements were available to be issued, to ensure that this filing includes all appropriate footnote disclosure of events both recognized in the combined consolidated financial statements as of December 31, 2020, and events which occurred subsequently but were not recognized in the combined consolidated financial statements. The Company has concluded that other than as disclosed in Note 11 and noted below, there were no subsequent events requiring adjustment to or disclosure in these combined consolidated financial statements.

On December 29, 2020, the Company entered into a sublease with Pioneer New Hampshire LLC to relocate its corporate headquarters to 112 Corporate Drive, Portsmouth, New Hampshire, thereby leasing office space of approximately 5,800 square feet of rentable space. The lease for the premises is effective at February 2021 and has a term of approximately 3.5 years, with two optional renewal options of three years each. The minimum monthly rent under the terms of the lease is $7.

F-26

FLEXENERGY, INC. AND FLEX LEASING POWER & SERVICES, LLC AND SUBSIDIARIES

CONDENSED COMBINED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(DOLLARS IN THOUSANDS)

​	September 30, 2021			December 31, 2020
Assets	​	​	​	​	​	​
Current assets	​	​	​	​	​	​
Cash	​	$	1,474	​	$	1,702
Accounts receivable, net of allowance of $11 and $45, respectively	​	​	2,041	​	​	2,416
Deferred IPO deal costs	​	​	3,657	​	​	—
Inventories, net	​	​	9,819	​	​	13,659
Prepaid expenses and other current assets	​	​	562	​	​	497
Total current assets	​	​	17,553	​	​	18,274
Long-term assets	​	​	​	​	​	​
Property and equipment, net	​	​	32,523	​	​	36,506
Deferred financing costs, net of amortization	​	​	623	​	​	630
Other non-current assets	​	​	61	​	​	166
Intangible assets, net	​	​	210	​	​	336
Total long-term assets	​	$	33,417	​	$	37,638
Total assets	​	$	50,970	​	$	55,912
Liabilities and stockholder’s equity	​	​	​	​	​	​
Current liabilities	​	​	​	​	​	​
Accounts payable	​	$	1,544	​	$	1,328
Accrued expenses	​	​	2,798	​	​	2,003
Deferred revenues	​	​	931	​	​	1,849
Current portion of notes payable	​	​	—	​	​	1,300
Current portion of capital lease obligations	​	​	132	​	​	148
Other current liabilities	​	​	213	​	​	214
Total current liabilities	​	​	5,618	​	​	6,842
Long-term liabilities	​	​	​	​	​	​
Capital leases, net of current portion	​	​	92	​	​	173
Line of credit	​	​	22,917	​	​	26,658
Notes payable, net of current portion	​	​	—	​	​	1,052
Other non-current liabilities	​	​	545	​	​	492
Total long-term liabilities	​	$	23,554	​	$	28,375
Total liabilities	​	$	29,172	​	$	35,217
Commitments and contingencies (see note 13)	​	​	​	​	​	​
Stockholder’s equity	​	​	​	​	​	​
Net parent investment	​	$	159,677	​	$	152,273
Accumulated other comprehensive income	​	​	477	​	​	543
Accumulated deficit	​	​	(138,356)	​	​	(132,121)
Total stockholder’s equity	​	$	21,798	​	$	20,695
Total liabilities and stockholder’s equity	​	$	50,970	​	$	55,912

The accompanying notes are an integral part of these Condensed Combined Consolidated Financial Statements.

F-27

FLEXENERGY, INC. AND FLEX LEASING POWER & SERVICES, LLC AND SUBSIDIARIES

CONDENSED COMBINED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS
(UNAUDITED)
(DOLLARS IN THOUSANDS)

​	Nine Months Ended September 30,
​	2021			2020
Revenue	​	​	​	​	​	​
Turbine leasing fleet	​	$	11,144	​	$	14,304
Turbine service on sold product	​	​	3,431	​	​	1,617
Manufactured product	​	​	3,712	​	​	3,276
Total revenue	​	​	18,287	​	​	19,197
Cost of revenue	​	​	​	​	​	​
Turbine leasing fleet (excluding depreciation of fleet turbines)	​	​	4,279	​	​	3,714
Turbine service on sold product	​	​	2,254	​	​	1,292
Manufactured product	​	​	5,651	​	​	5,419
Depreciation of fleet turbines	​	​	3,357	​	​	4,003
Total cost of revenue	​	​	15,541	​	​	14,428
Operating expenses	​	​	​	​	​	​
Selling, general and administrative	​	​	10,318	​	​	8,596
Research and development	​	​	98	​	​	126
Total operating expenses:	​	​	10,416	​	​	8,722
Operating loss	​	​	(7,670)	​	​	(3,953)
Other income (expense)	​	​	​	​	​	​
Interest expense	​	​	(792)	​	​	(876)
Other income (expense), net	​	​	2,562	​	​	(10)
Total other income (expense), net	​	​	1,770	​	​	(886)
Loss before income taxes	​	​	(5,900)	​	​	(4,839)
Income tax expense	​	​	(308)	​	​	(5)
Net loss	​	$	(6,208)	​	$	(4,844)
Other comprehensive gain (loss)	​	​	​	​	​	​
Foreign currency translation adjustments	​	​	(66)	​	​	(17)
Total other comprehensive gain (loss)	​	​	(66)	​	​	(17)
Comprehensive loss	​	$	(6,274)	​	$	(4,861)

The accompanying notes are an integral part of these Condensed Combined Consolidated Financial Statements.

F-28

FLEXENERGY, INC. AND FLEX LEASING POWER & SERVICES, LLC AND SUBSIDIARIES

CONDENSED COMBINED CONSOLIDATED STATEMENTS OF STOCKHOLDER’S EQUITY (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020
(DOLLARS IN THOUSANDS)

​

Net Parent Investment

Accumulated Other Comprehensive Income (Loss)

Accumulated Deficit

Total Stockholder’s Equity

Balance at January 1, 2020

​

$

151,473

​

$

100

​

$

(124,567)

​

$

27,006

Contributions

​

​

800

​

​

—

​

​

—

​

​

800

Distributions

​

​

—

​

​

—

​

​

(23)

​

​

(23)

Foreign currency translation adjustments

​

​

—

​

​

(17)

​

​

—

​

​

(17)

Net loss

​

​

—

​

​

—

​

​

(4,844)

​

​

(4,844)

Balance at September 30, 2020

​

$

152,273

​

$

83

​

$

(129,434)

​

$

22,922

​

Net Parent Investment

Accumulated Other Comprehensive Income (Loss)

Accumulated Deficit

Total Stockholder’s Equity

Balance at January 1, 2021

​

$

152,273

​

$

543

​

$

(132,121)

​

$

20,695

Contributions

​

​

7,404

​

​

—

​

​

—

​

​

7,404

Distributions

​

​

—

​

​

—

​

​

(27)

​

​

(27)

Foreign currency translation adjustments

​

​

—

​

​

(66)

​

​

—

​

​

(66)

Net loss

​

​

—

​

​

—

​

​

(6,208)

​

​

(6,208)

Balance at September 30, 2021

​

$

159,677

​

$

477

​

$

(138,356)

​

$

21,798

The accompanying notes are an integral part of these Condensed Combined Consolidated Financial Statements.

F-29

FLEXENERGY, INC. AND FLEX LEASING POWER & SERVICES, LLC AND SUBSIDIARIES

CONDENSED COMBINED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(DOLLARS IN THOUSANDS)

​	Nine Months Ended September 30,
​	2021			2020
Cash Flows from Operating Activities	​	​	​	​	​	​
Net loss	​	$	(6,208)	​	$	(4,844)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:	​	​	​	​	​	​
Depreciation and amortization of property and equipment	​	​	5,191	​	​	4,902
Amortization of deferred financing costs	​	​	162	​	​	142
Amortization of intangible assets	​	​	126	​	​	126
Bad debt expense	​	​	—	​	​	17
Forgiveness of debt – PPP loan	​	​	(2,378)	​	​	—
Gain on disposal of property and equipment	​	​	(24)	​	​	(94)
Changes in operating assets and liabilities:	​	​	​	​	​	​
Accounts receivable	​	​	375	​	​	513
Inventories, net	​	​	3,365	​	​	(3,736)
Prepaid expenses and other current assets	​	​	(65)	​	​	(207)
Other non-current assets	​	​	104	​	​	36
Accounts payable	​	​	210	​	​	(715)
Accrued expenses	​	​	821	​	​	118
Deferred revenues	​	​	(918)	​	​	(558)
Other current liabilities	​	​	—	​	​	(301)
Other non-current liabilities	​	​	53	​	​	53
Net Cash Provided by (Used in) Operating Activities	​	$	814	​	$	(4,548)
Cash Flows from Investing Activities	​	​	​	​	​	​
Purchases of property and equipment	​	​	(691)	​	​	(757)
Proceeds from disposal of property and equipment	​	​	24	​	​	193
Net Cash Used in Investing Activities	​	$	(667)	​	$	(564)
Cash Flows from Financing Activities	​	​	​	​	​	​
Distribution to parent	​	$	(27)	​	$	(23)
Contribution from parent	​	​	4,453	​	​	800
Deferred IPO deal costs	​	​	(699)	​	​	—
Proceeds from notes payable	​	​	—	​	​	2,352
Payments on line of credit	​	​	(12,353)	​	​	—
Advances from line of credit	​	​	8,484	​	​	4,330
Deferred financing costs	​	​	(27)	​	​	—
Payments on capital leases	​	​	(96)	​	​	(117)
Net Cash (Used in) Provided by Financing Activities	​	$	(265)	​	$	7,342
Effects of Exchange Rate Changes on Cash	​	$	(110)	​	$	30
Net Increase / (Decrease) in Cash	​	$	(228)	​	$	2,260
Cash – Beginning	​	$	1,702	​	$	2,000
Cash – Ending	​	$	1,474	​	​	4,260
Supplemental Disclosure	​	​	​	​	​	​
Interest paid in cash	​	$	624	​	$	792
Taxes paid in cash	​	​	84	​	​	11
Non-Cash Investing and Financing Activities	​	​	​	​	​	​
Net transfers from inventory to property and equipment	​	$	569	​	$	3,896
Accrued but not paid deferred financing costs	​	​	129	​	​	27
Deferred IPO deal costs unpaid	​	​	2,958	​	​	—
Forgiveness of debt – PPP loan	​	​	2,378	​	​	​

The accompanying notes are an integral part of these Condensed Combined Consolidated Financial Statements.

F-30

NOTES TO UNAUDITED CONDENSED COMBINED CONSOLIDATED FINANCIAL STATEMENTS

(DOLLARS IN THOUSANDS)

NOTE 1 — NATURE OF OPERATIONS

The condensed combined consolidated financial statements include the combined accounts of FlexEnergy, Inc. (“FEI”) and Flex Leasing Power & Service LLC (“FLPS”), collectively referred to as “the Company”. The Company is headquartered in Portsmouth, New Hampshire with field offices in Colorado, North Dakota, Texas and Canada.

On January 1, 2016, FlexEnergy Power Solutions, LLC (“FPS”) was formed to hold FEI and FLPS. FEI manufactures the GT333 kilowatt turbine, the larger GT1300 kilowatt turbine (“Flex Turbine”) and stand- alone heat recovery products (“Flex Heat Recovery products”). FLPS provides a rental and leasing offering of the turbine generator, particularly in the North America oilfield market. Flex Leasing Power and Services, ULC (“FLPS ULC”), which is wholly-owned by Flex Power Co., is a Canadian entity that supports expansion into the Canadian market. Flex Power Co. is a wholly-owned subsidiary of FLPS.

On December 31, 2020, FPS formed FlexEnergy Green Solutions, Inc. (“FGS”) to be its wholly-owned subsidiary. FPS intends to contribute all of its assets, which consist solely of 100% equity interests in FEI and FLPS, to FGS in exchange for 100% of the equity interests in FGS, which will result in FGS becoming a wholly-owned subsidiary of FPS, and FEI and FLPS becoming wholly-owned subsidiaries of FGS.

The Company is an energy focused technology company that designs, manufactures, sells and leases cost-effective energy solutions that lower its customers’ environmental footprint, often by making useable energy from sources of fuel or heat otherwise overlooked or wasted. The Company’s business consists of leasing and service of the Company’s gas-powered Flex Turbines supported by a vertically integrated original equipment manufacturing (“OEM”) with some direct sales of manufactured products. Leasing and service allows the Company to monetize emerging clean technologies via its Flex Turbine and Flex Heat Recovery products, with consistent revenues and cash flow.

The Company’s Flex Turbines offer a reliable source for distributed or grid connected electrical power, capable of being fired by a wide variety of gaseous fuels from waste gas from landfills and natural gas flaring to higher BTU fuels such as propane and synthetic gas. Leasing and sales of Flex Turbines presently represent the bulk of the Company’s operations and revenues. Flex Turbines provide the Company’s customers with solutions to gain independence over their electricity generation and minimize overall reliance on the grid. In addition, the Company’s Flex Heat Recovery products are integral to promising emerging power sources, such as fuel cells for electrical power.

The Company serves a diverse range of customers in the global oil and gas (“O&G”), transportation, power, and commercial and industrial (“C&I”) end markets. The Company’s primary focus is on base load, distributed, electric generation using Flex Turbines, with the technology base to expand in additional untapped end-markets.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying condensed combined consolidated financial statements include the accounts of FEI and its wholly owned subsidiaries and FLPS and its wholly owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. The Company’s condensed combined consolidated financial statements were prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and include the assets, liabilities, revenues and expenses of all controlled subsidiaries. In the opinion of management, the accompanying unaudited condensed combined consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.

F-31

The interim results for the nine months ended September 30, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or for any future interim periods.

USE OF ESTIMATES

The preparation of the Company’s condensed combined consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed combined consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Significant items subject to such estimates and assumptions include accounting for the accounts receivable allowance, the valuation of long-lived assets including intangible assets with finite lives, useful lives of long- lived assets such as property, equipment and intangible assets, valuation allowances for deferred income tax assets, inventory obsolescence, and exposure related to warranty and other contingent liabilities. Actual results could differ from those estimates.

SEGMENT INFORMATION

The Company is considered to be a single reporting segment. The Company’s chief operating decision makers (“CODM”), the Chief Executive Officer, the Chief Financial Officer and the Chief Commercial Officer, review financial information presented on a condensed combined consolidated basis for purposes of allocating resources and evaluating financial performance. The business activities of this reporting segment are the engineering, production, sales and leasing of its proprietary energy efficient Flex Turbines and Flex Heat Recovery products, and related parts and service.

The Company conducts its business through various offices and facilities located throughout the U.S. and Canada. All the Company’s revenues were to external customers for the nine months ended September 30, 2021 and 2020. Of the sales during the nine months ended September 30, 2021, $11,854 were sales to the US, $4,364 to Canada and $2,069 to non-North America countries, respectively. Of the sales during the nine months ended September 30, 2020, $16,819 were sales to the US, $2,048 to Canada and $330 to non-North America countries, respectively. Long-lived assets held in the U.S. and Canada as of September 30, 2021 were $24,754 and $8,663, respectively. Long-lived assets held in the U.S. and Canada at December 31, 2020 were $28,203 and $9,435, respectively.

ACCOUNTS RECEIVABLE

Accounts receivable are recorded at the invoiced amount and do not bear interest. Accounts receivable are stated at the amount the Company expects to collect from balances outstanding at year end and represent amounts billed to customers and not yet collected, and are recorded when the right to consideration becomes unconditional. Based on the Company’s evaluation of uncollected accounts receivable at the end of each year, bad debts are provided for using an allowance for doubtful accounts method. The evaluation considers historical trends to identify receivables that the Company believes may be uncollectible. The allowance for bad debt was $11 and $45 as of September 30, 2021 and December 31, 2020, respectively.

DEFERRED IPO DEAL COSTS

FGS is in the process of going through a public offering. Costs incurred for this offering have been capitalized at FEI and FLPS and will applied against proceeds upon a successful public offering. Deferred IPO deal costs were $3,657 and $0 as of September 30, 2021 and December 31, 2020, respectively.

INVENTORY

Inventory at FEI consists primarily of parts, components, and work in progress for the manufacture and repair of the Flex Turbine and Flex Heat Recovery products. Inventory at FLPS consists primarily of parts, components and turbines that are currently ready for or are being prepared for first time use. Once a

F-32

turbine has been placed into service, the inventory is transferred to property and equipment. Inventoried parts and components are mainly used for commissioning and/or repairing the turbines. Inventory is valued at the lower of cost or net realizable value and is determined on a the first in, first out (“FIFO”) cost method.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets ranging from three to ten years. Expenditures for repairs and maintenance are charged to expense as incurred, whereas major betterments are capitalized as additions to property and equipment.

The estimated useful lives used in computing depreciation of property and equipment are as follows:

Asset	Life
Turbines and other equipment	10 years
Leasehold improvements	Shorter of lease term or 10 years
Machinery and equipment	3 – 7 years
Furniture and fixtures	5 – 7 years
Fieldwork equipment	5 years
Computer equipment and software	3 – 5 years
Vehicles	4 – 5 years

Leasehold improvements are amortized using the straight-line method over the lesser of the term of the lease or the estimated useful life of the asset. Depreciation of assets leased to customers was of $3,357 and $4,003 for the nine months ended September 30, 2021 and 2020, respectively. Depreciation of assets leased to customers is recorded to cost of revenue. Depreciation of other assets was $1,834 and $899 for the nine months ended September 30, 2021 and 2020, respectively. Depreciation of other assets is recorded to operating expenses within the accompanying condensed combined consolidated statements of operations and comprehensive loss. The Company’s depreciation and amortization expense of property and equipment was $5,191 and $4,902 for the nine months ended September 30, 2021 and 2020, respectively.

INTANGIBLE ASSETS

Intangible assets, consisting of acquired patents, are presented at cost, net of accumulated amortization. Intangible assets are amortized over their estimated useful life of ten years on a straight-line basis. The Company continues to invest in its intellectual property portfolio and is actively filing for patent protection for its technology in both the U.S. and abroad. The costs, including legal, associated with compiling and filing patent applications are charged to selling, general, and administrative expenses as incurred.

IMPAIRMENT OF LONG-LIVED ASSETS

Long-lived assets such as property and equipment and intangible assets with finite lives are tested for impairment whenever events or circumstances indicate that the carrying amount may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount is not recoverable on an undiscounted cash flow basis, impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models and third-party independent appraisals, as considered necessary.

The Company did not record any impairment losses during the nine months ended September 30, 2021 and 2020, and there have been no events that triggered an impairment analysis as of September 30, 2021 and December 31, 2020.

F-33

REVENUE RECOGNITION

The Company’s revenue consists of turbine leasing fleet revenue, the sales of manufactured Flex Turbine and Flex Heat Recovery products, and service revenues on sold product. Revenue is recognized upon transfer of control of the promised goods or the Company’s performance of the services to its customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services.

The Company excludes sales tax collected from customers from revenue in its condensed combined consolidated statements of operations and comprehensive loss.

Significant Judgments — Contracts with Multiple Performance Obligations

A performance obligation is a promise in a contract with a customer to transfer products or services that are distinct. Determining whether products and services are distinct performance obligations that should be accounted for separately or combined as one unit of accounting may require significant judgment. The Company enters into contracts with its customers to manufacture Flex Turbines and Flex Heat Recovery products and provides certain products, parts, and accessories, collectively referred to as “products.” The Company will also provide services associated with these products and parts including commissioning and maintenance services, collectively referred to as “services.” These services are distinct and separate contractual arrangements.

Contracts may contain multiple products within the same agreement. However, each product is distinct as they are sold separately and revenue is only recorded when the individual product is completed and control of the product is transferred. Service contracts, and services noted within such contracts, are similar in that each service is distinct. Each service is explicitly stated in the contracts where the Company provides maintenance repairs and labor services in exchange for a fixed-rate per month per turbine. Revenue from maintenance service contracts is recognized over the term of the contract at the agreed upon monthly service fee as defined in the contract, while commissioning revenue is recognized at the agreed upon commissioning fee amount as defined within the contract once the Flex Turbine is installed and begins generating energy for the customer. The maintenance service contracts and commissioning revenue are each considered distinct and separated from other obligations in the contract since (i) the customer is able to benefit from the good or service separately or together with other resources made available through the arrangement and (ii) the services are each separately identifiable from the others provided in the contract.

Once distinct performance obligations are identified within a contract, the Company allocates the transaction price to each performance obligation on a relative standalone selling price (“SSP”) basis. The SSP is the price at which the Company would sell a promised product or service separately to a customer.

Turbine Leasing Fleet

Turbine leasing fleet revenue consists of revenue generated on the Company’s owned fleet of Flex Turbines and owned ancillary field equipment that supports the turbines fleet’s generation in the field. It primarily consists of recurring monthly revenue associated with executed rental agreements (“Generator Rental Agreements”) where the Company is the lessor to the third-party customers. Leases can cover multiple Flex Turbine units and explicitly assert the monthly lease payment due over the length of the agreement (typically 12-36 months). Revenue is recognized over time over the duration of the lease, which represents the Company’s obligation to the customer. All current leases are classified as operating leases. Additionally, there are no “rent increases” contained within any of the Company’s current leasing agreements and lease payments are due to the Company in exchange for the use of the Flex Turbine generator and coverage for routine maintenance and monitoring. These agreements typically include preventative and regular maintenance costs embedded within the lease payment (“executory costs”) over the term of the agreement. Such executory costs are considered non-lease components with revenue recognized on a straight-line basis. Lease and non-lease revenue is distinct between the fee to use Flex Turbine and the amount that covers continuous remote monitoring and maintenance. Turbine leasing fleet revenue also includes (i) commissioning

F-34

of leased units (ii) one-off billings to customers for repairs of leased Flex Turbine units outside the scope of the rental agreement and (iii) the rental of owned ancillary field assets such as standby diesel generators and automatic transfer switches.

Manufactured Product Sales

The Company’s standard terms of sales of new Flex Turbines and Flex Heat Recovery products to channel partners and direct end-users include transfer of title, care, custody and control of the goods at the point of shipment, payment terms ranging from full payment in advance of shipment to payment in 90 days, no right of return or exchange, and no post-shipment performance obligations except for standard warranties provided on the products and parts sold. The Company offers standard assurance type warranty that its products and parts sold will operate free of material defects and function for a period of the greater of 18 months from delivery or 12 months from commissioning of the unit. Once the standard warranty expires, customers have the option to purchase service/maintenance coverage at a fixed rate. Revenue is recognized upon transfer of control of the promised goods to the Company’s customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods. Title and risk of loss or damage to products passes to the purchaser of newly manufactured Flex Turbines and Flex Heat Recovery products upon production test completion and tender of delivery to the carrier at the Company’s U.S. manufacturing facility. The Company recognizes revenue in certain circumstances before product delivery occurs (commonly referred to as bill-and-hold transactions). Revenue from bill-and-hold transactions is recognized when all specific requirements for transfer of control under a bill-and-hold arrangement have been met which include, among other things, a request from the customer that the product be held for future delivery. For these bill-and-hold arrangements, the associated product inventory is identified separately as belonging to the customer and is ready for physical transfer.

Service on Sold Product

Service performed by the Company consists primarily of commissioning and maintenance services on units sold to third-party customers. Customers with purchased units in operation that are out of warranty will contact the Company for replacement parts on their turbine generators such as a replacement engine.

Once the customer agrees to the pricing and terms for the service order and places a purchase order, the Company will deliver the parts to the customer, recognizing revenue once the performance obligation is met.

Contracts for services are initiated through Service Request Orders (“SROs”), related to a combination of parts and labor. Like parts only, the Company will provide the customer with a quote for the service work and once accepted, will work to satisfy the transaction’s performance obligations and recognized revenue once parts are shipped and/or services have been rendered.

Service revenue also relates to commissioning Flex Turbines sold to third-party customers at the customers’ sites. This is a separate performance obligation from the purchase order to manufacture Flex Turbines. Typically, commissioning of manufactured units takes place within two months of tender for shipment, but can be delayed for up to several months based on when the customer submits its request for commissioning of the units and the commissioning takes place.

Lastly, the Company also provides maintenance service contracts on the existing installed base of Flex Turbines sold to its third-party customers. The maintenance service contracts are agreements to perform certain services to maintain a product for a specified period of time. Service revenue derived from maintenance service contracts is explicitly for the months covered and recognized over time on a straight-line basis over the length of the contract period, which represents the Company’s obligation to the customer.

Practical Expedient

The Company applies a practical expedient to expense costs as incurred for costs to obtain a contract when the amortization period would have been one year or less. These costs are recorded within selling, general and administrative expenses.

F-35

INCOME TAXES

FLPS is taxed as a disregarded entity for U.S. federal tax purposes, and the operations are not subject to U.S. federal income tax other than the operations that are conducted through taxable subsidiaries. FLPS may incur income taxes that are subject to withholding requirements related to certain of operations within Canada and other foreign countries in which the Company operates. FEI and Flex Power Co. income taxes are accounted for utilizing the asset and liability approach. Under this method, deferred tax assets and liabilities are recognized for the anticipated future tax consequences attributable to differences between the condensed combined consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred amounts are measured using enacted tax rates expected to apply to taxable income in the year those temporary differences are expected to be recovered or settled.

In assessing the realizability of the deferred income tax assets, including net operating loss and state tax credit carryforwards, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon evaluating both positive and negative evidence in making this assessment, of which management determined the need for a valuation allowance on all net deferred tax assets. Further, the Company recognizes interest expense (income) and penalties on uncertain tax positions and income tax deficiencies (refunds) in income tax expense in the accompanying condensed combined consolidated statements of operations and comprehensive loss.

FOREIGN CURRENCY TRANSACTIONS

The financial statements of an international subsidiary, FLPS ULC, are translated into the functional reporting currency of the Company (USD) using the exchange rate in effect at each balance sheet date for assets and liabilities. Revenues and expenses were translated to USD at the average exchange rate for the period. Resulting currency translation adjustments are recorded as a component of accumulated other comprehensive loss through the cumulative translation adjustment (“CTA”) account. Foreign exchange transaction gains and losses are recorded in the condensed combined consolidated statements of operations and comprehensive loss in other income (expense), net.

The Company cannot guarantee that the current exchange rate will remain steady; therefore, there is a possibility that the Company could post the same amount of profit for comparable periods and because of the fluctuating exchange rate, actually post higher or lower profit depending on the exchange rate of Canadian Dollar (“CAD”) converted to USD on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice.

PRODUCT WARRANTY

The Company provides for the estimated cost of product warranties at the time revenue is recognized. Warranty terms are for the greater of 18 months from delivery or 12 months from commissioning of the unit, to repair or replace any defective component in equipment supplied by the Company. The provision for product warranty is based primarily on historical rates, sales history and other considerations. The provision for product warranty is reported within the classification of manufactured product cost of revenue in the accompanying condensed combined consolidated statements of operations and comprehensive loss. Accrued product warranties were $223 and $526 as of September 30, 2021 and December 31, 2020, respectively and are reported within accrued expenses in the accompanying condensed combined consolidated balance sheet.

RESEARCH AND DEVELOPMENT

Research and development costs are expensed as incurred and reported in research and development costs in the accompanying condensed combined consolidated statements of operations and comprehensive loss. Costs were $98 and $126 for the nine months ended September 30, 2021 and 2020, respectively.

F-36

RECENT ACCOUNTING PRONOUNCEMENTS

Emerging growth company

The Company is an “emerging growth company” as defined in the Jumpstart Our Business Startups Act (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ASU 2016-02” or “Topic 842”). The purpose of ASU 2016-02 is to provide financial statement users a better understanding of the amount, timing, and uncertainty of cash flows arising from leases. The adoption of ASU 2016-02 will result in the recognition of a right-of-use asset and a lease liability for all leases. New disclosure requirements include qualitative and quantitative information about the amounts recorded in the financial statements. In September 2017, the FASB issued ASU 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842), which provides additional implementation guidance on the previously issued ASU 2016-02 Leases (Topic 842). ASU 2016-02 requires a lessee to recognize assets and liabilities on the balance sheet for all leases with lease terms greater than 12 months. ASU 2016-02 requires a modified retrospective transition by means of a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year in which the guidance is effective with the option to elect certain practical expedients and accounting policy elections. Topic 842 will be effective for the Company for fiscal years beginning after December 15, 2021, with interim periods within fiscal years beginning after December 15, 2022. The Company is currently evaluating the impact of the adoption of this update on its condensed combined consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326) (“ASU 2016-13” or “Topic 326”), which requires that all financial assets measured at amortized cost to be evaluated for current expected credit losses. Under the new guidance, immediate recognition of credit losses expected over the life of a financial instrument is required. The pronouncement eliminates the incurred credit loss impairment methodology and replaces it with an expected credit loss concept based on historical experience, current conditions, and reasonable and supportable forecasts. Early adoption is permitted. Topic 326 requires a modified retrospective approach by recording a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. ASU 2016-13 will be effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The adoption of this standard is not expected to have a material impact on the Company’s condensed combined consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to intraperiod tax allocation, interim period income tax calculation methodology, and the recognition of deferred tax liabilities for outside basis differences. It also simplifies certain aspects of accounting for franchise taxes and clarifies the accounting for transactions that results in a step-up in the tax basis of goodwill. The Company adopted ASU 2019-12 on January 1, 2021. There were no significant income tax implications to the Company’s tax provision as a result of the change in guidance.

In March of 2020, the FASB issued ASU 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASC 848, Reference Rate Reform) (“ASU 2020-04” or “Topic 848”) which provides guidance for contract modifications and certain hedging relationships associated with the transition from reference rates that are expected to be discontinued. The guidance provides optional expedients and exceptions for applying GAAP to contracts or other transactions affected by reference rate reform if certain criteria are met. The guidance was issued on March 12, 2020 and may be applied prospectively through December 31, 2022. The Company is evaluating applicable contracts and transactions to determine whether to elect the optional guidance. The adoption of this standard is not expected to have a material impact on the Company’s condensed combined consolidated financial statements.

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NOTE 3 — GOING CONCERN

The accompanying condensed combined consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company’s financial position and operating results raise substantial doubt about its ability to continue as a going concern within one year after the date the condensed combined consolidated financial statements are issued. The Company has sustained net losses of $6,208 and $4,844 for the nine months ended September 30, 2021 and 2020, respectively and has an accumulated deficit of $138,356 as of September 30, 2021. The ability of the Company to continue as a going concern is dependent upon (i) expanding operations, (ii) obtaining additional capital and (iii) reducing operating expenses and/or selling existing turbine assets should this be required to preserve liquidity. Management’s plan in this regard is to implement the Company’s business plan and to secure additional funds through equity or debt financing. There can be no assurance that such alternate financing, if available, can be obtained on acceptable terms. The condensed combined consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 4 — REVENUE RECOGNITION

Disaggregation of Revenue

The Company disaggregates revenue from contracts with customers by product type. The Company believes that this aggregates the payor types by nature, amount, timing, and uncertainty of its revenue streams. The following table summarizes the Company’s disaggregated revenues for the nine months ended September 30, 2021 and 2020:

​	2021			2020
Manufactured product	​	$	3,712	​	$	3,276
Turbine service on sold product	​	​	3,431	​	​	1,617
Total non-lease revenue	​	$	7,143	​	$	4,893
Turbine leasing fleet revenue	​	​	11,144	​	​	14,304
Total revenue	​	$	18,287	​	$	19,197

Contract Balances

Contract liabilities consist of advance payments for goods as well as deferred revenue on service obligations and extended warranties. All of the Company’s deferred revenue is included in current liabilities under deferred revenue.

The following is a summary of the Company’s contract balances as of September 30, 2021 and December 31, 2020:

​	September 30, 2021			December 31, 2020
Turbine leasing fleet	​	$	1,359	​	$	1,548
Turbine service on sold product	​	​	441	​	​	318
Manufactured product	​	​	146	​	​	442
Other	​	​	106	​	​	153
Total trade accounts receivable	​	$	2,052	​	$	2,461
Contract assets	​	$	2,052	​	$	2,461
Allowance for doubtful accounts	​	​	(11)	​	​	(45)
Total trade accounts receivable, net	​	$	2,041	​	$	2,416

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The amount of revenue recognized during the nine months ended September 30, 2021 that was included in the deferred revenue on service obligations and extended warranty balance at December 31, 2020 was $126.

At September 30, 2021, the Company had $931 of remaining performance obligations, which are included in deferred revenue. The Company expects to recognize approximately 100% of its remaining performance obligations as revenue during the subsequent 12-month period. At December 31, 2020, the Company had $1,849 of remaining performance obligations, which are included in deferred revenue. The Company recognized $1,744 of the performance obligations as revenue during the nine months ended September 30, 2021. The Company expects to recognize 100% of its remaining performance obligations that existed as of December 31, 2020 by the end of fiscal year 2021.

Bill-and-Hold Revenue

Certain customer arrangements consist of bill-and-hold characteristics under which the criteria for transfer of control is met, including the passing of title and significant risk and reward of ownership to the customers. Therefore, the customers are able to direct the use of the bill-and-hold inventory while the Company retains physical possession of the product until it is installed at a customer site at a point in time in the future. Revenue recognized in a bill-and-hold arrangement for the nine months ended September 30, 2021 and 2020 was $478 and $3,235, respectively.

Lessor Revenue

The Company’s lessor portfolio includes only operating leases. The following table presents future operating lease payments under non-cancellable lease arrangements to be received as of September 30, 2021:

Three months ended December 31, 2021	$	2,579
2022	​	1,674
2023	​	168
Total	$	4,421

NOTE 5 — INVENTORY

Inventory is stated at the lower of cost or net realizable value and consisted of the following as of September 30, 2021 and December 31, 2020:

​	September 30, 2021			December 31, 2020
Raw materials	​	$	6,905	​	$	9,367
Work in process	​	​	501	​	​	935
Finished goods	​	​	2,413	​	​	3,357
Total inventories, net	​	$	9,819	​	$	13,659

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NOTE 6 — PROPERTY AND EQUIPMENT

Property and equipment consisted of the following as of September 30, 2021 and December 31, 2020:

​	2021			2021
Turbines and other equipment	​	$	64,122	​	$	61,973
Machinery and equipment	​	​	5,115	​	​	5,146
Leasehold improvements	​	​	897	​	​	782
Fieldwork equipment	​	​	4,350	​	​	4,032
Computer equipment and software	​	​	641	​	​	1,074
Vehicles	​	​	305	​	​	274
Furniture and fixtures	​	​	540	​	​	540
Property, plant and equipment, gross	​	$	75,970	​	$	73,821
Accumulated depreciation	​	​	(43,563)	​	​	(38,432)
Construction in progress	​	​	116	​	​	1,117
Property, plant and equipment, net	​	$	32,523	​	$	36,506

The Company has equipment that is used by customers under lease arrangements. The remaining property and equipment are used by the Company for the manufacture of machines and related assets. Depreciation expense for equipment used by customers under lease arrangements was $3,357 and $4,003 for the nine months ended September 30, 2021 and 2020, respectively. The gross asset cost and accumulated depreciation for equipment used by customers under lease arrangements as of September 30, 2021 were $50,590 and $26,781, respectively. The gross asset cost and accumulated depreciation for equipment used by customers under lease arrangements as of December 31, 2020 were $36,518 and $15,117, respectively. The Company recognized a gain on disposal of property and equipment of $24 for the nine months ended September 30, 2021 and a gain on disposal of property and equipment of $94 for the nine months ended September 30, 2020.

NOTE 7 — INTANGIBLE ASSETS

Intangible assets consisted of the following as of September 30, 2021 and December 31, 2020:

​	September 30, 2021			December 31, 2020
Patents	​	$	1,680	​	$	1,680
Accumulated amortization	​	​	(1,470)	​	​	(1,344)
Intangible assets, net	​	$	210	​	$	336

Definite-lived intangible assets had a weighted-average remaining useful life of 1.25 years and 2.0 years as of September 30, 2021 and December 31, 2020, respectively.

The amortization of intangible assets was $126 for each of the nine months ended September 30, 2021 and 2020. The estimated annual amortization expense based on the intangible asset balance for the periods subsequent to September 30, 2021:

Three months ended December 31, 2021	$	42
2022	​	168
Total	$	210

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NOTE 8 — DEFERRED REVENUE

Deferred revenue consists of billed amounts collected in advance from various customers for service obligations and deposits on future orders. The durations of the service agreements range between 12 and 120 months. Customer deposits on future orders are non-interest bearing and non-refundable. Deferred revenue was $931 and $1,849 as of September 30, 2021 and December 31, 2020, respectively.

NOTE 9 — LEASES

The Company is obligated under operating leases for locations and apartments in New Hampshire, Colorado, North Dakota, Texas and Canada. Minimum rent payments under operating leases are recognized on a straight-line basis over the term of the related leases. In December 2020, the Company entered into a lessee sublease agreement with Pioneer New Hampshire LLC for approximately 5,800 rentable square feet of office space in Portsmouth, New Hampshire. This lease, which was entered into when the Company vacated its previous Portsmouth office space, expires in June 2024 with options to renew for up to an additional six years. In January 2019, the Company entered into a lease agreement for warehouse and manufacturing space in Dover, New Hampshire, which was later amended on February 22, 2021, with approximate monthly payments of $22 which expires in May 2027. There are no future minimum lease payment obligations after June 2027. In January 2020, FLPS entered into the First Amendment to Office Lease (the “First Amendment”) with GPI Plaza Tower, LP to acquire approximately 1,978 of additional rentable square feet for the Colorado office space as provided in the original Office Lease dated February 19, 2018. The lease term is approximately 5.5 years and is approximately $301 per year.

The Company is also obligated under capital lease obligations related to vehicles and forklifts. Depreciation on these assets is recorded on a straight-line basis over the term of the lease and is included within depreciation expense. Minimum rent payments under operating leases are recognized on a straight-line basis over the term of the lease. The Company recorded rental expense of $1,474 and $1,605 related to the leases for the nine months ended September 30, 2021 and 2020, respectively.

On December 29, 2020, the Company entered into a sublease with Pioneer New Hampshire LLC to relocate its corporate headquarters to 112 Corporate Drive, Portsmouth, New Hampshire, thereby leasing office space of approximately 5,800 square feet of rentable space. The lease for the premises is effective at February 2021 and has a term of approximately 3.5 years, with two optional renewal options of three years each. The minimum monthly rent under the terms of the lease is $7.

The future minimum lease payments under the Company’s capital and operating leases were as follows as of September 30, 2021:

​	Capital Leases			Operating Leases
Three months ended December 31, 2021	​	$	37	​	$	407
2022	​	​	140	​	​	1,144
2023	​	​	60	​	​	934
2024	​	​	—	​	​	561
2025	​	​	—	​	​	288
Thereafter	​	​	—	​	​	432
Total future minimum lease obligation	​	$	237	​	$	3,766
Less interest on capital leases	​	​	(13)	​	​	​
Net present value of capital lease obligations	​	$	224	​	​	​
Less current portion	​	​	(132)	​	​	​
Capital lease obligations, long term	​	$	92	​	​	​

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NOTE 10 — INCOME TAXES

The income tax expense is composed of the following for the nine months ended September 30, 2021 and 2020:

​	Nine Months Ended September 30,
​	2021			2020
Loss before income taxes	​	$	(5,900)	​	$	(4,839)
Income tax expense	​	​	(308)	​	​	(5)
Net loss	​	$	(6,208)	​	$	(4,844)
Income tax as a percentage of loss before income taxes	​	​	(5.22)%	​	​	(0.10)%

The calculation of the overall income tax provision for the nine months ended September 30, 2021 primarily consists of state and foreign income taxes. During the nine-month period ended September 30, 2021, the Company recorded an income tax provision of $308 on (loss) before income taxes of $(5,900). For the nine months ended September 30, 2020, the Company recorded an income tax provision of $5 on loss before income taxes of $(4,839). The effective tax rate for the nine months ended September 30, 2021 differs from the U.S. statutory rate of 21% primarily due to full valuation allowance on the Company’s US and foreign deferred tax assets.

As of December 31, 2020, the Company’s net deferred tax assets are fully offset by a valuation allowance. The valuation allowance is determined in accordance with the provisions of ASC 740, Income Taxes, which require an assessment of both negative and positive evidence when measuring the need for a valuation allowance. The Company reassesses the need for a valuation allowance on a quarterly basis. Based off the evidence currently available and the Company’s history of losses, the Company is maintaining a full valuation as of September 30, 2021.

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) was enacted into law. The CARES Act is aimed at providing emergency relief and health care for individuals and businesses affected by the COVID-19 pandemic. The CARES Act, among other things, includes provisions related to refundable payroll tax credits, deferral of the employer portion of social security payments, expanded net operating loss application, modifications to the net interest deduction limitations, and technical corrections to tax depreciation methods for qualified improvement property. The Company has completed its assessment of the impact of the legislation, and there is no significant impact to the condensed consolidated financial statements due to the valuation allowance in the US.

NOTE 11 — INDEBTEDNESS

Debt consisted of the following as of September 30, 2021 and December 31, 2020:

​	September 30 2021			December 31, 2020
Line of credit	​	$	22,917	​	$	26,658
Note payable	​	​	—	​	​	2,352
Total debt	​	$	22,917	​	$	29,010
Less current debt	​	​	—	​	​	(1,300)
Total long-term debt	​	$	22,917	​	$	27,710

Line of Credit

On February 8, 2019, FLPS entered into a senior secured revolving credit facility (“the Credit Agreement”) with Texas Capital Bank, National Association (“TCB”). The initial commitment amount is for $30,000 and availability under the Credit Agreement is based on a borrowing base calculation of eligible

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assets and other conditions. The facility is backed by a first priority lien on substantially all of the assets of FLPS, and the maturity date of the facility is February 8, 2024. The facility contains various covenants that limits the Company’s ability to, among other things, make restricted payments. Interest is defined based on a tiered leverage ratio and an applicable margin of (i) 1.50% to 2.00% above the base rate for base rate loans, or (ii) 2.50% to 3.00% above the adjusted Eurodollar rate for Eurodollar rate loans. Leverage ratio means as of the last day of the last fiscal month of each fiscal quarter, the ratio of (i) all debt and (ii) annualized EBITDA. Base Rate means, for any day, the highest of (a) Prime Rate; (b) the sum of the Federal Funds Rate for the day plus half of one percent (0.50%); and (c) the adjusted Eurodollar Rate for the day plus one percent (1.00%). FLPS is charged a commitment fee based on the daily average unused portion of the revolving credit facility, and that fee ranges from 0.225% to 0.475% per daily average. Additionally, FLPS is charged a letter of credit fee of between 2.50% and 3.00% per quarter with respect to the amount of letters of credit issued under the revolving credit facility. The applicable margin for loans, the commitment fee and the letter of credit fee set forth above will vary quarterly based on the Company’s leverage ratio. Based on the leverage ratio applicable at September 30, 2021, the margin and base rate were 2.00% and 3.25%, respectively for base rate loans; the margin and Eurodollar rate loan were 3.00% and .09%, respectively for Eurodollar rate loans; the commitment fee for the unused portion of the revolving credit facility was 0.225%; and the letter of credit fee was 3.00%. As of September 30, 2021, $917 and $22,000 of the outstanding line of credit balance was subject to base rate loan interest and a Eurodollar rate loan interest, respectively. FLPS is subject to financial covenants of a maximum leverage ratio and minimum fixed charge coverage ratio to be tested quarterly. The maximum permitted leverage ratio is 3.50 to 1.00. The minimum fixed charge coverage ratio is 1.25 to 1.00.

On February 12, 2021, the Company entered into a Limited Waiver of Leverage Ratio (the “Waiver”) with TCB pursuant to which the foregoing default event under the Credit Agreement was waived. In consideration of the waiver, (i) the Company agreed to pay TCB a fee of $22 upon execution of the Waiver, (ii) the Company made a $1,500 EBITDA equity contribution to FLPS (the “Waiver Contribution”), and (iii) FLPS made a $1,500 prepayment of its obligations to TCB under the Credit Agreement (the “Prepayment”). The Waiver also amended the Credit Agreement to increase the annualized EBITDA used to calculate the quarterly financial covenants, as well as decrease the availability under the revolving credit facility, by the amount of the Waiver Contribution. FPS contributed $1,500 to the Company to fund the Waiver Contribution and Prepayment made to TCB.

Gross borrowings outstanding under this revolving credit facility amounted to $22,917 and $26,658 as of September 30, 2021 and December 31, 2020, respectively. The Company incurred $156 and $27 in financing costs related to amendments to its existing revolving credit facility during the nine months ended September 30, 2021 and 2020, respectively. Gross debt issuance cost was $1,109 and $953 as of September 30, 2021 and December 31, 2020, respectively. Related accumulated amortization was $486 and $323 as of September 30, 2021 and December 31, 2020, respectively. These financing costs were capitalized under deferred financing costs on the condensed combined consolidated balance sheet. Deferred financing costs are amortized to interest expense over the term of the agreement using the effective interest method. Amortization expense was $162 and $142 for the nine months ended September 30, 2021 and 2020, respectively.

On January 27, 2020, FLPS entered into an amendment to the Credit Agreement (“First Amendment”) and First Amendment to Pledge and Security Agreement with TCB. Under the terms of the amendment, the borrowing base was amended to include certain non-turbine field equipment which was previously not included.

On August 28, 2020, FLPS entered into the Second Amendment to Credit Agreement with TCB. Under the terms of the amendment, certain terms within the borrowing base definition of accounts receivables relating to investment grade and non-investment grade customers were modified.

On December 21, 2020, FLPS entered into the Third Amendment to Credit Agreement with TCB. Under the terms of the amendment, FLPS ULC was added as an additional loan party to the Credit Agreement.

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On February 12, 2021, FLPS amended the Credit Agreement to increase the annualized EBITDA used to calculate the quarterly financial covenants, as well as decrease the availability under the revolving credit facility by $1,500.

On June 29, 2021, FLPS entered into the Fourth Amendment to Credit Agreement with TCB. Under the terms of the amendment, there was a modification of the due date of the FLPS financial statements to be delivered to TCB and decrease the availability under the revolving credit facility by an additional $2,000, resulting in a total decrease of availability of $3,500 when combined with the aforementioned amendment on February 12, 2021. As of September 30, 2021 and December 31, 2020, the amount available for drawdown were $3,177 and $1,429, respectively.

On December 10, 2021, FLPS entered into the Fifth Amendment to Credit Agreement with TCB. Under the terms of the amendment, modifications were made to allow for the pending contribution and IPO transaction and included related clauses regarding IPO-related transaction expenses and mandatory prepayments in connection with IPO proceeds. In addition, the availability limitation entered into under the Fourth Amendment was removed and further definition was added to the credit agreement regarding intercompany transactions.

PPP Loans

In 2020, the Company entered into loan agreements under the Small Business Administration (the “SBA”) Paycheck Protection Program (“PPP”) enabled by the Coronavirus Aid, Relief and Economic Security Act of 2020 (the “CARES Act”). On April 14, 2020, TCB entered into a note with FLPS and agreed to make available to FLPS a loan in the amount of $991. On May 6, 2020, Bank of America, N.A. (“Bank of America”) entered into a note with FEI and agreed to make available to FEI a loan in the amount of $1,361 (together, the “PPP Loans”). The PPP Loans bear interest at a rate per annum of 1.00%. The term of the PPP Loans are two years, ending April 14, 2022 and May 6, 2022, respectively.

On May 5, 2021, the Company received notice that the SBA had reviewed the forgiveness application of the FLPS PPP loan and provided forgiveness of the entire principal of $991 plus accrued interest of $10. On June 17, 2021, the Company received notice that the SBA had reviewed the forgiveness application of the FEI PPP loan and provided forgiveness of the entire principal of $1,361 plus accrued interest of $16. The Company accounted for the forgiveness on the PPP Loans in accordance with ASC 470 — Debt (“ASC 470”) and recorded a gain on extinguishment of debt on its condensed combined consolidated financial statements and related footnote disclosures. The Company recognized a gain on extinguishment of the PPP loans of $2,378 during the nine months ended September 30, 2021 and is recorded to other income, net within the accompanying condensed combined consolidated statements of operations and comprehensive loss.

Future minimum principal payments due on the line of credit are as follows as of September 30, 2021:

Three months ended December 31, 2021	$	—
2022	​	—
2023	​	—
2024	​	22,917
Total future principal payments	$	22,917

NOTE 12 — CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS

The Company’s three largest customers accounted for approximately 14%, 14% and 10% of total revenue for the nine months ended September 30, 2021. The Company’s two largest customers accounted for approximately 23% and 17% of total revenue for the nine months ended September 30, 2020. As of September 30, 2021, three customers accounted for 17%, 14% and 13% of the accounts receivable balance. As of December 31, 2020, two customers accounted for 15% and 14% of the accounts receivable balance. No

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single supplier accounted for more than 10% of the total cost of revenue for the nine months ended September 30, 2021 and 2020.

Cash could potentially subject the Company to concentrations of credit risk. However, because the Company maintains its cash with high-quality, accredited financial institutions, such funds are subject to minimal credit risk. The Company may maintain balances with financial institutions in excess of federally insured limits. The Company has not experienced any losses historically in these accounts and believes it is not exposed to significant credit risk in its cash.

NOTE 13 — COMMITMENTS AND CONTINGENCIES

Litigation and Legal Proceedings

Any material legal, tax or regulatory proceedings regarding matters arising in the ordinary course of business, which involve the Company’s assessment to determine the probability of whether a loss will occur and, if probable, its best estimate of probable loss. The Company records and discloses losses when these losses are probable and reasonably estimable, and discloses matters when losses are probable but not estimable or when losses are reasonably possible. Legal costs related to the defense of loss contingencies are expensed as incurred. The Company is not currently involved in legal proceedings that could reasonably be expected to have a material adverse effect on our business, prospects, financial condition or results of operations.

Guarantees and Indemnifications

Between December 2015 and July 2021, FPS issued a series of promissory notes with various investors that together, along with FPS’ affiliates, account for a majority of FPS’ voting equity and representation of its board of directors (the “Investor Notes”). The Investor Notes bear interest at an annualized rate ranging between 8.0% and 12.0% and are pre-payable without penalty at any time. The Investor Notes have a maturity date of December 31, 2022. FPS has the option to receive monthly interest in cash or to accrue monthly interest.

Prior to the closing of the Credit Agreement in February 2019, the Investor Notes were secured by a first priority lien of all assets of the Company and its subsidiaries. In connection with closing of the Credit Agreement, all noteholders of the Investor Notes entered into a Subordination and Intercreditor Agreement with TCB whereby all Investor Notes currently in place, and all future Investor Notes in substantially the same form, were from thereon secured by a second priority lien of all assets of FLPS and its subsidiaries, while the Investor Notes retained their first priority lien in all assets of all other existing and future subsidiaries of FPS.

NOTE 14 — RELATED PARTY TRANSACTIONS

On August 16, 2021, FPS entered into a Simple Agreement for Future Equity (as amended from time to time, the “SAFE”) with two related party investors, where the related party investors will pay a total of $5,500 in exchange for the right to receive FGS common stock upon a successful public offering (the “SAFE Transaction”). If the public offering does not occur, these transactions will result in the related party investors receiving the right to receive equity in FLPS from FPS. The proceeds of this transaction were contributed by FPS to FEI and FLPS as capital and recorded within the Company's net parent investment. During the nine months ended September 30, 2021, $2,500 was contributed to the Company as part of this transaction. The remaining $3,000 of committed capital under the agreement was contributed to the Company during the fourth quarter of 2021.

The Company distributed $27 and $23, respectively, to FPS during the nine months ended September 30, 2021 and 2020. In addition, during the nine months ended September 30, 2021 and 2020, $7,404 and $800, respectively, were re-contributed to the Company for working capital purposes or as part of the SAFE Transaction. There are no terms and conditions associated with the repayment of either of these amounts. The contributions were recorded within the Company’s net parent investment at September 30, 2021 and 2020.

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NOTE 15 — EMPLOYEE BENEFIT PLAN

The Company sponsors defined contribution 401(k) plans covering substantially all of its employees. The plans entitle employees, almost immediately after their start date, to make voluntary contributions to the plans. Contributions cannot exceed the maximum amount allowed under applicable provisions of the Internal Revenue Code (the “Code”). The Company provided a matching contribution of 100% up to 6% of base salary. Employees are vested in the matching contributions immediately. The Company’s contributions to the plans amounted to approximately $330 and $291 for nine months ended September 30, 2021 and 2020, respectively.

NOTE 16 — INCENTIVE PLANS

FlexEnergy, Inc. 2013 Equity Incentive Plan

On January 1, 2013, FEI implemented a long-term compensation incentive plan under which employees, officers, directors and other individuals providing services to FEI are eligible to receive cash payment awards (the “2013 Plan”). The values of each eligible payment under the 2013 Plan has been fixed through the amendment made on October 27, 2016 and there will be no further grants made. No forfeitures have been recognized under the 2013 Plan. An aggregate payout of $633 is due to the participants on the earlier of January 1, 2023 or when certain change in control terms (as provided below) are met. Under the 2013 Plan, a “Change in Control” will have occurred if a single shareholder or shareholder group obtains effective control of FEI, or upon a liquidation or dissolution. The weighted average contractual life remaining is 1.19 years for options outstanding and exercisable. The liability of $545 and $492 is recorded within Other non-current liabilities on the accompanying condensed combined consolidated balance sheets as of September 30, 2021 and December 31, 2020, respectively. Share-based compensation expense was $53 for the 2013 Incentive Plan during the nine months ended September 30, 2021 and 2020 and was recorded in selling, general and administrative operating expenses on the accompanying condensed combined consolidated statements of operations and comprehensive loss.

FlexEnergy, Inc. 2016 Target Incentive Plan (Participation Plan)

On October 27, 2016, FEI adopted the 2016 Target Incentive Plan (the “2016 Plan”), which provides for the grant of cash payment awards totaling $3,249 to certain officers and employees, payable upon satisfaction of a performance condition (i.e. the occurrence of a Change in Control, as defined) and a service vesting condition (i.e. the vesting of an award based on continuous service) . Any payments due under the 2016 Plan are required to be paid within 60 days following a Change in Control (as defined) that constitutes a Qualifying Sale. Under the 2016 Plan, a “Change in Control” will have occurred if a single shareholder or shareholder group obtains effective control of FPS or acquires 50% or more than the fair market value of its assets.

Under the 2016 Plan, cash payment awards of $3,249 in aggregate were granted in October 2016, and the Company does not expect there will be any further awards. There is no settlement payment of an award under the 2016 Plan unless and until there is a Qualifying Sale which also constitutes a Change in Control of FEI prior to the earlier of a Termination Transaction or the termination of the 2016 Plan on January 1, 2026. The payments under the 2016 Plan are only due to the participants if certain change in control terms are met on or before the earlier of January 1, 2026. To constitute a Qualifying Sale, a sale or series of sales of assets or ownership must result in the holders of Series A Units of FPS receiving more than $64.00 per Series A Unit. A total of 1,000,000 Series A Units are currently issued and outstanding. The change in control term is a performance condition and therefore the Company does not accrue or recognize any compensation cost until such event is considered probable. No compensation cost has been recognized on these awards to date as the event is not considered probable.

NOTE 17 — SUBSEQUENT EVENTS

The Company has evaluated subsequent events through January 11, 2022, the date these condensed combined consolidated financial statements were available to be issued, to ensure that this filing includes all

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appropriate footnote disclosure of events both recognized in the financial statements as of September 30, 2021, and events which occurred subsequently but were not recognized in the financial statements. The Company has concluded that there were no subsequent events requiring adjustment to or disclosure in these condensed combined consolidated financial statements.

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FLEXENERGY GREEN SOLUTIONS, INC.

2,222,222 Units

Common Stock and Warrants

January  , 2022

Through and including                  , 2022 (the 25th day after the date of this prospectus), all dealers effecting transactions in our common stock, whether or not participating in our initial public offering, may be required to deliver a prospectus. This delivery requirement is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13.   OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth all expenses to be paid by us, other than underwriting discounts and commissions, upon completion of this offering. All amounts shown are estimates except for the SEC registration fee and the FINRA filing fee.

SEC registration fee	$	5,401
FINRA filing fee	$	9,500
Exchange listing fee	$	50,000
Printing and engraving expenses	$	180,000
Legal fees and expenses	$	850,000
Accounting fees and expenses	$	2,200,000
Transfer agent and registrar fees	$	8,000
Miscellaneous expenses	$	422,097
Total	$	3,724,998

ITEM 14.   INDEMNIFICATION OF DIRECTORS AND OFFICERS

Section 145 of the Delaware General Corporation Law authorizes the board of directors of a corporation to grant, and authorizes a court to award, indemnity to officers, directors and other corporate agents.

Our Certificate of Incorporation contains provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for breach of the fiduciary duty of care, but will be liable for monetary damages for the following:

•

any breach of their duty of loyalty to our company or our stockholders;

•

any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

•

unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or

•

any transaction from which they derived an improper personal benefit.

Any amendment to, or repeal of, these provisions will not eliminate or reduce the effect of these provisions in respect of any act, omission or claim that occurred or arose prior to that amendment or repeal. If the Delaware General Corporation Law is amended to provide for further limitations on the personal liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent permitted by the Delaware General Corporation Law.

In addition, our Certificate of Incorporation and Bylaws provide that we will indemnify and hold harmless, to the fullest extent permitted by the Delaware General Corporation Law, any director or officer who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “proceeding”), by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the corporation or, while a director or officer of the corporation, is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against

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all liability and loss suffered and expenses (including attorneys’ fees and other amounts) reasonably incurred. The foregoing rights to indemnification generally do not apply to a proceeding initiated by a director or officer unless the proceedings were approved by our board of directors, the indemnification is required by law or the director or officer is seeking enforcement of the indemnification and advancement rights. Our Certificate of Incorporation and our Bylaws will also provide that we must pay the expenses (including attorneys’ fees) incurred by a director or officer in defending any proceeding in advance of its final disposition, provided that such payment of expenses in advance of the final disposition of the proceeding will be made only upon receipt of an undertaking by such director or officer to repay all amounts advanced if it is ultimately determined that the director or officer is not entitled to be indemnified.

Further, we have entered into or will enter into indemnification agreements with each of our directors and executive officers that may be broader than the specific indemnification provisions contained in the Delaware General Corporation Law. These indemnification agreements require us, among other things, to indemnify our directors and executive officers against liabilities that may arise by reason of their status or service. These indemnification agreements also require us to advance all expenses incurred by the directors and executive officers prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in any such action, suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding. We believe that these agreements are necessary to attract and retain qualified individuals to serve as directors and executive officers.

The limitation of liability and indemnification provisions that are expected to be included in our Certificate of Incorporation, Bylaws and in indemnification agreements that we have entered into or will enter into with our directors and executive officers may discourage stockholders from bringing a lawsuit against our directors and executive officers for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against our directors and executive officers, even though an action, if successful, might benefit us and other stockholders. Further, a stockholder’s investment may be adversely affected to the extent that we pay the costs of settlement and damage awards against directors and executive officers as required by these indemnification provisions. At present, we are not aware of any pending litigation or proceeding involving any person who is or was one of our directors, officers, employees or other agents or is or was serving at our request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, for which indemnification is sought, and we are not aware of any threatened litigation that may result in claims for indemnification.

We have obtained insurance policies under which, subject to the limitations of the policies, coverage is provided to our directors and executive officers against loss arising from claims made by reason of breach of fiduciary duty or other wrongful acts as a director or executive officer, including claims relating to public securities matters, and to us with respect to payments that may be made by us to these directors and executive officers pursuant to our indemnification obligations or otherwise as a matter of law.

Certain of our non-employee directors may, through their relationships with their employers, be insured and/or indemnified against certain liabilities incurred in their capacity as members of our board of directors.

The underwriting agreement to be filed as Exhibit 1.1 to this registration statement will provide for indemnification by the underwriter of us and our officers and directors for certain liabilities arising under the Securities Act or otherwise.

ITEM 15.   RECENT SALES OF UNREGISTERED SECURITIES

In connection with the Contribution Transaction, 9,678,878 shares of common stock will be issued to FlexEnergy Power Solutions, LLC. The common stock will be issued in reliance on the exemption contained in Section 4(a)(2) of the Securities Act, as a transaction by an issuer not involving any public offering.

ITEM 16.   EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)

Exhibits.   See the Exhibit Index attached to this registration statement, which is incorporated by reference herein.

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(b)

Financial Statement Schedules.   All financial statement schedules are omitted because the information called for is not required or is shown either in the combined consolidated financial statements or in the notes thereto.

ITEM 17.   UNDERTAKINGS

The undersigned registrant hereby undertakes to provide to the underwriter at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act, may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes:

(1)   For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(2)   For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

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EXHIBIT INDEX

Exhibit Number	Exhibit Description
1.1	Form of Underwriting Agreement.
2.1*	Form of Contribution Agreement, to be in effect at the consummation of this offering.
3.1*	Form of Second Amended and Restated Certificate of Incorporation, to be in effect at the consummation of this offering.
3.2*	Form of Amended and Restated Bylaws, to be in effect at the consummation of this offering.
4.1*	Form of Warrant to be issued to Roth Capital Partners, LLC in connection with this offering.
4.2	Form of Warrant Agent Agreement (including the terms of the Warrants) between FlexEnergy Green Solutions, Inc. and American Stock Transfer & Trust Company.
5.1	Opinion of Rutan & Tucker, LLP.
10.1+	Form of 2021 Incentive Award Plan and forms of award agreements thereunder, to be in effect at the consummation of this offering.
10.2+*	Form of Indemnity Agreement between FlexEnergy Green Solutions, Inc. and each of its directors and executive officers, to be in effect at the consummation of this offering.
10.3*	Form of Registration Rights Agreement among FlexEnergy Green Solutions, Inc., FlexEnergy Power Solutions, LLC, RNS Flex, LLC and TRF Platform Holdings, LLC to be in effect at the consummation of this offering.
10.4+	Board Chairperson Compensation Agreement between FlexEnergy Green Solutions, Inc. and George Walker, dated December 13, 2021.
10.5+	Executive Employment Agreement between FlexEnergy Energy Systems, Inc. and Mark Schnepel, dated December 13, 2021.
10.6+	Executive Employment Agreement between FlexEnergy Energy Systems, Inc. and Wes Kimmel, dated December 13, 2021.
10.7+	Executive Employment Agreement between Flex Leasing Power & Service LLC and Doug Baltzer, dated December 13, 2021.
10.8*	Sublease between Pioneer New Hampshire LLC and FlexEnergy Systems, Inc. dated December 23, 2020.
10.9*	Office Lease between Flex Leasing Power & Service LLC and GPI Plaza Tower, LP, dated February 19, 2018.
10.10*	First Amendment to Office Lease between Flex Leasing Power & Service LLC and GPI Plaza Tower, LP, dated August 29, 2019.
10.11*	Sublease between Flex Leasing Power & Service LLC and Energes, LLC, dated April 12, 2016.
10.12*	Lease Agreement between Flex Leasing Power Service ULC and Bennett Financial Corp, dated December 1, 2015.
10.13	Agreement to Renew Lease between Flex Leasing Power Service ULC and Bennett Financial Corp., dated December 15, 2021.
10.14*	Lease Renewal Agreement between Flex Leasing Power Service ULC and Bennett Financial Corp, dated July 1, 2020.
10.15*	Commercial Lease between Flex Leasing Power & Service LLC and West Epley LLC dated August 15, 2019.
10.16*	Commercial Lease Amendment between Flex Leasing Power & Service LLC and West Epley LLC dated June 1, 2020.
10.17*	Lease Agreement between FlexEnergy Energy Systems, Inc. and 1 Progress LLC, dated January 2019.
10.18*	First Lease Amendment between FlexEnergy Energy Systems, Inc. and 1 Progress LLC, dated February 22, 2021.
10.19*	Credit Agreement among Flex Leasing & Power Service LLC, as borrower, each of the other loan parties from time to time party thereto, the lenders from time to time party thereto and Texas Capital Bank, National Association, as administrative agent, swing line lender and L/C issuer, dated February 8, 2019.

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Exhibit Number	Exhibit Description
10.20*	Pledge and Security Agreement among Flex Leasing Power & Service LLC, Flex Power Co. and Texas Capital Bank, National Association dated February 8, 2019.
10.21*	Parent Pledge and Limited Guaranty Agreement among FlexEnergy Power Solutions, LLC and Texas Capital Bank, National Association dated February 8, 2019.
10.22*	Subordination and Intercreditor Agreement among RNS Flex, LLC, Energy Special Situations Fund II, L.P., ESS Participation Fund II, L.P., TRF Platform Holdings, LLC, FlexEnergy Power Solutions, LLC, Flex Leasing Power & Service LLC and Texas Capital Bank, National Association dated February 8, 2019.
10.23*	First Amendment to Credit Agreement and First Amendment to Pledge and Security Agreement among Flex Leasing & Power Service LLC, as borrower, each of the other borrowers and loan parties party thereto, the lenders party thereto and Texas Capital Bank, National Association, as administrative agent, dated January 27, 2020.
10.24*	Second Amendment to Credit Agreement among Flex Leasing & Power Service LLC, as borrower, each of the other borrowers and loan parties party thereto, the lenders party thereto and Texas Capital Bank, National Association, as administrative agent, dated August 28, 2020.
10.25*	Third Amendment to Credit Agreement among Flex Leasing & Power Service LLC, as borrower, each of the other borrowers and loan parties party thereto, the lenders party thereto and Texas Capital Bank, National Association, as administrative agent, dated December 22, 2020.
10.26*	Letter Agreement Regarding Limited Waiver of Leverage Ration Financial Covenant among Flex Leasing Power & Service LLC, each of the other borrowers and loan parties party thereto and Texas Capital Bank, National Association, as administrative agent, dated February 12, 2021.
10.27*	Fourth Amendment to Credit Agreement among Flex Leasing Power & Service LLC, each of the other borrowers and loan parties party thereto, the lenders party thereto and Texas Capital Bank, National Association, as administrative agent, dated June 29, 2021.
10.28	Fifth Amendment to Credit Agreement among Flex Leasing Power & Service LLC, each of the other borrowers and loan parties party thereto, the lenders party thereto and Texas Capital Bank, National Association, as administrative agent, dated December   , 2021.
10.29*	Joinder Agreement by Flex Leasing and Power Service ULC, in favor of Texas Capital Bank, National Association, as administrative agent, dated December 22, 2020.
10.30*	Joinder Agreement and Amendment to Subordination and Intercreditor Agreement by Flex Leasing and Power Service ULC, in favor of Texas Capital Bank, National Association, as administrative agent, and acknowledged by the existing loan parties and subordinated lenders thereto dated December 22, 2020.
10.31*	Amendment to Security Agreement by Flex Power Co. dated December 22, 2020.
10.32*	Canadian Pledge and Security Agreement between Flex Leasing and Power Service ULC and Texas Capital Bank, National Association, as administrative agent, dated December 22, 2020.
10.33*	Stock Pledge Agreement among FlexEnergy Power Solutions, LLC, RNS Flex, LLC, Energy Special Situations Fund II, L.P., ESS Participation Fund II, L.P. and TRF Platform Holdings, LLC, to be in effect at the consummation of this offering.
10.34	Amended and Restated Simple Agreement for Future Equity between FlexEnergy Power Solutions, LLC and RNS Flex LLC, dated December 2, 2021
10.35	Amended and Restated Simple Agreement for Future Equity between FlexEnergy Power Solutions, LLC and TRF Platform Holdings, LLC, dated December 2, 2021
21.1*	List of Subsidiaries of the Registrant.
23.1	Consent of Deloitte & Touche LLP, independent registered public accounting firm.
23.2	Consent of Rutan & Tucker, LLP (included in Exhibit 5.1).
24.1*	Power of Attorney (see page II-6).

*

Previously filed.

+

Management contract or compensatory plan or arrangement.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement on Form S-1 to be signed on its behalf by the undersigned, thereunto duly authorized, in Portsmouth, New Hampshire, on the 11th day of January, 2022.

FLEXENERGY GREEN SOLUTIONS, INC.

By:

/s/ Mark Schnepel

Name:

Mark Schnepel

Title:

Chief Executive Officer   

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement on Form S-1 has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Mark Schnepel Mark Schnepel	Chief Executive Officer (Principal Executive Officer)	January 11, 2022
/s/ Wes Kimmel Wes Kimmel	Chief Financial Officer (Principal Financial and Accounting Officer)	January 11, 2022
* Thomas Denison	Director	January 11, 2022
* Patrick Connelly	Director	January 11, 2022
* George Walker	Director	January 11, 2022

* By:	/s/ Wes Kimmel
​	Wes Kimmel
​	Attorney-in-Fact

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EX-1.1

Exhibit 1.1

[_______] SHARES OF COMMON STOCK

AND

[_________] WARRANTS TO PURCHASE COMMON STOCK

FLEXENERGY GREEN SOLUTIONS, INC.

UNDERWRITING AGREEMENT

________, 2022

Roth Capital Partners, LLC

888 San Clemente Drive, Suite 400

Newport Beach, CA 92660

Ladies and Gentlemen:

The undersigned, FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), hereby confirms its agreement (this “Agreement”) with Roth Capital Partners, LLC (the “Underwriter”) on the terms and conditions set forth herein.

It is understood that the Underwriter is to make a public offering of the Closing Securities and, if any, the Option Securities (each as defined below and collectively referred to herein as the “Public Securities”), as soon as it deems it advisable to do so. The Public Securities are to be initially offered to the public at the public offering price set forth in the Prospectus (the “Offering”). The Public Securities, the Underwriter Warrants and the Warrant Shares (each as defined below) are collectively referred to as the “Securities.”

The Company and the Underwriter hereby confirm their agreement as follows:

1.Registration Statement and Prospectus.

The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) a registration statement covering the Securities on Form S-1 (File No. 333-260111) under the Securities Act of 1933, as amended (the “Securities Act”), and the rules and regulations (the “Rules and Regulations”) of the Commission thereunder, and such amendments to such registration statement (including post effective amendments) as may have been required to the date of this Agreement. Such registration statement, as amended (including any post effective amendments), has been declared effective by the Commission. Such registration statement, including amendments thereto (including post effective amendments thereto) and all documents and information deemed to be a part of the Registration Statement through incorporation by reference or otherwise at the time of effectiveness thereof (the “Effective Time”), the exhibits and any schedules thereto at the Effective Time or thereafter during the period of effectiveness and the documents and information otherwise deemed to be a part thereof or included therein by the Securities Act or otherwise pursuant to the Rules and Regulations at the Effective Time or thereafter during the period of effectiveness, is herein called the “Registration Statement.” If the Company has filed or files an abbreviated registration statement pursuant to Rule 462(b) under the Securities Act (the “Rule 462 Registration Statement”), then any reference herein to the term Registration Statement shall include such Rule 462 Registration Statement. Any preliminary prospectus included in the Registration Statement or filed with the Commission pursuant to Rule 424(a) under the Securities Act is hereinafter called a “Preliminary Prospectus.” The Preliminary Prospectus relating to the Securities that was included in the Registration Statement at the time the Registration Statement was declared effective by the Commission is hereinafter called the “Pricing Prospectus.”

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The Company is filing with the Commission pursuant to Rule 424 under the Securities Act a final prospectus covering the Securities, which includes the information permitted to be omitted therefrom at the Effective Time by Rule 430A under the Securities Act. Such final prospectus, as so filed, is hereinafter called the “Final Prospectus.” The Final Prospectus, the Pricing Prospectus and any preliminary prospectus in the form in which they were included in the Registration Statement or filed with the Commission pursuant to Rule 424 under the Securities Act is hereinafter called a “Prospectus.” Reference made herein to any Preliminary Prospectus, the Pricing Prospectus or to the Prospectus shall be deemed to refer to and include any documents incorporated by reference therein and any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any document filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations of the Commission thereunder, incorporated by reference in such Preliminary Prospectus or the Prospectus, as the case may be.

2.Representations and Warranties of the Company Regarding the Offering.

(a)The Company represents and warrants to, and agrees with, the Underwriter, as of the date hereof, and as of the Closing Date (as defined in Section 4(c) below) and as of each Option Closing Date (as defined in Section 4(d) below), as follows:

(i)No Material Misstatements or Omissions. At each time of effectiveness, at the date hereof, at the Closing Date, and at each Option Closing Date, if any, the Registration Statement and any post-effective amendment thereto complied or will comply in all material respects with the requirements of the Securities Act and the Rules and Regulations and did not, does not, and will not, as the case may be, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Time of Sale Disclosure Package (as defined in Section 2(a)(v)(A)(1) below) as of [●] (Eastern time) (the “Applicable Time”) on the date hereof, and at the Closing Date and on each Option Closing Date, if any, and the Final Prospectus, as amended or supplemented, as of its date, at the time of filing pursuant to Rule 424(b) under the Securities Act, and at the Closing Date and at each Option Closing Date, if any, and any individual Written Testing-the-Waters Communication, when considered together with the Time of Sale Disclosure Package, did not, does not and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. The representations and warranties set forth in the two immediately preceding sentences shall not apply to statements in or omissions from the Registration Statement, the Time of Sale Disclosure Package or any Prospectus in reliance upon, and in conformity with, written information furnished to the Company by the Underwriter specifically for use in the preparation thereof, which written information is described in Section 7(g). The Registration Statement contains all exhibits and schedules required to be filed by the Securities Act or the Rules and Regulations. No order preventing or suspending the effectiveness or use of the Registration Statement or any Prospectus is in effect and no proceedings for such purpose have been instituted or are pending, or, to the knowledge of the Company, are contemplated or threatened by the Commission.

(ii)Marketing Materials. The Company has not distributed any prospectus or other offering material in connection with the Offering other than the Time of Sale Disclosure Package and the roadshow or investor presentations delivered to and approved by the Underwriter for use in connection with the marketing of the Offering (the “Marketing Materials”).

(iii)Emerging Growth Company. The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act (an “Emerging Growth Company”).

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(iv) Testing-the-Waters Communications. The Company (i) has not alone engaged in any Testing-the-Waters Communication and (ii) has not authorized anyone to engage in Testing-the-Waters Communications. The Company has not distributed any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act (“Written Testing-the-Waters Communications”), other than those previously provided to the Underwriter and listed on Schedule III hereto. “Testing-the-Waters Communication” means any oral or written communication with potential investors undertaken in reliance on Section 5(d) of the Securities Act. The Company has filed publicly on the Electronic Data Gathering, Analysis, and Retrieval system (“EDGAR”) at least 15 calendar days prior to any “road show” (as defined in Rule 433 und the Securities Act), any confidentially submitted registration statement and registration statement amendments relating to the offer and sale of Securities. Each Written Testing-the-Waters Communications, did not, as of the Applicable Time, and at all times through the completion of the public offer and sale of Shares will not, include any information that conflicted, conflicts or will conflict with the information contained in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus.

(v)Accurate Disclosure. (A) The Company has provided a copy to the Underwriter of each Issuer Free Writing Prospectus (as defined below) used in the sale of the Public Securities. The Company has filed all Issuer Free Writing Prospectuses required to be so filed with the Commission, and no order preventing or suspending the effectiveness or use of any Issuer Free Writing Prospectus is in effect and no proceedings for such purpose have been instituted or are pending, or, to the knowledge of the Company, are contemplated or threatened by the Commission. When taken together with the rest of the Time of Sale Disclosure Package or the Final Prospectus, no Issuer Free Writing Prospectus, as of its issue date and at all subsequent times through the completion of the public offer and sale of the Public Securities, has, does or will include (1) any untrue statement of a material fact or omission to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or (2) information that conflicted, conflicts or will conflict with the information contained in the Registration Statement or the Final Prospectus. The representations and warranties set forth in the immediately preceding sentence shall not apply to statements in or omissions from the Time of Sale Disclosure Package, the Final Prospectus or any Issuer Free Writing Prospectus in reliance upon, and in conformity with, written information furnished to the Company by the Underwriter specifically for use in the preparation thereof, which written information is described in Section 7(g). As used in this paragraph and elsewhere in this Agreement:

(1)       “Time of Sale Disclosure Package” means the Prospectus most recently filed with the Commission before the time of this Agreement, each Issuer Free Writing Prospectus, and the description of the transaction provided by the Underwriter included on Schedule V.

(2)       “Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433 under the Securities Act, relating to the Public Securities that (A) is required to be filed with the Commission by the Company, or (B) is exempt from filing pursuant to Rule 433(d)(5)(i) or (d)(8) under the Securities Act, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g) under the Securities Act.

(B)          At the time of filing of the Registration Statement and at the date hereof, the Company was not and is not an “ineligible issuer,” as defined in Rule 405 under the Securities Act or an “excluded issuer” as defined in Rule 164 under the Securities Act.

3

(C)          Each Issuer Free Writing Prospectus listed on Schedule II satisfied, as of its issue date and at all subsequent times through the Prospectus Delivery Period, all other conditions as may be applicable to its use as set forth in Rules 164 and 433 under the Securities Act, including any legend, record-keeping or other requirements.

(vi)Financial Statements. The consolidated financial statements of the Company, together with the related notes and schedules, included in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus comply in all material respects with the applicable requirements of the Securities Act and the Exchange Act, and the rules and regulations of the Commission thereunder, and fairly present, in all material respects, the consolidated financial condition of the Company as of the dates indicated and the consolidated results of operations and changes in cash flows for the periods therein specified in conformity with U.S. generally accepted accounting principles (“GAAP”) consistently applied throughout the periods involved, except as may be expressly stated in the notes thereto. Except as have been included in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus, no other financial statements or schedules are required under the Securities Act, the Exchange Act, or the Rules and Regulations to be included in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus.

(vii)Pro Forma Financial Information. The pro forma financial statements included or incorporated by reference in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus include assumptions that provide a reasonable basis for presenting the significant effects directly attributable to the transactions and events described therein, the related pro forma adjustments give appropriate effect to those assumptions, and the pro forma adjustments reflect the proper application of those adjustments to the historical financial statements amounts in the pro forma financial statements included or incorporated by reference in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus. The pro forma financial statements included or incorporated by reference in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus comply as to form in all material respects with the application requirements of Regulation S-X under the Exchange Act. No other pro forma financial information or schedules are required under the Securities Act, the Exchange Act, or the rules and regulations thereunder to be included in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus.

(viii)Independent Accountants. To the Company’s knowledge, Deloitte & Touche LLP, which has expressed its opinion with respect to the financial statements and schedules included in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus, is an independent public accounting firm with respect to the Company within the meaning of the Securities Act and the Rules and Regulations.

(ix)Accounting and Disclosure Controls. Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus, the Company and its subsidiaries maintain systems of “internal control over financial reporting” (as defined under Rules 13a-15 and 15d-15 under the Exchange Act) that comply with the requirements of the Exchange Act and have been designed by, or under the supervision of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) the interactive data in eXtensible Business Reporting Language included in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus fairly present the information called for in all material respects and are prepared in accordance with the Commission’s rules and guidelines applicable thereto. Since the date of the latest audited financial statements included in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus, there has been no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

4

The Company maintains disclosure controls and procedures that have been designed to ensure that material information relating to the Company and its subsidiaries is made known to the Company’s principal executive officer and principal financial officer by others within those entities; and, except as disclosed in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus, such disclosure controls and procedures are effective.

(x)Forward-Looking Statements. The Company has a reasonable basis for, and made in good faith, each “forward-looking statement” (within the meaning of Section 27A of the Securities Act or Section 21E of the Exchange Act) contained in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus.

(xi)Statistical and Market-Related Data. Nothing has come to the attention of the Company that has caused it to believe that the statistical and market-related data included in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus are not based on or derived from sources that are accurate and reliable in all material respects.

(xii)Trading Market. The Company’s common stock, par value $0.0001 per share (the “Common Stock”) is registered pursuant to Section 12(b) of the Exchange Act and is approved for listing on Nasdaq Capital Market (“Nasdaq”). There is no action pending by the Company or, to the Company’s knowledge, by Nasdaq to delist the Common Stock from Nasdaq, nor has the Company received any notification that Nasdaq is contemplating terminating such listing. When issued, the Closing Shares, the Option Shares and the Warrant Shares will be listed on Nasdaq. The Company has taken all actions it deems reasonably necessary or advisable to take on or prior to the date of this Agreement to ensure that it will be in compliance in all material respects with all applicable corporate governance requirements set forth in the rules of Nasdaq that are then in effect and applicable to the Company, and will take all action it deems reasonably necessary or advisable to ensure that it will be in compliance in all material respects with other applicable corporate governance requirements set forth in Nasdaq rules not currently in effect upon and all times after the effectiveness of such requirements, to the extent applicable to the Company.

(xiii)Absence of Manipulation. Other than excepted activity pursuant to Regulation M under the Exchange Act, the Company has not taken, directly or indirectly, any action that is designed to or that has constituted or that would reasonably be expected to cause or result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities. For the sake of clarity, actions by the Underwriter or persons acting on its behalf will not constitute direct or indirect action by the Company for purposes of this Section.

5

(xiv)Investment Company Act. The Company is not and, after giving effect to the Offering and the application of the net proceeds thereof will not be an “investment company,” as such term is defined in the Investment Company Act of 1940, as amended.

3.Representations and Warranties Regarding the Company.

(a)The Company represents and warrants to the Underwriter, as of the date hereof and as of the Closing Date and as of each Option Closing Date (if any), as follows:

(i)Good Standing. Each of the Company and its subsidiaries has been duly organized and is validly existing as a corporation or other entity in good standing under the laws of its jurisdiction of incorporation or organization. Each of the Company and its subsidiaries has the power and authority (corporate or otherwise) to own its properties and conduct its business as currently being carried on and as described in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus, and is duly qualified to do business as a foreign corporation or other entity in good standing in each jurisdiction where the nature of its properties or the conduct of its business makes such qualification necessary, except where the failure to so qualify has not had or would not be reasonably likely to result in a material adverse effect upon the business, properties, operations, condition (financial or otherwise) or results of operations of the Company and its subsidiaries, taken as a whole, or in its ability to perform its obligations under this Agreement (“Material Adverse Effect”).

(ii)Authorization. The Company has the power and authority to enter into this Agreement, the Warrants, the Underwriter Warrants, the Warrant Agent Agreement, and any other documents or agreements executed in connection with the transactions contemplated hereunder (the “Transaction Documents”) and to authorize, issue and sell the Securities as contemplated by the Transaction Documents. The Transaction Documents have been duly authorized by the Company, and when executed and delivered by the Company, will constitute the valid, legal and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except as rights to indemnity hereunder may be limited by federal or state securities laws or public policy and except as enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting the rights of creditors generally and subject to general principles of equity.

(iii)Contracts. The execution, delivery and performance of this Agreement and the other Transaction Documents and the consummation of the transactions herein and therein contemplated will not (A) result in a breach or violation of any of the terms and provisions of, or constitute a default under, any law, order, rule or regulation to which the Company or any subsidiary is subject, or by which any property or asset of the Company or any subsidiary is bound or affected, except to the extent that the breach or violation is not reasonably likely to result in a Material Adverse Effect, (B) conflict with, result in any violation or breach of, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any right of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) (a “Default Acceleration Event”) of, any agreement, lease, credit facility, debt, note, bond, mortgage, indenture or other instrument (the “Contracts”) or obligation or other understanding to which the Company or any subsidiary is a party or by which any property or asset of the Company or any subsidiary is bound or affected, except to the extent that such conflict, violation, breach, default, or Default Acceleration Event is not reasonably likely to result in a Material Adverse Effect, or (C) result in a breach or violation of any of the terms and provisions of, or constitute a default under, the Company’s Certificate of Incorporation or by-laws.

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(iv) No Violations of Governing Documents. Neither the Company nor any of its subsidiaries is in violation, breach or default under its certificate of incorporation, by-laws or other equivalent organizational or governing documents.

(v)Consents. No consents, approvals, orders, authorizations or filings are required on the part of the Company in connection with the execution, delivery or performance of this Agreement and the other Transaction Documents and the issue and sale of the Securities, except (A) the registration under the Securities Act of the Securities, which has been effected, (B) the necessary filings and approvals from Nasdaq to list the Closing Shares, the Option Shares and the Warrant Shares, (C) such consents, approvals, authorizations, registrations or qualifications as may be required under state or foreign securities or Blue Sky laws and the rules of the Financial Industry Regulatory Authority, Inc. (“FINRA”) in connection with the purchase and distribution of the Securities by the Underwriter, (D) such consents and approvals as have been obtained and are in full force and effect, and (E) such consents, approvals, orders, authorizations and filings the failure of which to make or obtain is not reasonably likely to result in a Material Adverse Effect.

(vi)Capitalization. The Company has an authorized capitalization as set forth in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus. All of the issued and outstanding shares of capital stock of the Company are duly authorized and validly issued, fully paid and nonassessable, and have been issued in compliance with all applicable securities laws, and conform in all material respects to the description thereof in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus. All of the issued shares of capital stock of or other equity interests in each subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable (except as nonassessability may be affected by Sections 18-303, 18-607 and 18-803 of the Delaware Limited Liability Company Act) and, except as set forth in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus, are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims. Except for the issuances of options or restricted stock in the ordinary course of business, since the respective dates as of which information is provided in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus, the Company has not entered into or granted any convertible or exchangeable securities, options, warrants, agreements, contracts or other rights in existence to purchase or acquire from the Company any shares of the capital stock of the Company. The Securities, when issued and paid for as provided herein, will be duly authorized and validly issued, fully paid and nonassessable, will be issued in compliance with all applicable securities laws, and will be free of preemptive, registration or similar rights and will conform to the description of the capital stock of the Company contained in the Registration Statement, the Time of Sale Disclosure Package and the Prospectus. The shares of Common Stock issuable upon the exercise of the Warrants and the Underwriter Warrants (collectively, the “Warrant Shares”), when issued, paid for and delivered upon due exercise of the Warrants and the Underwriter Warrants will be duly authorized and validly issued, fully paid and nonassessable, will be issued in compliance with all applicable securities laws, and will be free of preemptive, registration or similar rights. The Warrant Shares have been reserved for issuance. The Warrants and the Underwriter Warrants, when issued, will conform in all material respects to the descriptions thereof set forth in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus.

(vii)Taxes. Each of the Company and its subsidiaries has (a) filed all foreign, federal, state and local tax returns (as hereinafter defined) required to be filed with taxing authorities prior to the date hereof or has duly obtained extensions of time for the filing thereof and (b) paid all taxes (as hereinafter defined) shown as due and payable on such returns that were filed and has paid all taxes imposed on or assessed against the Company or such respective subsidiary that are due and payable, except for any taxes that are currently being contested in good faith or that, if not paid, are not reasonably likely to result in a Material Adverse Effect. The provisions for taxes payable, if any, shown on the financial statements included in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus are adequate, in accordance with GAAP, for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of such consolidated financial statements. To the Company’s knowledge, no issues have been raised (and are currently pending) by any taxing authority in connection with any of the returns or taxes asserted as due from the Company or its subsidiaries, and no waivers of statutes of limitation with respect to the returns or collection of taxes have been given by or requested from the Company or its subsidiaries. The term “taxes” mean all federal, state, local, foreign, and other net income, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments, or charges of any kind whatever, together with any interest and any penalties, additions to tax, or additional amounts with respect thereto. The term “returns” means all returns, declarations, reports, statements, and other documents required to be filed in respect to taxes.

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(viii)Material Change. Except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus, since the date of the most recent financial statements included in the Registration Statement, Time of Sale Disclosure Package or Final Prospectus, (a) neither the Company nor any of its subsidiaries has incurred any material liabilities or obligations, direct or contingent, or entered into any material transactions other than in the ordinary course of business, (b) the Company has not declared or paid any dividends or made any distribution of any kind with respect to its capital stock; (c) there has not been any change in the capital stock of the Company or any of its subsidiaries (other than a change in the number of outstanding shares of Common Stock due to the issuance of shares upon the exercise of outstanding options or warrants, upon the conversion of outstanding shares of preferred stock or other convertible securities or the issuance of restricted stock awards or restricted stock units under the Company’s existing stock awards plan, or any new grants thereof in the ordinary course of business), (d) there has not been any material change in the Company’s long-term or short-term debt, and (e) there has not been the occurrence of any Material Adverse Effect.

(ix)Absence of Proceedings. Except to the extent disclosed in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus, there is no pending or, to the knowledge of the Company, threatened, action, suit or proceeding to which the Company or any of its subsidiaries is a party or of which any property or assets of the Company or any of its subsidiaries is the subject before or by any court or governmental agency, authority or body, or any arbitrator or mediator, that is reasonably likely to result in a Material Adverse Effect

(x)Permits. The Company and each of its subsidiaries holds, and is in compliance with, all franchises, grants, authorizations, licenses, permits, easements, consents, certificates and orders (“Permits”) of any governmental or self-regulatory agency, authority or body required for the conduct of its business, and all such Permits are in full force and effect, in each case except where the failure to hold, or comply with, any of them is not reasonably likely to result in a Material Adverse Effect or adversely affect the consummation of the transactions contemplated by this Agreement.

(xi)Good Title. The Company and each of its subsidiaries have good and valid title to all property (whether real or personal) described in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus as being owned by them that are material to the business of the Company, in each case free and clear of all liens, claims, security interests, other encumbrances or defects, except those that are disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus and those that are not reasonably likely to result in a Material Adverse Effect. The property held under lease by the Company and its subsidiaries is held by them under valid, subsisting and enforceable leases with only such exceptions with respect to any particular lease as do not interfere in any material respect with the conduct of the business of the Company and its subsidiaries.

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(xii)Intellectual Property. The Company and each of its subsidiaries owns or possesses or has valid right to use all patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses, inventions, trade secrets and similar rights (“Intellectual Property”) necessary for the conduct of the business of the Company and its subsidiaries as currently carried on and as described in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus. To the knowledge of the Company, no action or use by the Company or any of its subsidiaries involve or give rise to any infringement of, or license or similar fees for, any Intellectual Property of others, except where such action, use, license or fee is not reasonably likely to result in a Material Adverse Effect. Neither the Company nor any of its subsidiaries has received any notice alleging any such infringement or fee. To the Company’s knowledge, none of the technology employed by the Company or any subsidiary has been obtained or is being used by the Company or such subsidiary in violation of any contractual obligation binding on the Company or such subsidiary or, to the Company’s knowledge, any of the officers, directors or employees of the Company or any subsidiary, or, to the Company’s knowledge, otherwise in violation of the rights of any persons, except in the case of violations that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(xiii)Employment Matters. There is (A) no unfair labor practice complaint pending against the Company, or any of its subsidiaries, nor to the Company’s knowledge, threatened against it or any of its subsidiaries before the National Labor Relations Board, any state or local labor relation board or any foreign labor relations board, and no grievance or arbitration proceeding arising out of or under any collective bargaining agreement is so pending against the Company or any of its subsidiaries, or, to the Company’s knowledge, threatened against it and (B) no labor disturbance by the employees of the Company or any of its subsidiaries exists or, to the Company’s knowledge, is imminent, and the Company is not aware of any existing or imminent labor disturbance by the employees of any of its or its subsidiaries, principal suppliers, manufacturers, customers or contractors, that could reasonably be expected, singularly or in the aggregate, to have a Material Adverse Effect. The Company is not aware that any key employee or significant group of employees of the Company or any subsidiary plans to terminate employment with the Company or any such subsidiary.

(xiv)ERISA Compliance. No “prohibited transaction” (as defined in Section 406 of the Employee Retirement Income Security Act of 1974, as amended, including the regulations and published interpretations thereunder (“ERISA”), or Section 4975 of the Internal Revenue Code of 1986, as amended from time to time (the “Code”)) or “accumulated funding deficiency” (as defined in Section 302 of ERISA) or any of the events set forth in Section 4043(b) of ERISA (other than events with respect to which the thirty (30)-day notice requirement under Section 4043 of ERISA has been waived) has occurred or could reasonably be expected to occur with respect to any employee benefit plan of the Company or any of its subsidiaries which would reasonably be expected to, singularly or in the aggregate, have a Material Adverse Effect. Each employee benefit plan of the Company or any of its subsidiaries is in compliance in all material respects with applicable law, including ERISA and the Code. The Company and its subsidiaries have not incurred and could not reasonably be expected to incur any material liability under Title IV of ERISA with respect to the termination of, or withdrawal from, any pension plan (as defined in ERISA). Each pension plan for which the Company or any of its subsidiaries would have any liability that is intended to be qualified under Section 401(a) of the Code is so qualified, and to the Company’s knowledge nothing has occurred, whether by action or by failure to act, that could, singularly or in the aggregate, cause the loss of such qualification.

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(xv)Environmental Matters. The Company and its subsidiaries are in compliance with all foreign, federal, state and local rules, laws and regulations relating to the use, treatment, storage and disposal of hazardous or toxic substances or waste and protection of health and safety or the environment which are applicable to their businesses, except where the failure to comply has not had and would not reasonably be expected to have, singularly or in the aggregate, a Material Adverse Effect. There has been no storage, generation, transportation, handling, treatment, disposal, discharge, emission, or other release of any kind of toxic or other wastes or other hazardous substances by, due to, or caused by the Company or any of its subsidiaries (or, to the Company’s knowledge, any other entity for whose acts or omissions the Company or any of its subsidiaries is or may otherwise be liable) upon any of the property now or previously owned or leased by the Company or any of its subsidiaries, or upon any other property, in violation of any law, statute, ordinance, rule, regulation, order, judgment, decree or permit or which would, under any law, statute, ordinance, rule (including rule of common law), regulation, order, judgment, decree or permit, give rise to any liability, except for any violation or liability which has not had and would not reasonably be expected to have, singularly or in the aggregate, a Material Adverse Effect; and there has been no disposal, discharge, emission or other release of any kind onto such property or into the environment surrounding such property of any toxic or other wastes or other hazardous substances with respect to which the Company or any of its subsidiaries has knowledge.

(xvi)SOX Compliance. The Company has taken all actions it deems reasonably necessary or advisable to take on or prior to the date of this Agreement to assure that, upon and at all times after the effectiveness of the Registration Statement, it will be in compliance in all material respects with all applicable provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and all rules and regulations promulgated thereunder or implementing the provisions thereof that are then in effect and will take all action it deems reasonably necessary or advisable to assure that it will be in compliance in all material respects with other applicable provisions of the Sarbanes-Oxley Act not currently in effect upon it and at all times after the effectiveness of such provisions.

(xvii)Money Laundering Laws. The operations of the Company and its subsidiaries are and have been conducted at all times in compliance in all material respects with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Entity (collectively, the “Money Laundering Laws”); and no action, suit or proceeding by or before any Governmental Entity involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened. “Governmental Entity” shall be defined as any arbitrator, court, governmental body, regulatory body, administrative agency or other authority, body or agency (whether foreign or domestic) having jurisdiction over the Company or any of its subsidiaries or any of their respective properties, assets or operations.

(xviii)Foreign Corrupt Practices Act. Neither the Company nor, any of its subsidiaries, or any director or officer of the Company or any subsidiary, nor, to the knowledge of the Company, any employee, representative, agent, affiliate of the Company or any of its subsidiaries or any other person acting on behalf of the Company or any of its subsidiaries, is aware of or has taken any action, directly or indirectly, that would result in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the “FCPA”), including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA in any material respect and the Company and, to the knowledge of the Company, its affiliates have conducted their businesses in compliance with the FCPA and have instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.

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(xix)OFAC. Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, employee, representative, agent or affiliate of the Company or any of its subsidiaries or any other person acting on behalf of the Company or any of its subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company will not directly or indirectly use the proceeds of the Offering contemplated hereby, or lend, contribute or otherwise make available such proceeds to any person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

(xx)Insurance. The Company and each of its subsidiaries carries, or is covered by, insurance in such amounts and covering such risks as is commercially reasonable for the conduct of its business and the value of its properties.

(xxi)Books and Records. The minute books of the Company and each of its subsidiaries have been made available to the Underwriter and counsel for the Underwriter, and such books (i) contain a complete summary of all meetings and actions of the board of directors (including each board committee) and stockholders of the Company (or analogous governing bodies and interest holders, as applicable), and each of its subsidiaries since the time of its respective incorporation or organization through the date of the latest meeting and action, and (ii) accurately in all material respects reflect all transactions referred to in such minutes.

(xxii)No Undisclosed Contracts. There is no Contract or document required by the Securities Act or by the Rules and Regulations to be described in the Registration Statement, the Time of Sale Disclosure Package or in the Final Prospectus or to be filed as an exhibit to the Registration Statement (“Material Contracts”) that is not so described or filed therein as required; and all descriptions of any Material Contracts contained in the Registration Statement, the Time of Sale Disclosure Package and in the Final Prospectus are accurate and complete descriptions of the Material Contracts in all material respects. Other than as described in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus, no Material Contract has been suspended or terminated for convenience or default by the Company or any subsidiary party thereto or any of the other parties thereto, and neither the Company nor any of its subsidiaries has received notice, and the Company has no knowledge, of any such pending or threatened suspension or termination.

(xxiii)No Undisclosed Relationships. No relationship, direct or indirect, exists between or among the Company or any of its subsidiaries on the one hand, and the directors, officers, stockholders (or analogous interest holders), customers or suppliers of the Company or any of its subsidiaries on the other hand, that is required to be described in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus and that is not so described.

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(xxiv)Insider Transactions. There are no outstanding loans, advances (except normal advances for business expenses in the ordinary course of business) or guarantees of indebtedness by the Company or any of its subsidiaries to or for the benefit of any of the officers or directors of the Company, any of its subsidiaries or any of their respective family members, except as disclosed in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus. All transactions between the Company and its directors, officers or other control persons of the Company have been duly approved by the board of directors of the Company, or duly appointed committees or officers thereof, if and to the extent required under applicable law.

(xxv)No Registration Rights. No person or entity has the right to require registration of shares of Common Stock or other securities of the Company or any of its subsidiaries within 180 days of the date hereof because of the filing or effectiveness of the Registration Statement or otherwise, except for persons and entities who have expressly waived such right in writing, or who have been given timely and proper written notice and have failed to exercise such right within the time or times required under the terms and conditions of such right, or who have acknowledged in writing that such right has been satisfied by the inclusion of securities in the Registration Statement. Except as described in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus, there are no persons with registration rights or similar rights to have any securities registered by the Company or any of its subsidiaries under the Securities Act.

(xxvi)Continued Business. No supplier, customer, distributor or sales agent of the Company or any subsidiary has notified the Company or any subsidiary that it intends to discontinue or decrease the rate of business done with the Company or any subsidiary, except where such discontinuation or decrease has not resulted in and would not reasonably be likely to result in a Material Adverse Effect.

(xxvii)No Finder’s Fee. There are no claims, payments, issuances, arrangements or understandings for services in the nature of a finder’s, consulting or origination fee with respect to the introduction of the Company to the Underwriter or the sale of the Securities hereunder or any other arrangements, agreements, understandings, payments or issuances with respect to the Company that may affect the Underwriter’s compensation, as determined by FINRA.

(xxviii) No Fees. Except as disclosed to the Underwriter in writing, the Company has not made any direct or indirect payments (in cash, securities or otherwise) to (i) any person, as a finder’s fee, investing fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who provided capital to the Company, (ii) any FINRA member, or (iii) any person or entity that has any direct or indirect affiliation or association with any FINRA member within the 12-month period prior to the date on which the Registration Statement was filed with the Commission (“Filing Date”) or thereafter.

(xxix)Proceeds. None of the net proceeds of the Offering will be paid by the Company to any participating FINRA member or any affiliate or associate of any participating FINRA member, except as specifically authorized herein.

(xxx)No FINRA Affiliations. To the Company’s knowledge, no (i) officer or director of the Company or its subsidiaries, (ii) owner of 5% or more of any class of the Company’s securities or (iii) owner of any amount of the Company’s unregistered securities acquired within the 180-day period prior to the Filing Date, has any direct or indirect affiliation or association with any FINRA member. The Company will advise the Underwriter and counsel to the Underwriter if it becomes aware that any officer, director of the Company or its subsidiaries or any owner of 5% or more of any class of the Company’s securities is or becomes an affiliate or associated person of a FINRA member participating in the Offering.

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(xxxi)No Financial Advisor. Other than the Underwriter, no person has the right to act as an underwriter or as a financial advisor to the Company in connection with the transactions contemplated hereby.

(xxxii)Certain Statements. The statements set forth in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus under the captions “Description of Capital Stock”, “Material U.S. Federal Income Tax Consequences to Non-U.S. Holders” and “Shares Eligible for Future Sale” insofar as they purport to describe the provisions of the laws and documents referred to therein, are accurate, complete and fair in material respects.

(xxxiii) Prior Sales of Securities. Except as set forth in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus, the Company has not sold or issued any shares of Common Stock during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulations D or S of, the Securities Act, other than shares issued pursuant to employee benefit plans, stock option plans or other employee compensation plans or pursuant to outstanding preferred stock, options, rights or warrants or other outstanding convertible securities.

(b)Any certificate signed by any officer of the Company in connection with this Agreement and delivered to the Underwriter or to counsel for the Underwriter shall be deemed a representation and warranty by the Company to the Underwriter as to the matters covered thereby.

4.Purchase, Sale and Delivery of Shares.

(a)On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to sell in the aggregate ________ shares of Common Stock, and ____Warrants, exercisable for an aggregate of _____ shares of Common Stock, and the Underwriter agrees to purchase, at the Closing, the following securities of the Company:

(i) the number of shares of Common Stock (the “Closing Shares”) set forth on Schedule I hereof; and

(ii)Warrants in the form and substance acceptable to the Underwriter to purchase up to the number of shares of Common Stock set forth on Schedule I hereof (the “Warrants” and, collectively with the Closing Shares the “Closing Securities”), which Warrants shall have an exercise price of $____, subject to adjustment as provided therein.

(b)The aggregate purchase price for the Closing Securities shall equal the amount set forth on Schedule I hereto (the “Closing Purchase Price”). The combined purchase price for one Share and one Warrant to purchase one Warrant Share shall be $_____ (the “Combined Common Purchase Price”) which shall be allocated as $_____ per Share (the “Share Purchase Price”) and $___ per Warrant (the “Warrant Purchase Price”).

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(c) On the Closing Date (defined below), the Underwriter shall deliver or cause to be delivered to the Company, via wire transfer, immediately available funds equal to the Closing Purchase Price and the Company shall deliver to, or as directed by, the Underwriter its Closing Securities and the Company shall deliver the other items required pursuant to Section 6 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth in Sections 5 and 6, the Closing shall occur at the offices of Roth Capital Partners, LLC, 888 San Clemente Drive, Suite 400, Newport Beach, CA 92660, or such other location as may be mutually acceptable, or such other location as may be mutually acceptable, at 6:00 a.m. Pacific Time, on the second (or if the Closing Securities are priced, as contemplated by Rule 15c6-1(c) under the Exchange Act, after 4:30 p.m. Eastern time), the third full business day following the date hereof, or at such other time and date as the Underwriter and the Company determine pursuant to Rule 15c6-1(a) under the Exchange Act, or, in the case of the Option Shares, at such date and time set forth in the Option Notice. The time and date of delivery of the Closing Securities is referred to herein as the “Closing Date”. The Public Securities are to be offered initially to the public at the offering price set forth on the cover page of the Prospectus.

(d)For the purposes of covering any over-allotments in connection with the distribution and sale of the Closing Securities, the Underwriter is hereby granted an option (the “Option”) to purchase, in the aggregate, up to _____ shares of Common Stock (the “Option Shares”) and Common Warrants to purchase up to ____ shares of Common Stock (the “Option Warrants” and, collectively with the Option Shares, the “Option Securities”) which may be purchased in any combination of Option Shares and/or Option Warrants at the Share Purchase Price and/or Common Warrant Purchase Price, respectively.

(e)In connection with an exercise of the Option, (a) the purchase price to be paid for the Option Shares is equal to the product of the Share Purchase Price multiplied by the number of Option Shares to be purchased and (b) the purchase price to be paid for the Option Warrants is equal to the product of the Warrant Purchase Price multiplied by the number of Option Warrants to be purchased (the aggregate purchase price to be paid on an Option Closing Date, the “Option Closing Purchase Price”).

(f)The Option granted pursuant to this Section 4 may be exercised by the Underwriter as to all (at any time) or any part (from time to time) of the Option Securities within 30 days after the date of this Agreement. The Underwriter will not be under any obligation to purchase any Option Securities prior to the exercise of the Option by the Underwriter. The Option granted hereby may be exercised by the giving of oral notice to the Company from the Underwriter, which must be confirmed in writing by overnight mail or other electronic transmission setting forth the number of Option Shares and/or Option Warrants to be purchased and the date and time for delivery of and payment for the Option Securities (each, an “Option Closing Date”), which will not be later than two (2) full Business Days after the date of the notice or such other time as shall be agreed upon by the Company and the Underwriter, at its offices or at such other place (including remotely by electronic transmission) as shall be agreed upon by the Company and the Underwriter. If such delivery and payment for the Option Securities does not occur on the Closing Date, each Option Closing Date will be as set forth in the notice. Upon exercise of the Option, the Company will become obligated to convey to the Underwriters, and, subject to the terms and conditions set forth herein, the Underwriters will become obligated to purchase, the number of Option Shares and/or Option Warrants specified in such notice. The Underwriter may cancel the Option at any time prior to the expiration of the Option by written notice to the Company.

(g)On the Closing Date, the Company shall issue to the Underwriter (and/or its designees), warrants (the “Underwriter Warrants”), in form and substance acceptable to the Underwriter, for the purchase of an aggregate of [●] shares of Common Stock, which shall be registered in the name or names and shall be in such denominations as the Underwriter may request at least one (1) business day before the Closing Date.

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5. Covenants.

(a)The Company covenants and agrees with the Underwriter as follows:

(i)The Company shall prepare the Final Prospectus in a form approved by the Underwriter and file such Final Prospectus pursuant to Rule 424(b) under the Securities Act not later than the Commission’s close of business on the second business day following the execution and delivery of this Agreement, or, if applicable, such earlier time as may be required by the Rules and Regulations.

(ii)During the period beginning on the date hereof and ending on the later of the Closing Date or such date as the Final Prospectus is no longer required by the Securities Act to be delivered in connection with sales by an underwriter or dealer (the “Prospectus Delivery Period”), prior to amending or supplementing the Registration Statement, including any Rule 462 Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus, the Company shall furnish to the Underwriter for review and comment a copy of each such proposed amendment or supplement, and the Company shall not file any such proposed amendment or supplement to which the Underwriter reasonably objects.

(iii)During the Prospectus Delivery Period, the Company shall promptly advise the Underwriter in writing (A) of the receipt of any comments of, or requests for additional or supplemental information from, the Commission, (B) of the time and date of any filing of any post-effective amendment to the Registration Statement or any amendment or supplement to the Time of Sale Disclosure Package, the Final Prospectus or any Issuer Free Writing Prospectus, (C) of the time and date that any post-effective amendment to the Registration Statement becomes effective and (D) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending its use or the use of the Time of Sale Disclosure Package, the Final Prospectus or any Issuer Free Writing Prospectus, or of any proceedings to remove, suspend or terminate from listing or quotation the Common Stock from any securities exchange upon which it is listed for trading or included or designated for quotation, or of the threatening or initiation of any proceedings for any of such purposes. If the Commission shall enter any such stop order at any time during the Prospectus Delivery Period, the Company will use its reasonable efforts to obtain the withdrawal or lifting of such order at the earliest possible moment. Additionally, the Company agrees that it shall comply with the provisions of Rules 424(b), 430A, 430B or 430C as applicable, under the Securities Act and will use its reasonable efforts to confirm that any filings made by the Company under Rule 424(b) or Rule 433 were received in a timely manner by the Commission (without reliance on Rule 424(b)(8) or 164(b) of the Securities Act).

(iv)(A) During the Prospectus Delivery Period, the Company will comply with all requirements imposed upon it by the Securities Act, and by the Rules and Regulations, as from time to time in force, and by the Exchange Act, so far as necessary to permit the continuance of sales of or dealings in the Public Securities as contemplated by the provisions hereof, the Time of Sale Disclosure Package, the Registration Statement and the Final Prospectus. If during the Prospectus Delivery Period any event occurs the result of which would cause the Final Prospectus (or if the Final Prospectus is not yet available to prospective purchasers, the Time of Sale Disclosure Package) to include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances then existing, not misleading, or if during such period it is necessary or appropriate in the opinion of the Company or its counsel or the Underwriter or counsel to the Underwriter to amend the Registration Statement or supplement the Final Prospectus (or if the Final Prospectus is not yet available to prospective purchasers, the Time of Sale Disclosure Package) to comply with the Securities Act, the Company will promptly notify the Underwriter, allow the Underwriter the opportunity to provide reasonable comments on such amendment, prospectus supplement or document, and will amend the Registration Statement or supplement the Final Prospectus (or if the Final Prospectus is not yet available to prospective purchasers, the Time of Sale Disclosure Package) or file such document (at the expense of the Company) so as to correct such statement or omission or effect such compliance.

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(B)          If at any time during the Prospectus Delivery Period there occurred or occurs an event or development the result of which such Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement or any Prospectus or included or would include, when taken together with the Time of Sale Disclosure Package, an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing at that subsequent time, not misleading, the Company will promptly notify the Underwriter and will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.

(v)The Company will use its commercially reasonable efforts to cooperate with the Underwriter to qualify the Public Securities for sale under the securities laws of such jurisdictions as the Underwriter reasonably designates and to continue such qualifications in effect so long as required for the distribution of the Public Securities, except that the Company shall not be required in connection therewith to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified, to execute a general consent to service of process in any state or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise subject.

(vi)During the Prospectus Delivery Period, the Company will furnish to the Underwriter and counsel to the Underwriter copies of the Registration Statement, each Prospectus, any Issuer Free Writing Prospectus, and all amendments and supplements to such documents, in each case as soon as available and in such quantities as the Underwriter may from time to time reasonably request.

(vii)The Company will make generally available to its security holders as soon as practicable, but in any event not later than 15 months after the end of the Company’s current fiscal quarter, an earnings statement (which need not be audited) covering a 12-month period that shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 of the Rules and Regulations.

(viii)The Company, whether or not the transactions contemplated hereunder are consummated or this Agreement is terminated, will pay or cause to be paid (A) all expenses (including transfer taxes allocated to the respective transferees) incurred in connection with the delivery to the Underwriter of the Public Securities (including all fees and expenses of the registrar and transfer agent of the Public Securities), and the cost of preparing and printing stock certificates, (B) all expenses and fees (including, without limitation, fees and expenses of the Company’s counsel) in connection with the preparation, printing, filing, delivery, and shipping of the Registration Statement (including the financial statements therein and all amendments, schedules, and exhibits thereto), the Public Securities, the Time of Sale Disclosure Package, any Prospectus, the Final Prospectus, any Issuer Free Writing Prospectus and any amendment thereof or supplement thereto, (C) all actual, reasonable and documented filing fees and actual, reasonable and documented fees and disbursements of the Underwriter’s counsel incurred in connection with the qualification of the Public Securities for offering and sale by the Underwriter or by dealers under the securities or blue sky laws of the states and other jurisdictions that the Underwriter shall designate, (D) the actual, reasonable and documented filing fees and reasonable fees and disbursements of counsel to the Underwriter incident to any required review and approval by FINRA, of the terms of the sale of the Public Securities, (F) listing fees, if any, and (G) all other costs and expenses incident to the performance of its obligations hereunder that are not otherwise specifically provided for herein. The Company will reimburse the Underwriter for its actual, reasonable and documented out-of-pocket expenses, including actual, reasonable and documented legal fees and disbursements, incurred by the Underwriter in connection with the purchase and sale of the Public Securities contemplated hereby up to an aggregate of $400,000 (including amounts payable pursuant to clauses (C) and (D) above); without the Company’s prior written consent, such consent not to be unreasonably withheld or delayed and in no event more than $500,000 in the aggregate. If this Agreement is terminated by the Underwriter in accordance with the provisions of Section 6 or Section 9, the Company will reimburse the Underwriter for all actual, reasonable and documented out-of-pocket disbursements (including, but not limited to, actual, reasonable and documented fees and disbursements of counsel, travel expenses, postage, facsimile and telephone charges) incurred by the Underwriter in connection with its investigation, preparing to market and marketing the Public Securities or in contemplation of performing its obligations hereunder.

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(ix)The Company intends to apply the net proceeds from the sale of the Public Securities to be sold by it hereunder for the purposes set forth in the Registration Statement, the Time of Sale Disclosure Package and the Final Prospectus under the heading “Use of Proceeds”.

(x)Other than excepted activity pursuant to Regulation M under the Exchange Act, the Company will not take, directly or indirectly, during the Prospectus Delivery Period, any action designed to or which might reasonably be expected to cause or result in, or that has constituted, the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Public Securities. For the sake of clarity, actions by the Underwriter or persons acting on its behalf will not constitute direct or indirect action by the Company for purposes of this Section.

(xi)The Company represents and agrees that, unless it obtains the prior written consent of the Underwriter, and the Underwriter represents and agrees that, unless it obtains the prior written consent of the Company, it has not made and will not make any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus; provided that the prior written consent of the parties hereto shall be deemed to have been given in respect of the free writing prospectuses included in Schedule I. Any such free writing prospectus consented to by the Company and the Underwriter is hereinafter referred to as a “Permitted Free Writing Prospectus.” The Company represents that it has treated or agrees that it will treat each Permitted Free Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule 433, and has complied or will comply with the requirements of Rule 433 applicable to any Permitted Free Writing Prospectus, including timely Commission filing where required, legending and record-keeping.

(xii)The Company agrees that, without the prior written consent of the Underwriter, it will not, during the period ending 180 days after the date hereof (“Lock-Up Period”), (i) offer, pledge, issue, sell, contract to sell, purchase, contract to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock; or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise; or (iii) file any registration statement with the Commission relating to the offering of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock, except for a registration statement on Form S-4 in connection with a business combination transaction or a registration statement on Form S-8 with respect to the registration of shares of Common Stock to be issued under an equity incentive plan for Company employees. The restrictions contained in the preceding sentence shall not apply to (1) the Public Securities to be sold hereunder, (2) the issuance of Common Stock upon the exercise of options or warrants (including the warrants to be sold hereunder), the settlement or vesting of restricted stock units or restricted stock awards, the conversion of outstanding preferred stock or other outstanding convertible securities, or the occurrence of issuance conditions set forth in a SAFE or similar agreement disclosed as outstanding in the Registration Statement (excluding exhibits thereto), the Time of Sale Disclosure Package, and the Final Prospectus, (3) the issuance of employee stock options not exercisable during the Lock-Up Period and the grant of restricted stock awards or restricted stock units or shares of Common Stock pursuant to equity incentive plans described in the Registration Statement (excluding exhibits thereto), the Time of Sale Disclosure Package and the Final Prospectus, or (4) the issuance of Common Stock or any securities convertible into, or exercisable or exchangeable for, Common Stock in connection with any acquisition or strategic investment (including any joint venture, marketing, distribution, collaboration, license, strategic alliance or partnership) or in connection with any debt facility established by the Company, including with any commercial bank or venture debt lender, provided, however, that in the case of an issuance pursuant to this clause (4), it shall be a condition to the issuance that the recipient execute an agreement reasonably satisfactory to the Underwriter stating that the recipient is receiving and holding the securities subject to restrictions substantially similar to those set forth in Exhibit A.

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(xiii)The Company hereby agrees, during a period of three years from the effective date of the Registration Statement, to furnish to the Underwriter copies of all reports or other communications (financial or other) furnished to shareholders, and to deliver to the Underwriter as soon as reasonably practicable upon availability, copies of any reports and financial statements furnished to or filed with the Commission or any national securities exchange on which any class of securities of the Company is listed; provided, that any information or documents available on EDGAR shall be considered furnished for purposes of this Section 5(a)(xiii).

(xiv)The Company hereby agrees to engage and maintain, at its expense, a registrar and transfer agent for the Common Stock.

(xv)The Company hereby agrees to use its reasonable best efforts to obtain approval to list the Closing Shares, the Option Shares and the Warrant Shares on Nasdaq.

(xvi)The Company hereby agrees not to take, directly or indirectly, any action designed to cause or result in, or that has constituted or might reasonably be expected to constitute, under the Exchange Act or otherwise, the stabilization or manipulation of the price of any securities of the Company to facilitate the sale or resale of the Public Securities.

(xvii)The Company will promptly notify the Underwriter if the Company ceases to be an Emerging Growth Company at any time prior to the later of (a) the end of the Prospectus Delivery Period and (b) the expiration of the Lock-Up Period.  

(xviii)The Company will use commercially reasonable efforts to cause the Registration Statement to remain effective with a current prospectus until the later of nine (9) months from the date of this Agreement and the date on which the Warrants and the Underwriter Warrants are no longer outstanding, and will notify the Underwriter and holders of the Warrants immediately and confirm the notice in writing: (i) of the effectiveness of the Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the period described in this Section 5(xviii) that, in the judgment of the Company, makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the Prospectus in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state securities commission shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort to obtain promptly the lifting of such order.

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6.Conditions of the Underwriter’s Obligations. The obligations of the Underwriter hereunder to purchase the Public Securities are subject to the accuracy, as of the date hereof, on the Closing Date, and on each Option Closing Date (as if made on the Closing Date or such Option Closing Date, as applicable), of and compliance with all representations, warranties and agreements of the Company contained herein, the performance by the Company of its obligations hereunder and the following additional conditions:

(a)If filing of the Final Prospectus, or any amendment or supplement thereto, or any Issuer Free Writing Prospectus, is required under the Securities Act or the Rules and Regulations, the Company shall have filed the Final Prospectus (or such amendment or supplement) or such Issuer Free Writing Prospectus with the Commission in the manner and within the time period so required (without reliance on Rule 424(b)(8) or 164(b) under the Securities Act); the Registration Statement shall remain effective; no stop order suspending the effectiveness of the Registration Statement or any part thereof, any Rule 462 Registration Statement, or any amendment thereof, nor suspending or preventing the use of the Time of Sale Disclosure Package, any Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus shall have been issued; no proceedings for the issuance of such an order shall have been initiated or, to the Company’s knowledge, threatened by the Commission; any request of the Commission for additional information (to be included in the Registration Statement, the Time of Sale Disclosure Package, any Prospectus, the Final Prospectus, any Issuer Free Writing Prospectus or otherwise) shall have been complied with to the reasonable satisfaction of the Underwriter.

(b)The Closing Shares, the Option Shares and the Warrant Shares shall be approved for listing on Nasdaq, subject to official notice of issuance and evidence of satisfactory distribution.

(c)FINRA shall have raised no objection to the fairness and reasonableness of the underwriting terms and arrangements.

(d)The Underwriter shall not have reasonably determined and advised the Company that the Registration Statement, the Time of Sale Disclosure Package, any Prospectus, the Final Prospectus, or any amendment thereof or supplement thereto, or any Issuer Free Writing Prospectus, contains an untrue statement of fact which, in the reasonable opinion of the Underwriter, is material, or omits to state a fact which, in the Underwriter’s reasonable opinion, is material and is required to be stated therein or necessary to make the statements therein not misleading.

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(e) On or after the date hereof (i) no downgrading shall have occurred in the rating accorded any of the Company’s securities by any “nationally recognized statistical organization,” as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Securities Act, and (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company’s securities.

(f)On the Closing Date and on each Option Closing Date, there shall have been furnished to the Underwriter the opinion and negative assurance letters of Rutan & Tucker, LLP, counsel to the Company, each dated the Closing Date or the Option Closing Date, as applicable, and addressed to the Underwriter, in form and substance reasonably satisfactory to the Underwriter.

(g)On the Closing Date and on each Option Closing Date, there shall have been furnished to the Underwriter the negative assurance letter of K&L Gates LLP, counsel to the Underwriter, dated the Closing Date or the Option Closing Date, as applicable, and addressed to the Underwriter, in form and substance reasonably satisfactory to Underwriter.

(h)The Underwriter shall have received a letter of Deloitte & Touche LLP, on the date hereof and on the Closing Date and on each Option Closing Date, addressed to the Underwriter, confirming that they are independent public accountants within the meaning of the Securities Act and are in compliance with the applicable requirements relating to the qualifications of accountants under Rule 2-01 of Regulation S-X of the Commission, and confirming the conclusions and findings of said firm with respect to the financial information; provided, however, that the requested comfort procedures must be reasonable and customary and in accordance with generally accepted auditing standards that require the information to be generated by or derived from accounting records subject to ordinary auditing procedures.

(i)On the Closing Date and on each Option Closing Date, there shall have been furnished to the Underwriter a certificate, dated the Closing Date and on each Option Closing Date and addressed to the Underwriter, signed by the chief executive officer and the chief financial officer of the Company, solely in their capacities as officers of the Company, to the effect that:

(i)The representations and warranties of the Company in this Agreement that are qualified by materiality or by reference to any Material Adverse Effect are true and correct in all respects, and all other representations and warranties of the Company in this Agreement are true and correct, in all material respects, as if made at and as of the Closing Date and on the Option Closing Date, and the Company has complied in all material respects with all the agreements and satisfied all the conditions on its part required to be performed or satisfied at or prior to the Closing Date or on the Option Closing Date, as applicable;

(ii)No stop order or other order (A) suspending the effectiveness of the Registration Statement or any part thereof or any amendment thereof, (B) suspending the qualification of the Public Securities for offering or sale, or (C) suspending or preventing the use of the Time of Sale Disclosure Package, any Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus, has been issued, and no proceeding for that purpose has been instituted or, to their knowledge, is contemplated by the Commission or any state or regulatory body; and

(iii)There has been no occurrence of any event resulting or reasonably likely to result in a Material Adverse Effect during the period from and after the date of this Agreement and prior to the Closing Date or on the Option Closing Date, as applicable.

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(j)On or before the date hereof, the Underwriter shall have received duly executed lock-up agreements (each a “Lock-Up Agreement”) in the form set forth on Exhibit A hereto, by and between the Underwriter and each of the parties specified in Schedule IV.

If the Underwriter, in its sole discretion, agrees to release or waive the restrictions set forth in the Lock-Up Agreement for an officer or director of the Company and provides the Company with notice of the impending release or waiver at least three business days before the effective date of the release or waiver, the Company agrees to announce the impending release or waiver by a press release substantially in the form of Exhibit B hereto through a major news service at least two business days before the effective date of the release or waiver.

(k)The Company shall have furnished to the Underwriter and its counsel such additional documents, certificates and evidence as the Underwriter or its counsel may have reasonably requested.

If any condition specified in this Section 6 shall not have been fulfilled when and as required to be fulfilled, this Agreement may be terminated by the Underwriter by notice to the Company at any time at or prior to the Closing Date or on the Option Closing Date, as applicable, and such termination shall be without liability of any party to any other party, except that Section 5(a)(viii), Section 7 and Section 8 shall survive any such termination and remain in full force and effect.

7.Indemnification and Contribution.

(a)The Company agrees to indemnify, defend and hold harmless the Underwriter, its affiliates, directors and officers and employees, and each person, if any, who controls the Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any losses, claims, damages or liabilities to which such party may become subject, under the Securities Act or otherwise (including in settlement of any litigation if such settlement is effected with the written consent of the Company), insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (i) an untrue statement or alleged untrue statement of a material fact contained in the Registration Statement, including the information deemed to be a part of the Registration Statement at the time of effectiveness and at any subsequent time pursuant to Rules 430A and 430B of the Rules and Regulations, or arise out of or are based upon the omission from the Registration Statement, or alleged omission to state therein, a material fact required to be stated therein or necessary to make the statements therein not misleading (ii) an untrue statement or alleged untrue statement of a material fact contained in the Time of Sale Disclosure Package, any Written Testing-the-Waters Communications, any Prospectus, or any amendment or supplement thereto, any Issuer Free Writing Prospectus, or the Marketing Materials or in any other materials provided by the Company for use in connection with the Offering, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, (iii) in whole or in part, any material inaccuracy in the representations and warranties of the Company contained herein, or (iv) in whole or in part, any material failure of the Company to perform its obligations hereunder or under law, and will reimburse such party for any actual, reasonable and documented legal or other expenses incurred by such party in connection with evaluating, investigating or defending against such loss, claim, damage, liability or action; provided, however, that the Company shall not be liable in any case to the extent that any such loss, claim, damage, liability or action arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in the Registration Statement, the Time of Sale Disclosure Package, any Written Testing-the-Waters Communications, any Prospectus, or any amendment or supplement thereto or any Issuer Free Writing Prospectus, in reliance upon and in conformity with written information furnished to the Company by the related Underwriter specifically for use in the preparation thereof, which written information is described in Section 7(g).

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(b)The Underwriter will indemnify, defend and hold harmless the Company and its affiliates, directors, officers and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any losses, claims, damages or liabilities to which such party may become subject, under the Securities Act or otherwise (including in settlement of any litigation, if such settlement is effected with the written consent of the Underwriter), insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in the Registration Statement, the Time of Sale Disclosure Package, any Prospectus, or any amendment or supplement thereto or any Issuer Free Writing Prospectus, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Registration Statement, the Time of Sale Disclosure Package, any Prospectus, the Final Prospectus, or any amendment or supplement thereto or any Issuer Free Writing Prospectus in reliance upon and in conformity with written information furnished to the Company by the Underwriter specifically for use in the preparation thereof, which written information is described in Section 7(g), and will reimburse such party for any legal or other expenses reasonably incurred by such party in connection with evaluating, investigating, and defending against any such loss, claim, damage, liability or action. The obligation of the Underwriter to indemnify the Company (including any controlling person, director or officer thereof) shall be limited to the amount of the underwriting discount applicable to the Public Securities to be purchased by the Underwriter hereunder actually received by the Underwriter plus the value of the Underwriter Warrants.

(c)Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the failure to notify the indemnifying party shall not relieve the indemnifying party from any liability that it may have to any indemnified party except to the extent such indemnifying party has been materially prejudiced by such failure. In case any such action shall be brought against any indemnified party, and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate in, and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party, and after notice from the indemnifying party to such indemnified party of the indemnifying party’s election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof; provided, however, that if (i) the indemnified party has reasonably concluded (based on advice of counsel) that there may be legal defenses available to it or other indemnified parties that are different from or in addition to those available to the indemnifying party, (ii) a conflict or potential conflict exists (based on advice of counsel to the indemnified party) between the indemnified party and the indemnifying party (in which case the indemnifying party will not have the right to direct the defense of such action on behalf of the indemnified party), or (iii) the indemnifying party has not in fact employed counsel reasonably satisfactory to the indemnified party to assume the defense of such action within a reasonable time after receiving notice of the commencement of the action, the indemnified party shall have the right to employ a single counsel to represent it and any other parties entitled to indemnification pursuant to this Section 7 in any claim in respect of which indemnity may be sought under subsection (a) or (b) of this Section 7, in which event the reasonable fees and expenses of such separate counsel shall be borne by the indemnifying party or parties and reimbursed to the indemnified party or parties as incurred.

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The indemnifying party under this Section 7 shall not be liable for any settlement of any proceeding effected without its written consent, which shall not be unreasonably conditioned, delayed or withheld, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party against any loss, claim, damage, liability or expense by reason of such settlement or judgment. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement, compromise or consent to the entry of judgment in any pending or threatened action, suit or proceeding in respect of which any indemnified party is a party or could be named and indemnity was or would be sought hereunder by such indemnified party, unless such settlement, compromise or consent (a) includes an unconditional release of such indemnified party from all liability for claims that are the subject matter of such action, suit or proceeding and (b) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

(d)If the indemnification provided for in this Section 7 is unavailable or insufficient to hold harmless an indemnified party under subsection (a) or (b) above, then the applicable indemnifying party, in lieu of indemnifying the indemnified party or parties, shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) above, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriter on the other from the Offering or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and the Underwriter on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriter on the other shall be deemed to be in the same proportion as the total net proceeds from the Offering (after deducting underwriting discounts and commissions but before deducting expenses) received by the Company bear to the total underwriting discount and commissions received by the Underwriter, including from the offering of the Option Securities, if applicable, in each case as set forth in the table on the cover page of the Final Prospectus. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriter and the parties’ relevant intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. The Company and the Underwriter agree that it would not be just and equitable if contributions pursuant to this subsection (e) were to be determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in the first sentence of this subsection (e). The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (e) shall be deemed to include any actual, reasonable and documented legal or other expenses incurred by such indemnified party in connection with investigating or defending against any action or claim that is the subject of this subsection (d). Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount of the underwriting discount and commissions applicable to the Public Securities to be purchased by such Underwriter hereunder actually received by the Underwriter. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

(e)The obligations of the Company under this Section 7 shall be in addition to any liability that the Company may otherwise have and the benefits of such obligations shall extend, upon the same terms and conditions, to each person, if any, who controls the Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act; and the obligations of each Underwriter under this Section 7 shall be in addition to any liability that the Underwriter may otherwise have and the benefits of such obligations shall extend, upon the same terms and conditions, to the Company and its respective officers, directors and each person who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act.

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(f)For purposes of this Agreement, each Underwriter severally confirms, and the Company acknowledges, that there is no information concerning such Underwriter furnished in writing to the Company by such Underwriter specifically for preparation of or inclusion in the Registration Statement, the Time of Sale Disclosure Package, any Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus, other than the statement set forth in the last paragraph on the cover page of the Prospectus, the marketing and legal names of each Underwriter, and the statements set forth in the “Underwriting” section of the Registration Statement, the Time of Sale Disclosure Package, and the Final Prospectus only insofar as such statements relate to the amount of selling concession and re-allowance, if any, or to over-allotment, stabilization and related activities that may be undertaken by such Underwriter.

8.Representations and Agreements to Survive Delivery. All representations, warranties, and agreements of the Company contained herein or in certificates delivered pursuant hereto, including, but not limited to, the agreements of the Underwriter and the Company contained in Section 5(a)(vii) and Section 7 hereof, shall remain operative and in full force and effect regardless of any investigation made by or on behalf of the Underwriter or any controlling person thereof, or the Company or any of their officers, directors, or controlling persons, and shall survive delivery of, and payment for, the Closing Securities and the Underwriter Warrants to and by the Underwriter hereunder.

9.Termination of this Agreement.

(a)The Underwriter shall have the right to terminate this Agreement by giving notice to the Company as hereinafter specified at any time at or prior to the Closing Date or any Option Closing Date (as to the Option Securities to be purchased on such Option Closing Date only), if (i) there has occurred any material adverse change in the securities markets or any event, act or occurrence that has materially disrupted, the securities markets or there has been a material adverse change in general financial, political or economic conditions the effect of which is to make it, in the reasonable judgment of the Underwriter, inadvisable or impracticable to market the Public Securities (ii) trading in the Company’s Common Stock shall have been suspended by the Commission or Nasdaq or trading in securities generally on Nasdaq Stock Market, the NYSE or the NYSE American shall have been suspended, (iii) minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been required, on Nasdaq Stock Market, the NYSE or NYSE American, by such exchange or by order of the Commission or any other governmental authority having jurisdiction, (iv) a banking moratorium shall have been declared by federal or New York state authorities, (v) there shall have occurred any attack on, outbreak or escalation of hostilities or act of terrorism involving the United States, any declaration by the United States of a national emergency or war, any substantial change or development involving a prospective substantial change in United States or other international political, financial or economic conditions or any other calamity or crisis, the effect of which is to make it, in the reasonable judgment of the Underwriter, inadvisable or impracticable to market the Public Securities, or (vi) in the reasonable judgment of the Underwriter, there has been, since the time of execution of this Agreement or since the respective dates as of which information is given in the Registration Statement, the Time of Sale Disclosure Package or the Final Prospectus, any material adverse change in the assets, properties, condition, financial or otherwise, or in the results of operations, business affairs or business prospects of the Company and its subsidiaries considered as a whole, whether or not arising in the ordinary course of business. Any such termination shall be without liability of any party to any other party except that the provisions of Section 5(a)(viii) and Section 7 hereof shall at all times be effective and shall survive such termination.

(b)If the Underwriter elects to terminate this Agreement as provided in this Section, the Company shall be notified promptly by the Underwriter by telephone, confirmed by letter.

24

10.Notices. Except as otherwise provided herein, all communications hereunder shall be in writing and, if to the Underwriter, shall be mailed, delivered or e-mailed to Roth Capital Partners, LLC, 800 San Clemente Drive, Suite 400, Newport Beach, CA 92660, e-mail: rothecm@roth.com, Attention: Managing Director; and if to the Company, shall be mailed, delivered or e-mailed to it at FlexEnergy Green Solutions, Inc., 112 Corporate Drive, Portsmouth, NH 03801, e-mail: wes.kimmel@flexenergy.com, Attention: Chief Financial Officer; or in each case to such other address as the person to be notified may have requested in writing. Any party to this Agreement may change such address for notices by sending to the parties to this Agreement written notice of a new address for such purpose.

11.Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns and the controlling persons, officers and directors referred to in Section 7. Nothing in this Agreement is intended or shall be construed to give to any other person, firm or corporation any legal or equitable remedy or claim under or in respect of this Agreement or any provision herein contained. The term “successors and assigns” as herein used shall not include any purchaser, as such purchaser, of any of the Securities from the Underwriter.

12.Absence of Fiduciary Relationship. The Company acknowledges and agrees that: (a) the Underwriter has been retained solely to act as underwriter in connection with the sale of the Public Securities and that no fiduciary, advisory or agency relationship between the Company and the Underwriter has been created in respect of any of the transactions contemplated by this Agreement, irrespective of whether the Underwriter has advised or is advising the Company on other matters; (b) the price and other terms of the Public Securities set forth in this Agreement were established by the Company following discussions and arms-length negotiations with the Underwriter and the Company is capable of evaluating and understanding and understands and accepts the terms, risks and conditions of the transactions contemplated by this Agreement; (c) it has been advised that the Underwriter and its affiliates are engaged in a broad range of transactions that may involve interests that differ from those of the Company and that no Underwriter has any obligation to disclose such interest and transactions to the Company by virtue of any fiduciary, advisory or agency relationship; and (d) it has been advised that the Underwriter is acting, in respect of the transactions contemplated by this Agreement, solely for the benefit of such Underwriter, and not on behalf of the Company.

13.Amendments and Waivers. No supplement, modification or waiver of this Agreement shall be binding unless executed in writing by the party to be bound thereby. The failure of a party to exercise any right or remedy shall not be deemed or constitute a waiver of such right or remedy in the future. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (regardless of whether similar), nor shall any such waiver be deemed or constitute a continuing waiver unless otherwise expressly provided.

14.Partial Unenforceability. The invalidity or unenforceability of any section, paragraph, clause or provision of this Agreement shall not affect the validity or enforceability of any other section, paragraph, clause or provision.

15.Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

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16.Submission to Jurisdiction. The Company irrevocably (a) submits to the jurisdiction of the Supreme Court of the State of New York, Borough of Manhattan or the United States District Court for the Southern District of New York for the purpose of any suit, action, or other proceeding arising out of this Agreement, or any of the agreements or transactions contemplated by this Agreement, the Registration Statement, the Time of Sale Disclosure Package, any Prospectus and the Final Prospectus (each a “Proceeding”), (b) agrees that all claims in respect of any Proceeding may be heard and determined in any such court, (c) waives, to the fullest extent permitted by law, any immunity from jurisdiction of any such court or from any legal process therein, (d) agrees not to commence any Proceeding other than in such courts, and (e) waives, to the fullest extent permitted by law, any claim that such Proceeding is brought in an inconvenient forum. EACH OF THE PARTIES HERETO (ON BEHALF OF ITSELF AND, TO THE FULLEST EXTENT PERMITTED BY LAW, ON BEHALF OF ITS RESPECTIVE CONTROLLING PERSONS, OFFICERS, DIRECTORS, MANAGERS, EQUITY HOLDERS AND CREDITORS) HEREBY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED UPON, ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, THE REGISTRATION STATEMENT, THE TIME OF SALE DISCLOSURE PACKAGE, ANY PROSPECTUS AND THE FINAL PROSPECTUS.

17.Counterparts. This Agreement may be executed and delivered (including by electronic mail) in one or more counterparts and, if executed in more than one counterpart, the executed counterparts shall each be deemed to be an original and all such counterparts shall together constitute one and the same instrument.

[Signature Page Follows]

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Please sign and return to the Company the enclosed duplicates of this letter whereupon this letter will become a binding agreement between the Company and the Underwriter in accordance with its terms.

		Very truly yours,
		FLEXENERGY GREEN SOLUTIONS, INC.
		By:
		Name:
		Title:
Confirmed as of the date first above-mentioned
by the Underwriter.
ROTH CAPITAL PARTNERS, LLC
By:
Name:	Aaron M. Gurewitz
Title:	Head of Equity Capital Markets

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SCHEDULE I

Underwriter Schedule

Underwriters	Closing Shares	Closing Warrants		Closing Purchase Price
Roth Capital Partners, LLC			$

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SCHEDULE II

Free Writing Prospectus

1. None.

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SCHEDULE III

Written Testing-the-Waters Communications

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SCHEDULE IV

List of officers, directors and stockholders executing lock-up agreements

FlexEnergy Power Solutions, LLC

Mark Schnepel

Wesley Kimmel

Douglas Baltzer

Thomas Denison

Patrick Connelly

George Walker

RNS Flex LLC

TRF Platform Holdings, LLC

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SCHEDULE V

Time of Sale Disclosure Package

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EXHIBIT A

Form of Lock-Up Agreement

Roth Capital Partners, LLC

888 San Clemente Drive

Newport Beach, CA 92660

Ladies and Gentlemen:

The undersigned understands that you propose to enter into an Underwriting Agreement (the “Underwriting Agreement”) with FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), relating to a proposed offering by the Company (the “Offering”) of shares of the Company’s Common Stock, par value $0.0001 per share (the “Common Stock”) and warrants to purchase shares of Common Stock. Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Underwriting Agreement.

In consideration of the foregoing, and in order to induce you to participate in the Offering, and for other good and valuable consideration receipt of which is hereby acknowledged, the undersigned hereby agrees that, without the prior written consent of Roth Capital Partners, LLC (“Roth”) (which consent may be withheld in its sole discretion), the undersigned will not, during the period (the “Lock-Up Period”) beginning on the date hereof and ending on the date 180 days after the date of the final prospectus relating to the Offering (the “Final Prospectus”), (1) offer, pledge, announce the intention to sell, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, or file (or participate in the filing of) a registration statement with the Securities and Exchange Commission in respect of, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for shares of Common Stock (including without limitation, shares of Common Stock that may be deemed to be beneficially owned by the undersigned in accordance with the rules and regulations of the Securities and Exchange Commission and securities which may be issued upon exercise of a stock option or warrant), (2) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the shares of, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of shares of Common Stock or such other securities, in cash or otherwise, (3) make any demand for or exercise any right with respect to, the registration of any shares of Common Stock or any security convertible into or exercisable or exchangeable for shares of Common Stock, or (4) publicly announce an intention to effect any transaction specific in clause (1), (2) or (3) above.

Notwithstanding the foregoing, the restrictions set forth in clause (1) and (2) above shall not apply to (a) the sale of the Option Securities in the Offering, (b) transfers (i) as a bona fide gift or gifts, provided that the donee or donees thereof agree to be bound in writing by the restrictions set forth herein, (ii) to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned, provided that the trustee of the trust agrees to be bound in writing by the restrictions set forth herein, and provided further that any such transfer shall not involve a disposition for value, (iii) by will or other testamentary document, or by intestate succession to the legal representative, heir, beneficiary or member of the immediate family of the undersigned, (iv) by operation of law, such as pursuant to a qualified domestic order or as required by a divorce settlement, or (v) to satisfy obligations under Amended and Restated SAFEs entered into as of December 2, 2021 (c) the acquisition or exercise of any stock option issued pursuant to the Company’s existing stock option plan, including any exercise effected by the delivery of shares of Common Stock of the Company held by the undersigned, (d) the purchase or sale of the Company’s securities pursuant to a plan, contract or instruction that satisfies all of the requirements of Rule 10b5-1(c)(1)(i)(B) that was in effect prior to the date hereof or is approved by Roth in its reasonable discretion, or (e) if the undersigned is a corporation, limited liability company, partnership, trust or other entity, transfers to its stockholders, members, partners or trust beneficiaries as part of a distribution, or to any corporation, partnership or other entity that is its affiliate, provided that the transferee or transferees thereof agree to be bound in writing by the restrictions set forth herein. For purposes of this Lock-Up Agreement, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin.

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The foregoing restrictions are expressly agreed to preclude the undersigned from engaging in any hedging or other transaction which is designed to or reasonably expected to lead to or result in a sale or disposition of shares of Common Stock even if such securities would be disposed of by someone other than the undersigned. Such prohibited hedging or other transactions would include without limitation any short sale or any purchase, sale or grant of any right (including without limitation any put option or put equivalent position or call option or call equivalent position) with respect to any of the shares of Common Stock or with respect to any security that includes, relates to, or derives any significant part of its value from such shares.

The undersigned hereby represents and warrants that the undersigned has full power and authority to enter into this Lock-Up Agreement. All authority herein conferred or agreed to be conferred and any obligations of the undersigned shall be binding upon the successors, assigns, heirs or personal representatives of the undersigned.

The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar or depositary against the transfer of the undersigned’s shares of Common Stock except in compliance with the foregoing restrictions.

If the undersigned is an officer or director of the Company, (i) Roth agrees that, at least three business days before the effective date of any release or waiver of the foregoing restrictions in connection with a transfer of Common Shares, Roth will notify the Company of the impending release or waiver, and (ii) the Company will agree in the Underwriting Agreement to announce the impending release or waiver by press release through a major news service at least two business days before the effective date of the release or waiver. Any release or waiver granted by Roth hereunder to any such officer or director shall only be effective two business days after the publication date of such press release. The provisions of this paragraph will not apply if (a) the release or waiver is effected solely to permit a transfer not for consideration and (b) the transferee has agreed in writing to be bound by the same terms described in this letter to the extent and for the duration that such terms remain in effect at the time of the transfer.

The undersigned understands that, if the Underwriting Agreement does not become effective, or if the Underwriting Agreement (other than the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the securities to be sold thereunder, the undersigned shall be released from all obligations under this Lock-Up Agreement.

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This Lock-Up Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of laws principles thereof. The undersigned irrevocably (i) submits to the jurisdiction of the Supreme Court of the State of New York, Borough of Manhattan and the United States District Court for the Southern District of New York, for the purpose of any suit, action, or other proceeding arising out of this Lock-Up Agreement (each a “Proceeding”), (ii) agrees that all claims in respect of any Proceeding may be heard and determined in any such court, (iii) waives, to the fullest extent permitted by law, any immunity from jurisdiction of any such court or from any legal process therein, (iv) agrees not to commence any Proceeding other than in such courts, and (v) waives, to the fullest extent permitted by law, any claim that such Proceeding is brought in an inconvenient forum.

Very truly yours,

Name:

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EXHIBIT B

Form of Press Release

FlexEnergy Green Solutions, Inc.

[Date]

FlexEnergy Green Solutions, Inc. (the “Company”) announced today that Roth Capital Partners, LLC the Underwriter in the Company’s recent public sale of       shares of common stock and __warrants to purchase up to ___ shares of the Company’s common stock are [waiving][releasing] a lock-up restriction with respect to      shares of the Company’s common stock held by [certain officers or directors] [an officer or director] of the Company.  The [waiver][release] will take effect on     , 2022, and the shares may be sold on or after such date.

This press release is not an offer for sale of the securities in the United States or in any other jurisdiction where such offer is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended.

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EX-4.2

Exhibit 4.2

WARRANT AGENT AGREEMENT

This Warrant Agent Agreement (this “Warrant Agreement”), dated as of ___, 2022 (the “Issuance Date”) between FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), and American Stock Transfer & Trust Company, LLC (the “Warrant Agent”).

WHEREAS, pursuant to the terms of that certain Underwriting Agreement (“Underwriting Agreement”), dated ___, 2022, by and among the Company and Roth Capital Partners, LLC, as the underwriter, the Company is engaged in a public offering (the “Offering”) of up to ___ shares (the “Shares”) of common stock, par value $0.0001 per share (the “Common Stock”) of the Company and ____ Warrants (the “Warrants”) to purchase one share of Common Stock (such shares of Common Stock underlying the Warrants, the “Warrant Shares”);

WHEREAS, the Company has filed with the Securities and Exchange Commission (the “Commission”) a Registration Statement on Form S-1 (File No. 333-260111) (as the same may be amended from time to time, the “Registration Statement”), for the registration under the Securities Act of 1933, as amended (the “Securities Act”), of the Shares, the Warrants and Warrant Shares, and the Registration Statement was declared effective on ____ 2022;

WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in accordance with the terms set forth in this Warrant Agreement in connection with the issuance, registration, transfer, exchange and exercise of the Warrants;

WHEREAS, the Company desires to provide for the provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants; and

WHEREAS, all acts and things have been done and performed which are necessary to make the Warrants the valid, binding and legal obligations of the Company, and to authorize the execution and delivery of this Warrant Agreement.

NOW, THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:

1. Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company with respect to the Warrants, and the Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance with the express terms and conditions set forth in this Warrant Agreement (and no implied terms or conditions).

2. Warrants.

2.1. Form of Warrants. The Warrants shall be registered securities and shall be evidenced by a global certificate (“Global Certificate”) in the form of Exhibit A, which shall be deposited on behalf of the Company with a custodian for The Depository Trust Company (“DTC”) and registered in the name of Cede & Co., a nominee of DTC. If DTC subsequently ceases to make its book-entry settlement system available for the Warrants, the Company may instruct the Warrant Agent regarding making other arrangements for book-entry settlement. If the Warrants are not eligible for, or it is no longer necessary to have the Warrants available in, book-entry form, the Company may instruct the Warrant Agent to provide written instructions to DTC to deliver to the Warrant Agent for cancellation the Global Certificate, and the Company shall instruct the Warrant Agent to deliver to each Holder (as defined below separate certificates evidencing Warrants (“Definitive Certificates” and, together with the Global Certificate, “Warrant Certificates”) , in the form of Exhibit D. The Warrants represented by the Global Certificate are referred to as “Global Warrants”.

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2.2. Issuance and Registration of Warrants.

2.2.1. Warrant Register. The Warrant Agent shall maintain books (“Warrant Register”) for the registration of original issuance and the registration of transfer of the Warrants. Any Person in whose name ownership of a beneficial interest in the Warrants evidenced by a Global Certificate is recorded in the records maintained by DTC or its nominee shall be deemed the “beneficial owner” thereof, provided that all such beneficial interests shall be held through a Participant (as defined below), which shall be the registered holder of such Warrants.

2.2.2. Issuance of Warrants. Upon the initial issuance of the Warrants, the Warrant Agent shall issue the Global Certificate and deliver the Warrants in the DTC book-entry settlement system in accordance with written instructions delivered to the Warrant Agent by the Company. Ownership of beneficial interests in the Warrants shall be shown on, and the transfer of such ownership shall be effected through, records maintained (i) by DTC and (ii) by institutions that have accounts with DTC (each, a “Participant”), subject to a Holder’s right to elect to receive a Warrant in certificated form in the form of Exhibit D to this Warrant Agreement. Any Holder desiring to elect to receive a Warrant in certificated form shall make such request in writing delivered to the Warrant Agent pursuant to Section 2.2.8, and shall surrender to the Warrant Agent the interest of the Holder on the books of the Participant evidencing the Warrants which are to be represented by a Definitive Certificate through the DTC settlement system. Thereupon, the Warrant Agent shall countersign and deliver to the Person entitled thereto a Warrant Certificate or Warrant Certificates, as the case may be, as so requested.

2.2.3. Beneficial Owner; Holder. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the Person in whose name that Warrant shall be registered on the Warrant Register (the “Holder”, which term shall include a Holder’s transferees, successors and assigns and a “Holder” shall include, if the Warrants are held in “street name,” a Participant or a designee appointed by such Participant) as the absolute owner of such Warrant for purposes of any exercise thereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Warrant Agent or any agent of the Company or the Warrant Agent from giving effect to any written certification, proxy or other authorization furnished by DTC governing the exercise of the rights of a holder of a beneficial interest in any Warrant. The rights of beneficial owners in a Warrant evidenced by the Global Certificate shall be exercised by the Holder or a Participant through the DTC system, except to the extent set forth herein or in the Global Certificate.

2.2.4. Execution. The Warrant Certificates shall be executed on behalf of the Company by any authorized officer of the Company (an “Authorized Officer”), who need not be the same authorized signatory for all of the Warrant Certificates, either manually or by facsimile signature. The Warrant Certificates shall be countersigned by an authorized signatory of the Warrant Agent, which need not be the same signatory for all of the Warrant Certificates, and no Warrant Certificate shall be valid for any purpose unless so countersigned. In case any Authorized Officer of the Company that signed any of the Warrant Certificates ceases to be an Authorized Officer of the Company before countersignature by the Warrant Agent and issuance and delivery by the Company, such Warrant Certificates, nevertheless, may be countersigned by the Warrant Agent, issued and delivered with the same force and effect as though the person who signed such Warrant Certificates had not ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by any person who, at the actual date of the execution of such Warrant Certificate, shall be an Authorized Officer of the Company authorized to sign such Warrant Certificate, although at the date of the execution of this Warrant Agreement any such person was not such an Authorized Officer.

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2.2.5. Registration of Transfer. At any time at or prior to the Expiration Date (as defined below), a transfer of any Warrants may be registered and any Warrant Certificate or Warrant Certificates may be split up, combined or exchanged for another Warrant Certificate or Warrant Certificates evidencing the same number of Warrants as the Warrant Certificate or Warrant Certificates surrendered. Any Holder desiring to register the transfer of Warrants or to split up, combine or exchange any Warrant Certificate shall make such request in writing delivered to the Warrant Agent, and shall surrender to the Warrant Agent the Warrant Certificate or Warrant Certificates evidencing the Warrants the transfer of which is to be registered or that is or are to be split up, combined or exchanged. Thereupon, the Warrant Agent shall countersign and deliver to the Person entitled thereto a Warrant Certificate or Warrant Certificates, as the case may be, as so requested. The Warrant Agent may require reasonable and customary payment with respect to a registration of transfer of Warrants or a split-up, combination or exchange of a Warrant Certificate (but, for purposes of clarity, not upon the exercise of the Warrants and issuance of Warrant Shares to the Holder), of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with such registration of transfer, split-up, combination or exchange, together with reimbursement to the Warrant Agent of all reasonable expenses incidental thereto. All such fees and expenses shall be paid by the Company, and not by the Holder.

2.2.6. Loss, Theft and Mutilation of Warrant Certificates. Upon receipt by the Company and the Warrant Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Warrant Certificate, and, in case of loss, theft or destruction, of indemnity or security in customary form and amount, and reimbursement to the Company and the Warrant Agent of all reasonable expenses incidental thereto, and upon surrender to the Warrant Agent and cancellation of the Warrant Certificate if mutilated, the Warrant Agent shall, on behalf of the Company, countersign and deliver a new Warrant Certificate of like tenor to the Holder in lieu of the Warrant Certificate so lost, stolen, destroyed or mutilated. The Warrant Agent may charge the Holder an administrative fee for processing the replacement of lost Warrant Certificates, which shall be charged only once in instances where a single surety bond obtained covers multiple certificates. The Warrant Agent may receive compensation from the surety companies or surety agents for administrative services provided to them.

2.2.7. Proxies. The Holder of a Warrant may grant proxies or otherwise authorize any Person, including the Participants and beneficial holders that may own interests through the Participants, to take any action that a Holder is entitled to take under this Warrant Agreement or the Warrants; provided, however, that at all times that Warrants are evidenced by a Global Certificate, exercise of those Warrants shall be effected on their behalf by Participants through DTC in accordance the procedures administered by DTC.

2.2.8. Warrant Certificate Request. A Holder has the right to elect at any time or from time to time a Warrant Exchange (as defined below) pursuant to a Warrant Certificate Request Notice (as defined below). Upon written notice by a Holder to the Warrant Agent for the exchange of some or all of such Holder’s Global Warrants for a Definitive Certificate evidencing the same number of Warrants, which request shall be in the form attached hereto as Exhibit E (a “Warrant Certificate Request Notice” and the date of delivery of such Warrant Certificate Request Notice by the Holder, the “Warrant Certificate Request Notice Date” and the deemed surrender upon delivery by the Holder of a number of Global Warrants for the same number of Warrants evidenced by a Definitive Certificate, a “Warrant Exchange”), the Warrant Agent shall promptly effect the Warrant Exchange and shall promptly issue and deliver to the Holder a Definitive Certificate for such number of Warrants in the name set forth in the Warrant Certificate Request Notice. Such Definitive Certificate shall be dated the original issue date of the Warrants, shall be manually executed by an authorized signatory of the Company, shall be in the form attached hereto as Exhibit D, and shall be reasonably acceptable in all respects to such Holder. In connection with a Warrant Exchange, the Company agrees to deliver, or to direct the Warrant Agent to deliver, the Definitive Certificate to the Holder within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined below) of the Warrant Certificate Request Notice pursuant to the delivery instructions in the Warrant Certificate Request Notice (“Warrant Certificate Delivery Date”). If the Company fails for any reason to deliver to the Holder the Definitive Certificate subject to the Warrant Certificate Request Notice by the Warrant Certificate Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares evidenced by such Definitive Certificate (based on the VWAP of the Common Stock on the Warrant Certificate Request Notice Date), $10 per Business Day for each Business Day after such Warrant Certificate Delivery Date until such Definitive Certificate is delivered or, prior to delivery of such Warrant Certificate, the Holder rescinds such Warrant Exchange. The Company covenants and agrees that, upon the date of delivery of the Warrant Certificate Request Notice, the Holder shall be deemed to be the holder of the Definitive Certificate and, notwithstanding anything to the contrary set forth herein, the Definitive Certificate shall be deemed for all purposes to contain all of the terms and conditions of the Warrants evidenced by such Warrant Certificate and the terms of this Warrant Agreement, other than Sections 3.3 and 8 herein, which shall not apply to the Warrants evidenced by the Definitive Certificate. For purposes of clarity, if there is a conflict between the express terms of this Warrant Agreement and the Warrant Certificate in the form of Exhibit D hereto with respect to terms of the Warrants, the terms of the Warrant Certificate shall govern and control.

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3. Terms and Exercise of Warrants.

3.1. Exercise Price. Each Warrant shall entitle the Holder, subject to the provisions of the applicable Warrant Certificate and of this Warrant Agreement, to purchase from the Company the number of shares of Common Stock stated therein, at the price of $___ per whole share, subject to the subsequent adjustments provided in Section 4 hereof. The term “Exercise Price” as used in this Warrant Agreement refers to the price per share at which shares of Common Stock may be purchased at the time a Warrant is exercised.

3.2. Duration of Warrants. Warrants may be exercised only during the period (“Exercise Period”) commencing on ___, 2022 and terminating at 5:00 P.M., Eastern Standard Time (the “close of business”) on the third anniversary of the Issuance Date, ____ 2025 (“Expiration Date”). Subject to the last sentence of Section 3.3.6(c), each Warrant not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect thereof under this Warrant Agreement shall cease at the close of business on the Expiration Date.

3.3. Exercise of Warrants.

3.3.1. Exercise and Payment.

(a) Exercise of the purchase rights represented by a Warrant may be made, in whole or in part, at any time or times during the Exercise Period by delivery to the Company or the Warrant Agent of the Notice of Exercise in the form annexed as Exhibit B hereto (the “Notice of Exercise”). Within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period following the date the Holder delivers the Notice of Exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure set forth in Section 3.3.6 is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender a Warrant Certificate to the Company until the Holder has purchased all of the Warrant Shares available thereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender such Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of a Warrant resulting in purchases of a portion of the total number of Warrant Shares available thereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. The Holder and any assignee, by acceptance of a Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face thereof.

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(b) Notwithstanding the foregoing in this Section 3.3.1, a Holder whose interest in a Warrant is a beneficial interest in certificate(s) representing such Warrant held in registered form through DTC (or another established clearing corporation performing similar functions), shall effect exercises made pursuant to this Section 3.3.1 by delivering to DTC (or such other clearing corporation, as applicable) the appropriate instruction form for exercise, complying with the procedures to effect exercise that are required by DTC (or such other clearing corporation, as applicable), subject to a Holder’s right to elect to receive a Warrant in certificated form pursuant to the terms of this Warrant Agreement, in which case this sentence shall not apply. Upon giving irrevocable instructions to its Participant to exercise Warrants, solely for purposes of Regulation SHO, the holder whose interest in the Warrant is a beneficial interest shall be deemed to have exercised such Warrant, regardless of when the applicable Warrant Shares are delivered to such holder.

3.3.2. Issuance of Warrant Shares.

(a) The Warrant Agent shall, on the Trading Day following the date of exercise of any Warrant, advise the Company, and the transfer agent and registrar for the Company’s Common Stock (the “Transfer Agent”), in respect of (i) the number of Warrant Shares indicated on the Notice of Exercise as issuable upon such exercise with respect to such exercised Warrants, (ii) the instructions of the Holder or Participant, as the case may be, provided to the Warrant Agent with respect to the delivery of the Warrant Shares and the number of Warrants that remain outstanding after such exercise and (iii) such other information as the Company or the Transfer Agent shall reasonably request.

(b) The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with DTC through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by Holder or (B) the Warrant is being exercised via cashless exercise, and otherwise by physical delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earliest of (i) two (2) Trading Days of, (ii) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company and (iii) the number of Trading Days comprising the Standard Settlement Period after, the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which the Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading Days of and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST program so long as the Warrants remains outstanding and exercisable. As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise. Notwithstanding the foregoing, with respect to any Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City time) on the Initial Exercise Date, which may be delivered at any time after the time of execution of the Underwriting Agreement, the Company agrees to deliver the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City time) on the Initial Exercise Date and the Initial Exercise Date shall be the Warrant Share Delivery Date for purposes hereunder, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received by such Warrant Share Delivery Date.

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3.3.3. Valid Issuance. All Warrant Shares issued by the Company upon the proper exercise of a Warrant in conformity with this Warrant Agreement shall be validly issued, fully paid and non-assessable.

3.3.4. No Fractional Exercise. No fractional Warrant Shares will be issued upon the exercise of the Warrant. If, by reason of any adjustment made pursuant to Section 4, a Holder would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.

3.3.5. No Transfer Taxes. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that if Warrant Shares are to be issued in a name other than the name of the Holder, the Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the DTC (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.

3.3.6. Restrictive Legend Events.

(a)       The Company shall use its reasonable best efforts to maintain the effectiveness of the Registration Statement and the current status of the prospectus included therein or to file and maintain the effectiveness of another registration statement and another current prospectus covering the Warrants and the Warrant Shares at any time that the Warrants are exercisable. The Company shall provide to the Warrant Agent and each Holder prompt written notice of any time that the Company is unable to deliver the Warrant Shares via DTC transfer or otherwise without restrictive legend because (A) the Commission has issued a stop order with respect to the Registration Statement, (B) the Commission otherwise has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently, (C) the Company has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently, (D) the prospectus contained in the Registration Statement is not available for the issuance of the Warrant Shares to the Holder or (E) otherwise (each a “Restrictive Legend Event”). To the extent that the Warrants cannot be exercised as a result of a Restrictive Legend Event, the Company shall, at the election of the Holder, which shall be given within five (5) days of receipt of such notice of the Restrictive Legend Event, either (A) rescind the previously submitted Notice of Exercise and the Company shall return all consideration paid by registered holder for such shares upon such rescission or (B) treat the attempted exercise as a cashless exercise as described in paragraph (ii) below and refund the cash portion of the exercise price to the Holder.

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(b)       If a Restrictive Legend Event has occurred, the Warrant may also be exercisable on a cashless basis. Notwithstanding anything herein to the contrary, but without limiting the rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to this Section 3.3.6(b) or to receive cash payments pursuant to Section 3.3.2(b) and Section 3.3.8 herein, the Company shall not be required to make any cash payments or net cash settlement to the Holder in lieu of delivery of the Warrant Shares. Upon a “cashless exercise”, the Holder shall be entitled to receive the number of Warrant Shares equal to the quotient (if such quotient would be a positive number) obtained by dividing (A-B) (X) by (A), where:

(A) =     as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 3.3.1. hereof on a day that is not a Trading Day or (2) both executed and delivered pursuant to Section 3.3.1. hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in Rule 600(b)(68) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise or (z) the bid price of the Common Stock on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder’s execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular trading hours” on a Trading Day) pursuant to Section 3.3.1. hereof or (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 3.3.1. hereof after the close of “regular trading hours” on such Trading Day;

(B) =     the Exercise Price of the Warrant, as adjusted as set forth herein; and

(X) =     the number of Warrant Shares that would be issuable upon exercise of the Warrant in accordance with the terms of the Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

(c)       If the Warrant Shares are issued in such a cashless exercise, the Company acknowledges and agrees that, in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised and the Company agrees not to take any position contrary thereto. Upon receipt of a Notice of Exercise for a cashless exercise, the Warrant Agent will promptly deliver a copy of the Notice of Exercise to the Company to confirm the number of Warrant Shares issuable in connection with the cashless exercise. The Company shall calculate and transmit to the Warrant Agent in a written notice, and the Warrant Agent shall have no duty, responsibility or obligation under this Section 3.3.6 to calculate, the number of Warrant Shares issuable in connection with any cashless exercise. The Warrant Agent shall be entitled to rely conclusively on any such written notice provided by the Company, and the Warrant Agent shall not be liable for any action taken, suffered or omitted to be taken by it in accordance with such written instructions or pursuant to this Warrant Agreement. Notwithstanding anything herein to the contrary, on the Expiration Date, the Warrant shall be automatically exercised via cashless exercise pursuant to this Section 3.3.6.

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3.3.7. Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the number of Warrant Shares issuable in connection with any exercise, the Company shall promptly deliver to the Holder the number of Warrant Shares that are not disputed.

3.3.8. Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 3.3.2 pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

3.3.9. Beneficial Ownership Limitation. The Company shall not affect any exercise of a Warrant, and a Holder shall not have the right to exercise any portion of a Warrant, pursuant to Section 3 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below).  For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of shares of Common Stock issuable upon exercise of such Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, non-exercised portion of such Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or non-converted portion of any other securities of the Company (including, without limitation, any other securities of the Company which would entitle the holder thereof to acquire at any time shares of Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, shares of Common Stock (“Common Stock Equivalents”)) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties.  Except as set forth in the preceding sentence, for purposes of this Section 3.3.9, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 3.3.9 applies, the determination of whether a Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of a Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether a Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of a Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 3.3.9, in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding.  Upon the written or oral request of a Holder, the Company shall within two (2) Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including such Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of a Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 3.3.9, provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon exercise of the Warrant held by the Holder and the provisions of this Section 3.3.9 shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61^st day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 3.3.9 to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of a Warrant.

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4. Adjustments.

4.1. Adjustment upon Subdivisions or Combinations. If the Company, at any time while the Warrants are outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of the Warrants), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of each Warrant shall be proportionately adjusted such that the aggregate Exercise Price of such Warrant shall remain unchanged. Any adjustment made pursuant to this Section 4.1 shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

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4.2. Adjustment for Other Distributions.

4.2.1. Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 4.1, if at any time the Company grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of a Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

4.2.2 Pro Rata Distributions. While any Warrant is outstanding, if the Company declares or makes any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the issuance of a Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of the Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided, however, that, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

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4.3. Fundamental Transaction. If, at any time while any Warrant ise outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent exercise of a Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 3.3.9 on the exercise of a Warrant), the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which each Warrant is exercisable immediately prior to such Fundamental Transaction. For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration that such Holder receives upon any exercise of each Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant Agreement and the Warrants in accordance with the provisions of this Section 4.3 pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for the applicable Warrants created by this Warrant Agreement a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to the Warrants that are exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of the Warrants (without regard to any limitations on the exercise of the Warrants) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of the Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant Agreement and the Warrants referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant Agreement and the Warrants with the same effect as if such Successor Entity had been named as the Company herein and therein. The Company shall instruct the Warrant Agent in writing to mail by first class mail, postage prepaid, to each Holder, written notice of the execution of any such amendment, supplement or agreement with the Successor Entity. Any supplemented or amended agreement entered into by the successor corporation or transferee shall provide for adjustments, which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 4.3. The Warrant Agent shall have no duty, responsibility or obligation to determine the correctness of any provisions contained in such agreement or such notice, including but not limited to any provisions relating either to the kind or amount of securities or other property receivable upon exercise of warrants or with respect to the method employed and provided therein for any adjustments, and shall be entitled to rely conclusively for all purposes upon the provisions contained in any such agreement. The provisions of this Section 4.3 shall similarly apply to successive reclassifications, changes, consolidations, mergers, sales and conveyances of the kind described above.

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4.4. Other Events. If any event occurs of the type contemplated by the provisions of Section 4.1 or 4.2 but not expressly provided for by such provisions (including, without limitation, the granting of stock appreciation rights, Adjustment Rights, phantom stock rights or other rights with equity features to all holders of Common Stock for no consideration), then the Company’s Board of Directors will, at its discretion and in good faith, make an adjustment in the Exercise Price and the number of Warrant Shares or designate such additional consideration to be deemed issuable upon exercise of a Warrant, so as to protect the rights of the registered Holder. No adjustment to the Exercise Price will be made pursuant to more than one sub-section of this Section 4 in connection with a single issuance.

4.5. Notices to Holder.

4.5.1. Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 4, the Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

4.5.2. Notice to Allow Exercise by Holder. If (A) the Company declares a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Company declares a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company authorizes the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company (or any of its Subsidiaries) is a party, any sale or transfer of all or substantially all of its assets, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or (E) the Company authorizes the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by email to the Holder at its last email address as it appears upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. The Holder shall remain entitled to exercise its Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

4.6. Voluntary Adjustment By Company. Subject to the rules and regulations of the Trading Market, the Company may at any time during the term of the Warrants, subject to the prior written consent of the Holder, reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the board of directors of the Company.

4.7. Notices of Changes in Warrant. Upon every adjustment of the Exercise Price or the number of Warrant Shares issuable upon exercise of a Warrant, the Company shall give prompt written notice thereof to the Warrant Agent, which notice shall state the Exercise Price resulting from such adjustment and the increase or decrease, if any, in the number of Warrant Shares purchasable at such price upon the exercise of a Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified in Sections 4.1 or 4.2, then, in any such event, the Company shall give written notice to each Holder, at the last address set forth for such holder in the Warrant Register, as of the record date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event. The Warrant Agent shall be entitled to rely conclusively on, and shall be fully protected in relying on, any certificate, notice or instructions provided by the Company with respect to any adjustment of the Exercise Price or the number of shares issuable upon exercise of a Warrant, or any related matter, and the Warrant Agent shall not be liable for any action taken, suffered or omitted to be taken by it in accordance with any such certificate, notice or instructions or pursuant to this Warrant Agreement. The Warrant Agent shall not be deemed to have knowledge of any such adjustment unless and until it shall have received written notice thereof from the Company.

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5. Restrictive Legends; Fractional Warrants. If a Warrant Certificate surrendered for transfer bears a restrictive legend, the Warrant Agent shall not register that transfer until the Warrant Agent has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the Warrants must also bear a restrictive legend upon that transfer. The Warrant Agent shall not be required to effect any registration of transfer or exchange which will result in the transfer of or delivery of a Warrant Certificate for a fraction of a Warrant.

6. Other Provisions Relating to Rights of Holders of Warrants.

6.1. No Rights as Stockholder. Except as otherwise specifically provided herein, a Holder, solely in its capacity as a holder of Warrants, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant Agreement be construed to confer upon a Holder, solely in its capacity as the registered holder of Warrants, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock, reclassification of share capital, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights or rights to participate in new issues of shares, or otherwise, prior to the issuance to the Holder of the Warrant Shares which it is then entitled to receive upon the due exercise of Warrants.

6.2. Reservation of Common Stock. The Company shall at all times reserve and keep available a number of its authorized but unissued shares of Common Stock that will be sufficient to permit the exercise in full of all outstanding Warrants issued pursuant to this Warrant Agreement.

7. Concerning the Warrant Agent and Other Matters.

7.1. Instructions to Warrant Agent. Any instructions given to the Warrant Agent orally, as permitted by any provision of this Warrant Agreement, shall be confirmed in writing by the Company as soon as practicable. The Warrant Agent shall not be liable or responsible and shall be fully authorized and protected for acting, or failing to act, in accordance with any oral instructions which do not conform with the written confirmation received in accordance with this Section 7.1.

7.2. Fees and Expenses.

(a) Whether or not any Warrants are exercised, for the Warrant Agent’s services as agent for the Company hereunder, the Company shall pay to the Warrant Agent such fees as may be separately agreed between the Company and Warrant Agent and the Warrant Agent’s out of pocket expenses in connection with this Warrant Agreement, including, without limitation, the fees and expenses of the Warrant Agent’s counsel. While the Warrant Agent endeavors to maintain out-of-pocket charges (both internal and external) at competitive rates, these charges may not reflect actual out-of-pocket costs, and may include handling charges to cover internal processing and use of the Warrant Agent’s billing systems.

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(b) All amounts owed by the Company to the Warrant Agent under this Warrant Agreement are due within 30 days of the invoice date. Delinquent payments are subject to a late payment charge of [_______] per month commencing 45 days from the invoice date. The Company agrees to reimburse the Warrant Agent for any attorney’s fees and any other costs associated with collecting delinquent payments.

(c) No provision of this Warrant Agreement shall require Warrant Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties under this Warrant Agreement or in the exercise of its rights.

7.3. Duties and Obligations of Warrant Agent. As agent for the Company hereunder, the Warrant Agent: (a) shall have no duties or obligations other than those specifically set forth herein or as may subsequently be agreed to in writing by the Warrant Agent and the Company; (b) shall be regarded as making no representations and having no responsibilities as to the validity, sufficiency, value, or genuineness of the Warrants or any Warrant Shares; (c) shall not be obligated to take any legal action hereunder; if, however, the Warrant Agent determines to take any legal action hereunder, and where the taking of such action might, in its judgment, subject or expose it to any expense or liability it shall not be required to act unless it has been furnished with an indemnity reasonably satisfactory to it; (d) may rely on and shall be fully authorized and protected in acting or failing to act upon any certificate, instrument, opinion, notice, letter, telegram, telex, facsimile transmission or other document or security delivered to the Warrant Agent and believed by it to be genuine and to have been signed by the proper party or parties; (e) shall not be liable or responsible for any recital or statement contained in the Registration Statement or any other documents relating thereto; (f) shall not be liable or responsible for any failure on the part of the Company to comply with any of its covenants and obligations relating to the Warrants, including without limitation obligations under applicable securities laws; (g) may rely on and shall be fully authorized and protected in acting or failing to act upon the written, telephonic or oral instructions with respect to any matter relating to its duties as Warrant Agent covered by this Warrant Agreement (or supplementing or qualifying any such actions) of officers of the Company, and is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from the Company or counsel to the Company, and may apply to the Company, for advice or instructions in connection with the Warrant Agent’s duties hereunder, and the Warrant Agent shall not be liable for any delay in acting while waiting for those instructions; any applications by the Warrant Agent for written instructions from the Company may, at the option of the Warrant Agent, set forth in writing any action proposed to be taken or omitted by the Warrant Agent under this Warrant Agreement and the date on or after which such action shall be taken or such omission shall be effective; the Warrant Agent shall not be liable for any action taken by, or omission of, the Warrant Agent in accordance with a proposal included in such application on or after the date specified in such application (which date shall not be less than five Business Days after the date such application is sent to the Company, unless the Company shall have consented in writing to any earlier date) unless prior to taking any such action, the Warrant Agent shall have received written instructions in response to such application specifying the action to be taken or omitted; (h) may consult with counsel satisfactory to the Warrant Agent, including its in-house counsel, and the advice of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered, or omitted by it hereunder in good faith and in accordance with the advice of such counsel; (i) may perform any of its duties hereunder either directly or by or through nominees, correspondents, designees, or subagents, and it shall not be liable or responsible for any misconduct or negligence on the part of any nominee, correspondent, designee, or subagent appointed with reasonable care by it in connection with this Warrant Agreement; (j) is not authorized, and shall have no obligation, to pay any brokers, dealers, or soliciting fees to any Person; and (k) shall not be required hereunder to comply with the laws or regulations of any country other than the United States of America or any political subdivision thereof.

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7.4. Liability of Warrant Agent.

(a) In the absence of gross negligence or willful or illegal misconduct on its part, the Warrant Agent shall not be liable for any action taken, suffered, or omitted by it or for any error of judgment made by it in the performance of its duties under this Warrant Agreement. Anything in this Warrant Agreement to the contrary notwithstanding, in no event shall Warrant Agent be liable for special, indirect, incidental, consequential or punitive losses or damages of any kind whatsoever (including but not limited to lost profits), even if the Warrant Agent has been advised of the possibility of such losses or damages and regardless of the form of action. Any liability of the Warrant Agent will be limited in the aggregate to the amount of fees paid by the Company hereunder. The Warrant Agent shall not be liable for any failures, delays or losses, arising directly or indirectly out of conditions beyond its reasonable control including, but not limited to, acts of government, exchange or market ruling, suspension of trading, work stoppages or labor disputes, fires, civil disobedience, riots, rebellions, storms, electrical or mechanical failure, computer hardware or software failure, communications facilities failures including telephone failure, war, terrorism, insurrection, earthquakes, floods, acts of God or similar occurrences.

(b) If any question or dispute arises with respect to the proper interpretation of the Warrants or the Warrant Agent’s duties under this Warrant Agreement or the rights of the Company or of any Holder, the Warrant Agent shall not be required to act and shall not be held liable or responsible for its refusal to act until the question or dispute has been judicially settled (and, if appropriate, it may file a suit in interpleader or for a declaratory judgment for such purpose) by final judgment rendered by a court of competent jurisdiction, binding on all Persons interested in the matter which is no longer subject to review or appeal, or settled by a written document in form and substance satisfactory to Warrant Agent and executed by the Company and each such Holder. In addition, the Warrant Agent may require for such purpose, but shall not be obligated to require, the execution of such written settlement by all the Holders and all other Persons that may have an interest in the settlement.

7.5. Indemnification. The Company covenants to indemnify the Warrant Agent and hold it harmless from and against any loss, liability, claim or expense (“Loss”) arising out of or in connection with the Warrant Agent’s duties under this Warrant Agreement, including the costs and expenses of defending itself against any Loss, unless such Loss has been determined by a court of competent jurisdiction to be a result of the Warrant Agent’s gross negligence or willful misconduct.

7.6. Termination. Unless terminated earlier by the parties hereto, this Warrant Agreement shall terminate 90 days after the earlier of the Expiration Date and the date on which no Warrants remain outstanding (the “Termination Date”). On the Business Day following the Termination Date, the Warrant Agent shall deliver to the Company any entitlements, if any, held by the Warrant Agent under this Warrant Agreement. The Warrant Agent’s right to be reimbursed for fees, charges and out-of-pocket expenses as provided in this Section 8 shall survive the termination of this Warrant Agreement.

7.7. Severability. If any provision of this Warrant Agreement shall be held illegal, invalid, or unenforceable by any court, this Warrant Agreement shall be construed and enforced as if such provision had not been contained herein and shall be deemed an agreement among the parties to it to the full extent permitted by applicable law.

7.8. Representations and Warranties of the Company. The Company represents and warrants that: (a) it is duly incorporated and validly existing under the laws of its jurisdiction of incorporation; (b) the offer and sale of the Warrants and the execution, delivery and performance of all transactions contemplated thereby (including this Warrant Agreement) have been duly authorized by all necessary corporate action and will not result in a breach of or constitute a default under the articles of association, bylaws or any similar document of the Company or any indenture, agreement or instrument to which it is a party or is bound; (c) this Warrant Agreement has been duly executed and delivered by the Company and constitutes the legal, valid, binding and enforceable obligation of the Company; (d) the Warrants will comply in all material respects with all applicable requirements of law; and (e) to the best of its knowledge, there is no litigation pending or threatened as of the date hereof in connection with the offering of the Warrants.

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7.9. Controlling Provisions. In the event of inconsistency between this Warrant Agreement and the descriptions in the Registration Statement, as they may from time to time be amended, the terms of this Warrant Agreement shall control.

7.10. Authorized Representatives. Set forth in Exhibit C is a list of the names and specimen signatures of the persons authorized to act for the Company under this Warrant Agreement (the “Authorized Representatives”). The Company shall, from time to time, certify to the Warrant Agent the names and signatures of any other persons authorized to act for the Company under this Warrant Agreement.

7.11. Notices. Except as expressly set forth elsewhere in this Warrant Agreement, all notices, instructions and communications under this Warrant Agreement shall be in writing, shall be effective upon receipt and shall be addressed, if to the Company, to its address set forth beneath its signature to this Warrant Agreement, or, if to the Warrant Agent, to American Stock Transfer & Trust Company, LLC, 6201 15^th Avenue, Brooklyn, N.Y. 11219, or to such other address of which a party hereto has notified the other party.

7.12. Governing Law, Etc.

(a) This Warrant Agreement shall be governed by and construed in accordance with the laws of the State of New York. All actions and proceedings relating to or arising from, directly or indirectly, this Warrant Agreement may be litigated in courts located within the Borough of Manhattan in the City and State of New York. The Company hereby submits to the personal jurisdiction of such courts and consents that any service of process may be made by certified or registered mail, return receipt requested, directed to the Company at its address last specified for notices hereunder. Each of the parties hereto hereby waives the right to a trial by jury in any action or proceeding arising out of or relating to this Warrant Agreement.

(b) This Warrant Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto. This Warrant Agreement may not be assigned, or otherwise transferred, in whole or in part, by either party without the prior written consent of the other party, which the other party will not unreasonably withhold, condition or delay; except that (i) consent is not required for an assignment or delegation of duties by Warrant Agent to any affiliate of Warrant Agent and (ii) any reorganization, merger, consolidation, sale of assets or other form of business combination by Warrant Agent or the Company shall not be deemed to constitute an assignment of this Warrant Agreement.

(c) No provision of this Warrant Agreement may be amended, modified or waived, except in a written document signed by both parties. The Company and the Warrant Agent may amend or supplement this Warrant Agreement without the consent of any Holder for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained herein or adding or changing any other provisions with respect to matters or questions arising under this Warrant Agreement as the parties may deem necessary or desirable and that the parties determine, in good faith, shall not adversely affect the interest of the Holders. All other amendments and supplements shall require the vote or written consent of Holders of at least 50.1% of the then outstanding Warrants, provided that adjustments may be made to the Warrant terms and rights in accordance with Section 4 without the consent of the Holders; provided further, however, that no modification of the terms (including but not limited to the adjustments described in Section 4) upon which the Warrants are exercisable or reducing the percentage required for consent to modification of this Warrant Agreement may be made without the consent of the Holders of all of the then-outstanding Warrants.

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7.13. Payment of Taxes. The Company will from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant Agent in respect of the issuance or delivery of Warrant Shares upon the exercise of Warrants, but the Company may require the Holders to pay any transfer taxes in respect of the Warrants or such shares. The Warrant Agent may refrain from registering any transfer of Warrants or any delivery of any Warrant Shares unless or until the Persons requesting the registration or issuance shall have paid to the Warrant Agent for the account of the Company the amount of such tax or charge, if any, or shall have established to the reasonable satisfaction of the Company and the Warrant Agent that such tax or charge, if any, has been paid.

7.14. Resignation of Warrant Agent.

7.14.1. Appointment of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further duties and liabilities hereunder after giving thirty (30) days’ notice in writing to the Company, or such shorter period of time agreed to by the Company. The Company may terminate the services of the Warrant Agent, or any successor Warrant Agent, after giving thirty (30) days’ notice in writing to the Warrant Agent or successor Warrant Agent, or such shorter period of time as agreed. If the office of the Warrant Agent becomes vacant by resignation, termination or incapacity to act or otherwise, the Company shall appoint in writing a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of 30 days after it has been notified in writing of such resignation or incapacity by the Warrant Agent, then the Warrant Agent or any Holder may apply to any court of competent jurisdiction for the appointment of a successor Warrant Agent at the Company’s cost. Pending appointment of a successor to such Warrant Agent, either by the Company or by such a court, the duties of the Warrant Agent shall be carried out by the Company. Any successor Warrant Agent (but not including the initial Warrant Agent), whether appointed by the Company or by such court, shall be a Person organized and existing under the laws of any state of the United States of America, in good standing, and authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authority. After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed, and except for executing and delivering documents as provided in the sentence that follows, the predecessor Warrant Agent shall have no further duties, obligations, responsibilities or liabilities hereunder, but shall be entitled to all rights that survive the termination of this Warrant Agreement and the resignation or removal of the Warrant Agent, including but not limited to its right to indemnity hereunder. If for any reason it becomes necessary or appropriate or at the request of the Company, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties, and obligations.

7.14.2. Notice of Successor Warrant Agent. If a successor Warrant Agent is appointed, the Company shall give notice thereof to the predecessor Warrant Agent and the transfer agent for the Common Stock not later than the effective date of any such appointment.

7.14.3. Merger or Consolidation of Warrant Agent. Any Person into which the Warrant Agent may be merged or converted or with which it may be consolidated or any Person resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party or any Person succeeding to the shareowner services business of the Warrant Agent or any successor Warrant Agent shall be the successor Warrant Agent under this Warrant Agreement, without any further act or deed.

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8. Miscellaneous Provisions.

8.1. Persons Having Rights under this Warrant Agreement. Nothing in this Warrant Agreement expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any Person or corporation other than the parties hereto and the Holders any right, remedy, or claim under or by reason of this Warrant Agreement or of any covenant, condition, stipulation, promise, or agreement hereof.

8.2. Examination of the Warrant Agreement. A copy of this Warrant Agreement shall be available at all reasonable times at the office of the Warrant Agent designated for such purpose for inspection by any Holder. Prior to such inspection, the Warrant Agent may require any such holder to provide reasonable evidence of its interest in the Warrants.

8.3. Counterparts. This Warrant Agreement may be executed in any number of original, facsimile or electronic counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

8.4. Effect of Headings. The Section headings herein are for convenience only and are not part of this Warrant Agreement and shall not affect the interpretation thereof.

8.5. Conflicting Provisions. If a Warrant is held in global form through DTC (or any successor depositary), such Warrant is issued subject to this Warrant Agreement. To the extent any provision of a Warrant conflicts with the express provisions of this Warrant Agreement, the provisions of such Warrant shall govern and be controlling.

8.6. Notices. Any notice, statement or demand authorized by this Warrant Agreement to be given or made by the Company, the Warrant Agent or by the holder of any Warrant to or on the Company or the Warrant Agent including, without limitation, any Notice of Exercise, shall be in writing and delivered by e-mail, hand or sent by a nationally recognized overnight courier service, addressed (until another address is filed in writing by the Company or the Warrant Agent) as set forth below and if to any holder any notice, statement or demand shall be given to the last address set forth for such holder (if any) in the Warrant Register:

If to the Company, to:

FlexEnergy Green Solutions, Inc.

112 Corporate Drive

Portsmouth, NH 03801

Attention: Chief Financial Officer

Email: wes.kimmel@flexenergy.com

with a copy (which shall not constitute notice) to:

Rutan & Tucker, LLP

18575 Jamboree Road, Ninth Floor

Irvine, CA 92612

Attention: Gregg Amber

E-mail: gamber@rutan.com

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If to the Warrant Agent, to:

American Stock Transfer & Trust Company, LLC

6201 15^th Avenue

Brooklyn, NY 11219

Attention: Yvonne Rivera

E-mail: ReorgWarrants@astfinancial.com

Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the time of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth above prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth above on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given.

9. Certain Definitions. As used herein, the following terms have the following meanings:

(a) “Adjustment Right” means any right granted with respect to any securities issued in connection with, or with respect to, any issuance, sale or delivery (or deemed issuance, sale or delivery in accordance with Section 4) of Common Stock (other than rights of the type described in Section 4.2 and 4.3) that could result in a decrease in the net consideration received by the Company in connection with, or with respect to, such securities (including, without limitation, any cash settlement rights, cash adjustment or other similar rights) but excluding anti-dilution and other similar rights (including pursuant to Section 4.4).

(b) “Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

(c) “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.

(d) “Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

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(f) “Subsidiary” means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

(e) “Trading Day” means any day on which the Common Stock is traded on the Trading Market, or, if the Trading Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market in the United States on which the Common Stock is then traded, provided that “Trading Day” shall not include any day on which the Common Stock is are scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00 P.M., New York City time).

(g) “Trading Market” means NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock Exchange (or any successors to any of the foregoing).

(h) “VWAP” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on the “Pink Open Market” (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

[Signature Page Follows]

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IN WITNESS WHEREOF, this Warrant Agent Agreement has been duly executed by the parties hereto as of the day and year first above written.

FLEXENERGY GREEN SOLUTIONS, Inc.

By:

Name:

Title:      

American Stock Transfer & Trust Company, LLC

By:

Name:

Title:      

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EXHIBIT A

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

FLEXENERGY GREEN SOLUTIONS, INC.

WARRANT CERTIFICATE
NOT EXERCISABLE AFTER _____, 2025

This certifies that the person whose name and address appears below, or registered assigns, is the registered owner of the number of Warrants set forth below. Each Warrant entitles its registered holder to purchase from FlexEnergy Green Solutions, Inc., a company incorporated under the laws of the State of Delaware (the “Company”), at any time prior to 5:00 P.M. (Eastern Standard Time) on _____, 2025, one share of common stock, par value $0.0001 per share, of the Company (each, a “Warrant Share” and collectively, the “Warrant Shares”), at an exercise price of $_____ per share, subject to possible adjustments as provided in the Warrant Agreement (as defined below).

This Warrant Certificate, with or without other Warrant Certificates, upon surrender at the designated office of the Warrant Agent, may be exchanged for another Warrant Certificate or Warrant Certificates evidencing the same number of Warrants as the Warrant Certificate or Warrant Certificates surrendered. A transfer of the Warrants evidenced hereby may be registered upon surrender of this Warrant Certificate at the designated office of the Warrant Agent by the registered holder in person or by a duly authorized attorney, properly endorsed or accompanied by proper instruments of transfer, a signature guarantee, and such other and further documentation as the Warrant Agent may reasonably request and duly stamped as may be required by the laws of the State of New York and of the United States of America.

The terms and conditions of the Warrants and the rights and obligations of the holder of this Warrant Certificate are set forth in the Warrant Agent Agreement dated as of ______, 2022 (the “Warrant Agreement”) between the Company and American Stock Transfer & Trust Company, LLC (the “Warrant Agent”). A copy of the Warrant Agreement is available for inspection during business hours at the office of the Warrant Agent.

This Warrant Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by an authorized signatory of the Warrant Agent.

IN WITNESS WHEREOF, this Warrant certificate has been duly executed by the parties hereto as of the day and year first above written.

FLEXENERGY GREEN SOLUTIONS, Inc.

By:

Name:

Title:      

American Stock Transfer & Trust Company, LLC

By:

Name:

Title:      

_{PLEASE DETACH HERE}

Certificate No.:_________ Number of Warrants:__________

WARRANT CUSIP NO.: ___________

EXHIBIT B

[FORM OF NOTICE OF EXERCISE]

NOTICE OF EXERCISE

To:        FlexEnergy Green Solutions, Inc.

(1)The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

(2)Payment shall take the form of (check applicable box):

¨ in lawful money of the United States; or

¨ if permitted, the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in Section 3.3.6(b) of the Warrant Agreement, to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in Section 3.3.6(b) of the Warrant Agreement.

(3)Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

_______________________________

The Warrant Shares shall be delivered to the following DWAC Account Number:

_______________________________

_______________________________

_______________________________

[SIGNATURE OF HOLDER]

Name of Investing Entity:
________________________________________________________________________

Signature of Authorized Signatory of Investing Entity:
_________________________________________________

Name of Authorized Signatory:
___________________________________________________________________

Title of Authorized Signatory:
____________________________________________________________________

Date:
________________________________________________________________________________________

EXHIBIT C

AUTHORIZED REPRESENTATIVES

Name Title Signature

EXHIBIT D

[FORM OF CERTIFICATED WARRANT]

EXHIBIT E

[FORM OF WARRANT CERTIFICATE REQUEST NOTICE]

WARRANT CERTIFICATE REQUEST NOTICE

To: American Stock Transfer & Trust Company, LLC,

as Warrant Agent for FlexEnergy Green Solutions, Inc. (the “Company”)

The undersigned Holder of Common Stock Purchase Warrants (“Warrants”) in the form of Global Warrants issued by the Company hereby elects to receive a Definitive Certificate evidencing the Warrants held by the Holder as specified below:

(1) Name of Holder of Warrants in form of Global Warrants:

(2) Name of Holder in Definitive Certificate (if different from name of Holder of Warrants in form of Global Warrants):

(3) Number of Warrants in name of Holder in form of Global Warrants:

(4) Number of Warrants for which Definitive Certificate shall be issued:

(5) Number of Warrants in name of Holder in form of Global Warrants after issuance:

The Definitive Certificate shall be delivered to the following address:

The undersigned hereby acknowledges and agrees that, in connection with this Warrant Exchange and the issuance of the Definitive Certificate, the Holder is deemed to have surrendered the number of Warrants in form of Global Warrants in the name of the Holder equal to the number of Warrants evidenced by the Definitive Certificate.

Name of Holder:

Signature of Authorized Signatory of Holder:

Name of Authorized Signatory:

Title of Authorized Signatory:

Date: _______________

EX-5.1

		Exhibit 5.1
	January 11, 2022

FlexEnergy Green Solutions, Inc.
112 Corporate Drive
Portsmouth, NH 03801

Attn: Chief Executive Officer

Re: FlexEnergy Green Solutions, Inc. Registration Statement on Form S-1

Ladies and Gentlemen:

We have acted as counsel to FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), with respect to certain matters in connection with the filing by the Company of a Registration Statement on Form S-1 (Registration No. 333-260111) filed with the Securities and Exchange Commission (the “Commission”) on October 7, 2021, as amended or supplemented through the date hereof, under the Securities Act of 1933, as amended (the “Securities Act”) (such Registration Statement, as amended or supplemented, the “Registration Statement”), including a related prospectus filed with the Registration Statement (the “Prospectus”), relating to: (i) $23,000,000 of units (the “Units”), which consist of (x) shares (the “Shares”) of the Company’s common stock, par value $0.0001 per share (“Common Stock”) and, (y) warrants to purchase shares of Common Stock (the “Common Warrants,” and the shares of Common Stock underlying the Common Warrants, the “Common Warrant Shares”) and (ii) warrants to purchase shares of Common Stock (the “Underwriter’s Warrant” and, together with the Common Warrants, the “Warrants,” and the shares of Common Stock underlying the Underwriter’s Warrant, the “Underwriter’s Warrant Shares,” and together with the Common Warrant Shares, the “Warrant Shares”) to be issued to Roth Capital Partners LLC (the “Underwriter”) pursuant to the underwriting agreement to be entered into by and between the Company and the Underwriter (the “Underwriting Agreement”), as set forth in the Registration Statement and the Prospectus. The Units, the Shares, the Warrants and the Warrant Shares are collectively referred to as the “Securities.” The Securities will be sold by the Company pursuant to an underwriting agreement to be entered into by and between the Company and the Underwriter (the “Underwriting Agreement”).

This opinion letter is being furnished in accordance with the requirements of Item 601(b)(5) of Regulation S-K promulgated under the Securities Act. In rendering the opinions set forth below, we have examined originals or copies of: (i) the Registration Statement; (ii) the Second Amended and Restated Certificate of Incorporation of the Company; (iii) the Amended and Restated Bylaws of the Company; (iv) the form of Underwriting Agreement; (v) resolutions adopted by the board of directors of the Company; and (vi) such other documents, records, and matters of law as we have deemed relevant or necessary for purposes of this opinion letter.

FlexEnergy Green Solutions, Inc.

January 11, 2022

Page 2

We have assumed the genuineness and authenticity of all signatures on original documents; the authenticity of all documents submitted to us as originals; the conformity to originals of all documents submitted to us as copies; and the accuracy, completeness, and authenticity of certificates of public officials. As to certain factual matters, we have relied upon a certificate of an officer of the Company and have not sought independently to verify such matters.

Our opinion herein is limited to the General Corporation Law of the State of Delaware (the “DGCL”) and, with respect to the enforceability of the Underwriter’s Warrant, the laws of the State of New York. We express no opinion (i) to the extent that the laws of any other jurisdiction are applicable to the subject matter of this opinion letter and (ii) as to compliance with any federal or state securities law, rule, or regulation.

Subject to the foregoing and the other matters set forth herein, it is our opinion that, as of the date hereof:

1.The Shares have been duly authorized for issuance and, when issued and paid for in accordance with the terms and conditions of the Underwriting Agreement, the Shares will be validly issued, fully paid and non-assessable.

2.The Units have been duly authorized for issuance and, when the Units are issued and paid for in accordance with the terms and conditions of the Underwriting Agreement, the Units will constitute valid and legally binding obligations of the Company.

3.The Warrants have been duly authorized and, upon delivery of the consideration as provided in the Underwriting Agreement, will constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms, subject, as to enforcement, to bankruptcy, insolvency, fraudulent conveyance, fraudulent transfer, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally and by general equitable principles (regardless of whether enforcement is sought in equity or at law), including, without limitation, principles regarding good faith and fair dealing (including the possible unavailability of specific performance or injunctive relief, concepts of materiality and reasonableness, and the discretion of the court before which a proceeding is brought).

4.The Warrant Shares issuable upon exercise of the Warrants have been duly authorized and, when issued upon exercise of the Warrants in accordance with the terms thereof, will be validly issued, fully paid and non-assessable.

 

FlexEnergy Green Solutions, Inc.

January 11, 2022

Page 3

This opinion is for your benefit in connection with the Registration Statement and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Securities Act. We consent to you filing this opinion as an exhibit to the Registration Statement and to the reference to our firm in the Prospectus under the heading “Legal Matters.” In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder.

Respectfully Submitted,

/s/ RUTAN & TUCKER, LLP

EX-10.1

Exhibit 10.1

FLEXENERGY GREEN SOLUTIONS, INC. 2021 INCENTIVE AWARD PLAN

1.            Establishment of the Plan; Effective Date; Duration.

(a)            Establishment of the Plan; Effective Date. FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), hereby establishes this incentive compensation plan to be known as the “FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan,” as amended from time to time (the “Plan”). The Plan permits the grant of Incentive Stock Options, Nonqualified Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Other Stock-Based Awards, Other Cash-Based Awards and Dividend Equivalents. The Plan shall become effective upon the date on which the Plan is approved by the affirmative vote of the holders of a majority of the Common Shares which are present or represented and entitled to vote and voted at a meeting (the “Effective Date”). If the Plan is not so approved by the stockholders of the Company, then the Plan will be null and void in its entirety. The Plan shall remain in effect as provided in Section 1(b). Capitalized but undefined terms shall have the meaning set forth in Section 3.

(b)            Duration of the Plan. The Plan shall commence on the Effective Date and shall remain in effect, subject to the right of the Board to amend or terminate the Plan at any time pursuant to Section 13. However, in no event may an Award be granted under the Plan on or after ten years from the Effective Date.

2.            Purpose. The purpose of the Plan is to provide a means through which the Company and its Affiliates may attract and retain key personnel and to provide a means whereby certain directors, officers, employees, consultants and advisors (and certain prospective directors, officers, employees, consultants and advisors) of the Company and its Affiliates can acquire and maintain an equity interest in the Company, or be paid incentive compensation, which may be measured by reference to the value of Common Shares, thereby strengthening their commitment to the welfare of the Company and its Affiliates and aligning their interests with those of the Company’s shareholders.

3.            Definitions. Certain terms used herein have the definitions given to them in the first instance in which they are used. In addition, for purposes of the Plan, the following terms are defined as set forth below:

(a)            “Affiliate” means (i) any person or entity that directly or indirectly controls, is controlled by or is under common control with the Company and/or (ii) to the extent provided by the Committee, any person or entity in which the Company has a significant interest. The term “control” (including, with correlative meaning, the terms “controlled by” and “under common control with”), as applied to any person or entity, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of that person or entity, whether through the ownership of voting or other securities, by contract or otherwise.

(b)            “Applicable Laws” means the requirements relating to the administration of equity incentive plans under U.S. federal and state securities, tax and other applicable laws, rules and regulations, the applicable rules of any stock exchange or quotation system on which the Common Shares are listed or quoted, and the applicable laws and rules of any foreign country or other jurisdiction where Awards are granted, as are in effect from time to time.

(c)            “Award” means, individually or collectively, any Incentive Stock Option, Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Other Stock-Based Awards, Other Cash-Based Awards, and/or Dividend Equivalents granted under the Plan.

(d)            “Award Agreement” means a written agreement evidencing an Award, which may be electronic, that contains terms and conditions determined by the Committee, consistent with and subject to the terms and conditions of the Plan. An Award Agreement may be a unilateral agreement, if determined by the Committee.

(e)            “Board” means the Board of Directors of the Company.

(f)            “Cause” means, in the case of a particular Award, unless the applicable Award Agreement states otherwise, (A) the Company or an Affiliate having “cause” to terminate a Participant’s employment or service, as defined in any employment or consulting or similar agreement between the Participant and the Company or an Affiliate in effect at the time of termination, or (B) in the absence of an employment or consulting or similar agreement (or the absence of any definition of  “Cause” contained therein), a Participant’s (i) conviction of, or the entry of a plea of guilty or no contest to, a felony or any other crime that causes the Company or its Affiliates public disgrace or disrepute, or materially and adversely affects the Company’s or its Affiliates’ operations or financial performance or the relationship the Company has with its customers; (ii) gross negligence or willful misconduct with respect to the Company or any of its Affiliates, including, without limitation fraud, embezzlement, theft or proven dishonesty in the course of his or her employment or other service; (iii) alcohol abuse or use of controlled drugs other than in accordance with a physician’s prescription; (iv) refusal to perform any lawful, material obligation or fulfill any duty (other than any duty or obligation of the type described in clause (vi) below) to the Company or its Affiliates (other than due to a disability, as determined by the Committee), which refusal, if curable, is not cured within 15 days after delivery of written notice thereof; (v) material breach of any agreement with or duty owed to the Company or any of its Affiliates, which breach, if curable, is not cured within 15 days after the delivery of written notice thereof; (vi) any breach of any obligation or duty to the Company or any of its Affiliates (whether arising by statute, common law or agreement) relating to confidentiality, noncompetition, nonsolicitation and/or proprietary rights; (vii) material violation of the Company’s written policies or codes of conduct, including those related to discrimination, harassment, performance of illegal or unethical practices, and ethical misconduct; or (viii) in the case of a director, repeated failure to participate in Board meetings (including meetings of any Board committee of which the director is a member) on a regular basis despite having received proper notice of meetings in advance.

(g)            “Change in Control” shall, in the case of a particular Award, unless the applicable Award Agreement states otherwise or contains a different definition of  “Change in Control,” be deemed to occur upon any of the following events that is not a Company Sale:

(i)            any “person” as that term is used in Sections 13(d) and 14(d) of the Exchange Act (other than (A) the Company or any of its Affiliates, (B) any trustee or other fiduciary holding securities under any employee benefit plan of the Company or any of its Affiliates, (C) an underwriter temporarily holding securities pursuant to an offering of those securities, (D) an entity owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of Common Shares, (E) FlexEnergy Power Solutions, LLC, or (F) any direct or indirect “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of more than 10% or more of the total voting power of the equity securities of FlexEnergy Power Solutions, LLC as of January 1, 2021) becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, by way of merger, consolidation, recapitalization, reorganization or otherwise, of 50% or more of the total voting power of the then outstanding voting securities of the Company;

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(ii)            the consummation of a merger or consolidation of the Company with any other company, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 50% of the total voting power represented by the voting securities of the Company or the surviving entity outstanding immediately after the merger or consolidation;

(iii)            any other event specified as a “Change in Control” in an applicable Award Agreement.

Notwithstanding the foregoing, if a Change in Control constitutes a payment event with respect to any Award (or any portion of an Award) that provides for the deferral of compensation that is subject to Code Section 409A, to the extent required to avoid the imposition of additional taxes under Code Section 409A, the transaction or event described in subsection (i), (ii), (iii), (iv) or (v) with respect to the Award (or portion thereof) shall only constitute a Change in Control for purposes of the payment timing of the Award if the transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5). Additionally, the issuance of securities by the Company in a financing transaction approved by the Committee shall not be deemed or deemed to cause or result in a “Change in Control”.

(h)            “Code” means the Internal Revenue Code of 1986, as amended, and any successor thereto. Reference in the Plan to any section of the Code shall be deemed to include any regulations or other interpretative guidance under that section, and any amendments or successor provisions to that section, regulations or guidance.

(i)            “Committee” means a committee of at least two people as the Board may appoint to administer the Plan or, if no such committee has been appointed by the Board, the Board.

(j)            “Common Shares” means shares of the Company’s common stock, par value $0.0001 per share (and any stock or other securities into which ordinary shares may be converted or into which they may be exchanged).

(k)            “Company” means FlexEnergy Green Solutions, Inc., a Delaware corporation.

(l)            “Company Sale” shall, in the case of a particular Award, unless the applicable Award Agreement states otherwise or contains a different definition of  “Company Sale,” be deemed to occur upon any of the following events:

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(i)            any “person” as that term is used in Sections 13(d) and 14(d) of the Exchange Act (other than (A) the Company or any of its Affiliates, (B) any trustee or other fiduciary holding securities under any employee benefit plan of the Company or any of its Affiliates, (C) an underwriter temporarily holding securities pursuant to an offering of those securities, (D) an entity owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of Common Shares, or (E) FlexEnergy Power Solutions, LLC prior to an initial public offering of the Company’s common stock) becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, by way of merger, consolidation, recapitalization, reorganization or otherwise, of 100% of the total voting power of the then outstanding voting securities of the Company;

(ii)            the consummation of a merger or consolidation of the Company with any other company, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 10% of the total voting power represented by the voting securities of the Company or the surviving entity outstanding immediately after the merger or consolidation;

(iii)            the consummation of a plan of complete liquidation of the Company or the sale or disposition by the Company of all or substantially all the Company’s assets; or

(iv)            any other event specified as a “Company Sale” in an applicable Award Agreement.

(m)            “Date of Grant” means the date on which the granting of an Award is authorized, or other date specified in the authorization.

(n)            “Dividend Equivalent” means a right to receive the equivalent value (in cash or Common Shares) of ordinary dividends that would otherwise be paid on the Common Shares subject to an Award that is a full-value award but that have not been issued or delivered, awarded under Section 11.

(o)            “Effective Date” has the meaning set forth in Section 1(a).

(p)            “Eligible Director” means a person who is a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act.

(q)            “Eligible Person” with respect to an Award denominated in Common Shares, means any (i) individual employed by the Company or an Affiliate; (ii) director of the Company or an Affiliate; (iii) consultant or advisor to the Company or an Affiliate; provided that if the Securities Act applies those persons must be eligible to be offered securities registrable on Form S-8 under the Securities Act; or (iv) prospective employees, directors, officers, consultants or advisors who have accepted offers of employment or consultancy from the Company or its Affiliates (and would satisfy the provisions of clauses (i) through (iii) above once he or she begins employment with or begins providing services to the Company or its Affiliates).

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(r)            “Exchange Act” means the U.S. Securities Exchange Act of 1934, as it may be amended from time to time, including the rules and regulations promulgated thereunder and successor provisions and rules and regulations thereto.

(s)            “Exercise Price” has the meaning set forth in Section 7(b).

(t)            “Fair Market Value” means, as of any date, the value of Common Shares determined as follows:

(i)            If the Common Shares are listed on any established stock exchange or a national market system, the Fair Market Value will be the closing sales price for the Common Shares (or the closing bid, if no sales were reported) as quoted on that exchange or system on the day of determination, as reported in The Wall Street Journal or other source the Committee deems reliable;

(ii)            If the Common Shares are regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value will be the mean between the high bid and low asked prices for the Common Shares on the day of determination, as reported in The Wall Street Journal or other source the Committee deems reliable; or

(iii)            In the absence of an established market for the Common Shares, the Fair Market Value will be determined in good faith by the Committee.

(iv)            Notwithstanding the foregoing, the determination of Fair Market Value in all cases shall be in accordance with the requirements set forth under Code Section 409A to the extent necessary for an Award to comply with, or be exempt from, Code Section 409A.

(u)            “Good Reason” means, unless the applicable Award Agreement states otherwise: (a) if a Participant is a party to an employment or service agreement with the Company or its Affiliates and the agreement provides for a definition of Good Reason, the definition contained therein; or (b) if no agreement exists or if the agreement does not define Good Reason, the occurrence of one or more of the following without the Participant’s express written consent, which circumstances are not remedied by the Company within 30 days of its receipt of a written notice from the Participant describing the applicable circumstances (which notice must be provided by the Participant within 90 days of the Participant’s knowledge of the applicable circumstances): (i) any material, adverse change in the Participant’s duties, responsibilities, authority, title, status or reporting structure; (ii) a material reduction in the Participant’s base salary or bonus opportunity; or (iii) a geographical relocation of the Participant’s principal office location by more than 50 miles.

(v)            “Immediate Family Members” has the meaning set forth in Section 14(b)(ii).

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(w)            “Incentive Stock Option” means an Option that is designated by the Committee as an incentive stock option as described in Code Section 422 and otherwise meets the requirements set forth in the Plan.

(x)            “Indemnifiable Person” has the meaning set forth in Section 4(e).

(y)            “Mature Shares” means Common Shares owned by a Participant that are not subject to any pledge or security interest and that have been either previously acquired by the Participant on the open market or meet any other requirements, if any, the Committee determines are necessary in order to avoid an accounting earnings charge on account of the use of those shares to pay the Exercise Price or satisfy a tax or deduction obligation of the Participant.

(z)            “Nonqualified Stock Option” means an Option that is not designated by the Committee as an Incentive Stock Option.

(aa)          “Option” means an Award granted under Section 7.

(bb)          “Option Period” has the meaning set forth in Section 7(c).

(cc)           “Other Cash-Based Award” means a cash Award granted to a Participant under Section 10, including cash awarded as a bonus or upon the attainment of any performance goals or otherwise as permitted under the Plan.

(dd)          “Other Stock-Based Award” means an equity-based or equity-related Award, other than an Option, SAR, Restricted Stock, Restricted Stock Unit or Dividend Equivalent, granted in accordance with the terms and conditions set forth under Section 10 (including upon the attainment of any performance goals or otherwise as permitted under the Plan).

(ee)          “Participant” means an Eligible Person who has been selected by the Committee to participate in the Plan and to receive an Award pursuant to Section 6.

(ff)           “Permitted Transferee” has the meaning set forth in Section 14(b)(ii).

(gg)          “Person” means any individual, entity or group within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act.

(hh)          “Plan” means this FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan, as amended from time to time.

(ii)            “Restricted Period” means the period of time determined by the Committee during which an Award is subject to restrictions or, as applicable, the period of time within which performance is measured for purposes of determining whether an Award has been earned.

(jj)            “Restricted Stock Unit” means an unfunded and unsecured promise to deliver Common Shares, cash, other securities or other property, subject to certain performance or time-based restrictions (including, without limitation, a requirement that the Participant remain continuously employed, provide continuous services for a specified period of time, or attain specified performance objectives), granted under Section 9.

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(kk)          “Restricted Stock” means Common Shares, subject to certain specified performance or time-based restrictions (including, without limitation, a requirement that the Participant remain continuously employed, provide continuous services for a specified period of time, or attain specified performance objectives), granted under Section 9.

(ll)            “SAR Period” has the meaning set forth in Section 8(b).

(mm)         “Securities Act” means the Securities Act of 1933, as amended, and any successor thereto. Reference in the Plan to any section of the Securities Act shall be deemed to include any rules, regulations or other interpretative guidance under that section, and any amendments or successor provisions to those section, rules, regulations or guidance.

(nn)          “Stock Appreciation Right” or “SAR” means an Award granted under Section 8.

(oo)            “Strike Price” means, except as otherwise provided by the Committee in the case of Substitute Awards, (i) in the case of a SAR granted in tandem with an Option, the Exercise Price of the related Option, or (ii) in the case of a SAR granted independent of an Option, the Fair Market Value on the Date of Grant.

(pp)      “Subsidiary” means, with respect to any specified Person:

(i)            any corporation, association or other business entity (other than a partnership) of which more than 50% of the total voting power of shares or other equity interests (without regard to the occurrence of any contingency and after giving effect to any voting agreement, stockholders’ agreement, operating agreement, or other agreement that effectively transfers voting power) is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a combination thereof); and

(ii)            any partnership (or any comparable foreign entity) (A) the sole general partner (or functional equivalent thereof) or the managing general partner of which is that Person or Subsidiary of that Person or (B) the only general partners (or functional equivalents thereof) of which are that Person or one or more Subsidiaries of that Person (or any combination thereof).

(qq)           “Substitute Award” has the meaning set forth in Section 5(e).

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4.            Administration.

(a)            The Committee shall administer the Plan. To the extent required to comply with the provisions of Rule 16b-3 promulgated under the Exchange Act (if the Board is not acting as the Committee under the Plan), it is intended that each member of the Committee shall, at the time he or she takes any action with respect to an Award under the Plan, be an Eligible Director. However, the fact that a Committee member fails to qualify as an Eligible Director shall not invalidate any Award granted by the Committee that is otherwise validly granted under the Plan.

(b)            Subject to the provisions of the Plan and Applicable Laws, the Committee shall have the sole and plenary authority, in addition to other express powers and authorizations conferred on the Committee by the Plan, to: (i) designate Participants; (ii) determine the type or types of Awards to be granted to a Participant; (iii) determine the number of Common Shares to be covered by, or with respect to which payments, rights, or other matters are to be calculated in connection with, Awards; (iv) determine the terms and conditions of any Award (including any performance goals, criteria, and/or periods applicable to Awards); (v) determine whether, to what extent, and under what circumstances Awards may be settled or exercised in cash, Common Shares, other securities, other Awards or other property, or canceled, forfeited, or suspended and the method or methods by which Awards may be settled, exercised, canceled, forfeited, or suspended; (vi) determine whether, to what extent, and under what circumstances the delivery of cash, Common Shares, other securities, other Awards or other property and other amounts payable with respect to an Award shall be deferred either automatically or at the election of the Participant or of the Committee; (vii) interpret, administer, reconcile any inconsistency in, correct any defect in and/or supply any omission in the Plan and any instrument or agreement relating to, or Award granted under, the Plan, including any changes required to comply with Applicable Laws (including any amendments to the terms and conditions of outstanding Awards in response to changes in Applicable Laws); (viii) establish, amend, suspend, or waive any rules and regulations and appoint any agents the Committee deems appropriate for the proper administration of the Plan; (ix) accelerate the vesting or exercisability of, payment for or lapse of restrictions on, Awards; and (x) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan.

(c)            The Committee may delegate to one or more officers of the Company or any Affiliate the authority to act on behalf of the Committee with respect to any matter, right, obligation, or election that is the responsibility of or that is allocated to the Committee herein, and that may be so delegated as a matter of law, except for grants of Awards to persons subject to Section 16 of the Exchange Act.

(d)            Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations, and other decisions under or with respect to the Plan or any Award or any documents evidencing Awards granted pursuant to the Plan shall be within the sole discretion of the Committee, may be made at any time and shall be final, conclusive and binding upon all persons or entities, including, without limitation, the Company, any Affiliate, any Participant, any holder or beneficiary of any Award, and any shareholder of the Company.

(e)            No member of the Board, the Committee, delegate of the Committee or any employee or agent of the Company (each such person, an “Indemnifiable Person”) shall be liable for any action taken or omitted to be taken or any determination made in good faith with respect to the Plan or any Award hereunder. Each Indemnifiable Person shall be indemnified and held harmless by the Company against and from any loss, cost, liability, or expense (including attorneys’ fees) that may be imposed upon or incurred by the Indemnifiable Person in connection with or resulting from any action, suit or proceeding to which the Indemnifiable Person may be a party or in which the Indemnifiable Person may be involved by reason of any action taken or omitted to be taken under the Plan or any Award Agreement and against and from any and all amounts paid by the Indemnifiable Person with the Company’s approval, in settlement thereof, or paid by the Indemnifiable Person in satisfaction of any judgment in any such action, suit or proceeding against the Indemnifiable Person, provided that the Company shall have the right, at its own expense, to assume and defend any such action, suit or proceeding and once the Company gives notice of its intent to assume the defense, the Company shall have sole control over the defense with counsel of the Company’s choice. The foregoing right of indemnification shall not be available to an Indemnifiable Person to the extent that a final judgment or other final adjudication (in either case not subject to further appeal) binding upon the Indemnifiable Person determines that the acts or omissions of the Indemnifiable Person giving rise to the indemnification claim resulted from the Indemnifiable Person’s bad faith, fraud or willful criminal act or omission or that the right of indemnification is otherwise prohibited by law or by the Company’s Certificate of Incorporation or Bylaws. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which the Indemnifiable Persons may be entitled under the Company’s Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or any other power that the Company may have to indemnify the Indemnifiable Persons or hold them harmless.

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(f)            Notwithstanding anything to the contrary contained in the Plan, the Board may, in its sole discretion, at any time and from time to time, grant Awards and administer the Plan with respect to those Awards. In any such case, the Board shall have all the authority granted to the Committee under the Plan.

5.            Grant of Awards; Shares Subject to the Plan; Limitations.

(a)            The Committee may, from time to time, grant Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Other Stock-Based Awards, Other Cash-Based Awards, and/or Dividend Equivalents to one or more Eligible Persons.

(b)            Subject to Section 12, Awards granted under the Plan shall be subject to the following limitations: (i) the Committee is authorized to deliver under the Plan an aggregate of [l] Common Shares; and (ii) the maximum number of Common Shares that may be granted under the Plan during any single fiscal year to any Participant who is a non-employee director, when taken together with any cash fees paid to the non-employee director during that year in respect of his or her service as a non-employee director (including service as a member or chair of any committee of the Board), shall not exceed $350,000 in total value (calculating the value of any such Awards based on the grant date fair value of the Awards for financial reporting purposes); provided that the non-employee directors who are considered independent (under the rules of The Nasdaq Stock Market or other securities exchange on which the Common Shares are traded) may make exceptions to this limit for a non-executive chair, if any, of the Board, of the Audit Committee, of the Compensation Committee or of the Nominating and Governance Committee, in which case (A) the non-employee Director receiving the additional compensation may not participate in the decision to award the compensation, and (B) the maximum number of Common Shares that may be granted under the Plan during any single fiscal year, when taken together with any cash fees paid during that year in respect of his or her service as a non-employee director (including service as a member or chair of any committee of the Board), shall not exceed $500,000 in total value (calculating the value of any such Awards based on the grant date fair value of the Awards for financial reporting purposes). Notwithstanding the automatic annual increase set forth in (i) above, the Board may act prior to January 1st of a given year to provide that there will be no increase in the share reserve for that year or that the increase in the share reserve for that year will be a lesser number of Common Shares than would otherwise occur pursuant to the stipulated percentage.

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(c)            If (i) any Option or other Award granted hereunder is exercised through the tendering of Common Shares (either actually or by attestation) or by the withholding of Common Shares by the Company, or (ii) tax or deduction liabilities arising from the Option or other Award are satisfied by the tendering of Common Shares (either actually or by attestation) or by the withholding of Common Shares by the Company, then in each case the Common Shares so tendered or withheld shall be added to the Common Shares available for grant under the Plan on a one-for-one basis. Shares underlying Awards under this Plan that are forfeited, cancelled, expire unexercised, or are settled in cash are available again for Awards under the Plan.

(d)            Common Shares delivered by the Company in settlement of Awards may be authorized and unissued shares, shares held in the treasury of the Company, shares purchased on the open market or by private purchase, or a combination of the foregoing.

(e)            Awards may, in the sole discretion of the Committee, be granted under the Plan in assumption of, or in substitution for, outstanding awards previously granted by an entity acquired by the Company or with which the Company combines (“Substitute Awards”). The number of Common Shares underlying any Substitute Awards shall not be counted against the aggregate number of Common Shares available for Awards under the Plan.

6.            Eligibility. Participation shall be limited to Eligible Persons who have entered into an Award Agreement or who have received written notification from the Committee, or from a person designated by the Committee, that they have been selected to participate in the Plan.

7.            Options.

(a)            Generally. Each Option granted under the Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email or the posting on a web site maintained by the Company or a third party under contract with the Company)). Each Option so granted shall be subject to the conditions set forth in this Section 7, and to any other conditions not inconsistent with the Plan reflected in the applicable Award Agreement. All Options granted under the Plan shall be Nonqualified Stock Options unless the applicable Award Agreement expressly states that the Option is intended to be an Incentive Stock Option. The maximum aggregate number of Common Shares that may be issued through the exercise of Incentive Stock Options granted under the Plan is [l] Common Shares. Incentive Stock Options shall be granted only to Eligible Persons who are employees of the Company and its Affiliates, and no Incentive Stock Option shall be granted to any Eligible Person who is ineligible to receive an Incentive Stock Option under the Code. No Option shall be treated as an Incentive Stock Option unless the Plan has been approved by the stockholders of the Company in a manner intended to comply with the stockholder approval requirements of Code Section 422(b)(1); provided that any Option intended to be an Incentive Stock Option shall not fail to be effective solely on account of a failure to obtain approval, but rather the Option shall be treated as a Nonqualified Stock Option unless and until approval is obtained. In the case of an Incentive Stock Option, the terms and conditions of the grant shall be subject to and comply with any rules prescribed by Code Section 422. If for any reason an Option intended to be an Incentive Stock Option (or any portion thereof) does not qualify as an Incentive Stock Option, then, to the extent of the nonqualification, the Option or portion thereof shall be regarded as a Nonqualified Stock Option appropriately granted under the Plan.

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(b)            Exercise Price. Except with respect to Substitute Awards, the exercise price (“Exercise Price”) per Common Share for each Option shall not be less than 100% of the Fair Market Value of that share determined as of the Date of Grant; provided, however, that in the case of an Incentive Stock Option granted to an employee who, at the time of the grant of the Option, owns shares representing more than 10% of the total combined voting power of all classes of shares of the Company or any related corporation (as determined in accordance with Treasury Regulation Section 1.422-2(f)), the Exercise Price per share shall not be less than 110% of the Fair Market Value per share on the Date of Grant and provided further, that, notwithstanding any provision herein to the contrary, the Exercise Price shall not be less than the par value per Common Share.

(c)            Vesting and Expiration. Options shall vest and become exercisable in the manner (including any terms and conditions) and on the date or dates determined by the Committee (including, if applicable, the attainment of any performance goals, as determined by the Committee in the applicable Award Agreement) and shall expire after that period, not to exceed ten years, as may be determined by the Committee (the “Option Period”); provided, however, that the Option Period shall not exceed five years from the Date of Grant in the case of an Incentive Stock Option granted to a Participant who on the Date of Grant owns shares representing more than 10% of the total combined voting power of all classes of shares of the Company or any related corporation (as determined in accordance with Treasury Regulation Section 1.422- 2(f)); provided, further, that notwithstanding any vesting dates set by the Committee, the Committee may, in its sole discretion, accelerate the exercisability of any Option, which acceleration shall not affect the terms and conditions of the Option other than with respect to exercisability. In the event of any termination of employment or service with the Company and its Affiliates thereof of a Participant who has been granted one or more Options, the Options shall be exercisable at the time or times and subject to the terms and conditions set forth in the Award Agreement. If the Option would expire at a time when the exercise of the Option would violate applicable securities laws, the expiration date applicable to the Option will be automatically extended to a date that is 30 calendar days following the date the exercise would no longer violate applicable securities laws (so long as the extension does not violate Code Section 409A); provided, that in no event shall the expiration date be extended beyond the expiration of the Option Period.

(d)            Method of Exercise and Form of Payment. No Common Shares shall be delivered pursuant to any exercise of an Option until payment in full of the Exercise Price therefor is received by the Company and the Participant has paid to the Company an amount equal to any taxes required to be withheld or paid. Options that have become exercisable may be exercised by delivery of written or electronic notice of exercise to the Company in accordance with the terms of the applicable Award Agreement and accompanied by payment of the Exercise Price. The Exercise Price shall be payable (i) in cash, check, cash equivalent and/or Common Shares valued at the Fair Market Value at the time the Option is exercised (including, pursuant to procedures approved by the Committee, by means of attestation of ownership of a sufficient number of Common Shares in lieu of actual delivery of the shares to the Company); provided that the Common Shares are not subject to any pledge or other security interest and are Mature Shares and; (ii) by any other method the Committee permits in accordance with Applicable Laws, in its sole discretion, including without limitation: (A) in other property having a Fair Market Value on the date of exercise equal to the Exercise Price or (B) if there is a public market for the Common Shares at that time, by means of a broker-assisted “cashless exercise” pursuant to which the Company is delivered a copy of irrevocable instructions to a stockbroker to sell the Common Shares otherwise deliverable upon the exercise of the Option and to deliver promptly to the Company an amount equal to the Exercise Price or (C) by a “net exercise” method whereby the Company withholds from the delivery of the Common Shares for which the Option was exercised that number of Common Shares having a Fair Market Value equal to the aggregate Exercise Price for the Common Shares for which the Option was exercised. No fractional Common Shares shall be issued or delivered pursuant to the Plan or any Award, and the Committee shall determine whether cash, other securities or other property shall be paid or transferred in lieu of any fractional Common Shares, or whether the fractional Common Shares or any rights thereto shall be canceled, terminated or otherwise eliminated.

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(e)            Notification upon Disqualifying Disposition of an Incentive Stock Option. Each Participant awarded an Incentive Stock Option under the Plan shall notify the Company in writing immediately after the date he or she makes a disqualifying disposition of any Common Shares acquired pursuant to the exercise of the Incentive Stock Option. A disqualifying disposition is any disposition (including, without limitation, any sale) of the Common Shares before the later of  (A) two years after the Date of Grant of the Incentive Stock Option or (B) one year after the date of exercise of the Incentive Stock Option. The Company may, if determined by the Committee and in accordance with procedures established by the Committee, retain possession of any Common Shares acquired pursuant to the exercise of an Incentive Stock Option as agent for the applicable Participant until the end of the period described in the preceding sentence.

(f)            Compliance With Laws, etc. Notwithstanding the foregoing, in no event shall a Participant be permitted to exercise an Option in a manner that the Committee determines would violate the Sarbanes-Oxley Act of 2002, if applicable, or any other Applicable Laws or the applicable rules and regulations of the Securities and Exchange Commission or the applicable rules and regulations of any securities exchange or inter-dealer quotation system on which the securities of the Company are listed or traded.

8.            Stock Appreciation Rights.

(a)            Generally. Each SAR granted under the Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email or the posting on a web site maintained by the Company or a third party under contract with the Company)). Each SAR so granted shall be subject to the conditions set forth in this Section 8, and to any other conditions not inconsistent with the Plan reflected in the applicable Award Agreement. Any Option granted under the Plan may include tandem SARs. The Committee also may award SARs to Eligible Persons independent of any Option.

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(b)            Strike Price. The Strike Price per Common Share for each SAR shall not be less than 100% of the Fair Market Value of the share determined as of the Date of Grant.

(c)            Vesting and Expiration. A SAR granted in connection with an Option shall become exercisable and shall expire according to the same vesting schedule and expiration provisions as the corresponding Option (including the terms and conditions set forth in the applicable Award Agreement). A SAR granted independent of an Option shall vest and become exercisable and shall expire in the manner (including any terms and conditions) and on the date or dates determined by the Committee (including, if applicable, the attainment of any performance goals, as shall be determined by the Committee in the applicable Award Agreement) and shall expire after that period, not to exceed ten years, as may be determined by the Committee (the “SAR Period”); provided, however, that notwithstanding any vesting dates set by the Committee, the Committee may, in its sole discretion, accelerate the exercisability of any SAR, which acceleration shall not affect the terms and conditions of the SAR other than with respect to exercisability. In the event of any termination of employment or service with the Company and its Affiliates thereof of a Participant who has been granted one or more SAR, the SARs shall be exercisable at the time or times and subject to the terms and conditions as set forth in the Award Agreement (or in the underlying Option Award Agreement, as may be applicable). If the SAR would expire at a time when the exercise of the SAR would violate applicable securities laws, the expiration date applicable to the SAR will be automatically extended to a date that is 30 calendar days following the date the exercise would no longer violate applicable securities laws (so long as the extension shall not violate Code Section 409A); provided, that in no event shall the expiration date be extended beyond the expiration of the SAR Period.

(d)            Method of Exercise. SARs that have become exercisable may be exercised by delivery of written or electronic notice of exercise to the Company in accordance with the terms of the applicable Award Agreement, specifying the number of SARs to be exercised and the date on which the SARs were awarded. Notwithstanding the foregoing, if on the last day of the Option Period (or in the case of a SAR independent of an option, the SAR Period), the Fair Market Value exceeds the Strike Price, the Participant has not exercised the SAR or the corresponding Option (if applicable), and neither the SAR nor the corresponding Option (if applicable) has expired, the SAR shall be deemed to have been exercised by the Participant on the last day of the Option Period and the Company shall make the appropriate payment therefor.

(e)            Payment. Upon the exercise of a SAR, the Company shall pay to the Participant an amount equal to the number of shares subject to the SAR that are being exercised multiplied by the excess, if any, of the Fair Market Value of one Common Share on the exercise date over the Strike Price, less an amount equal to any taxes required to be withheld or paid. The Company shall pay this amount in cash, in Common Shares valued at Fair Market Value, or any combination thereof, as determined by the Committee. No fractional Common Shares shall be issued or delivered pursuant to the Plan or any Award, and the Committee shall determine whether cash, other securities or other property shall be paid or transferred in lieu of any fractional Common Shares, or whether the fractional Common Shares or any rights thereto shall be canceled, terminated or otherwise eliminated.

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9.            Restricted Stock and Restricted Stock Units.

(a)            Generally. Each grant of Restricted Stock and Restricted Stock Units shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email or the posting on a web site maintained by the Company or a third party under contract with the Company)). Each grant shall be subject to the conditions set forth in this Section 9, and to any other terms and conditions not inconsistent with the Plan reflected by the Committee in the applicable Award Agreement (including the performance goals, if any, upon whose attainment the Restricted Period shall lapse in part or full).

(b)            Restricted Accounts; Escrow or Similar Arrangement. Upon the grant of Restricted Stock, a book entry in a restricted account shall be established in the Participant’s name at the Company’s transfer agent and, if the Committee determines that the Restricted Stock shall be held by the Company or in escrow rather than held in the restricted account pending the release of the applicable restrictions, the Committee may require the Participant to additionally execute and deliver to the Company (i) an escrow agreement satisfactory to the Committee, if applicable, and (ii) the appropriate share power (endorsed in blank) with respect to the Restricted Stock covered by the agreement. If a Participant shall fail to execute an agreement evidencing an Award of Restricted Stock and, if applicable, an escrow agreement and blank share power within the amount of time specified by the Committee, the Award shall be null and void. Subject to the restrictions set forth in this Section 9 and the applicable Award Agreement, the Participant generally shall have the rights and privileges of a stockholder as to the Restricted Stock, including without limitation the right to vote the Restricted Stock and the right to receive dividends, if applicable. To the extent shares of Restricted Stock are forfeited, any share certificates issued to the Participant evidencing the shares shall be returned to the Company, and all rights of the Participant to the shares and as a stockholder with respect thereto shall terminate without further obligation on the part of the Company.

(c)          Vesting. Unless otherwise provided by the Committee in an Award Agreement, the unvested portion of Restricted Stock and Restricted Stock Units shall terminate and be forfeited upon termination of employment or service of the Participant granted the applicable Award.

(d)            Delivery of Restricted Stock and Settlement of Restricted Stock Units.

(i)            Upon the expiration of the Restricted Period with respect to any shares of Restricted Stock, the restrictions set forth in the applicable Award Agreement shall be of no further force or effect with respect to those shares, except as set forth in the applicable Award Agreement. If an escrow arrangement is used, upon expiration, the Company shall deliver to the Participant, or his or her beneficiary, without charge, the share certificate evidencing the shares of Restricted Stock that have not then been forfeited and with respect to which the Restricted Period has expired (rounded down to the nearest full share). Dividends, if any, that may have been withheld by the Committee and attributable to any particular share of Restricted Stock shall be distributed to the Committee and attributable to any particular share of Restricted Stock shall be distributed to the Participant in cash or, at the sole discretion of the Committee, in Common Shares having a Fair Market Value equal to the amount of the dividends, upon the release of restrictions on the share and, if the share is forfeited, the Participant shall have no right to the dividends (except as otherwise set forth by the Committee in the applicable Award Agreement).

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(ii)            Unless otherwise provided by the Committee in an Award Agreement, upon the expiration of the Restricted Period with respect to any outstanding Restricted Stock Units, the Company shall deliver to the Participant, or his or her beneficiary, without charge, one Common Share for each outstanding Restricted Stock Unit; provided, however, that the Committee may, in its sole discretion, elect to (i) pay cash or part cash and part Common Share in lieu of delivering only Common Shares in respect of the Restricted Stock Units or (ii) defer the delivery of Common Shares (or cash or part Common Shares and part cash, as the case may be) beyond the expiration of the Restricted Period if delivery would result in a violation of Applicable Laws until it is no longer the case. If a cash payment is made in lieu of delivering Common Shares, the amount of the payment shall be equal to the Fair Market Value of the Common Shares as of the date on which the Restricted Period lapsed with respect to the Restricted Stock Units, less an amount equal to any taxes required to be withheld or paid.

10.            Other Stock-Based Awards and Other Cash-Based Awards.

(a)            Other Stock-Based Awards. The Committee may grant types of equity-based or equity-related Awards not otherwise described by the terms of the Plan (including the grant or offer for sale of unrestricted Common Shares), in amounts and subject to terms and conditions, determined by the Committee (including, if applicable, the attainment of any performance goals, as set forth in the applicable Award Agreement). Other Stock-Based Awards may involve the transfer of actual Common Shares to Participants, or payment in cash or otherwise of amounts based on the value of Common Shares. The terms and conditions of the Awards shall be consistent with the Plan and set forth in the Award Agreement and need not be uniform among all the Awards or all Participants receiving the Awards.

(b)            Other Cash-Based Awards. The Committee may grant a cash Award granted to a Participant not otherwise described by the terms of the Plan, including cash awarded as a bonus or upon the attainment of any performance goals or otherwise as permitted under the Plan.

(c)          Value of Awards. Each Other Stock-Based Award shall be expressed in terms of Common Shares or units based on Common Shares, as determined by the Committee, and each Other Cash-Based Award shall be shall be expressed in terms of cash, as determined by the Committee. The Committee may establish performance goals and/or criteria in its discretion, and any such performance goals and/or criteria shall be set forth in the applicable Award Agreement. If the Committee exercises its discretion to establish performance goals and/or criteria, the number and/or value of Other Stock-Based Awards or Other Cash-Based Awards that will be paid out to the Participant will depend on the extent to which the performance goals and/or criteria are met.

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(d)            Payment of Awards. Payment, if any, with respect to an Other Stock-Based Award or Other Cash-Based Award shall be made in accordance with the terms of the Award, as set forth in the Award Agreement, in cash, Common Shares or a combination of cash and Common Shares, as the Committee determines.

(e)           Vesting. The Committee shall determine the extent to which the Participant shall have the right to receive Other Stock-Based Awards or Other Cash-Based Awards following the Participant’s termination of employment or service (including by reason of the Participant’s death, disability (as determined by the Committee), or termination for or without Cause or for or without Good Reason). These provisions shall be determined in the sole discretion of the Committee and these provisions may be included in the applicable Award Agreement, but need not be uniform among all Other Stock-Based Awards or Other Cash-Based Awards issued pursuant to the Plan, and may reflect distinctions based on the reasons for the termination of employment or service.

11.            Dividend Equivalents. No adjustment shall be made in the Common Shares issuable or taken into account under Awards on account of cash dividends that may be paid or other rights that may be issued to the holders of Common Shares prior to issuance of the Common Shares under the Award. The Committee may grant Dividend Equivalents based on the dividends declared on Common Shares that are subject to any Award (other than an Option or Stock Appreciation Right). Any Award of Dividend Equivalents may be credited as of the dividend payment dates, during the period between the Date of Grant of the Award and the date the Award becomes payable or terminates or expires, as determined by the Committee; however, Dividend Equivalents shall not be payable unless and until the Award becomes payable, and shall be subject to forfeiture to the same extent as the underlying Award. Dividend Equivalents may be subject to any additional limitations and/or restrictions determined by the Committee. Dividend Equivalents shall be payable in cash, Common Shares or converted to full-value Awards, calculated based on a formula determined by the Committee.

12.            Changes in Capital Structure and Similar Events. In the event of  (i) any dividend (other than ordinary cash dividends) or other distribution (whether in the form of cash, Common Shares, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, amalgamation, consolidation, spin-off, split-up, split-off, combination, repurchase or exchange of Common Shares or other securities of the Company, issuance of warrants or other rights to acquire Common Shares or other securities of the Company, or other similar corporate transaction or event (including, without limitation, a Change in Control or Company Sale) that affects the Common Shares, or (ii) unusual or infrequently occurring events (including, without limitation, a Change in Control or Company Sale) affecting the Company, any Affiliate, or the financial statements of the Company or any Affiliate, or changes in applicable rules, rulings, regulations or other requirements of any governmental body or securities exchange or inter-dealer quotation system, accounting principles or law, such that in either case an adjustment is determined by the Committee in its sole discretion to be necessary or appropriate, then the Committee shall make the adjustments it deems equitable, including without limitation any or all of the following:

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(a)         adjusting any or all of  (i) the number of Common Shares or other securities of the Company (or number and kind of other securities or other property) that may be delivered in respect of Awards or with respect to which Awards may be granted under the Plan (including, without limitation, adjusting any or all of the limitations under Section 5) and (ii) the terms of any outstanding Award, including, without limitation, (A) the number of Common Shares or other securities of the Company (or number and kind of other securities or other property) subject to outstanding Awards or to which outstanding Awards relate, (B) the Exercise Price or Strike Price with respect to any Award or (C) any applicable performance measures (including, without limitation, any performance goals and/or criteria);

(b)           providing for a substitution or assumption of Awards in a manner that substantially preserves the applicable terms of the Awards;

(c)           accelerating the exercisability or vesting of, lapse of restrictions on, or termination of, Awards or providing for a period of time for exercise prior to the occurrence of the event;

(d)           modifying the terms of Awards to add events, conditions or circumstances (including termination of employment within a specified period after a Change in Control or Company Sale) upon which the exercisability or vesting of or lapse of restrictions thereon will accelerate;

(e)        deeming any performance measures (including, without limitation, any performance goals and/or criteria) satisfied at target, maximum or actual performance through closing or any other level determined by the Committee in its sole discretion, or providing for the performance measures to continue (as is or as adjusted by the Committee) after closing;

(f)            providing that for a period prior to the Change in Control or Company Sale determined by the Committee in its sole discretion, any Options or SARs that would not otherwise become exercisable prior to the Change in Control or Company Sale will be exercisable as to all Common Shares subject thereto (but the exercise will be contingent upon and subject to the occurrence of the Change in Control or Company Sale and if the Change in Control or Company Sale does not take place after giving the notice for any reason whatsoever, the exercise will be null and void) and that any Options or SARs not exercised prior to the consummation of the Change in Control or Company Sale will terminate and be of no further force and effect as of the consummation of the Change in Control or Company Sale; and

(g)        canceling any one or more outstanding Awards and causing to be paid to the holders thereof, in cash, Common Shares, other securities or other property, or any combination thereof, the value of the Awards, if any, as determined by the Committee (which if applicable may be based upon the price per Common Share received or to be received by other shareholders of the Company in that event), including without limitation, in the case of an outstanding Option or SAR, a cash payment in an amount equal to the excess, if any, of the Fair Market Value (as of a date specified by the Committee) of the Common Shares subject to the Option or SAR over the aggregate Exercise Price or Strike Price of the Option or SAR, respectively (it being understood that, in that event, any Option or SAR having a per share Exercise Price or Strike Price equal to, or in excess of, the Fair Market Value of a Common Share subject thereto may be canceled and terminated without any payment or consideration therefor); provided, however, that in the case of any “equity restructuring” (within the meaning of the Financial Accounting Standards Board Accounting Standards Codification Topic 718), the Committee shall make an equitable or proportionate adjustment to outstanding Awards to reflect the equity restructuring. The Company shall give each Participant notice of an adjustment hereunder and, upon notice, the adjustment shall be conclusive and binding for all purposes.

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13.            Amendments and Termination.

(a)            Amendment and Termination of the Plan. The Board may amend, alter, suspend, discontinue, or terminate the Plan or any portion thereof at any time; provided that (i) no amendment to Section 13(b) (to the extent required by the proviso in Section 13(b)) shall be made without shareholder approval and (ii) no amendment, alteration, suspension, discontinuation or termination shall be made without stockholder approval if the approval is necessary to comply with any tax or regulatory requirement applicable to the Plan (including, without limitation, as necessary to comply with any rules or requirements of any securities exchange or inter-dealer quotation system on which the Common Shares may be listed or quoted); provided, further, that any amendment, alteration, suspension, discontinuance or termination that would materially and adversely affect the rights of any Participant or any holder or beneficiary of any Award theretofore granted shall not to that extent be effective as to the affected Participant, holder or beneficiary without the consent of the affected Participant, holder or beneficiary.

(b)          Amendment of Award Agreements. The Committee may, to the extent consistent with the terms of any applicable Award Agreement, waive any conditions or rights under, amend any terms of, or alter, suspend, discontinue, cancel or terminate, any Award theretofore granted or the associated Award Agreement, prospectively or retroactively; provided that the waiver, amendment, alteration, suspension, discontinuance, cancellation or termination that would materially and adversely affect the rights of any Participant or any holder or beneficiary of any Award with respect to any Award theretofore granted shall not to that extent be effective without the consent of the affected Participant, holder or beneficiary; provided, further, that without stockholder approval, except as otherwise permitted under Section 12, (i) no amendment or modification may reduce the Exercise Price of any Option or the Strike Price of any SAR, (ii) the Committee may not cancel any outstanding Option or SAR where the Fair Market Value of the Common Shares underlying the Option or SAR is less than its Exercise Price or Strike Price, as applicable, and replace it with a new Option or SAR, another Award or cash and (iii) the Committee may not take any other action that is considered a “repricing” for purposes of the stockholder approval rules of the applicable securities exchange or inter-dealer quotation system on which the Common Shares are listed or quoted.

14.            General.

(a)       Award Agreements. Each Award under the Plan shall be evidenced by an Award Agreement, which shall be delivered to the Participant (whether in paper or electronic medium (including email or the posting on a web site maintained by the Company or a third party under contract with the Company)) and shall specify the terms and conditions of the Award and any rules applicable thereto, including without limitation, the effect on the Award of the death, disability or termination of employment or service of a Participant, or of any other events determined by the Committee. Except as the Plan otherwise provides, each Award may be made alone or in addition or in relation to any other Award. The terms of each Award to a Participant need not be identical, and the Committee need not treat Participants or Awards (or portions thereof) uniformly.

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(b)            Nontransferability.

(i)            Each Award shall be exercisable only by a Participant during the Participant’s lifetime, or, if permissible under Applicable Laws, by the Participant’s legal guardian or representative. No Award may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant other than by will or by the laws of descent and distribution and the purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or an Affiliate; provided that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.

(ii)          Notwithstanding the foregoing, the Committee may, in its sole discretion, permit Awards (other than Incentive Stock Options) to be transferred by a Participant, without consideration, subject to any rules the Committee adopts consistent with any applicable Award Agreement to preserve the purposes of the Plan, to: (A) any person who is a “family member” of the Participant, as that term is used in the instructions to Form S-8 under the Securities Act (collectively, the “Immediate Family Members”); (B) a trust solely for the benefit of the Participant and his or her Immediate Family Members; (C) a partnership or limited liability company whose only partners or stockholders are the Participant and his or her Immediate Family Members; or (D) any other transferee as may be approved either (I) by the Board or the Committee in its sole discretion, or (II) as provided in the applicable Award Agreement. (each transferee described in clauses (A), (B), (C) and (D) above is hereinafter referred to as a “Permitted Transferee”); provided that the Participant gives the Committee advance written notice describing the terms and conditions of the proposed transfer and the Committee notifies the Participant in writing that the transfer would comply with the requirements of the Plan.

(iii)            The terms of any Award transferred in accordance with the immediately preceding sentence shall apply to the Permitted Transferee and any reference in the Plan, or in any applicable Award Agreement, to a Participant shall be deemed to refer to the Permitted Transferee, except that (A) Permitted Transferees shall not be entitled to transfer any Award, other than by will or the laws of descent and distribution; (B) Permitted Transferees shall not be entitled to exercise any transferred Option unless there shall be in effect a registration statement on an appropriate form covering the Common Shares to be acquired pursuant to the exercise of the Option if the Committee determines, consistent with any applicable Award Agreement, that such a registration statement is necessary or appropriate; (C) the Committee or the Company shall not be required to provide any notice to a Permitted Transferee, whether or not the notice is or would otherwise have been required to be given to the Participant under the Plan or otherwise; and (D) the consequences of the termination of the Participant’s employment by, or services to, the Company or an Affiliate under the terms of the Plan and the applicable Award Agreement shall continue to be applied with respect to the Participant, including, without limitation, that an Option shall be exercisable by the Permitted Transferee only to the extent, and for the periods, specified in the Plan and the applicable Award Agreement.

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(c)            Tax Withholding and Deductions.

(i)            A Participant shall be required to pay to the Company or any Affiliate, and the Company or any Affiliate shall have the right and is hereby authorized to deduct and withhold, from any cash, Common Shares, other securities or other property deliverable under any Award or from any compensation or other amounts owing to a Participant, the amount (in cash, Common Shares, other securities or other property) of any required taxes (up to the maximum statutory rate under Applicable Laws as in effect from time to time as determined by the Committee) and deduction in respect of an Award, its grant, vesting or exercise, or any payment or transfer under an Award or under the Plan and to take any other action necessary in the opinion of the Committee or the Company to satisfy all obligations for the payment of the taxes.

(ii)           Without limiting the generality of clause (i) above, the Committee may, in its sole discretion, permit a Participant to satisfy, in whole or in part, the foregoing tax and deduction liability by (A) the delivery of Common Shares (which are not subject to any pledge or other security interest and are Mature Shares, except as otherwise determined by the Committee) owned by the Participant having a Fair Market Value equal to the liability or (B) having the Company withhold from the number of Common Shares otherwise issuable or deliverable pursuant to the exercise or settlement of the Award a number of shares with a Fair Market Value equal to the liability.

(d)            No Claim to Awards; No Rights to Continued Employment; Waiver. No employee of the Company or an Affiliate, or other person, shall have any claim or right to be granted an Award under the Plan or, having been selected for the grant of an Award, to be selected for a grant of any other Award. There is no obligation for uniformity of treatment of Participants or holders or beneficiaries of Awards. The terms and conditions of Awards and the Committee’s determinations and interpretations with respect thereto need not be the same with respect to each Participant and may be made selectively among Participants, whether or not the Participants are similarly situated. Neither the Plan nor any action taken hereunder shall be construed as giving any Participant any right to be retained in the employ or service of the Company or an Affiliate, nor shall it be construed as giving any Participant any rights to continued service on the Board. The Company or any of its Affiliates may at any time dismiss a Participant from employment or discontinue any consulting relationship, free from any liability or any claim under the Plan, unless otherwise expressly provided in the Plan or any Award Agreement. By accepting an Award under the Plan, a Participant shall thereby be deemed to have waived any claim to continued exercise or vesting of an Award or to damages or severance entitlement related to non-continuation of the Award beyond the period provided under the Plan or any Award Agreement, notwithstanding any provision to the contrary in any written employment contract or other agreement between the Company and its Affiliates and the Participant, whether any such agreement is executed before, on or after the Date of Grant.

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(e)           International Participants. With respect to Participants who reside or work outside of the United States of America, the Committee may in its sole discretion amend the terms of the Plan or outstanding Awards with respect to those Participants in order to conform the terms with the requirements of local law or to obtain more favorable tax or other treatment for a Participant, the Company or its Affiliates.

(f)            Designation and Change of Beneficiary. Each Participant may file with the Committee a written designation of one or more persons as the beneficiary(ies) who shall be entitled to receive the amounts payable with respect to an Award, if any, due under the Plan upon his or her death. A Participant may, from time to time, revoke or change his or her beneficiary designation without the consent of any prior beneficiary by filing a new designation with the Committee. The last designation received by the Committee shall be controlling; provided, however, that no designation, or change or revocation thereof, shall be effective unless received by the Committee prior to the Participant’s death, and in no event shall it be effective as of a date prior to receipt. If no beneficiary designation is filed by a Participant, the beneficiary shall be deemed to be his or her spouse or, if the Participant is unmarried at the time of death, his or her estate.

(g)           Termination of Employment/Service. Unless determined otherwise by the Committee at any point following the event: (i) neither a temporary absence from employment or service due to illness, vacation or leave of absence nor a transfer from employment or service with the Company to employment or service with an Affiliate (or vice-versa) shall be considered a termination of employment or service with the Company or an Affiliate; and (ii) if a Participant’s employment with the Company and its Affiliates terminates, but the Participant continues to provide services to the Company and its Affiliates in a non-employee capacity (or vice-versa), the change in status shall not be considered a termination of employment with the Company or an Affiliate.

(h)           No Rights as a Stockholder. Except as otherwise specifically provided in the Plan or any Award Agreement, no person shall be entitled to the privileges of ownership in respect of Common Shares or other securities that are subject to Awards hereunder until the shares have been issued or delivered to that person.

(i)            Government and Other Regulations.

(i)            The obligation of the Company to settle Awards in Common Shares or other consideration shall be subject to all Applicable Laws, rules, and regulations, and to any approvals required by governmental agencies. Notwithstanding any terms or conditions of any Award to the contrary, the Company shall be under no obligation to offer to sell or to sell, and shall be prohibited from offering to sell or selling, any Common Shares or other securities pursuant to an Award unless the shares have been properly registered for sale pursuant to the Securities Act with the Securities and Exchange Commission or unless the Company has received an opinion of counsel, satisfactory to the Company, that the shares may be offered or sold without registration pursuant to an available exemption therefrom and the terms and conditions of the exemption have been fully complied with. The Company shall be under no obligation to register for sale under the Securities Act any of the Common Shares or other securities to be offered or sold under the Plan. The Committee shall have the authority to provide that all certificates for Common Shares or other securities of the Company or any Affiliate delivered under the Plan shall be subject to any stop transfer orders and other restrictions the Committee deems advisable under the Plan, the applicable Award Agreement, the federal securities laws, or the rules, regulations and other requirements of the Securities and Exchange Commission, any securities exchange or inter-dealer quotation system upon which the shares or other securities are then listed or quoted and any other applicable federal, state, local or non-U.S. laws, and, without limiting the generality of Section 9, the Committee may cause a legend or legends to be put on the certificates and Award Agreements to make appropriate reference to the restrictions. Notwithstanding any provision in the Plan to the contrary, the Committee reserves the right to add any additional terms or provisions to any Award granted under the Plan that it in its sole discretion deems necessary or advisable in order that the Award complies with the legal requirements of any governmental entity to whose jurisdiction the Award is subject.

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(ii)           The Committee may cancel an Award or any portion thereof if it determines, in its sole discretion, that legal or contractual restrictions and/or blockage and/or other market considerations would make the Company’s acquisition of Common Shares from the public markets, the Company’s issuance of Common Shares or other securities to the Participant, the Participant’s acquisition of Common Shares or other securities from the Company and/or the Participant’s sale of Common Shares to the public markets, illegal, impracticable or inadvisable. If the Committee determines to cancel all or any portion of an Award denominated in Common Shares in accordance with the foregoing, the Company shall pay to the Participant an amount equal to the excess of  (A) the aggregate Fair Market Value of the Common Shares subject to the Award or portion thereof canceled (determined as of the applicable exercise date, or the date that the shares would have been vested or delivered, as applicable), over (B) the aggregate Exercise Price or Strike Price (in the case of an Option or SAR, respectively) or any amount payable as a condition of delivery of Common Shares (in the case of any other Award). This amount shall be delivered to the Participant as soon as practicable following the cancellation of the Award or portion thereof.

(j)            Payments to Persons Other Than Participants. If the Committee shall find that any person to whom any amount is payable under the Plan is unable to care for his or her affairs because of illness or accident, or is a minor, or has died, then any payment due to that person or his or her estate (unless a prior claim therefor has been made by a duly appointed legal representative) may, if the Committee so directs the Company, be paid to his or her spouse, child, relative, an institution maintaining or having custody of that person, or any other person deemed by the Committee to be a proper recipient on behalf of that person otherwise entitled to payment. Any such payment shall be a complete discharge of the liability of the Committee and the Company therefor.

(k)            Nonexclusivity of the Plan. Neither the adoption of this Plan by the Board nor the submission of this Plan to the stockholders of the Company for approval shall be construed as creating any limitations on the power of the Board to adopt any other incentive arrangements it deems desirable, including, without limitation, the granting of stock options or other equity-based awards otherwise than under this Plan, and these arrangements may be either applicable generally or only in specific cases.

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(l)            No Trust or Fund Created. The Plan is intended to constitute an “unfunded” plan for incentive compensation. Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any Affiliate, on the one hand, and a Participant or other person or entity, on the other hand. No provision of the Plan or any Award shall require the Company, for the purpose of satisfying any obligations under the Plan, to purchase assets or place any assets in a trust or other entity to which contributions are made or otherwise to segregate any assets, nor shall the Company maintain separate bank accounts, books, records or other evidence of the existence of a segregated or separately maintained or administered fund for those purposes. Participants shall have no rights under the Plan other than as unsecured general creditors of the Company, except that insofar as they may have become entitled to payment of additional compensation by performance of services, they shall have the same rights as other employees under general law.

(m)          Reliance on Reports. Each member of the Committee and each member of the Board shall be fully justified in acting or failing to act, as the case may be, and shall not be liable for having so acted or failed to act in good faith, in reliance upon any report made by the independent public accountant of the Company and its Affiliates and/or any other information furnished in connection with the Plan by any agent of the Company or the Committee or the Board, other than himself.

(n)           Relationship to Other Benefits. No payment under the Plan shall be taken into account in determining any benefits under any pension, retirement, profit sharing, group insurance or other benefit plan of the Company or any Affiliate except as otherwise specifically provided in the other plan or an agreement thereunder.

(o)           Governing Law. The Plan shall be governed by and construed in accordance with the internal laws of the State of Delaware applicable to contracts made and performed wholly within the State of Delaware, without giving effect to the conflict of laws provisions thereof.

(p)           Severability. If any provision of the Plan or any Award or Award Agreement is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as to any person or entity or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, the provision shall be construed or deemed amended to conform to the Applicable Laws, or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, the provision shall be construed or deemed stricken as to that jurisdiction, person or entity or Award and the remainder of the Plan and the Award shall remain in full force and effect.

(q)           Obligations Binding on Successors. The obligations of the Company under the Plan shall be binding upon any successor corporation or organization resulting from the merger, amalgamation, consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding to substantially all of the assets and business of the Company.

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(r)            Code Section 409A.

(i)            Notwithstanding any provision of this Plan to the contrary, all Awards made under this Plan are intended to be exempt from or, in the alternative, comply with Code Section 409A and the interpretive guidance thereunder, including the exceptions for stock rights and short-term deferrals. The Plan shall be construed and interpreted in accordance with that intent. Each payment under an Award shall be treated as a separate payment for purposes of Code Section 409A.

(ii)           If a Participant is a “specified employee” (as that term is defined for purposes of Code Section 409A) at the time of his or her termination of service, no amount that is nonqualified deferred compensation subject to Code Section 409A and that becomes payable by reason of the termination of service shall be paid to the Participant (or in the event of the Participant’s death, the Participant’s representative or estate) before the earlier of  (x) the first business day after the date that is six months following the date of the Participant’s termination of service, and (y) within 30 days following the date of the Participant’s death. For purposes of Code Section 409A, a termination of service shall be deemed to occur only if it is a “separation from service” within the meaning of Code Section 409A, and references in the Plan and any Award Agreement to “termination of service” or similar terms shall mean a “separation from service.” If any Award is or becomes subject to Code Section 409A, unless the applicable Award Agreement provides otherwise, the Award shall be payable upon the Participant’s “separation from service” within the meaning of Code Section 409A. If any Award is or becomes subject to Code Section 409A and if payment of the Award would be accelerated or otherwise triggered under a Change in Control or Company Sale, then the definition of Change in Control or Company Sale shall be deemed modified, only to the extent necessary to avoid the imposition of an excise tax under Code Section 409A, to mean a “change in control event” as that term is defined for purposes of Code Section 409A.

(iii)          Any adjustments made pursuant to Section 12 to Awards that are subject to Code Section 409A shall be made in compliance with the requirements of Code Section 409A, and any adjustments made pursuant to Section 12 to Awards that are not subject to Code Section 409A shall be made in such a manner as to ensure that after the adjustment, the Awards either (x) continue not to be subject to Code Section 409A or (y) comply with the requirements of Code Section 409A.

(s)           Notification of Election Under Code Section 83(b). If any Participant, in connection with the acquisition of Common Shares under an Award, makes the election permitted under Code Section 83(b), the Participant shall notify the Company of the election within ten days of filing notice of the election with the Internal Revenue Service.

(t)            Expenses; Gender; Titles and Headings; Interpretation. The expenses of administering the Plan shall be borne by the Company and its Affiliates. Masculine pronouns and other words of masculine gender shall refer to both men and women. The titles and headings of the sections in the Plan are for convenience of reference only, and in the event of any conflict, the text of the Plan, rather than those titles or headings shall control. Unless the context of the Plan otherwise requires, words using the singular or plural number also include the plural or singular number, respectively; derivative forms of defined terms will have correlative meanings; the terms “hereof,” “herein” and “hereunder” and derivative or similar words refer to this entire Plan; the term “Section” refers to the specified Section of this Plan and references to “paragraphs” or “clauses” shall be to separate paragraphs or clauses of the Section or subsection in which the reference occurs; the words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”; and the word “or” shall be disjunctive but not exclusive.

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(u)           Other Agreements. Notwithstanding the above, the Committee may require, as a condition to the grant of and/or the receipt of Common Shares or other securities under an Award, that the Participant execute lock-up, shareholder or other agreements, as it may determine in its sole and absolute discretion.

(v)           Payments. Participants shall be required to pay, to the extent required by Applicable Laws, any amounts required to receive Common Shares or other securities under any Award made under the Plan.

(w)          Clawback; Erroneously Awarded Compensation. All Awards (including on a retroactive basis) granted under the Plan are subject to the terms of any Company forfeiture, incentive compensation recoupment, clawback or similar policy as it may be in effect from time to time, as well as any similar provisions of Applicable Laws, as well as any other policy of the Company that may apply to the Awards, such as anti-hedging or pledging policies, as they may be in effect from time to time. In particular, these policies and/or provisions shall include, without limitation, (i) any Company policy established to comply with Applicable Laws (including, without limitation, Section 304 of the Sarbanes-Oxley Act and Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act), and/or (ii) the rules and regulations of the applicable securities exchange or inter-dealer quotation system on which the Common Shares or other securities are listed or quoted, and these requirements shall be deemed incorporated by reference into all outstanding Award Agreements.

(x)            No Fractional Shares. No fractional shares of Common Shares shall be issued or delivered pursuant to the Plan. The Committee shall determine whether cash, other Awards, or other property shall be issued or paid in lieu of fractional shares or whether fractional shares or any rights thereto shall be forfeited, rounded, or otherwise eliminated.

(y)           Paperless Administration. If the Company establishes, for itself or using the services of a third party, an automated system for the documentation, granting or exercise of Awards, such as a system using an internet website or interactive voice response, then the paperless documentation, granting or exercise of Awards by a Participant may be permitted through the use of such an automated system.

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(z)           Data Privacy. As a condition for receiving any Award, each Participant explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of personal data as described in this Section 14(z) by and among the Company and its Subsidiaries and Affiliates exclusively for implementing, administering and managing the Participant’s participation in the Plan. The Company and its Subsidiaries and Affiliates may hold certain personal information about a Participant, including the Participant’s name, address and telephone number; birthdate; social security, insurance number or other identification number; salary; nationality; job title(s); any Common Shares held in the Company or its Subsidiaries and Affiliates; and Award details, to implement, manage and administer the Plan and Awards (the “Data”). The Company and its Subsidiaries and Affiliates may transfer the Data amongst themselves as necessary to implement, administer and manage a Participant’s participation in the Plan, and the Company and its Subsidiaries and Affiliates may transfer the Data to third parties assisting the Company with Plan implementation, administration and management. These recipients may be located in the Participant’s country, or elsewhere, and the Participant’s country may have different data privacy laws and protections than the recipients’ country. By accepting an Award, each Participant authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, to implement, administer and manage the Participant’s participation in the Plan, including any required Data transfer to a broker or other third party with whom the Company or the Participant may elect to deposit any Common Shares. The Data related to a Participant will be held only as long as necessary to implement, administer, and manage the Participant’s participation in the Plan. A Participant may, at any time, view the Data that the Company holds regarding the Participant, request additional information about the storage and processing of the Data regarding the Participant, recommend any necessary corrections to the Data regarding the Participant or refuse or withdraw the consents in this Section 14(z) in writing, without cost, by contacting the local human resources representative. The Company may cancel Participant’s ability to participate in the Plan and, in the Committee’s discretion, the Participant may forfeit any outstanding Awards if the Participant refuses or withdraws the consents in this Section 14(z).

(aa)         Broker-Assisted Sales. In the event of a broker-assisted sale of Common Shares in connection with the payment of amounts owed by a Participant under or with respect to the Plan or Awards: (i) any Common Shares to be sold through the broker-assisted sale will be sold on the day the payment first becomes due, or as soon thereafter as practicable; (ii) the Common Shares may be sold as part of a block trade with other Participants in the Plan in which all participants receive an average price; (iii) the applicable Participant will be responsible for all broker’s fees and other costs of sale, and by accepting an Award, each Participant agrees to indemnify and hold the Company harmless from any losses, costs, damages, or expenses relating to any such sale; (iv) to the extent the Company or its designee receives proceeds of the sale that exceed the amount owed, the Company will pay the excess in cash to the applicable Participant as soon as reasonably practicable; (v) the Company and its designees are under no obligation to arrange for the sale at any particular price; and (vi) if the proceeds of the sale are insufficient to satisfy the Participant’s applicable obligation, the Participant may be required to pay immediately upon demand to the Company or its designee an amount in cash sufficient to satisfy any remaining portion of the Participant’s obligation.

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FLEXENERGY GREEN SOLUTIONS, INC.

STOCK OPTION GRANT NOTICE
(2021 INCENTIVE AWARD PLAN)

FLEXENERGY GREEN SOLUTIONS, INC., a Delaware corporation (the “Company”), pursuant to its 2021 Incentive Award Plan, as may be amended from time to time (the “Plan”), hereby grants to Optionholder an option to purchase the number of Common Shares set forth below. This option is subject to all of the terms and conditions as set forth in this Stock Option Grant Notice (including the vesting schedule set forth on Exhibit A hereto, collectively, this “Grant Notice”), in the corresponding Option Agreement, the Plan and the Notice of Exercise, all of which are attached hereto and incorporated herein in their entirety. Capitalized terms not explicitly defined herein but defined in the Plan or the corresponding Option Agreement will have the same definitions as in the Plan or the corresponding Option Agreement. If there is any conflict between the terms in this Grant Notice, the corresponding Option Agreement, the Plan and the Notice of Exercise, then such conflict or inconsistency shall be resolved by giving such documents precedence in the following order: this Grant Notice, the corresponding Option Agreement, the Plan and then the Notice of Exercise.

Optionholder:

Date of Grant:

Vesting Commencement Date:

Number of Shares Subject to Option:

Exercise Price (Per Common Share):

Total Exercise Price:

Expiration Date:

Type of Grant:	¨   Incentive Stock Option      ¨   Nonqualified Stock Option
Vesting Schedule:	This award shall vest pursuant to the schedule set forth in Exhibit A, which is attached hereto and incorporated herein in its entirety.
Payment:	By one or a combination of the following methods (described in the corresponding Option Agreement) as indicated by a checkmark opposite the applicable method below:
	¨     By cash, check, bank draft or money order payable to the Company
	¨     Pursuant to a Regulation T Program if the shares are publicly traded
	¨     By delivery of already-owned shares if the shares are publicly traded

Additional Terms/Acknowledgements:

Optionholder acknowledges receipt of, and understands and agrees to, this Grant Notice, the corresponding Option Agreement, the Plan and the Notice of Exercise.  Optionholder acknowledges and agrees that this Grant Notice, the corresponding Option Agreement and the Notice of Exercise may not be modified, amended or revised except as provided in the Plan.  Optionholder further acknowledges that as of the Date of Grant, this Grant Notice, the corresponding Option Agreement, the Plan and the Notice of Exercise set forth the entire understanding between Optionholder and the Company regarding this option award and supersede all prior oral and written agreements, promises and/or representations on that subject with the exception of the following agreements only.

Acceptance/Expiration of Option:

To accept this option, Optionholder must within 30 days following the Award Date (at which time this option will otherwise automatically expire) complete, execute and deliver this Grant Notice (including all applicable Exhibits and the corresponding Option Agreement).   Notwithstanding the foregoing, if Optionholder has not accepted this Option prior to the occurrence of a Change in Control, Company Sale, dissolution or liquidation, this option may be cancelled by the Company.

OTHER AGREEMENTS:

By accepting this option, you consent to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.

FLEXENERGY GREEN SOLUTIONS, INC.	OPTIONHOLDER:
By:	By:
Name: Mark Schnepel	Name:
Title: Chief Executive Officer	Date:

ATTACHMENTS: Option Agreement, 2021 Incentive Award Plan, Notice of Exercise

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EXHIBIT A

VESTING SCHEDULE

The options under this award with respect to [l] Common Shares (the “Immediately Vested Options”) shall be immediately vested on the Date of Grant.

The options under this award with respect to [l] Common Shares (the “Vesting Options”) shall vest annually over a period of four years in four equal tranches on each annual anniversary of the Date of Grant, such that (i) one-quarter of the Vesting Options shall vest on the first anniversary of the Date of Grant, (ii) another one-quarter of the Vesting Options shall vest on the second anniversary of the Date of Grant, (iii) another one-quarter of the Vesting Options shall vest on the third anniversary of the Date of Grant, and (iv) the final one-quarter of the Vesting Options shall vest on the fourth anniversary of the Date of Grant, in all cases subject to the terms and conditions of the corresponding Option Agreement.

Notwithstanding the above, (A) if the Optionholder’s Continuous Service is terminated without Cause by the Company (or a successor, if appropriate) during the one-year period immediately following the consummation of a Change in Control, then the vesting of the Vesting Options shall accelerate such that 100% of the Vesting Options shall become vested, effective as of immediately prior to such termination of the Optionholder’s Continuous Service; and (B) if a Company Sale occurs during the Optionholder’s Continuous Service, then the vesting of the Vesting Options shall accelerate such that 100% of the Vesting Options shall become vested, effective as of immediately prior to the occurrence of the Company Sale. As a condition of the application of the accelerated vesting contemplated by the foregoing, the Optionholder shall execute the Company’s form of a general release of any claims against the Company (the “Release”) and permit such Release to become effective and irrevocable in accordance with its terms. Unless the Release is executed by the Optionholder and delivered to the Company within the period of time set forth in the Release, and such Release becomes effective and irrevocable, there shall be no accelerated vesting of Vesting Options as otherwise contemplated by the foregoing.

EXHIBIT A
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ATTACHMENT I

OPTION AGREEMENT

[See attached.]

ATTACHMENT I
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FLEXENERGY GREEN SOLUTIONS, INC.

2021 INCENTIVE AWARD PLAN

OPTION AGREEMENT
(INCENTIVE STOCK OPTION OR NONSTATUTORY STOCK OPTION)

Pursuant to your Stock Option Grant Notice (including the vesting schedule attached thereto as Exhibit A, collectively, the “Grant Notice”) and this Option Agreement (this “Option Agreement”), FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”) has granted you an option under its 2021 Incentive Award Plan (the “Plan”) to purchase the number of Common Shares indicated in your Grant Notice at the exercise price indicated in your Grant Notice. The option is granted to you effective as of the date of grant set forth in the Grant Notice (the “Date of Grant”). If there is any conflict between the terms in the Grant Notice, this Option Agreement, the Plan and the Notice of Exercise, then such conflict shall be resolved by giving such documents precedence in the following order: the Grant Notice, this Option Agreement, the Plan and then the Notice of Exercise. Capitalized terms not explicitly defined in this Option Agreement or in the Grant Notice but defined in the Plan will have the same definitions as in the Plan.

The details of your option, in addition to those set forth in the Grant Notice and the Plan, are as follows:

1.             VESTING; NO STOCKHOLDER RIGHTS. Your option will vest as provided in your Grant Notice. Vesting will cease upon the termination of your Continuous Service with the Company except as may be provided otherwise in the vesting schedule in Exhibit A to your Grant Notice or in an employment or other agreement between you and the Company. You will not be deemed to be the holder of the Common Shares, or have any of the rights of a stockholder, with respect to your option unless and until the option vests and you exercise the option in accordance with this Option Agreement and the Company has issued and delivered Common Shares to you and your name shall have been entered as a stockholder of record on the books of the Company. As used in this Agreement, “Continuous Service” means that your service with the Company or an Affiliate, whether as an employee, consultant or director, is not interrupted or terminated. Your Continuous Service shall not be deemed to have terminated merely because of a change in the capacity in which you render service to the Company or an Affiliate as an employee, consultant or director or a change in the entity for which you render such service, provided that there is no interruption or termination of your Continuous Service; provided further that if this Option Agreement (and the corresponding Award) is subject to Section 409A of the Code, this sentence shall only be given effect to the extent consistent with Section 409A of the Code. For example, a change in status from an employee of the Company to a director of an Affiliate will not constitute an interruption of Continuous Service. The Committee or its delegate, in its sole discretion, may determine whether Continuous Service will be considered interrupted in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal or family leave of absence. The Committee or its delegate, in its sole discretion, may determine whether a Company transaction, such as a sale or spin-off of a division or subsidiary that employs you, shall be deemed to result in a termination of Continuous Service for purposes of this Option Agreement, and such decision shall be final, conclusive and binding.

ATTACHMENT I
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2.             NUMBER OF SHARES AND EXERCISE PRICE. The number of Common Shares subject to your option and your exercise price per share are set forth in your Grant Notice and will be adjusted in the event of changes in capital structure and similar events as provided in Section 11 of the Plan.

3.             METHOD OF PAYMENT. You must pay the full amount of the exercise price for the shares you wish to exercise. You may pay the exercise price in cash or by check, bank draft or money order payable to the Company or in any other manner expressly indicated as a permitted method of exercise on your Grant Notice, which may include one or more of the following:

(a)            Provided that at the time of exercise the Common Shares are publicly traded, pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that, prior to the issuance of Common Shares, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds. This manner of payment is also known as a “cashless exercise”, “broker-assisted exercise”, “same day sale”, or “sell to cover”.

(b)            Provided that at the time of exercise the Common Shares are publicly traded, by delivery to the Company (either by actual delivery or attestation) of already-owned Common Shares that are owned free and clear of any liens, claims, vesting conditions, transfer restrictions, encumbrances or security interests, and that are valued at Fair Market Value on the date of exercise. “Delivery” for these purposes, in the sole discretion of the Company at the time you exercise your option, will include delivery to the Company of your attestation of ownership of such Common Shares in a form approved by the Company. You may not exercise your option by delivery to the Company of Common Shares if doing so would violate the provisions of any law, regulation or agreement restricting the redemption of the Company’s stock.

4.             WHOLE SHARES. You may exercise your option only for whole Common Shares.

5.             SECURITIES LAW COMPLIANCE. In no event may you exercise your option unless the Common Shares issuable upon exercise are then registered under the Securities Act or, if not registered, the Company has determined that your exercise and the issuance of the shares would be exempt from the registration requirements of the Securities Act. The exercise of your option also must comply with all other applicable laws and regulations governing your option, and you may not exercise your option if the Company determines that such exercise would not be in material compliance with such laws and regulations.

6.             TERM. You may not exercise your option before the Date of Grant or after the expiration of the option’s term. Except as may be provided otherwise in the vesting schedule in Exhibit A to your Grant Notice or in an employment or other agreement between you and the Company, the term of your option expires (subject to the provisions of Section 6(c) of the Plan if your Option is an Incentive Stock Option and you, on the Date of Grant, own shares representing more than 10% of the combined voting power of the Company) upon the earliest of the following:

ATTACHMENT I
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(a)            immediately upon the termination of your service with the Company for Cause;

(b)            three months after the termination of your service with the Company for any reason other than Cause, your Disability (as defined below) or your death (except as otherwise provided in Section 6(d) below); provided, however, that if during any part of such three month period your option is not exercisable solely because of the condition set forth in the section above relating to “Securities Law Compliance,” your option will not expire until the earlier of the Expiration Date or until it has been exercisable for an aggregate period of three months after the termination of your service with the Company;;

(c)            12 months after the termination of your service with the Company due to your Disability (except as otherwise provided in Section 6(d) below). For purposes of this Option Agreement, “Disability” means your inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or that has lasted or can be expected to last for a continuous period of not less than 12 months as provided in Sections 22(e)(3) and 409A(a)(2)(c)(i) of the Code, and will be determined by the Committee on the basis of such medical evidence as the Committee deems warranted under the circumstances;

(d)            12 months after your death if you die either during your service with the Company or within three months after your service with the Company terminates for any reason other than Cause;

(e)            the Expiration Date indicated in your Grant Notice; or

(f)            the day before the 10th anniversary of the Date of Grant.

If your option is an Incentive Stock Option, note that to obtain the federal income tax advantages associated with an Incentive Stock Option, the Code requires that at all times beginning on the Date of Grant and ending on the day three months before the date of your option’s exercise, you must be an employee of the Company or an Affiliate, except in the event of your death or Disability. The Company has provided for extended exercisability of your option under certain circumstances for your benefit but cannot guarantee that your option will necessarily be treated as an Incentive Stock Option if you continue to provide services to the Company or an Affiliate as a consultant or director after your employment terminates or if you otherwise exercise your option more than three months after the date your employment with the Company or an Affiliate terminates.

7.             EXERCISE.

(a)            You may exercise the vested portion of your option during its term by (i) delivering a Notice of Exercise (in the form attached to the Grant Notice or such other form as may be designated by the Company) or completing such other documents and/or procedures designated by the Company for exercise and (ii) paying the exercise price and any applicable withholding taxes to the Company’s Secretary, stock plan administrator, or such other person as the Company may designate, together with such additional documents as the Company may then require. Subject to the applicable terms of the Plan, your option shall become exercisable only to the extent your option is vested (as provided in the Vesting Schedule (see above)) at the time of exercise.

ATTACHMENT I
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(b)            By exercising your option you agree that, as a condition to any exercise of your option, the Company may require you and you hereby agree to enter into an arrangement providing for the payment by you to the Company of any tax withholding obligation of the Company arising by reason of (i) the exercise of your option, or (ii) the disposition of Common Shares acquired upon such exercise.

(c)            If your option is an Incentive Stock Option, by exercising your option you agree that you will notify the Company in writing within 15 days after the date of any disposition of any of the shares of the Common Shares issued upon exercise of your option that occurs within two years after the Date of Grant or within one year after such Common Shares are transferred upon exercise of your option.

8.             TRANSFERABILITY. Except as otherwise provided in this Section 8, your option is not assignable or transferable, except by will or by the laws of descent and distribution, and is exercisable during your life only by you. Without limiting the generality of the foregoing, your option may not be sold, assigned, transferred or otherwise disposed of, or pledged or hypothecated in any manner (whether by operation of law or otherwise), and shall not be subject to execution, attachment or other process. Any assignment, transfer, sale, pledge, hypothecation or other disposition of your option or any attempt to make any such levy of execution, attachment or other process will cause your option to terminate immediately, unless the Chief Financial Officer of the Company, with advice from counsel, specifically waives applicability of this provision.

(a)            Certain Trusts. Upon receiving written permission from the Chief Financial Officer of the Company, with advice from counsel, you may transfer your option to a trust if you are considered to be the sole beneficial owner (determined under Section 671 of the Code and applicable state law) while the option is held in the trust. You and the trustee must enter into transfer and other agreements required by the Company.

(b)            Domestic Relations Orders. Upon receiving written permission from the Chief Financial Officer of the Company, with advice from counsel, and provided that you and the designated transferee enter into transfer and other agreements required by the Company, you may transfer your option pursuant to the terms of a domestic relations order, official marital settlement agreement or other divorce or separation instrument as permitted by Treasury Regulation 1.421-1(b)(2) that contains the information required by the Company to effectuate the transfer. You are encouraged to discuss the proposed terms of any division of this option with the Company prior to finalizing the domestic relations order or marital settlement agreement to help ensure the required information is contained within the domestic relations order or marital settlement agreement. If this option is an Incentive Stock Option, this option may be deemed to be a Nonstatutory Stock Option as a result of such transfer.

(c)            Beneficiary Designation. Upon receiving written permission from the Chief Financial Officer of the Company, you may, by delivering written notice to the Company, in a form approved by the Company and any broker designated by the Company to handle option exercises, designate a third party who, on your death, will thereafter be entitled to exercise this option within the 12 months following the date of your death (or such shorter exercise period as may be required by Section 6 above) and receive the Common Shares or other consideration resulting from such exercise. In the absence of such a designation, your executor or administrator of your estate will be entitled to exercise this option and receive, on behalf of your estate, the Common Shares or other consideration resulting from such exercise.

ATTACHMENT I
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9.             OPTION NOT A SERVICE CONTRACT. Your option is not an employment or service contract, and nothing in your option will be deemed to create in any way whatsoever any obligation on your part to continue in the employ or service of the Company or an Affiliate, or of the Company or an Affiliate to continue your employment or service. In addition, nothing in your option will obligate the Company or an Affiliate, their respective stockholders, boards of directors, officers or employees to continue any relationship that you might have as a member of the Company’s Board or a consultant for the Company or an Affiliate. The Company and its Affiliates hereby reserve its rights to discharge and terminate your services at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in a written agreement between you and the Company or an Affiliate.

10.           WITHHOLDING OBLIGATIONS.

(a)            At the time you exercise your option, in whole or in part, and at any time thereafter as requested by the Company, you hereby agree to make adequate provision for (including by means of a “same day sale” pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board to the extent permitted by the Company), any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if any, which arise in connection with the exercise of your option.

(b)            If you fail to make the adequate provisions contemplated by Section 10(a) above, then subject to compliance with any applicable legal conditions or restrictions, the Company shall have the option in its discretion (but not the obligation) to withhold from fully vested Common Shares otherwise issuable to you upon the exercise of your option a number of whole Common Shares having a Fair Market Value, determined by the Company as of the date of exercise, not in excess of the amount of tax required to be withheld by law (or, at the Company’s option, such lower amount as may be necessary to avoid classification of your option as a liability for financial accounting purposes).

(c)            The Company assumes no responsibility for individual income taxes, penalties or interest related to grant or exercise of any option. Neither the Company nor any Affiliate makes any representation or undertaking regarding the treatment of any tax withholding in connection with the grant or exercise of any option. You should consult with your personal tax advisor regarding the tax ramifications, if any, which result from receipt of the option, the subsequent issuance, if any, of Common Shares on exercise of the option, and subsequent disposition of any such Common Shares. You acknowledge that the Company may be required to withhold federal, state and/or local taxes in connection with the exercise of the option. You may not exercise your option unless the tax withholding obligations of the Company and/or any Affiliate are satisfied. Accordingly, you may not be able to exercise your option when desired even though your option is vested, and the Company will have no obligation to issue a certificate for such Common Shares unless such obligations are satisfied.

ATTACHMENT I
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11.           SECTION 409A; TAX CONSEQUENCES. It is the Company’s intent that this option be exempt from Section 409A of the Code to the extent applicable, and that this Option Agreement be administered accordingly. You hereby agree that the Company does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimizes your tax liabilities. You will not make any claim against the Company, or any of its officers, directors, employees or Affiliates, related to tax liabilities arising from your option or your other compensation. You understand that you may suffer adverse tax consequences as a result of the grant, vesting or exercise of your options or with the purchase or disposition of any Common Shares subject to the Option.

12.           NOTICES. Any notices provided for in your option or the Plan will be given in writing and will be deemed effectively given upon receipt. The Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan and this option by electronic means or to request your consent to participate in the Plan by electronic means. By accepting this option, you consent to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.

13.           AGREEMENT SUMMARIES. If the Company provides you (or anyone acting on your behalf) with summary or other information concerning, including or otherwise relating to your rights or benefits under this Option Agreement (including, without limitation, the option and any exercise thereof), such summary or other information shall in all cases be qualified in its entirety by the Grant Notice, this Option Agreement, the Plan and the Notice of Exercise and, unless it explicitly states otherwise and is signed by an officer of the Company, shall not constitute an amendment or other modification hereto.

14.           ACKNOWLEDGEMENTS. You understand, acknowledge, agree and hereby stipulate that: (1) you are executing this Option Agreement voluntarily and without any duress or undue influence by the Company or anyone else; (2) the option is intended to be consideration in exchange for the promises and covenants set forth in this Option Agreement; (3) you have carefully read, considered and understand all of the provisions of this Option Agreement and the Company’s policies reflected in this Option Agreement; (4) you have asked any questions needed for you to understand the terms, consequences and binding effect of this Option Agreement and you fully understand them; (5) you were provided an opportunity to seek the advice of an attorney and/or a tax professional of your choice before accepting this option; (6) the obligations and restrictions set forth in this Option Agreement are fair and reasonable and (7) your participation in the Plan confers no rights or interests other than as herein provided.

ATTACHMENT I
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ATTACHMENT II

2021 INCENTIVE AWARD PLAN

[see attached]

ATTACHMENT II

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ATTACHMENT III

FORM OF NOTICE OF EXERCISE

[see attached]

ATTACHMENT III
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FLEXENERGY GREEN SOLUTIONS, INC.

NOTICE OF EXERCISE

FlexEnergy Green Solutions, Inc.

112 Corporate Drive

Portsmouth, NH 03801

Date of Exercise: _____________, 20__

[Option Holder]

This constitutes notice under my stock option that I elect to purchase the number of shares for the price set forth below.

Type of option (check one):	Incentive	Nonstatutory
Stock option dated:
Number of shares as to which option is exercised:
Shares to be issued in name of:
Total exercise price:
Cash payment delivered herewith:

By this exercise, I agree (i) to provide such additional documents as you may require pursuant to the terms of the 2021 Incentive Award Plan (the “Plan”), (ii) to provide for the payment by me to you (in the manner designated by you) of your withholding obligation, if any, relating to the exercise of this option, and (iii) if this exercise relates to an incentive stock option, to notify you in writing within fifteen (15) days after the date of any disposition of any of the Common Shares issued upon exercise of this option that occurs within two (2) years after the date of grant of this option or within one (1) year after such Common Shares are issued upon exercise of this option.

Very truly yours,

Address:

ATTACHMENT III
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RESTRICTED STOCK AWARD AGREEMENT

This Restricted Stock Award Agreement (this “Agreement”) is made and entered into as of [DATE] (the “Grant Date”) by and between FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), and [l] (the “Grantee”).

WHEREAS, the Company has adopted the FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan (the “Plan”) pursuant to which awards of Restricted Stock may be granted; and

WHEREAS, the Committee has determined that it is in the best interests of the Company and its stockholders to grant the award of Restricted Stock provided for herein.

NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows:

1.            Grant of Restricted Stock. Pursuant to Section 9 of the Plan, the Company hereby issues to the Grantee on the Grant Date a Restricted Stock Award consisting of, in the aggregate, [NUMBER] of Common Shares of the Company (the “Restricted Stock”), on the terms and conditions and subject to the restrictions set forth in this Agreement and the Plan. Capitalized terms that are used but not defined herein have the meaning ascribed to them in the Plan.

2.            Consideration. The grant of the Restricted Stock is made in consideration of the services to be rendered by the Grantee to the Company.

3.            Restricted Period; Vesting.

3.1            Except as otherwise provided herein, provided that the Grantee remains in Continuous Service through the applicable vesting date, the Restricted Stock will vest in accordance with the following schedule:

Vesting Date	Common Shares
[VESTING DATE]	[NUMBER OR PERCENTAGE OF SHARES THAT VEST ON THE VESTING DATE]
[VESTING DATE]	[NUMBER OR PERCENTAGE OF SHARES THAT VEST ON THE VESTING DATE]

The period over which the Restricted Stock vests is referred to as the “Restricted Period”. As used in this Agreement, “Continuous Service” means that the Grantee’s service with the Company or an Affiliate, whether as an employee, consultant or director, is not interrupted or terminated. The Grantee’s Continuous Service shall not be deemed to have terminated merely because of a change in the capacity in which the Grantee renders service to the Company or an Affiliate as an employee, consultant or director or a change in the entity for which the Grantee renders such service, provided that there is no interruption or termination of the Grantee’s Continuous Service; provided further that if any Award is subject to Section 409A of the Code, this sentence shall only be given effect to the extent consistent with Section 409A of the Code. For example, a change in status from an employee of the Company to a director of an Affiliate will not constitute an interruption of Continuous Service. The Committee or its delegate, in its sole discretion, may determine whether Continuous Service will be considered interrupted in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal or family leave of absence. The Committee or its delegate, in its sole discretion, may determine whether a Company transaction, such as a sale or spin-off of a division or subsidiary that employs a Grantee, shall be deemed to result in a termination of Continuous Service for purposes of affected Awards, and such decision shall be final, conclusive and binding.

3.2            The foregoing vesting schedule notwithstanding, if the Grantee’s Continuous Service terminates for any reason at any time before all of his or her Restricted Stock has vested, the Grantee’s unvested Restricted Stock shall be automatically forfeited upon such termination of Continuous Service and neither the Company nor any Affiliate shall have any further obligations to the Grantee under this Agreement.

3.3            Unless otherwise determined by the Committee at the time of a Change in Control, a Change in Control shall have no effect on the Restricted Stock.

4.            Restrictions. Subject to any exceptions set forth in this Agreement or the Plan, during the Restricted Period, the Restricted Stock or the rights relating thereto may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Grantee. Any attempt to assign, alienate, pledge, attach, sell or otherwise transfer or encumber the Restricted Stock or the rights relating thereto during the Restricted Period shall be wholly ineffective and, if any such attempt is made, the Restricted Stock will be forfeited by the Grantee and all of the Grantee’s rights to such shares shall immediately terminate without any payment or consideration by the Company.

5.            Rights as Stockholder; Dividends.

5.1            The Grantee shall be the record owner of the Restricted Stock until the Common Shares are sold or otherwise disposed of, and shall be entitled to all of the rights of a stockholder of the Company including, without limitation, the right to vote such shares and receive all dividends or other distributions paid with respect to such shares. Notwithstanding the foregoing, any dividends or other distributions shall be subject to the same restrictions on transferability as the shares of Restricted Stock with respect to which they were paid.

5.2            The Company may issue stock certificates or evidence the Grantee’s interest by using a restricted book entry account with the Company’s transfer agent. Physical possession or custody of any stock certificates that are issued shall be retained by the Company until the time as the Restricted Stock vests.

5.3            If the Grantee forfeits any rights he or she has under this Agreement in accordance with Section 3, the Grantee shall, on the date of such forfeiture, no longer have any rights as a stockholder with respect to the Restricted Stock and shall no longer be entitled to vote or receive dividends on such shares.

6.            No Right to Continued Service. Neither the Plan nor this Agreement shall confer upon the Grantee any right to be retained in any position as an employee, consultant or director of the Company or its Affiliates. Further, nothing in the Plan or this Agreement shall be construed to limit the discretion of the Company or any of its Affiliates to terminate the Grantee’s Continuous Service at any time, with or without Cause.

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7.            Adjustments. If any change is made to the outstanding Common Shares or the capital structure of the Company, if required, the Common Shares shall be adjusted or terminated in any manner as contemplated by Section 12 of the Plan.

8.            Tax Liability and Withholding.

8.1            The Grantee shall be required to pay to the Company, and the Company shall have the right to deduct from any compensation paid to the Grantee pursuant to the Plan, the amount of any required withholding taxes in respect of the Restricted Stock and to take all such other action as the Committee deems necessary to satisfy all obligations for the payment of such withholding taxes. The Committee may permit the Grantee to satisfy any federal, state or local tax withholding obligation by any of the following means, or by a combination of such means:

(a)            tendering a cash payment.

(b)            authorizing the Company to withhold Common Shares from those Common Shares that would otherwise be issuable or deliverable to the Grantee as a result of the vesting of the Restricted Stock; provided, however, that no Common Shares shall be withheld with a value exceeding the [minimum/maximum] amount of tax required to be withheld by law.

(c)            delivering to the Company previously owned and unencumbered Common Shares.

8.2            Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and remains the Grantee’s responsibility and the Company (a) makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the grant or vesting of the Restricted Stock or the subsequent sale of any shares; and (b) does not commit to structure the Restricted Stock to reduce or eliminate the Grantee’s liability for Tax-Related Items.

9.            Section 83(b) Election. The Grantee may make an election under Code Section 83(b) (a “Section 83(b) Election”) with respect to the Restricted Stock. Any such election must be made within thirty (30) days after the Grant Date. If the Grantee elects to make a Section 83(b) Election, the Grantee shall provide the Company with a copy of an executed version and satisfactory evidence of the filing of the executed Section 83(b) Election with the US Internal Revenue Service. The Grantee agrees to assume full responsibility for ensuring that the Section 83(b) Election is actually and timely filed with the US Internal Revenue Service and for all tax consequences resulting from the Section 83(b) Election.

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10.            [Non-competition and Non-solicitation.

10.1            In consideration of the Restricted Stock, the Grantee agrees and covenants not to:

(a)            contribute his or her knowledge, directly or indirectly, in whole or in part, as an employee, officer, owner, manager, advisor, consultant, agent, partner, director, stockholder, volunteer, intern or in any other similar capacity to an entity engaged in the same or similar business as the Company and its Affiliates, including those engaged in the business of [l] for a period of [l] following the Grantee’s termination of Continuous Service;

(b)            directly or indirectly, solicit, hire, recruit, attempt to hire or recruit, or induce the termination of employment of any employee of the Company or its Affiliates for [l] following the Grantee’s termination of Continuous Service; or

(c)            directly or indirectly, solicit, contact (including, but not limited to, e-mail, regular mail, express mail, telephone, fax, and instant message), attempt to contact or meet with the current[, former or prospective] customers of the Company or any of its Affiliates for purposes of offering or accepting goods or services similar to or competitive with those offered by the Company or any of its Affiliates for a period of [l] following the Grantee’s termination of Continuous Service.

10.2            If the Grantee breaches any of the covenants set forth in Section 10.1:

(a)            all unvested Restricted Stock shall be immediately forfeited; and

(b)            the Grantee hereby consents and agrees that the Company shall be entitled to seek, in addition to other available remedies, a temporary or permanent injunction or other equitable relief against such breach or threatened breach from any court of competent jurisdiction, without the necessity of showing any actual damages or that money damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned equitable relief shall be in addition to, not in lieu of, legal remedies, monetary damages or other available forms of relief.]

11.            Compliance with Law. The issuance and transfer of Common Shares shall be subject to compliance by the Company and the Grantee with all applicable requirements of federal and state securities laws and with all applicable requirements of any stock exchange on which the Common Shares may be listed. No Common Shares shall be issued or transferred unless and until any then applicable requirements of state and federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel. The Grantee understands that the Company is under no obligation to register the Common Shares with the Securities and Exchange Commission, any state securities commission or any stock exchange to effect such compliance.

12.            Legends. A legend may be placed on any certificate(s) or other document(s) delivered to the Grantee and may be noted in the book entry account with the Company’s transfer agent indicating restrictions on transferability of the shares of Restricted Stock pursuant to this Agreement or any other restrictions that the Committee may deem advisable under the rules, regulations and other requirements of the Securities and Exchange Commission, any applicable federal or state securities laws or any stock exchange on which the Common Shares are then listed or quoted.

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13.            Notices. Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the Chief Financial Officer of the Company at the Company’s principal corporate offices. Any notice required to be delivered to the Grantee under this Agreement shall be in writing and addressed to the Grantee at the Grantee’s address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved by the Company) from time to time.

14.            Governing Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without regard to conflict of law principles.

15.            Interpretation. Any dispute regarding the interpretation of this Agreement shall be submitted by the Grantee or the Company to the Committee for review. The resolution of such dispute by the Committee shall be final and binding on the Grantee and the Company.

16.            Restricted Stock Subject to Plan. This Agreement is subject to the Plan as approved by the Company’s stockholders. The terms and provisions of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

17.            Successors and Assigns. The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon the Grantee and the Grantee’s beneficiaries, executors, administrators and the person(s) to whom the Restricted Stock may be transferred by will or the laws of descent or distribution.

18.            Severability. The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to the extent permitted by law.

19.            Discretionary Nature of Plan. The Plan is discretionary and may be amended, cancelled or terminated by the Company at any time, in its discretion. The grant of the Restricted Stock in this Agreement does not create any contractual right or other right to receive any Restricted Stock or other Awards in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment, modification, or termination of the Plan shall not constitute a change or impairment of the terms and conditions of the Grantee’s employment with the Company.

20.            Amendment. The Committee has the right to amend, alter, suspend, discontinue or cancel the Restricted Stock, prospectively or retroactively; provided, that, no such amendment shall adversely affect the Grantee’s material rights under this Agreement without the Grantee’s consent.

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21.            No Impact on Other Benefits. The value of the Grantee’s Restricted Stock is not part of his or her normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit.

22.            Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

23.            Acceptance. The Grantee hereby acknowledges receipt of a copy of the Plan and this Agreement. The Grantee has read and understands the terms and provisions thereof, and accepts the Restricted Stock subject to all of the terms and conditions of the Plan and this Agreement. The Grantee acknowledges that there may be adverse tax consequences upon the grant or vesting of the Restricted Stock or disposition of the underlying shares and that the Grantee has been advised to consult a tax advisor prior to such grant, vesting or disposition.

[signature page follows]

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

FLEXENERGY GREEN SOLUTIONS, INC.

By:

Name: Mark Schnepel

Title: Chief Executive Officer

[EMPLOYEE NAME]

By:

Name:

[Signature Page to Restricted Stock Award Agreement] 

FLEXENERGY GREEN SOLUTIONS, INC. 2021 INCENTIVE AWARD PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (the “Agreement”), is made and entered into effective [●], 2021 (the “Grant Date”), by and between FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), and [●] (the “Participant”).

RECITALS

WHEREAS, the Company has adopted the FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan, as amended (the “Plan”), a copy of which has been made available to the Participant;

WHEREAS, pursuant to Section 9 of the Plan, the Company desires to grant to the Participant an award of Restricted Stock Units (the “Units”) set forth in Section 2(a) below, subject to certain restrictions set forth in this Agreement, effective as of the Grant Date; and

WHEREAS, the Board or the Committee has duly made all determinations necessary or appropriate to the grants hereunder.

NOW, THEREFORE, in consideration of the premises and the mutual covenants set forth in this Agreement and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties agree as follows:

AGREEMENT

1.            Definitions. Any capitalized term used in this Agreement that is not defined in this Agreement will have the same meaning given to it in the Plan.

2.            Grant of Restricted Stock Units; Vesting.

(a)           Subject to the terms and conditions of the Plan, and the additional terms and conditions set forth in this Agreement, the Company hereby grants to the Participant an award of [●] time-vesting Units (the “Award”). Each Unit is a notional amount that represents one unvested Common Share and constitutes the right, subject to the terms and conditions of the Plan and this Agreement, to distribution of a Common Share if and when the Unit vests.

(b)           Provided that the Participant is providing Continuous Service to the Company as of each applicable vesting date, one third (1/3) of the Units granted under this Award will vest on each of the first three (3) anniversaries of the Grant Date (each individually, a “Vesting Date”). In the event that the Participant’s employment or engagement with the Company or its Affiliates is terminated for any reason before the Vesting Date, except as otherwise determined by the Committee, all unvested Units shall be canceled and forfeited. The vested Units shall be settled and become payable in Common Shares in accordance with Section 3. As used in this Agreement, “Continuous Service” means that Participant’s service with the Company or an Affiliate, whether as an employee, consultant or director, is not interrupted or terminated. Participant’s Continuous Service shall not be deemed to have terminated merely because of a change in the capacity in which Participant renders service to the Company or an Affiliate as an employee, consultant or director or a change in the entity for which Participant renders such service, provided that there is no interruption or termination of Participant’s Continuous Service; provided further that if this Agreement (and the corresponding Award) is subject to Section 409A of the Code, this sentence shall only be given effect to the extent consistent with Section 409A of the Code. For example, a change in status from an employee of the Company to a director of an Affiliate will not constitute an interruption of Continuous Service. The Committee or its delegate, in its sole discretion, may determine whether Continuous Service will be considered interrupted in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal or family leave of absence. The Committee or its delegate, in its sole discretion, may determine whether a Company transaction, such as a sale or spin-off of a division or subsidiary that employs Participant, shall be deemed to result in a termination of Continuous Service for purposes of this Agreement, and such decision shall be final, conclusive and binding.

(c)          [In the event of a Change in Control (as defined in the Plan), all of the Participant’s unvested Units granted under this Award shall vest immediately in full upon the effective date of the Change in Control, subject to the Participant’s provision of Continuous Service with the Company on such date. The vested Units shall be settled and become payable in Common Shares in accordance with Section 3.]¹

3.           Timing; Form of Payment. Once a Unit vests, the Participant will be entitled to receive a Common Share in its place or, in the Committee’s discretion, an equivalent amount in cash (or partly in cash and partly in Common Shares). Delivery of the Common Shares or cash, as applicable, will be made as soon as administratively feasible following the vesting of the associated Unit, and in no event later than the [sixtieth (60^th)] day following the Vesting Date. Any Common Shares paid will be credited to an account established for the benefit of the Participant in book entry with the Company’s transfer agent. The Participant will have full legal and beneficial ownership of the Common Shares at that time.

4.            Certificates; Transferability. Units awarded under Section 2 will be credited to a book entry account maintained by the Company on behalf of the Participant, and such book entry will appropriately record the terms, conditions and restrictions applicable to such Units. Neither unvested Units, nor the right to vote such Units, may be sold, assigned, transferred, exchanged, pledged, hypothecated or otherwise encumbered.

5.            Rights as a Stockholder. Unless and until a Unit has vested and the Common Share underlying it has been distributed to the Participant, the Participant will not be entitled to vote in respect of that Unit or that Common Share. Except as provided in this Section 5 or as otherwise required by law, the Participant shall not have any rights as a stockholder with respect to any Common Shares covered by the Units granted hereunder prior to the date on which he or she is recorded as the holder of those Common Shares on the records of the Company. [Notwithstanding any other part of this Agreement, any quarterly or other regular, periodic dividends or distributions (as determined by the Committee) paid on Common Shares will accrue with respect to (i) unvested Units, and (ii) Units that are vested but unpaid pursuant to Section 3, and in each case will be subject to the same forfeitures provisions (if any), and be paid out at the same time or time(s), as the underlying Units on which such dividends or other distributions have accrued]².

6.            Withholding. No later than the date as of which an amount first becomes includible as income of the Participant for any income and/or employment tax purposes with respect to any Unit, the Participant shall pay to the Company, or make arrangements satisfactory to the Company regarding the payment of, all federal, state, local and foreign income and/or employment taxes that are required by applicable law to be withheld with respect to such amount. The Participant authorizes the Company to withhold from his or her compensation to satisfy any income and/or employment tax withholding obligations in connection with this Award. If the Participant is no longer employed by the Company at the time any applicable taxes are due and must be remitted by the Company, the Participant agrees to pay applicable taxes to the Company, and the Company may delay distribution of the Common Shares underlying this Award until proper payment of such taxes has been made by the Participant. The Participant may satisfy such obligations under this Section 6 by any method authorized under this Agreement and the Plan.

7.            Plan. The Participant hereby acknowledges receipt of a copy of the Plan. Notwithstanding any other provision of this Agreement, the Units are granted pursuant to the Plan, as in effect on the date of the Agreement, and are subject to the terms and conditions of the Plan, as the same may be amended from time to time; provided, however, that except as otherwise provided by the Plan, no amendment to either the Plan or this Agreement will deprive the Participant, without the Participant’s consent, of any Units or of the Participant’s rights under this Agreement. The interpretation and construction by the Committee of the Plan, this Agreement, the Units, and such rules and regulations as may be adopted by the Committee for the purpose of administering the Plan, will be final and binding upon the Participant.

¹       Update for each Participant.

²       Update for each Participant, as determined by the Committee.

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8.            No Employment Rights Or Rights to Provide Service. No provision of the Plan or this Agreement will give the Participant any right to continue in the employ of or service to the Company or any of its Affiliates, create any inference as to the length of employment or engagement of the Participant, affect the right of the Company or its Affiliates to terminate the employment or engagement of the Participant, with or without Cause, or give the Participant any right to participate in any employee welfare or benefit plan or other program of the Company or any of its Affiliates.

9.            Changes in Company’s Capital or Organizational Structure. The existence of the Units shall not affect in any way the right or authority of the Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of the Company, or any issue of preferred Company shares ahead of or affecting the Common Shares or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other act or proceeding, whether of a similar character or otherwise.

10.          Delays. In accordance with the terms of the Plan, the Company shall have the right to suspend or delay any time period prescribed in this Agreement or in the Plan for any action if the Committee shall determine that the action may constitute a violation of any law or result in any liability under any law to the Company, an Affiliate or a stockholder in the Company until such time as the action required or permitted will not constitute a violation of law or result in liability to the Company, an Affiliate or a stockholder of the Company.

11.          Reserved.

12.          Entire Agreement. This Agreement, together with the Plan and any other agreements incorporated herein by reference, constitutes the entire obligation of the parties with respect to the subject matter of this Agreement and supersedes any prior written or oral expressions of intent or understanding with respect to such subject matter (provided, that this Agreement shall not supersede any written consulting agreement, written employment agreement, or other written agreement between the Company and the Participant, including, but not limited to, any written restrictive covenant agreements). The Participant represents that, in executing this Agreement, he or she does not rely and has not relied upon any representation or statement not set forth herein made by the Company or its Affiliates with regard to the subject matter, bases or effect of this Agreement or otherwise.

13.          Amendment. This Agreement may be amended as provided in the Plan.

14.          Waiver; Cumulative Rights. The failure or delay of either party to require performance by the other party of any provision of this Agreement will not affect its right to require performance of such provision unless and until such performance has been waived in writing. Each right under this Agreement is cumulative and may be exercised in part or in whole from time to time.

15.          Counterparts. This Agreement may be signed in two counterparts, each of which will be an original, but both of which will constitute one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

16.          Notices. Any notices required or permitted under this Agreement must be in writing and may be delivered personally or by mail, postage prepaid, addressed to (a) the Company at the address of its principal executive office, Attention: Chief Financial Officer and (b) the Participant at the Participant’s address as shown on the Company’s payroll records, or to such other address as the Participant, by notice to the Company, may designate in writing from time to time.

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17.          Headings. The headings in this Agreement are for reference purposes only and will not affect the meaning or interpretation of this Agreement.

18.          Severability. If any provision of this Agreement is for any reason held to be invalid or unenforceable, such invalidity or unenforceability will not affect any other provision of this Agreement, and this Agreement will be construed as if such invalid or unenforceable provision were omitted.

19.          No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against any party.

20.          Successors and Assigns. This Agreement will inure to the benefit of and be binding upon each successor and assign of the Company. All obligations imposed upon the Participant or a representative, and all rights granted to the Company under this Agreement, will be binding upon the Participant’s or the representative’s heirs, legal representatives and successors.

21.         Tax Consequences.     The Participant agrees to determine and be responsible for all tax consequences to the Participant with respect to the Units.

22.          Code Section 409A Compliance. This Agreement and delivery of Units and Common Shares under this Agreement are intended to be exempt from or to comply with Section 409A of the Code (“Section 409A”) and shall be administered and construed in accordance with such intent. Notwithstanding any provision of this Agreement, to the extent that the Committee determines that any portion of the Units granted under this Agreement is subject to Section 409A and fails to comply with the requirements of Section 409A, notwithstanding anything to the contrary contained in the Plan or in this Agreement, the Committee reserves the right to amend, restructure, terminate or replace such portion of the Units in order to cause such portion of the Units to either not be subject to Section 409A or to comply with the applicable provisions of such section. In furtherance, and not in limitation, of the foregoing: (a) in no event may the Participant designate, directly or indirectly, the calendar year of any payment to be made hereunder; and (b) notwithstanding any other provision of this Agreement to the contrary, a termination of employment hereunder shall mean and be interpreted consistent with a “separation from service” within the meaning of Section 409A with respect to any payment hereunder that constitute a “deferral of compensation” under Section 409A that becomes due on account of such separation from service. Notwithstanding any provision of the Plan to the contrary, in no event shall the Company be liable to the Participant on account of this Agreement’s failure to (a) qualify for favorable U.S. or foreign tax treatment or (b) avoid adverse tax treatment under U.S. or foreign law, including, without limitation, Section 409A.

[signature page follows]

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IN WITNESS WHEREOF, the Company and the Participant have executed this Agreement as of the date first written above.

FLEXENERGY GREEN SOLUTIONS, INC.: PARTICIPANT:

By:
	Mark Schnepel, Chief Executive Officer	[●]

[Signature Page to Restricted Stock Unit Award Agreement]

FLEXENERGY GREEN SOLUTIONS, INC.

AMENDMENT NO. 1 TO
FLEXENERGY GREEN SOLUTIONS, INC. 2021 INCENTIVE AWARD PLAN

THIS AMENDMENT NO. 1 (this “Amendment”) to the FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan (the “Plan”) of FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), is effective as of December ___, 2021 (the “Effective Date”). Capitalized terms used but not defined in this Amendment have the meanings given in the Plan.

WHEREAS, the Company previously adopted the Plan, which had been approved by the board of directors and stockholders of the Company, under which the Company is authorized to grant Awards to directors, officers, employees, consultants and advisors of the Company; and

WHEREAS, the Board has determined that it is in the best interests of the Company and its stockholders to amend the Plan to increase the aggregate amount of Common Shares deliverable under the Plan from 1,585,767 to 1,651,431.

NOW, THEREFORE, the Plan is hereby amended as follows:

1.       Effective as of the Effective Date, Section 5(b) of the Plan is hereby amended to delete “1,585,767 Common Shares” therefrom and replace it with “1,651,431 Common Shares”.

2.       Effective as of the Effective Date, Section 7(a) of the Plan is hereby amended to delete “1,585,767 Common Shares” therefrom and replace it with “1,651,431 Common Shares”.

3.       In all other respects, the Plan, as amended by this Amendment, is hereby ratified and confirmed and shall remain in full force and effect.

IN WITNESS WHEREOF, the Company has executed this Amendment as of the Effective Date.

FlexEnergy Green Solutions, Inc.

By:

Name:

Title:

EX-10.4

Exhibit 10.4

FLEXENERGY GREEN SOLUTIONS, INC.

BOARD CHAIRPERSON COMPENSATION AGREEMENT

This Board Chairperson Compensation Agreement (this “Agreement”), dated as of December 13, 2021 is entered into by and between FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Company”), and George P. Walker (“Director”).

WHEREAS, the Company and its board of directors (the “Board”) desire for Director to serve the Company as a director, the Chairperson of the Board of Directors and the Chairperson of the Company’s audit committee, compensation committee and nominating and corporate governance committee.

NOW THEREFORE in consideration of the mutual benefits to be derived from this Agreement, the Company and Director hereby agree as follows:

1.Director Duties. Director agrees to serve as a director of the Company, the Chairperson of the Company’s Board of Directors, and the Chairperson of the Company’s Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, until Director’s successor is duly elected and qualified or until Director’s earlier death, resignation, retirement, disqualification or removal.

2.Compensation and Benefits. For so long as Director serves as the Chairperson of the Company’s Board of Directors, and the Chairperson of the Company’s Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee, Director shall be compensated as follows:

(a)Retainer Fees. Director shall be entitled to receive an initial retainer fee of $93,750 paid by December 15, 2021, and quarterly retainer fees of $31,250 by the end of each calendar quarter (the “Quarterly Fee”), commencing with an initial Quarterly Fee paid by December 31, 2021. These retainer fees are in lieu of, and Director shall not be entitled to any other, cash retainer or meeting fees payable to other members of the Board. The Quarterly Fee shall be paid at the end of each calendar quarter during which Director serves the Company in the capacities described in Section 1; provided however, that the final Quarterly Fee shall be prorated based on the portion of such calendar quarter during which Director serves the Company in the capacities described in Section 1.

(b)Reimbursement of Expenses. The Company shall pay or reimburse Director for all travel, business and entertainment expenses incurred by and reasonably necessary for Director to perform Director’s duties for the Company in accordance with such policies and procedures as the Company may from time to time and subject to the Company’s normal requirements with respect to reporting and documentation of such expenses.

(c)Incentive Award Plan Eligibility. Director shall be eligible to participate in, and receive one or more grants under, the FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan. Any such awards and the terms and conditions thereof shall be subject to the discretion of the Board and set forth in award documentation as the Board deems reasonably necessary in connection with any such award.

(d)No Withholding. In Director’s service to the Company pursuant to this Agreement, Director shall not be an employee of the Company. The Company shall report compensation paid hereunder consistent with the foregoing and Director shall be liable for all taxes associated herewith.

(e)Additional Benefits. The Company shall also provide Director with other benefits provided from time to time to its other directors, including directors’ and officers’ insurance coverage and director indemnification rights.

3.Termination. At any time, Director may be removed as Chairperson and/or as a director as provided in Company’s certificate of incorporation, bylaws and applicable law. Director may resign as Chairperson and/or as director as provided in Company’s certificate of incorporation, bylaws and applicable law. Notwithstanding anything to the contrary contained in or arising from this Agreement or any statements, policies, or practices of Company, neither Director nor Company shall be required to provide any advance notice or any reason or cause for termination of Director’s status as Chairperson or a director, except as provided in Company’s certificate of incorporation, bylaws and applicable law.

4.Entire Agreement; Amendment. This Agreement contains the entire agreement between the Company and Director with respect to the subject matter hereof. This Agreement may not be amended, waived, changed, modified or discharged except by an instrument in writing executed by or on behalf of the party against whom enforcement of any amendment, waiver, change, modification or discharge is sought. No course of conduct or dealing shall be construed to modify, amend or otherwise affect any of the provisions hereof.

5.Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered in person, delivered by express mail or other expedited service or upon receipt if mailed, postage prepaid, via registered mail, return receipt requested.

6.Assignability. This Agreement shall not be assignable by either party and shall be binding upon, and shall inure to the benefit of, the heirs, executors, administrators, legal representatives, successors and assigns of the parties. Any successor to the Company (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company’s business and/or assets shall assume this Agreement and agree expressly to perform this Agreement in the same manner and to the same extent as the Company would be required to perform it in the absence of a succession. For all purposes under this Agreement, the term “Company” shall include any successor to the Company’s business and/or assets that executes and delivers the assumption agreement described in this Section 6 or which becomes bound by this Agreement by operation of law.

7.Governing Law. This Agreement shall be governed by and construed under the laws of the State of Delaware without regard to conflict of laws principles that would otherwise result in the application of the laws of any jurisdiction other than the State of Delaware.

8.Waiver and Further Agreement. Any waiver of any breach of any terms or conditions of this Agreement shall not operate as a waiver of any other breach of such terms or conditions or any other term or condition, nor shall any failure to enforce any provision hereof operate as a waiver of such provision or of any other provision hereof. Each of the parties hereto agrees to execute all such further instruments and documents and to take all such further action as the other party may reasonably require in order to effectuate the terms and purposes of this Agreement.

9.Headings of No Effect. The Section headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.

10.Counterparts. This Agreement may be executed in two or more counterparts, and with counterpart signature pages, all of which together shall for all purposes constitute one Agreement. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in “portable document format” (“.pdf”) form, or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

[SIGNATURES ON FOLLOWING PAGE]

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

COMPANY:
FlexEnergy Green Solutions, Inc.
By:	/s/ Mark G. Schnepel
Name:	Mark G. Schnepel
Title:	Chief Executive Officer
DIRECTOR:
/s/ George P. Walker
George P. Walker

EX-10.5

Exhibit 10.5

FLEXENERGY ENERGY SYSTEMS, INC.

EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (this “Agreement”) is entered by and between FlexEnergy Energy Systems, Inc., a Delaware corporation (the “Company”), and Mark G. Schnepel (“Executive”).

1.Duties and Scope of Employment.

(a)Title and Duties. As of the Effective Date (as defined in Section 3 below), Executive will be employed and serve as President and Chief Executive Officer of the Company. During the Employment Term, and without any additional compensation in connection with such service, Executive shall also serve as an officer of such affiliates of the Company as the Board may determine from time to time. During the Employment Term (as defined in Section 3 below), Executive will have authority and render such business and professional services in the performance of Executive’s duties as are customarily associated with Executive’s position(s) provided above, and Executive agrees to perform such other duties and functions as may from time to time be reasonably determined by the Board. The “Board” means (i) the board of directors of FlexEnergy Green Solutions, Inc. (“FGS”) if the Company is a direct or indirect subsidiary of FGS; or (ii) the board of directors or analogous governing body of the Company if the Company is not a direct or indirect subsidiary of FGS.

(b)Obligations. During the Employment Term, and excluding any periods of vacation, sick leave, or other leave to which the Executive is entitled, Executive will perform Executive’s duties faithfully and to the best of Executive’s ability and will devote such time as reasonably necessary to fulfill Executive’s responsibilities in the position. Executive and the Company agree that the Company represents Executive’s principal business focus. Except as may otherwise be approved by the Company from time to time, Executive’s services shall be primarily performed at the Company’s office at Portsmouth, New Hampshire, or other locations less than 50 miles from such location determined by the Company. Executive agrees to travel as reasonably necessary to fulfill Executive’s responsibilities in the position. During the Employment Term, Executive agrees that Executive shall maintain loyalty to the Company, shall take no action that would be injurious to the Company interests, and shall comply with all rules, regulations and policies of the Company. During the Employment Term, it shall not be a violation of this Agreement for Executive to (i) serve on up to two (2) civic or charitable boards or committees (and other board and committees from time to time as approved by the Board), (ii) deliver lectures, fulfill speaking engagements or teach at educational institutions, or (iii) manage personal investments and business endeavors, so long as such activities do not significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with this Agreement.

(c)Executive’s Employability. Executive represents and warrants that: (i) Executive has the right to execute, deliver and perform Executive’s duties under this Agreement, and (ii) Executive is not a party to any other agreements, arrangements or obligations (e.g., confidentiality agreements, noncompetition agreements), whether written, oral or implied, which include terms that would limit Executive’s ability to execute, deliver and perform Executive’s duties under this Agreement or which are otherwise inconsistent with this Agreement. This warranty will remain in full force and effect throughout the Employment Term (as defined in Section 3 below).

2.Compensation.

(a)Base Salary. During the Employment Term, the Company will pay Executive as compensation for Executive’s services a base salary at rate of $24,625.00 per month (the “Base Salary”). The Base Salary will be paid in regular installments in accordance with the Company’s normal payroll practices, subject to applicable deductions and withholdings. The first and last payment will be adjusted, if necessary, to reflect a commencement or termination date other than the first or last working day of a pay period.

(b)Annual Bonus. Executive shall be eligible for an annual bonus (collectively the “Annual Bonus”) during the Employment Term in a target amount equal to 50% of Base Salary, to be earned based on such targets, criteria, terms and conditions as be determined by the Board (or a duly authorized committee thereof) in its sole discretion, subject to the terms of this Agreement. Any such Annual Bonus (i) will only be determined and awarded after the completion of the audited financial statements for FGS with respect to the applicable annual period for which the Annual Bonus is to be earned; (ii) will only be awarded and paid if both (A) Executive remains employed with the Company during the full annual period for which the Annual Bonus is to be earned and (B) (I) Executive remains employed with the Company through the award and payment of the Annual Bonus or (II) subject to Section 4(b), Executive’s employment with the Company is terminated by the Company without Cause between the last day of the annual period for which the Annual Bonus is to be earned and the date on which the Annual Bonus would otherwise be paid; and (iii) will be paid as soon as practicable, but not later than 45 days, after the completion and public release of audited financial statements for FGS with respect to the applicable annual period for which the Annual Bonus is earned.

(c)Equity Incentives.

(i)Incentive Award Plan Eligibility. Executive shall be eligible to participate in, and receive one or more grants under, the FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan (the “Incentive Plan”). Any such awards and the terms and conditions thereof shall be subject to the discretion of the board of directors of FGS and set forth in award documentation as such board of directors deems reasonably necessary in connection with any such award.

(ii)Issuance of Shares One Year After IPO. The Company agrees to cause the issuance to Executive under the Incentive Plan (pursuant to then-current forms of award agreement under the Incentive Plan), after the one (1) year anniversary of the IPO (as defined in Section 3 below), of an amount of shares of common stock of FGS equal to 1.2% of the total number of shares initially available under the Plan if (A) Executive remains employed by the Company throughout the one (1)-year period immediately following the IPO, (B) Executive is terminated by the Company without Cause (defined below) during one (1)-year period immediately following the IPO, or (C) Executive terminates this Agreement for Good Reason.  For the avoidance of doubt, no shares will be issued to Executive if Executive fails to remain employed by the Company during the one (1)-year period immediately following the IPO under any other circumstances (ex. resignation by Executive without Good Reason, termination by the Company for Cause).

(iii)Initial Stock Option Award. Without limiting Sections 2(c)(i) or 2(c)(ii) above, the Company will recommend to the FGS board of directors that Executive receive a stock option award to purchase, (A) at an exercise price determined by the FGS board of directors in accordance with the requirements of the Incentive Plan, (B) (I) shares of common stock of FGS in an amount equal to 2% of the total number of shares initially available under the Plan, to be initially vested and exercisable upon grant, and (II) shares of common stock of FGS in an amount equal to 8% of the total number of shares initially available under the Plan, to vest and become exercisable over a four (4)-year period with 25% vesting on each anniversary of the IPO (defined below) subject to Executive’s continuous service through the applicable anniversary, (C) not subject to any adjustment pursuant to Section 12 of the Incentive Plan, without Executive’s written consent, that would reduce the number of shares subject to the stock option or increase the exercise price applicable to the stock option (except to provide equitable adjustment with respect to a reverse stock split or other event specified in Section 12(i) of the Incentive Plan having a substantively similar effect on the outstanding capital of FGS), and (D) otherwise subject to the general terms and conditions of the Incentive Plan. Notwithstanding the foregoing, it is hereby acknowledged and agreed that no stock option award to Executive has been approved by the FGS board of directors, and Executive has no right to receive (and neither the Company nor FGS has any obligation to issue) any stock option award unless and until the FGS board of directors has actually approved any such stock option award and the full terms thereof (including the applicable exercise price).

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(d)Expense Reimbursement. During the Employment Term, the Executive shall be entitled to reimbursement of reasonable out-of-pocket business expenses incurred by Executive in furtherance of Company’s business in accordance with Company’s policies with respect thereto as in effect from time to time (the “Expense Reimbursement”). All reimbursements provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A including, where applicable, the requirement that (i) any reimbursement is for expenses incurred during Executive’s lifetime (or during a shorter period of time specified in this Agreement); (ii) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year; (iii) the reimbursement of an eligible expense shall be made no later than the last day of the calendar year following the year in which the expense is incurred; and (iv) the right to reimbursement or in kind benefits is not subject to liquidation or exchange for another benefit.

(e)Vacation. Executive shall be entitled to a minimum of three (3) weeks paid vacation per year, in accordance with the Company’s standard vacation policy.

(f)Employee Benefits. During the Employment Term, Executive will be considered a full-time employee and be entitled to participate in the employee benefit plans and programs currently and hereafter maintained by the Company of general applicability to other Employees of Executive’s classification at the Company (the “Benefits”). The Company reserves the right to cancel or change the Benefit plans and programs it offers to its employees at any time. In the event of any dispute between this Agreement and the terms of any Benefit summary plan description, the terms of the summary plan description shall control.

3.Effective Date; Term of Employment.

(a)Employment Term; Effective Date. The “Employment Term” under this Agreement will commence on the Effective Date and will continue until the Executive’s employment terminated by either the Company or Executive as provided in Section 3(b) of this Agreement. This Agreement shall only become a legally effective agreement binding on Executive and the Company on the closing date (the “Effective Date”) of an initial public offering of the common stock of FGS pursuant to a registration statement filed under the Securities Act of 1933, as amended (an “IPO”). If an IPO does not close on or before January 31, 2022, then this Agreement shall thereafter be void and no legal force or effect.

(b)Termination. Notwithstanding anything else contained in this Agreement, Executive’s employment hereunder shall terminate upon the earliest to occur of the following:

(i)Death. Immediately upon Executive’s death.

(ii)Termination by Executive.

(1)Generally. If terminated by Executive without Good Reason, upon written notice by Executive to the Board that Executive is terminating employment (a “Resignation Notice”), which termination shall be effective 60 days after the date of such notice, or such earlier date as specified in writing by the Company in its sole discretion during such 60-day period; or

(2)For Good Reason. If terminated by Executive for Good Reason, upon written notice by Executive to Company that Executive is terminating Executive’s employment for Good Reason and that sets forth the factual basis supporting the Good Reason, which termination shall be effective 30 days after the date of such notice, or such earlier date as specified in writing by the Company in its sole discretion during such 30-day period. For the avoidance of doubt, such termination shall not constitute a termination for Good Reason if Company cures the conditions identified in Executive’s notice as provided in Section 3(d)(iii).

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(iii)Termination by the Company.

(1)For Cause. If terminated by the Company for Cause (defined below), upon written notice by the Company to Executive that Executive’s employment is being terminated for Cause, which termination shall be effective on the date of such notice or such later date as specified in writing by the Company;

(2)Without Cause or Disability. If terminated by the Company for reasons other than for Cause or Disability, upon written notice by Company to Executive that Executive’s employment is being terminated, which termination shall be effective immediately after the date of such notice or such later date as specified in writing by the Company; or

(3)For Disability. If terminated by the Company because of Executive’s Disability (defined below), upon written notice by the Company to Executive that Executive’s employment is being terminated as a result of Executive’s Disability, which termination shall be effective 30 days after the date of such notice or such later date as specified in writing by the Company, unless within such period Executive becomes capable of rendering services of the character contemplated hereby (and a physician chosen by the Company so certifies in writing) and Executive in fact resumes such services.

(c)Deemed Termination for Cause. Notwithstanding anything in this Agreement to the contrary, if (i) the Company at any time determines that Cause existed at the time of Executive’s termination or written notice thereof, (ii) Executive has breached or breaches the terms of Section 5, then upon written notice by the Company to Executive (i) the Executive’s termination shall be deemed be (or have been) terminated by the Company for Cause pursuant to Section 3(b)(iii)(1) (including for purposes of Section 4 and Section 6(g)(ii)(1)), (ii) the Company may immediately cease payments of any Basic Severance Payments and/or any Extended Severance Payments that may otherwise be due to Executive, and (iii) the Company may recover from Executive any Basic Severance Payments and/or any Extended Severance Payments that may have already been paid to Executive. The cessation and recovery of such any payments shall be in addition to, and not as an alternative to, any other remedies at law or in equity available to the Company with respect to the matters constituting Cause, including, without limitation, the right to specific performance and/or injunctive or other relief.

(d)Certain Definitions.

(i)Definition of Cause. For purposes of this Agreement, “Cause” means any of the following: (A) conviction of, or the entry of a plea of guilty or no contest to, a felony, a crime of moral turpitude, or any other crime that causes the Company public disgrace or disrepute, or which materially and adversely affects the Company’s operations or financial performance or the relationship the Company has with its customers; (B) gross negligence or willful misconduct with respect to the Company, including, without limitation fraud, embezzlement, theft or proven dishonesty in the course of Executive’s employment or other service; (C) alcohol abuse or use of either illegal drugs or controlled drugs (other than in accordance with a physician’s prescription); (D) refusal to perform any lawful, material obligation or fulfill any duty (other than any duty or obligation of the type described in clause (F) below) to the Company (other than due to a disability, as determined by the Committee), which refusal, if curable, is not cured within 15 days after delivery of written notice thereof (and for the avoidance of doubt, the relevant refused obligation or duty will be specifically identified in such written notice); (E) material breach of any agreement with or duty owed to the Company, which breach, if curable, is not cured within 15 days after the delivery of written notice thereof (and for the avoidance of doubt, if applicable, the relevant breached duty will be specifically identified in such written notice); (F) any breach of any obligation or duty to the Company (whether arising by statute, common law or agreement) relating to confidentiality, non-competition, non-solicitation, trade secrets, and/or proprietary rights; (G) material violation of the Company’s written policies or codes of conduct, including those related to discrimination, harassment, performance of illegal or unethical practices, and ethical misconduct; or (H) in the case of a director, repeated failure to participate in Board meetings (including meetings of any Board committee of which the director is a member) on a regular basis despite having received proper notice of meetings in advance.

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(ii)Definition of Disability. For purposes of this Agreement, “Disability” means Executive’s inability to perform one or more of the essential functions of Executive’s job due to Executive’s physical or mental impairment, with or without reasonable accommodation as required by law, for any period aggregating more than 120 days in any 365 consecutive day period; provided however, that (A) if the Company determines that Executive has become Disabled, the Company shall notify Executive of its determination; (B) Executive may then request a reasonable accommodation (as that term is defined under the Americans with Disabilities Act) from the Company to assist in his/her return to work; (C) the Company will determine whether Executive’s request can be reasonably accommodated without undue hardship no later than 30 days after Executive requests an accommodation (with additional time being provided in the event of Executive or Executive’s medical provider delaying in providing information that is necessary to the Company’s determination); and (D) in the event Executive’s request cannot be reasonably accommodated (and/or presents an undue hardship), the Company may, by notice given in the manner provided in this Agreement, terminate Executive’s employment hereunder.

(iii)Definition of Good Reason. For purposes of this Agreement, “Good Reason” means any of the following within the prior 90 days without Executive’s approval: (A) any material diminution of Executive’s authority, duties or responsibilities with or to the Company, other than (i) a paid leave of absence at the direction of and approved by the Board or (ii) an unpaid administrative leave imposed for the purposes of investigating or addressing misconduct by Executive; (B) the Board assigns Executive duties or responsibilities that are materially inconsistent with Executive’s position; (C) any material breach of this Agreement by the Company, including, without limitation, a reduction in Executive’s Base Salary below the amount specified in Section 2(a) without Executive’s consent; or (D) a change in the geographic location at which Executive must primarily perform services to a location more than 50 miles from Portsmouth, New Hampshire without Executive’s approval. Executive must give the Company written notice of Executive’s intention to terminate employment for Good Reason, which notice must state the grounds on which the proposed termination for Good Reason is based. Executive must provide such written notice of the occurrence of these grounds no later than 90 days after their initial occurrence. The Company may remedy these condition(s) within 15 days of receiving notice from Executive and no “Good Reason” will exist if the Company remedies such condition(s) during such 15-day period.

(iv)Definition of Change in Control Period. For purposes of this Agreement, a “Change in Control Period ” means the one (1)-year period commencing six (6)-months prior to a Change in Control (as defined in the Incentive Plan).

(e)Transition Assistance. For a period of 30 days following the effective date of Executive’s resignation, Executive shall make himself or herself available to the Company and/or its agents (i) for the purpose of facilitating an efficient transition of Executive’s job related responsibilities and duties to other designated individuals, and (ii) to respond to questions from the Company and/or its agents regarding information and/or activities in which Executive was engaged while employed by the Company; provided that the foregoing time period is based on Executive’s reasonable efforts to cooperate, Executive will not be entitled to additional compensation for such availability and cooperation; and further provided that such assistance shall be reasonable and not substantially interfere or conflict with Executive’s responsibilities to any new employer.

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4.Payments upon Termination.

(a) Generally; Accrued Obligations. If Executive’s employment is terminated for any reason, then the Company shall pay Executive the Accrued Obligations promptly following the effective date of such termination. “Accrued Obligations” means (A) the portion of Executive’s Base Salary that has accrued prior to any termination of Executive’s employment with Company and has not yet been paid, any bonus that has been awarded to Executive as of the date of termination of Executive’s employment but has not yet been paid to Executive, (B) and the amount of any unreimbursed Expense Reimbursement. Executive’s entitlement to any other compensation or benefit under any plan of Company shall be governed by and determined in accordance with the terms of such plans, except as otherwise specified in this Agreement.

(b)Termination by the Company without Cause or Termination for Good Reason. If the Company terminates Executive’s employment without Cause or the Executive terminates Executive’s employment for Good Reason, then, in addition to the Accrued Obligations, and subject to (A) the Executive signing a separation and release agreement in the form attached as Exhibit A, and as such form may be updated by the Company from time to time at any time to conform with changes in applicable laws (a “General Release”) and (B) the General Release becoming effective and irrevocable, all within 60 days after the date of termination (or such shorter period as set forth in the General Release), the Company shall pay Executive:

(i)the Basic Severance Payments, or

(ii)if the Board, in its sole discretion, elects (by written notice to Executive within 10 days following the termination of Executive’s employment) that the Company will pay Extended Severance Payments to Executive instead of the Basic Severance Payments pursuant to Section 4(b)(i), the Extended Severance Payments (instead of the Basic Severance Payments); and

if applicable pursuant to Section 2(b), an Annual Bonus with respect to the preceding annual period.

(c)Terminations without Cause during a Change in Control Period. If the Company terminates Executive’s employment without Cause during a Change in Control Period, then, in addition to the Accrued Obligations, and subject to (i) the Executive signing a General Release and (ii) the General Release becoming effective and irrevocable, all within 60 days after the date of termination (or such shorter period as set forth in the General Release), the Company shall pay Executive the Extended Severance Payments.

(d)COBRA Premiums.

(i)Subject to Section 4(d)(ii), if (A) Executive is entitled to Basic Severance Payments or Extended Severance Payments (including, without limitation, Executive’s timely execution and delivery of a General Release that has become effective and irrevocable), and (B) Executive is eligible for and timely and properly elects continuation health care coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), then the Company will pay or promptly reimburse the COBRA premium amounts required for the continued coverage of Executive and Executive’s dependents (if any) under the Company’s group health care plans at the same levels that would have applied if Executive’s employment had not terminated (if possible) until the end of the Basic Severance Term or Extended Severance Term, as applicable (or until such earlier time as Executive ceases to be eligible for COBRA coverage, if earlier) (the “COBRA Premiums”). Notwithstanding the foregoing, if the Company determines, in its sole discretion, that it cannot pay the COBRA Premium without a substantial risk of violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company instead shall pay Executive a monthly cash payment equal to the applicable COBRA Premium for that month.

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(ii) If, however, health care insurance benefits are available to Executive from a new employer, the Company shall have no further obligation relating to payment of additional COBRA Premiums. Executive agrees to promptly inform the Company if and when health care insurance benefits are available from a new employer, and to reimburse the Company for any amounts paid with respect to COBRA Premiums to the extent paid after health care insurance benefits are available to Executive from a new employer.

(e)Certain Definitions.

(i)Basic Severance Payments; Basic Severance Term. For purposes of this Agreement, “Basic Severance Payments” means, to the extent applicable, the monthly cash severance at the Base Salary rate, less standard withholdings and deductions, to be paid during the Basic Severance Term. For purposes of this Agreement, “Basic Severance Term” means the six (6)-month period immediately following the termination date of Executive’s employment.

(ii)Extended Severance Payments; Extended Severance Term. For purposes of this Agreement, “Extended Severance Payments” means, to the extent applicable, the monthly cash severance at the Base Salary rate, less standard withholdings and deductions, to be paid during the applicable Extended Severance Term. For purposes of this Agreement, “Extended Severance Term” means the one (1)-year period immediately following the termination date of Executive’s employment.

(f)Execution of General Release. For the avoidance of doubt, the Company shall not be obligated to pay Executive any severance payments unless a General Release has been timely executed and delivered by Executive and such General Release has become effective and irrevocable.

(g)Limited Rights to Severance Payments. For clarity, (i) entitlement to severance payments of any kind pursuant to this Agreement shall only be possible if (A) the Company terminates Executive’s employment without Cause, or (B) Executive terminates this Agreement for Good Reason; and (ii) no severance payment obligations shall arise out of (W) a termination of this Agreement by the Company with Cause, (X) a termination of this Agreement by the Executive without Good Reason, or (Y) a termination of this Agreement due to Executive’s death or Disability.

(h)No Continued Vesting. For the avoidance of doubt, vesting of any grants under the Incentive Plan or any other stock, stock option or other incentive awards shall cease upon the date of any termination of Executive’s employment, and shall not continue to vest for the remainder of any Noncompetition Period, Non-Solicitation Period or during any applicable Basic Severance Term or Extended Severance Term.

(i)Execution of General Release. In accordance with Section 4(b), Section 4(c) and Section 4(d), to receive the payments set forth in those Sections, Executive’s or Executive’s estate’s, if applicable, General Release must be executed, effective and irrevocable before the expiration of 60 days after the date of termination. The payments specified in these Sections will begin as soon as practicable (not to exceed 30 days) after the General Release is executed, effective and irrevocable, but if the 60-day period could span two (2) tax years, the payments must be made in the later year. For example, if the Company terminates Executive’s employment without Cause on December 15, Executive has 60 days—until February 13 —for a General Release to be sign and become effective and irrevocable. In this case, payments due in accordance with Section 4(b), Section 4(c) or Section 4(d) may not begin until the following year, even if the release was signed, effective and irrevocable in December. If Executive’s or Executive’s estate’s, if applicable, General Release is not executed, effective and irrevocable before the end of the 60-day-period, then the Executive and Executive’s estate forfeit, on behalf of Executive and all who might claim through Executive, the payments that would otherwise be due under the applicable Section of this Agreement.

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5. Confidentiality and Invention Assignment Agreement. Executive has executed, and as applicable shall execute, the Company’s Confidentiality and Invention Assignment Agreement, the current form of is attached as Exhibit B, and as updated from time to time (“CIIA”), the provisions of which are hereby incorporated by reference and shall govern the Executive’s obligations and responsibilities with regard to the Company Confidential Information (as that term is defined in the CIIA), the assignment of intellectual property, and other matters. Executive agrees to comply with the terms of the CIIA. To the extent that any provision of the CIIA conflicts with any provision in this Agreement, the provisions requiring Executive to comply with the higher standard shall govern.

6.Restrictive Covenants.

(a)Acknowledgement. Executive agrees that, during the Employment Term, Executive (i) has a duty of loyalty to the Company, and (ii) shall not engage in or undertake any action that conflicts with the undivided loyalty owed by Executive to the Company. Executive represents and warrants that Executive has no other agreements, relationships, or commitments to any other person or entity that conflict with the provisions of this Agreement, Executive’s obligations to the Company under this Agreement, or Executive’s ability to perform Executive’s duties to the Company. Executive acknowledges and agrees that: (A) Executive’s employment with the Company has brought Executive into close contact with Confidential Information of the Company and its customers, vendors, suppliers, employees, and independent contractors; and (B) the agreements and covenants contained in this Section 6 are essential, reasonable, and no broader than necessary to protect the reasonable business interests and goodwill of the Company. Executive further acknowledges, represents, and agrees that the terms of this Section 6 do not and will not pose an undue hardship on Executive, and that Executive will be able to maintain gainful employment notwithstanding the terms of this Section 6. Executive further acknowledges, represents, and agrees that he/she has received valuable consideration (including, but not limited to, a payment of five hundred dollars ($500.00) that is expressly for the purposes of serving as consideration for this Section 6) that is sufficient to support the promises being made by Executive herein. Accordingly, Executive covenants and agrees to the following restrictive covenants.

(b)Non-Solicitation of Company Employees and Contractors. Executive agrees that during the Non-Solicitation Period (defined below), Executive shall not directly or indirectly (i) hire, employ, recruit, solicit, lure or entice away, or in any other manner persuade or attempt to persuade, any employee of the Company to discontinue such employee’s employment with the Company or (ii) solicit or encourage any independent contractor providing services to the Company to terminate or diminish its relationship with the Company; provided, that, the foregoing shall not be breached by general advertisements not targeted at employees or independent contractors of the Company.

(c)Non-Solicitation of Company Customers. Executive agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly (i) solicit or assist in the solicitation by any third party of any Covered Customer (defined below) for the purpose of providing services or products that compete with, or are similar to, the service or product offerings of the Company, except when such solicitation is done on behalf of the Company, or (ii) discourage any Covered Customer from obtaining of services or products from the Company.

(d)Non-Interference with Vendors and Service Providers. Executive agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly negatively influence or otherwise interfere with the Company’s relationships with vendors, suppliers, consultants, advisors, or other service providers of the Company.

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(e)Non-Competition with the Company. Executive agrees that, during the Non-Competition Period, Executive shall not directly or indirectly, as a director, manager, member, stockholder, partner, owner, employee, consultant, or agent of any business, or in any other capacity, other than on behalf of the Company, organize, establish, own, operate, manage, control, engage in, participate in, invest in, permit Executive’s name to be used by, act as a consultant or advisor to, render services for (alone or in association with any person, firm, corporation, or other entity), or otherwise assist any person or entity that engages in or owns, invests in, operates, manages, or controls any venture or enterprise in all or a part of the Restricted Area, that engages in (A) the manufacture, sale, lease, service or other manner of offering of products or services that provide natural gas or hydrogen fueled distributed power generation with a single unit nameplate capacity of up to 5MW (which excludes, for the avoidance of doubt, the manufacture, sale, lease, service or other manner of offering of batteries, solar or wind powered energy generation equipment, or electrochemical (non-combustion) powered fuel cells), (B) the manufacture, sale, lease, service or other manner of offering of heat exchanger/transfer products that can operate with gases at a temperature above 1000° Fahrenheit or (C) any other new line of business, products or services offered or in development by FGS or any direct or indirect subsidiary thereof during the prior six months of the Employment Term and in which Executive has had material involvement (the “Restricted Business”). Notwithstanding the foregoing, nothing in this Agreement shall prevent Executive from owning, directly or indirectly, for passive investment purposes not intended to circumvent this Agreement, less than 2% of the publicly traded common equity securities of any company engaged in the Business (so long as Executive has no power to manage, operate, advise, consult with, or control the competing enterprise and no power, alone or in conjunction with other affiliated parties, to select a director, manager, general partner, or similar governing official of the competing enterprise other than in connection with the normal and customary voting powers afforded Executive in connection with any permissible equity ownership).

(f)Non-Disparagement. Executive also agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly (i) disparage the Company, its affiliates and their respective directors, officers, managers, managers, employees, or agents, or (ii) make any public statement that could reasonably be expected to materially and adversely affects the reputation, brand, or business of the Company. This provision does not apply to any statements made to governmental agencies for the purposes of asserting, or participating in any investigation by such agencies concerning, Executive’s statutory rights. In the event of a termination of Executive’s employment (other than a termination for Cause, including pursuant to Section 3(c)), subject to a General Release for Executive being signed, delivered, effective and irrevocable, and further subject to Executive’s compliance and continuing compliance with Executive’s continuing obligations of this Agreement (including this Section 6), then the Company shall cause the FGS board of directors and FGS executive officers (while such individuals serve in such capacities) not to disparage Executive during the remainder of the Non-Solicitation Period. This provision does not apply to any statements or other disclosures by the Company, the FGS board of directors or FGS executive officers for the purpose of or necessary for compliance with federal or state securities laws, as well as rules of any securities exchange on which any securities of the Company, including FGS, are then traded.

(g)Certain Defined Terms. The following terms, when used in this Section 6, will have the respective meanings set forth below:

(i)“Restricted Area” means the area within the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided however if any court of competent jurisdiction determines that the geographic scope of such Restricted Area is unreasonable, the “Restricted Area” means with respect to the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company, the area within each state or territory thereof for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided however if any court of competent jurisdiction determines that the geographic scope of such Restricted Area is unreasonable, the “Restricted Area” means with respect to the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company, the area within each county or similar jurisdiction thereof for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided, however if any court of competent jurisdiction determines that the geographic scope of such Applicable Area is unenforceable, the “Restricted Area” means within 50 miles of any location at which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company.

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(ii)“Non-Competition Period” means:

(1)the period during Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company if Executive’s employment (A) is terminated by the Company for Cause, (B) is terminated by the Company without Cause during a Change in Control Period, or (C) is terminated by Executive other than for Good Reason.

(2)the period during Executive’s employment with the Company and for the six (6)-month period after the end of Executive’s employment with the Company if Executive’s employment is terminated in any circumstances not provided in Section 6(g)(ii)(1)(A), (B) or (C) above; provided, however, that the Board may, in its sole discretion, elect (by written notice to Executive within 10 days following the termination of Executive’s employment) that the Company will pay Extended Severance Payments to Executive (instead of any Basic Severance Payments), in which case the “Non-Competition Period” instead means the period during the Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company.

(iii)“Non-Solicitation Period” means the period during Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company.

(iv)“Company” includes the Company and any of the Company’s affiliates.

(v)“Covered Customers” means persons; firms; associations; partnerships; corporations; limited liability companies; institutions, local, state, federal and foreign entities or agencies; and other entities (A) to which the Company provided services or products before or during Executive’s employment with the Company, (B) in relation to which Executive has provided any of the Services, or (C) that the Company (or Executive in connection with the Services) has contacted or solicited with respect to the provision of services or products before or during Executive’s employment with the Company.

(vi)An “employee” or “independent contractor” of the Company is any person who is an employee or independent contractor, respectively, of any of the Company on the date hereof or who becomes an employee or independent contractor of the Company during Executive’s employment with the Company.

(h)Remedies. If Executive breaches any of the provisions contained in this Section 6, the Company shall have the remedies set forth below, each of which shall be enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to the Company at law or in equity. The provisions of this Section 6 are intended to be for the benefit of the Company and its affiliates, and any of the Company or its affiliate may enforce such provisions. Executive recognizes and acknowledges that a breach of the covenants contained in this Section 6 will cause irreparable harm to the goodwill and business of the Company, the exact amount of which will be difficult to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, in the event of an alleged or threatened breach by Executive of any of the provisions of this Section 6, the Company may, in addition to all other rights and remedies existing in its favor, seek specific performance and/or injunctive or other relief in order to enforce or prevent any violations of the provisions hereof. Additionally, if Executive breaches Executive’s obligations under Section 5 or Section 6, then the Company may immediately cease payments of any Basic Severance Payments and/or any Extended Severance Payments and may recover any Basic Severance Payments and/or any Extended Severance Payments paid to Executive after such breach. The cessation and recovery of such payments shall be in addition to, and not as an alternative to, any other remedies at law or in equity available to the Company including, without limitation, the right to specific performance and/or injunctive or other relief.

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(i)Severability. In the event any provision of this Section 6 shall be determined by a court of competent jurisdiction to be unenforceable by reason of its extending for too great a period of time or over too great a geographical area or by reason of its being too extensive in any other respect, it will be interpreted to extend only over the maximum period of time for which it may be enforceable, over the maximum geographical area as to which it may be enforceable, or to the maximum extent in all other respects as to which it may be enforceable, all as determined by such court in such action. If any provision of this Agreement, or any part thereof, is held to be invalid or unenforceable because of the scope or duration of or the area covered by such provision, the parties agree that the court making such determination shall reduce the scope, duration and/or area of such provision (and shall substitute appropriate provisions for any such invalid or unenforceable provisions) in order to make such provision enforceable to the fullest extent permitted by law and/or shall delete specific words and phrases, and such modified provision shall then be enforceable and shall be enforced. In the event that any court determines that the time period or the area, or both, are unreasonable and that any of the covenants is to that extent invalid or unenforceable, the parties agree that such covenants will remain in full force and effect, first, for the greatest time period, and second, in the greatest geographical area that would not render them unenforceable.

(j)Enforceability. The Parties each acknowledge that the other party acted in good faith in the negotiation and execution of the provisions in this Section 6. In particular, the Parties acknowledge that given the nature of Executive’s duties and responsibilities (and Executive’s associated influence over the Company’s business and its relationships with its customers), the restrictions and duration of the obligations set forth in this Section 6 are reasonable and no broader than necessary to protect the legitimate business interests of the Company and the goodwill thereof. Executive further acknowledges that the restrictions and duration of this Section 6 do not and will not impose an unreasonable hardship upon Executive. The Parties further agree that the requirements of this Section 6 shall survive the termination of Executive’s employment with the Company.

(k)Waiver or Inapplicability of Non-Competition Obligations. Executive may submit to the Board a written description setting out a reasonable description (including without limitation the identity of any associated employer and other relevant parties) of any contemplated activity that would or may otherwise violate or contravene Executive’s obligations under Section 6(e) (the “Specified Activity”), and request that the Board waive or otherwise confirm the inapplicability of Executive’s obligations under Section 6(e) with respect to such Specified Activity. If and to the extent the Board confirms in writing to Executive the waiver or inapplicability of Executive’s obligations under Section 6(e) with respect to the Specified Activity (such waiver or confirmation, not to be unreasonably withheld based on the interests of the Company), then Executive shall thereafter have no liability or obligation under Section 6(e) with respect to the Specified Activity.

7.Assignment. This Agreement will be binding upon and inure to the benefit of (a) the heirs, executors and legal representatives of Executive upon Executive’s death and (b) any successor of the Company. Any such successor of the Company will be deemed substituted for the Company under the terms of this Agreement for all purposes. For this purpose, “successor” means any person, firm, corporation or other business entity which at any time, whether by purchase, merger or otherwise, directly or indirectly acquires all or substantially all of the assets or business of the Company. None of the rights of Executive to receive any form of compensation or benefits pursuant to this Agreement may be assigned or transferred except by will or the laws of descent and distribution. None of the obligations of Executive under this Agreement may be assigned or transferred. Any other attempted assignment, transfer, conveyance or other disposition of Executive’s right to compensation or other benefits will be null and void.

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8. Notices. All notices, requests, demands and other communications called for under this Agreement will be in writing and will be delivered personally by hand or by courier, mailed by United States first-class mail, postage prepaid, or sent by email or by other electronic means directed to the party to be notified at the address or email address indicated for such party on the signature page to this Agreement, or at such other address or email address as such party may designate by 10 days’ advance written notice to the other parties hereto. All such notices and other communications will be deemed given upon personal delivery, three (3) days after the date of mailing, or when sent if given via email or other electronic means.

9.Severability. In the event that any provision(s) of this Agreement becomes or is declared by an arbitrator or a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement will continue in full force and effect without such provision(s).

10.Arbitration.

READ THE FOLLOWING ARBITRATION PROVISION CAREFULLY. IT LIMITS CERTAIN OF YOUR RIGHTS, INCLUDING YOUR RIGHT TO OBTAIN REDRESS THROUGH COURT ACTION

(a)Executive and the Company agree that other than any claims (by Company or Executive) for injunctive relief, any dispute or controversy arising out of, relating to, or in connection with this Agreement, or the interpretation, validity, construction, performance, breach, or termination thereof, will be settled by binding arbitration to be held in New Hampshire in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association (the “Rules”). The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator will be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having jurisdiction.

(b)The arbitrator(s) will apply New Hampshire law to the merits of any dispute or claim, without reference to rules of conflicts of law. The arbitration proceedings will be governed by federal arbitration law and by the Rules, without reference to state arbitration law.

(c)EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EXECUTIVE AGREES TO SUBMIT ANY CLAIMS (OTHER THAN THOSE FOR INJUNCTIVE RELIEF) WHICH ARISE OUT OF, RELATE TO, OR ARE IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION THEREOF TO BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EXECUTIVE’S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, CLAIMS OF DISCRIMINATION, HARASSMENT, OR RETALIATION, OTHER THAN CLAIMS FOR INJUNCTIVE RELIEF.

(d)The Parties each acknowledge and agree that they have had ample time to consider the terms of this arbitration agreement, that they each negotiated it at arms-length with equal bargaining power,

/s/ Mark G. Schnepel

Executive Signature Signifying Agreement To Arbitration

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11.Integration/Waiver. This Agreement, its exhibits, and the confidentiality and invention assignment agreement described in Section 5 above represent the entire agreement and understanding between the parties as to the subject matter herein and supersede all prior or contemporaneous agreements whether written or oral, including without limitation any employment agreement previously signed by Executive. To the extent that any provision of the CIIA conflicts with any provision in this Agreement, the provisions requiring Executive to comply with the higher standard shall govern. No waiver, alteration or modification of any of the provisions of this Agreement will be binding unless in writing and signed by duly authorized representatives of the parties hereto.

12.Tax Withholding. All payments made pursuant to this Agreement will be subject to applicable taxes and other withholdings or deductions authorized or required by law.

13.Governing Law; Consent to Personal Jurisdiction. THIS AGREEMENT WILL BE GOVERNED BY THE LAWS OF THE STATE OF NEW HAMPSHIRE WITHOUT REGARD FOR CONFLICTS OF LAWS PRINCIPLES. EACH PARTY EXPRESSLY CONSENTS TO THE PERSONAL JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN THE DISTRICT OF NEW HAMPSHIRE SUBJECT TO THE ARBITRATION PROVISION SET FORTH IN SECTION 10.

14.Attorneys’ Fees. In the event of arbitration or litigation arising from or relating to this Agreement, each party shall be responsible for such party’s own attorneys’ fees and costs and expenses including expert witness fees.

15.Construction of Agreement. The parties have participated jointly in the negotiating and drafting of this Agreement. If a question concerning intent or interpretation arises, no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of authorship.

16.Captions. Titles or captions contained in this Agreement are for convenience and are not intended to affect the substantive meaning of any provision.

17.Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

18.Code Section 409A. To the fullest extent applicable, amount and other benefits payable under this Agreement are intended to be exempt from the definition of “nonqualified deferred compensation” under section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”) in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, notwithstanding anything in the Agreement to the contrary, to the extent that any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement must be interpreted and administered to the extent possible, or amended, to comply with the applicable requirements of Section 409A with respect to these amounts or benefits.

[Signature page follows]

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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year first above written.

“COMPANY”
FlexEnergy Energy Systems, Inc.
By:	/s/ Wes Kimmel
Name:	Wes Kimmel
Title:	Chief Financial Officer
Date:	December 13, 2021
Address:
112 Corporate Drive, Suite 3
Portsmouth, NH 03801
Attn.: Board of Directors
Email:	wes.kimmel@flexenergy.com
“EXECUTIVE”
/s/ Mark G. Schnepel
Mark G. Schnepel
Date:	December 13, 2021
Address:
[***]
[***]
Email:	[***]

Exhibit A

Form of General Release

SEVERANCE AGREEMENT AND RELEASE

You are advised to consult with an attorney before executing this Agreement.

This Severance Agreement and Release (the “Agreement”) is entered into knowingly and voluntarily by and between Mark Schnepel (“Employee”) and FlexEnergy Energy Systems, Inc., a Delaware corporation (“Company”). Employee and the Company may be collectively referred to as the “Parties.”

RECITALS

A.       Employee was employed as an executive of the Company.

B.       Employee’s employment ended on or about _______________ (“Separation Date”).

C.       The Company and Employee desire to resolve any and all issue(s) between them under the terms of this Agreement, including, but not limited to, any issue(s) arising out of or relating to Employee’s employment with the Company and the separation thereof.

AGREEMENT

In consideration of the promises set forth below, the sufficiency of which is acknowledged, the Parties agree as follows:

I.       Consideration. In consideration of Employee’s execution, non-revocation, and compliance with the full terms of this Agreement, the Company will pay to Employee severance and certain other payments as expressly set forth in Sections 4(b), 4(c) and 4(d) of Employee’s Executive Employment Agreement, dated December 13, 2021 (the “Severance Payment”). The Severance Payment will be subject to applicable withholdings and be made available to Employee according to the time frame set forth in Section 4 of Employee’s Executive Employment Agreement.

II.        Representations and Warranties. Employee understands and expressly acknowledges and agrees that:

· Employee has the sole right and exclusive authority to execute this Agreement;

· Employee has not sold, assigned, transferred, conveyed or otherwise disposed of any of the claims, demands, obligations, or causes of action referred to in this Agreement;

· No other person or entity has or has had an interest in the claims, demands, obligations, or causes of action referred to in this Agreement;

· The Severance Payment that Employee will receive in exchange for signing this Agreement is in addition to anything of value to which Employee is already entitled;

· Employee has been properly and timely paid all wages and/or other amounts due.

· The Severance Payment provided for in this Agreement is all that Employee will ever receive from the Company or any Released Parties (defined below) for any and all claims, demands, obligations, or causes of action released in this Agreement;

· This Agreement and its terms shall not be construed as an admission of any liability whatsoever on the part of the Company or any Released Parties described in this Agreement; To the contrary, liability is and always has been expressly denied;

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· As of the date of execution of this Agreement, Employee has no work-related illness or injury and has not filed any workers’ compensation claims relating to his employment with the Company; and

· The foregoing representations and warranties are essential terms of this Agreement and, as such, Employee affirms that each of those representations and warranties is accurate as of the date of Employee’s execution of this Agreement.

III.        Release of Claims.

A.       Employee, for himself, his marital community (if any), his agents, heirs, executors, administrators, and assigns, knowingly and voluntarily fully releases and discharges forever:

· FlexEnergy Energy Systems, Inc. and its parent, subsidiary, and affiliated entities;

· The Company’s past and present owners, directors, officers, partners, managers, agents, shareholders, employees, attorneys, investors, accountants, insurers, and representatives; and

· The predecessors, successors, and assigns of the above entities or individuals and the spouses of these individuals

(collectively referred to as the “Released Parties”) from any and all agreements, debts, claims, demands, actions, judgments, causes of action, and liabilities of every kind or nature, known or unknown, that Employee, individually or as a member of a class, ever had or now has under the laws of any jurisdiction, including, without limitation, the state in which Employee worked for the Company.

B.       Without limiting Paragraph III.A in any way, Employee knowingly and voluntarily releases any and all claims arising under: the Civil Rights Acts of 1866, 1871, 1964 and 1991; any and all state law pertaining to the employer-employee relationship; the Employee Retirement Income Security Act of 1974; the Rehabilitation Act of 1973; the Occupational Safety and Health Act; the Health Insurance Portability and Accountability Act; the Americans with Disabilities Act; the National Labor Relations Act; the Family and Medical Leave Act; the Patient Protection and Affordable Care Act; the Equal Pay Act; the Worker Adjustment and Retraining Notification Act; any whistleblower statute; any statute concerning the making or enforcing of contracts; and all similar provisions under all other federal, state, and local laws.

C.       Without limiting Paragraphs III.A and B in any way, Employee also voluntarily releases all equitable claims and all common law claims, including without limitation claims of or for: breach of an express or an implied contract; breach of the covenant of good faith and fair dealing; unpaid wages, salary, commissions, incentive pay, fringe benefits, severance, vacation, bonuses or other benefits; unjust enrichment; negligent or intentional interference with contractual relations; negligent or intentional interference with prospective economic relations; estoppel; fraud; negligence; negligent or intentional misrepresentation; personal injury; slander; libel; defamation; false light; injurious falsehood; invasion of privacy; wrongful discharge; failure to hire; retaliatory discharge; constructive discharge; negligent or intentional infliction of emotional distress; negligent hiring, supervision or retention; loss of consortium; punitive damages; and any claims that may relate to drug and/or alcohol testing.

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D.       Employee further acknowledges and agrees that the release contained in this Agreement is a general release, and that he further waives and releases any and all claims which exist as of this date, including those of which he does not know or suspect to exist, whether through ignorance, oversight, error, negligence, or otherwise, and which, if known, would materially affect his decision to sign this Agreement. It is Employee’s intent to waive any and all claims arising up to and including the Effective Date of this Agreement, whether such claims are known to Employee or not.

E.       Employee acknowledges and agrees that the release contained in this Agreement waives any right Employee has to recover damages or other individual relief in any charge or lawsuit brought by Employee, as well as in any charge or lawsuit brought by any governmental agency charged with enforcing any law, whether federal, state or local (any “Governmental Agency”).

F.       Nothing in this Agreement is intended to nor shall the Agreement be interpreted to release or waive Employee’s rights to (i) file an administrative charge with any Governmental Agency (as defined in Section III.E); or (ii) cooperate with or participate in any Governmental Agency charge, investigation or lawsuit. However, as noted in Section III.E, should Employee elect to file or cooperate with or participate in such a charge, Employee has waived his right to recover damages or other individual relief in connection with such a charge.

G.       This Agreement shall not be interpreted to release or require the release of the Company or the Released Parties from any claims or rights arising after the date this Agreement is signed, or release or require the release of any claims or rights that the law prohibits Employee from releasing in this Agreement.

IV.       Employee Understands This Agreement. Employee acknowledges that Employee has had the opportunity to consult an attorney of Employee’s own choosing before entering into this Agreement. Employee represents and warrants that Employee has read all of the terms of this Agreement; and that Employee fully understands and voluntarily accepts these terms, which Employee acknowledges are written in plain language that Employee can and does understand. Employee further acknowledges and agrees that all of Employee’s questions about this Agreement, if any, have been fully answered. Employee further acknowledges and agrees that Employee has been given a reasonable period of time within which to consider this Agreement.

V.       Confidentiality. Employee agrees that the existence, terms and conditions of this Agreement, including the amount of severance furnished under the Agreement, are strictly confidential, and that with the exception of his spouse (if any) and/or attorney (if any), Employee has not and will not, either directly or indirectly, or through any other person, agent or representative, disclose any of the above information, except as required by order of a court of competent jurisdiction, or as may be necessary to protect or enforce rights under this Agreement, or as may be reasonably necessary for obtaining legal advice or for financial reporting or other purposes as required by law, including those set forth in Section III.F. This Agreement does not prohibit Employee from disclosing information that, by law, Employee has an express right to disclose.

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VI.       Return of Company Property. Prior to execution of this Agreement, Employee will return to the Company all of the Company’s property in his possession and/or control, including but not limited to all keys, credit cards, access codes, and documents (original and copies, whether in electronic or other format) relating in any way to the Company. By signing this Agreement, Employee affirms that he has no such property remaining in his possession and/or control. Employee must comply fully with this paragraph before the Company is obligated to perform under the Agreement.

VII.       Time to Consider and Revoke Agreement; Effective Date.

A.       Employee has twenty-one (21) days from the receipt of this Agreement to decide whether to sign it and is advised to consult with an attorney before doing so. Employee understands that he may use as much of this twenty-one (21) day period as he wishes prior to signing. Employee is not to sign this Agreement unless he fully understands its provisions and is signing it voluntarily.

B.       After Employee has signed this Agreement, Employee has seven (7) calendar days to change his mind and notify the Company in writing that Employee has revoked this Agreement (“Revocation Period”). If Employee so revokes this Agreement, this Agreement will be null and void, and will have no force or effect. For this revocation to be effective, written notice must be sent in a manner that complies with the notice provisions of Employee’s Executive Employment Agreement and must be received by the Company on or before the seventh (7^th) calendar day after the day Employee signs the Agreement.

C.       If Employee: (1) complies with Section VI above; (2) signs and delivers this Agreement within the time frames and in accordance with the provisions of subsection A of this Paragraph; and (3) does not cancel or revoke the Agreement within seven (7) calendar days after Employee signs this Agreement, this Agreement shall become effective on the eighth (8^th) calendar day after Employee signed it (the “Effective Date”).

D.       Employee understands that if he revokes this Agreement, it shall not be effective or enforceable and Employee will not receive any Severance Payment.

VIII.       OWBPA Acknowledgement. Employee acknowledges and agrees that the release set forth in Paragraph III releases all claims under the Age Discrimination in Employment Act (“ADEA”). Employee further acknowledges and agrees that: (1) his release and waiver of any claim under the ADEA is knowing and voluntary; (2) he has been informed by this writing to consult with his attorney prior to executing this Agreement; (3) the consideration furnished under this Agreement is in addition to anything of value to which he is already entitled; (4) Employee has read and fully understands this Agreement and understands that he is waiving any and all age discrimination claims; (5) Employee is not waiving any rights or claims related to the validity of this release (as it pertains to age discrimination claims) and/or claims that may arise after this Agreement is executed; and (6) Employee has been given up to 21 days to consider this Agreement before signing it.

IX.       Attorneys’ Fees and Costs. In the event of litigation arising out of or relating to any alleged breach of this Agreement, the prevailing party shall be entitled to an award of reasonable attorneys’ fees and costs.

X.       Waiver. No waiver of any of the terms of this Agreement shall constitute a waiver of any other terms, whether or not similar, nor shall any waiver be a continuing waiver. No waiver shall be binding unless executed in writing by the party making the waiver. The Company or Employee may waive any provision of this Agreement intended for its/his benefit, but such waiver shall in no way excuse the other from the performance of any of its/his other obligations under this Agreement.

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XI.       Severability. In the event that any provision(s) of this Agreement is found to be unenforceable for any reason whatsoever, the unenforceable provision shall be considered to be severable, and the remainder of this Agreement shall continue in full force and effect.

XII.       Choice of Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New Hampshire, without regard to the principles of conflicts of law, except to the extent those laws are preempted by federal law.

XIII.       Subsequent Modifications. The terms of this Agreement may be altered or amended, in whole or in part, only upon the signed written agreement of all Parties to this Agreement. No oral agreement may modify any term of this Agreement.

XIV.       Entire Agreement. This Agreement is the final, complete and exclusive statement and expression of the agreement among the parties hereto with relation to the subject matter of this Agreement, it being understood that there are no oral representations, understandings or agreements covering the same subject matter as this Agreement. This Agreement supersedes, and cannot be varied, contradicted or supplemented by evidence of any prior or contemporaneous discussions, correspondence, or oral or written agreements of any kind. This Agreement does not, however, supersede, extinguish, or otherwise modify any confidentiality obligations of Employee, or any post-employment obligations of Employee, that may exist under separate agreements. Such confidentiality obligations remain in full force and effect.

XV.       Execution. This Agreement may be executed in counterparts with the same force and effect as if all signatures appeared on one document.

It is so agreed.

DATED:
	Mark Schnepel
	FlexEnergy Energy Systems, Inc.
DATED:	By:
	Name:
	Title:

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Exhibit B

Form of Confidentiality and Invention Assignment Agreement

 

CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT

THIS CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT (this “Agreement”) is dated as of December 13, 2021 (the “Effective Date”) between FlexEnergy Energy Systems, Inc., a Delaware corporation, its subsidiaries, affiliates, successors or assigns (the “Company”), and the undersigned recipient (“Recipient”).

1.The Relationship. Unless the parties otherwise agree in writing, this Agreement applies during and to Recipient’s service relationship with the Company, whether as an employee, independent contractor, advisor or otherwise (collectively, the “Relationship”). Recipient understands that during the Relationship, the Company intends to provide Recipient with information, including Company Confidential Information (as defined below), without which Recipient would not be able to perform Recipient’s duties to the Company. Recipient acknowledges that the Company is relying on Recipient’s execution and delivery of this Agreement as an inducement to establish and/or maintain the Relationship, and that without this Agreement the Company would not continue with a Relationship with Recipient. The services to be rendered to the Company during the Relationship are referred to as the “Services.” Any rights of Recipient to monetary or other compensation in connection with the Services constitute further consideration for Recipient’s obligations under this Agreement. Recipient acknowledges that Recipient’s obligations under this Agreement survive a termination of the Relationship.

2.Confidential Information.

(a)Company Confidential Information. Recipient understands that “Company Confidential Information” means all non-public, confidential or proprietary information and physical material (including any and all combinations of individual items of information) that the Company has or will develop, author, invent, conceive, discover, acquire, create, compile, discover, and/or own, that has value in or to the Company’s business. Company Confidential Information includes both information disclosed by the Company to Recipient (directly or indirectly, in writing, orally, graphically, by machine-readable format, by inspection of tangible objects, or otherwise), and information authored, discovered, developed, invented, conceived, learned, or reduced to practice by Recipient during the course the Relationship. Company Confidential Information also includes all non-public, confidential or proprietary information of which the unauthorized disclosure could be detrimental to the interests of the Company, whether or not such information is expressly identified as Company Confidential Information.

(i)By example, and without limitation, Company Confidential Information includes: (A) trade secrets (including but not limited to any information that is a Trade Secret as defined by the any Uniform Trade Secrets Act, similar state law, or the Defense of Trade Secrets Act (“Trade Secrets”)), inventions, ideas, processes, formulas, algorithms, software in source or object code, data, protocols, programs, works of authorship, information fixed in any tangible medium of expression, logos, trademarks, service marks, trade names, trade dress, mask works, know-how, improvements, discoveries, developments, designs and drawings, techniques, schematics, new products, machines, apparatus, systems, articles of manufacture, compounds, formulations, configurations, compositions of matter, biological materials, and any other proprietary technologies, in each of the forgoing cases whether or not patentable, copyrightable, or otherwise legally protectable, and all Intellectual Property Rights (as defined below) therein (all of the foregoing collectively, “Inventions”); (B) information regarding research, development, prototypes, samples, plant and equipment, new products, hardware configurations, marketing and selling, business plans, budgets and unpublished financial statements, licenses, prices and costs, margins, discounts, credit terms, pricing and billing practices, quoting procedures, methods of obtaining business, forecasts, future plans and potential strategies, financial projections and business strategies, operational plans, financing and capital-raising plans, activities and agreements, internal services and operational manuals, methods of conducting Company business, suppliers and supplier information, and purchasing; (C) information regarding customers and potential customers of Company, including customer lists, names, representatives, their needs or desires with respect to the types of products or services offered by Company, proposals, bids, contracts and their contents and parties, the type and quantity of products and services provided or sought to be provided to customers and potential customers of Company and other non-public information relating to customers and potential customers; (D) information regarding any of Company’s business partners and their services, including names, representatives, proposals, bids, contracts and their contents and parties, the type and quantity of products and services received by Company, and other non-public information relating to business partners; (E) information regarding Company personnel, employee lists, compensation, and employee skills; (F) other Company documents, agreements, files, reports, notes, and materials; and (G) any other non-public information which a competitor of Company could use to the competitive disadvantage of Company. Without limiting the foregoing, Recipient specifically acknowledges that the customer lists and sales lead lists of the Company are confidential and not readily known to the Company’s competitors, that such customers are particularly important to the Company’s business, that business relationships between such customers and the Company would normally continue unless interfered with, and that solicitation of such customers by Recipient, following the termination of the Relationship, would cause injury to the Company’s business.

(ii)Notwithstanding the foregoing, Company Confidential Information does not include any such information which Recipient establishes (A) was in the public domain at the time of disclosure by the Company to Recipient (other than as a result of, directly or indirectly, any violation of this Agreement or other wrongful action or omission by Recipient); (B) is in the public domain after disclosure by the Company to Recipient (other than as a result of, directly or indirectly, any violation of this Agreement or other wrongful action or omission by Recipient); or (C) was in Recipient’s rightful possession, without confidentiality obligations, at the time of disclosure by the Company as demonstrated by Recipient’s written records in existence immediately prior to the time of the disclosure; provided that any combination of individual items of information shall not be deemed to be within any of the foregoing exceptions merely because one or more of the individual items are within such exception, unless the combination as a whole is within such exception. Also, if the Relationship is that of an employee, this Agreement shall not limit Recipient’s rights to discuss the terms and working conditions of the Relationship to the extent protected by applicable law.

 

(b)Nature and Ownership of Company Confidential Information. Recipient understands and acknowledges that (i) the Relationship creates a relationship of confidence and trust with respect to the Company Confidential Information, and that the Company has a protectable interest therein, (ii) during the Relationship, Recipient will receive and have access to Company Confidential Information, (iii) because of the nature of the Company’s business, the protection of such Company Confidential Information is of vital concern to the Company, and (iv) the Company Confidential Information represents one of the most important assets of the Company and enhances the Company’s opportunity for maintaining business and future growth. Recipient further (A) acknowledges and agrees that the Company retains sole and exclusive ownership of all Company Confidential Information (including all associated Intellectual Property Rights (defined below)), (B) acknowledges and agrees that Recipient obtains no title or interest in or to any Company Confidential Information, and (C) agrees to assign, and hereby assigns, to the Company (and successors and designees) any rights or interests that Recipient may have or acquire in any Company Confidential Information.

(c)Nonuse and Nondisclosure; Compelled Disclosure.

(i)Recipient agrees that during and after the Relationship, except as permitted under this Section 2(c) or Section 10(l), Recipient shall hold Company Confidential Information in strict confidence, and take all reasonable precautions to prevent any unauthorized use or disclosure of Company Confidential Information. Recipient shall not (A) use the Company Confidential Information for any purpose whatsoever other than for the benefit of the Company in the course of the Relationship, or (B) disclose the Company Confidential Information to any third party without the prior written authorization of the Company. Recipient understands that Recipient’s unauthorized use or disclosure of Company Confidential Information may lead to immediate termination of the Relationship and additional legal action by the Company. Recipient shall immediately notify the Company, in writing, of any known or perceived disclosure or misappropriation of the Company's Proprietary Information of which Recipient is aware, whether such disclosure or misappropriation is a result of a negligent or an intentional act of Recipient or a third party.

(ii)Notwithstanding anything to the contrary, during and following the Relationship, Recipient shall hold in strictest confidence the Company’s Trade Secrets that come into Recipient’s knowledge during the Relationship, and shall not directly or indirectly disclose, publish, or make use of at any time such Trade Secrets for so long as the information remains a Trade Secret or the obligations of this Agreement are effective, whichever is longer. If Recipient has any questions regarding what data or information constitutes a Trade Secret, Recipient agrees to contact the appropriate person(s) at the Company for written clarification.

(iii)If Recipient is required to disclose any Company Confidential Information pursuant to applicable federal, state or local law, regulation or a valid order issued by a court or governmental agency of competent jurisdiction (a “Legal Order”), prior to such disclosure Recipient shall use best efforts to provide the Company with (A) prompt written notice of such requirement so that the Company may seek, at its sole cost and expense, a protective order or other remedy; and (B) reasonable assistance in opposing such disclosure or seeking a protective order or other limitations on disclosure. If, after providing such notice and assistance as required herein, Recipient remains required by a Legal Order to disclose any Company Confidential Information, the Recipient (or its Representatives or other persons to whom such Legal Order is directed) shall disclose no more than that portion of the Company Confidential Information which, in the written opinion of the Recipient's legal counsel, such Legal Order specifically requires the Recipient to disclose.

(d)Associated Third Party Information. Recipient recognizes that the Company has received, and in the future will receive, from third parties associated with the Company, such as the Company’s customers, suppliers, licensors, licensees, advisors, independent contractors, partners or collaborators (“Associated Third Parties”), their confidential or proprietary information (“Associated Third Party Confidential Information”), subject to a duty on the Company’s part to maintain the confidentiality of such Associated Third Party Confidential Information and to use it only for certain limited purposes. By way of example, Associated Third Party Confidential Information may include the habits or practices of Associated Third Parties, the technology of Associated Third Parties, requirements of Associated Third Parties, and information related to the business conducted between the Company and such Associated Third Parties. Recipient agrees at all times during the Relationship and thereafter, that Recipient owes the Company and its Associated Third Parties a duty to hold all such Associated Third Party Confidential Information in the strictest confidence, and not to use it or to disclose it to any other third party except as necessary in carrying out Recipient’s work for the Company consistent with the Company’s agreement with such Associated Third Parties. Recipient further agrees to comply with any and all Company policies and guidelines that may be adopted from time to time regarding Associated Third Parties and Associated Third Party Confidential Information. Recipient understands that Recipient’s unauthorized use or disclosure of Associated Third Party Confidential Information or violation of any Company policies during or after the Relationship may lead to disciplinary action, up to, and including, immediate termination and additional legal action by the Company. Recipient understands that Recipient’s unauthorized use or disclosure of Company Confidential Information may lead to immediate termination of the Relationship and additional legal action by the Company.

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(e)Former Employer Confidential Information. Recipient agrees that during the Relationship, Recipient has not and shall not improperly access, download, upload, store, use, disclose, or induce the Company to access, use or disclose any proprietary information or trade secrets of any former employer or other person or entity with which Recipient has an obligation of confidentiality. Recipient further agrees that Recipient has not brought, and shall not bring, onto the Company’s premises or transfer onto the Company’s technology systems any unpublished document, proprietary information, or trade secrets or other confidential information belonging to any third party unless disclosure to, and use by, the Company has been consented to, in writing, by such third party.

(f)Defend Trade Secrets Act. Misappropriation of a trade secret of the Company in breach of this Agreement may subject Recipient to criminal liability under the Defend Trade Secrets Act of 2016 (the “DTSA”), entitle the Company to injunctive relief, and require Recipient to pay compensatory damages, double damages, and attorneys’ fees. Notwithstanding any other provision of this Agreement, the Company hereby notifies Recipient in accordance with the DTSA that Recipient will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, in each case solely for the purpose of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. The Company further notifies Recipient that if Recipient files a lawsuit for retaliation by the Company for reporting a suspected violation of law, Recipient may disclose the Company’s trade secrets to Recipient’s attorney and use the trade secret information in the court proceeding if Recipient files any document containing the trade secret under seal and does not disclose the trade secret except pursuant to court order.

(g)Other Rights. For the absence of doubt, this Agreement is intended to supplement, and not to supersede, any rights the Company may have in law or equity with respect to the protection of trade secrets or confidential or proprietary information.

3.Inventions.

(a)Company Inventions. For purposes of this Agreement, “Company Inventions” means any and all prior, existing and future Inventions solely or jointly authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (solely or jointly with others) (i) in connection with, relating to, or as a result of, the services performed for the Company, (ii) with the use of Company’s equipment, supplies, facilities, or Company Confidential Information, or (iii) otherwise relating to the Company’s actual or anticipated businesses, products, services, or research and development, except as otherwise provided in Section 3(g) or Section 3(h) below.

(b)Assignment of Company Inventions.

(i)Recipient agrees that all right, title, and interest in and to any and all Company Inventions are the sole property of the Company. Recipient also agrees to promptly make full written disclosure to the Company of any Company Inventions. Recipient agrees to deliver and assign, and hereby irrevocably assigns, fully to the Company (and its successors and designees) all of Recipient’s right, title, and interest in and to the Company Inventions. Recipient expressly agrees that this assignment includes a present conveyance to the Company of ownership of any of the Company Inventions that are not yet in existence. Recipient hereby waives and irrevocably quitclaims to the Company (and successors and designees) any and all claims, of any nature whatsoever, that Recipient now has or may hereafter have for infringement of any and all of the Company Inventions. Upon the Company’s request, Recipient further agrees to assign to a Company-designated third party, including without limitation the United States, all of Recipient’s right, title, and interest in and to any particular Company Invention(s).

(ii)Recipient further acknowledges that for any Company Invention, Company, in its sole discretion, may make an application for patent as the applicant under 37 CFR 1.46 as a juristic entity under 37 CFR § 1.31. Recipient further acknowledges that all original works of authorship that are made by Recipient (solely or jointly with others) within the scope of and during the period of the Relationship and that are protectable by Copyright are “works made for hire,” as that term is defined in the United States Copyright Act. “Copyright” means the exclusive legal right to reproduce, perform, display, distribute and make derivative works of a work of authorship (as a literary, musical, or artistic work) recognized by the laws of any jurisdiction or country. Recipient understands and agrees that Recipient has no right to publish on, submit for publishing, or use for any publication any work product protected by this Section, except as necessary to perform services for Company. Recipient further waives all of Recipient’s rights under the United States Copyright Act and under any other country’s copyright law, including any rights provided in 17 U.S.C. § 106 and 106A, for any and all purposes for which such work product and any derivative works thereof may be used to the full extent now or hereafter permitted by the laws of the United States of America or the laws of any other country.

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(c)Moral Rights; Non-Assignable and Non-Licensable Rights. The assignment to the Company of the Company Inventions includes all rights of attribution, paternity, integrity, modification, disclosure, withdrawal, special, and any other similar rights throughout the world that may be known as or referred to as “moral rights,” “artist’s rights,” “droit moral,” or the like recognized by the laws of any jurisdiction or country (collectively, “Moral Rights”). To the extent that Moral Rights cannot be assigned under applicable law, Recipient hereby waives and agrees not to enforce any and all Moral Rights, including, without limitation, any limitation on subsequent modification, to the extent permitted under applicable law. Recipient further acknowledges and agrees that neither Recipient’s successors-in-interest nor legal heirs retain any Moral Rights in any Company Inventions (and any Intellectual Property Rights with respect thereto). To the extent any of the rights, title, and interests in and to Company Inventions cannot be assigned by Recipient to the Company, Recipient hereby grants to Company an exclusive, royalty-free, perpetual, irrevocable, transferable, worldwide, fully paid-up license (with the right to grant and authorize multiple tiers of sublicenses) to make, have made, use, import, offer for sale, sell, reproduce, distribute, modify, adapt, prepare derivative works of, display, perform, and otherwise exploit such Company Inventions, without restriction, including, without limitation, as part of, or in connection with, such Company Invention, and to practice any method related thereto. To the extent any of the rights, title, or interests in and to Company Inventions can neither be assigned nor licensed by Recipient to the Company, Recipient hereby irrevocably waives and agrees never to assert the non-assignable and non-licensable rights, title, and interests against the Company, any of the Company’s successors in interest, or any of the Company’s customers.

(d)Maintenance of Records. Recipient agrees to keep and maintain adequate, current, accurate and authentic written records of Company Inventions authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (solely or jointly with others) during the term of the Relationship. The records may be in the form of notes, sketches, drawings, flow charts, electronic files, reports, data or recordings, or any other format that may be specified by the Company. As between the Company and Recipient, the records are and shall be available to and remain the sole property of the Company at all times. Recipient agrees not to remove such records from the Company’s place of business except as expressly permitted by Company policy which may, from time to time, be revised at the sole election of the Company for the purpose of furthering the Company’s business. Recipient agrees to deliver all such records (including any copies thereof) to the Company upon the termination of the Relationship as provided in Section 5.

(e)Cooperation in Perfecting Rights. Recipient agrees to assist the Company, or its designee, at the Company’s expense, in every appropriate way to secure the Company’s, or its designee’s, rights in the Company Inventions and any Copyrights, patents, trademarks, mask work rights, Moral Rights, or other intellectual property rights recognized by the laws of any jurisdiction or country (collectively, “Intellectual Property Rights”) relating thereto in any and all countries, including the disclosure to the Company or its designee of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments, recordations, and all other instruments that the Company or its designee shall deem appropriate or necessary in order to apply for, register, obtain, maintain, defend, enforce and transfer such rights, or if not transferable, waive and agree never to assert such rights, and in order to deliver, assign and convey to the Company (and successors and designees) the sole and exclusive right, title, and interest in and to such Company Inventions and any Intellectual Property Rights relating thereto, and testifying in a suit or other proceeding relating to such Company Inventions. Recipient further agrees that Recipient’s obligation to execute or cause to be executed, when it is in Recipient’s power to do so, any such instrument or papers shall continue during and at all times after the end of the Relationship and until the expiration of the last such intellectual property right to expire in any country of the world.

(f)Attorney-in-Fact. Recipient agrees that, if the Company is unable because of Recipient unavailability, mental or physical incapacity, or for any other reason to secure Recipient’s signature with respect to any Company Inventions, including, without limitation, for the purpose of applying for or pursuing any application for any United States or foreign Intellectual Property Rights registrations covering the Company Inventions assigned to the Company in Section 3(b), then Recipient hereby irrevocably designates and appoints the Company and its duly authorized officers and agents as Recipient’s agent and attorney-in-fact, to act for and on Recipient’s behalf to execute and file any instruments, papers and oaths, and to do all other lawfully permitted acts with respect to such Company Inventions to further the prosecution and issuance of Intellectual Property Rights registrations with the same legal force and effect as if executed by Recipient. This power of attorney shall be deemed coupled with an interest, shall be irrevocable, and shall not be affected by Recipient’s subsequent incapacity.

(g)Prior Inventions. Recipient represents that Exhibit A provides a complete list describing with particularity any and all Inventions that, as of the Effective Date: (i) Recipient (or any Recipient assignee(s)) owns or has an interest, (ii) that may relate to the Company’s actual or anticipated businesses, products, services, or research and development, and (iii) that are not assigned to the Company under this Agreement (“Prior Inventions”); or, if no such list is attached, Recipient represents that there are no Prior Inventions, and to the extent such Prior Inventions do exist and are not listed on Exhibit A, Recipient hereby forever waives any and all rights or claims of ownership to such Prior Inventions. Recipient understands that Recipient’s listing of any Inventions on Exhibit A does not constitute an acknowledgement by the Company of the existence or extent of such Inventions, nor of Recipient’s ownership of such Inventions. Recipient shall not incorporate any Prior Inventions listed on Exhibit A, Prior Inventions required to be listed on Exhibit A or Inventions otherwise owned by any third party into any Company Invention without the Company’s prior written permission. Whether or not Recipient receives written permission, unless the Company otherwise specifically agrees in writing, Recipient hereby irrevocably grants to the Company a nonexclusive, royalty-free, perpetual, irrevocable, transferable, worldwide, fully paid-up license (with the right to grant and authorize multiple tiers of sublicenses) to make, have made, use, import, offer for sale, sell, reproduce, distribute, modify, adapt, prepare derivative works of, display, perform, and otherwise exploit such Inventions, without restriction, including, without limitation, as part of, or in connection with, such Invention, and to practice any method related thereto.

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(h)Exception to Assignments. Subject to the requirements of applicable state law, if any, Recipient understands that the Company Inventions shall not include, and the provisions of this Agreement requiring assignment of inventions to the Company do not apply to, any invention (an “Excluded Invention”) that qualifies fully for exclusion under the provisions of applicable state law, if any, other than those Company Inventions that are covered by a contract between the Company and the United States or any of its agencies that require full title to such Company Invention to be in the United States. In order to assist in the determination of which Inventions qualify for such exclusion, Recipient shall advise the Company promptly in writing, during the Relationship and for a period of 12 months immediately thereafter, of all Inventions that Recipient believes are Excluded Inventions pursuant to this Section 3(h) that solely or jointly authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (i) in connection with, relating to, or as a result of, the services performed for the Company, (ii) with the use of Company’s equipment, supplies, facilities, or Company Confidential Information, or (iii) otherwise relating to the Company’s actual or anticipated businesses, products, services, or research and development.

4.No Conflicting Obligations.

(a)Current Obligations. Recipient agrees that, during the Relationship, Recipient (i) has a duty of loyalty to the Company, (ii) shall not engage in or undertake any other employment, occupation, consulting, or commitment that is directly related to Company’s actual or anticipated businesses, products, services, or research and development, and (iii) shall not engage in any other activities or enter any agreements that conflict with this Agreement or Recipient’s other obligations to the Company. Without limiting the generality of the foregoing, Recipient further agrees that Recipient shall not, directly or indirectly through another person or entity, during the Relationship (A) anywhere in the world, render services of any nature to any person or entity who engages in any business that competes with the Company, (B) solicit or induce any employee or service provided of the Company to leave the employ or service of the Company, (C) make any statement or do any act intended to cause the existing or potential customers of the Company to use the products or services of a competitor to the Company, or (D) induce any customer or other business relation of the Company to cease doing business with or negatively alter its business with the Company.

(b)Prior Relationships. Without limiting Section 4(a), Recipient represents and warrants that Recipient has no other agreements, relationships, or commitments to any other person or entity that conflict with the provisions of this Agreement, Recipient’s obligations to the Company under this Agreement, or Recipient’s ability to perform the services for which Recipient is being engaged by the Company. Recipient further agrees that if Recipient has signed a confidentiality agreement or similar type of agreement with any former client, employer or other third party, Recipient shall comply with the terms of any such agreement to the extent that its terms are lawful under applicable law. Recipient represents and warrants that after undertaking a careful search (including searches of Recipient’s computers, cell phones, electronic devices, and documents), Recipient have returned all property and confidential information belonging to all prior clients, employers and/or other third parties for which Recipient has performed services in accordance with the terms of Recipient’s applicable agreement. Recipient acknowledges and agrees that Recipient has provided the Company with copies of all agreements (e.g., non-competition agreements, non-solicitation of customers agreements, non-solicitation of employees agreements, confidentiality agreements, inventions agreements, etc.), if any, with a current or former client, employer, or any other third party, that may relate to or restrict Recipient’s ability to perform services for the Company, or fulfill any obligation Recipient may have to the Company. Moreover, Recipient agrees to fully indemnify the Company, its directors, officers, managers, members, agents, employees, investors, shareholders, administrators, affiliates, divisions, subsidiaries, predecessor and successor entities, and assigns for all verdicts, judgments, settlements, and other losses incurred by any of them resulting from Recipient’s breach of Recipient’s obligations under any agreement with a third party to which Recipient is a party or obligation to which Recipient is bound, as well as any reasonable attorneys’ fees and costs if the plaintiff is the prevailing party in such an action, except as prohibited by law.

5.Return of Company Materials.

(a)Definition of Electronic Media Equipment and Electronic Media Systems. For purposes of this Agreement, “Electronic Media Equipment” includes, but is not limited to, computers, external storage devices, thumb drives, handheld electronic devices, telephone equipment, and other electronic media devices. For purposes of this Agreement, “Electronic Media Systems” includes, but is not limited to, computer servers, messaging and email systems or accounts, and web-based services (including cloud-based information storage accounts), whether provided for Recipient’s use directly by the Company or by third-party providers on behalf of the Company.

(b)Return of Company Property. Recipient acknowledges and agrees that anything that Recipient creates or works on for the Company while performing the Services belongs solely to the Company and that Recipient cannot remove, retain, or use such information without the Company’s express written permission. Accordingly, upon a termination of the Relationship for any reason or upon the Company’s request at any other time, Recipient shall immediately deliver to the Company, and shall not keep in Recipient’s possession, recreate, or deliver to anyone else, any and all Company property, including, but not limited to, Company Confidential Information, Associated Third Party Confidential Information, all equipment including all Electronic Media Equipment, all tangible embodiments of the Company Inventions, all information electronically stored on any Electronic Media Equipment or Electronic Media System and passwords to access the same, Company credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, photographs, charts, drafts, any other documents and property, and reproductions of any of the foregoing items, including, without limitation, those records maintained pursuant to Section 3(d). In connection with Recipient’s obligation to return information to the Company, Recipient shall not copy, delete, or alter any information, including personal information voluntarily created or stored, contained upon Electronic Media Equipment or Electronic Media Systems before Recipient returns the information to the Company.

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(c)Return of Company Information on Personal Electronic Media Equipment. In addition, if Recipient has used any personal Electronic Media Equipment or personal Electronic Media Systems to create, receive, store, review, prepare or transmit any Company information, including, but not limited to, Company Confidential Information, Recipient shall make a prompt and reasonable search for such information in good faith, including reviewing any personal Electronic Media Equipment or personal Electronic Media Systems to locate such information and, if Recipient locates such information, Recipient shall notify the Company of that fact, provide the Company with a computer-useable copy of all such Company information from those equipment and systems, and then permanently delete and expunge any Company Confidential Information from the Electronic Media Equipment and Electronic Media Systems, as applicable. Recipient shall cooperate reasonably with the Company to verify that the necessary copying and deletion is completed (including providing the Company access to the Electronic Media Equipment or Electronic Media System as reasonably requested to verify that the necessary copying and/or deletion is completed) and upon request providing a sworn declaration confirming the return of information and property and deletion and non-possession of information.

6.Use of Technology Systems.

(a)Recipient acknowledges and agrees that Recipient has no reasonable expectation of privacy in any computer, handheld device, telephone, voicemail, email, or other technology system that is used to conduct the business of the Company. All information, data, and messages created, received, sent, or stored in these systems are, at all times, the property of the Company. As such, the Company has the right to audit and search all such items and systems, with or without notice, to ensure that the Company is licensed to use the software on the Company’s devices in compliance with the Company’s software licensing policies, to ensure compliance with the Company’s policies, and for any other business-related purposes in the Company’s sole discretion. Recipient is not permitted to add any unlicensed, unauthorized, or non-compliant applications to the Company’s technology systems, including, without limitation, open source or free software not authorized by the Company, and Recipient shall refrain from copying unlicensed software onto the Company’s technology systems or using non-licensed software or websites. Recipient understands that it is Recipient’s responsibility to comply with the Company’s policies governing use of the Company’s documents and the internet, email, telephone, and technology systems to which Recipient will have access in connection with the Relationship.

(b)Recipient agrees not to incorporate into any Company software or otherwise deliver to Company any software code licensed under the GNU General Public License or Lesser General Public License or any other license that, by its terms, requires or conditions the use or distribution of such code on the disclosure, licensing, or distribution of any source code owned or licensed by Company except in strict compliance with Company’s policies, if any, allowing the use of such software.

(c)Recipient is aware that the Company has or may acquire software and systems that are capable of accessing, monitoring and recording all Company network traffic to and from any computer, handheld device, telephone, voicemail, email, or other technology system Recipient may use to access the Company’s internal networks. The Company reserves the right to access, review, copy, and delete any of the information, data, or messages accessed through these systems, with or without notice to Recipient and/or in Recipient’s absence. This includes, but is not limited to, all e-mail messages sent or received, all website visits, all chat sessions, all news group activity (including groups visited, messages read, and postings by Recipient), and all file transfers into and out of the Company’s internal networks. The Company further reserves the right to retrieve previously deleted messages from e-mail or voicemail and monitor usage of the Internet, including websites visited and any information Recipient has downloaded. In addition, the Company may review Internet and technology systems activity and analyze usage patterns, and may choose to publicize this data to assure that technology systems are devoted to legitimate business purposes.

(d)Recipient acknowledges and agrees that Recipient has no expectation of privacy in Company property. Recipient agrees that any Company property situated on Company premises, or held by third-party providers for the benefit of the Company, is subject to inspection by Company personnel at any time with or without further notice. Any property situated on the Company’s premises, including disks and other storage media, filing cabinets or other work areas, is subject to inspection by Company personnel at any time with or without notice. Recipient also acknowledges and agrees that as it relates to the Company’s desire to protect its confidential and proprietary information, Recipient has no expectation of privacy as to any personal Electronic Media Equipment or personal Electronic Media Systems that Recipient uses for Company purposes. Recipient further agrees that the Company, at the Company’s sole discretion, may have access to such personal Electronic Media Equipment or personal Electronic Media Systems to retrieve, destroy, or ensure the permanent deletion of Company information from such equipment or systems.

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7.No Change to Duration of Relationship. Recipient understands and acknowledges that this Agreement does not alter, amend or expand upon any rights Recipient may have in the duration of any independent contractor, employment or other service relationship with the Company under any other agreement or under applicable law. Except as expressly otherwise agreed in writing and signed by the president or chief executive officer of the Company (or another properly authorized officer of the Company), Recipient understands and acknowledges that (a) the Relationship is and shall remain for no specified term and constitutes an “at-will” arrangement, (b) the Relationship may be terminated at any time, with or without good cause or reason or for any or no cause or reason, at Recipient’s option or at the Company’s option, with or without prior notice, and (c) that the Company may modify Recipient’s role, position, duties and/or compensation, as applicable, from time to time as the Company deems necessary.

8.Publication of this Agreement to Subsequent Employer or Business Associates.

(a)If Recipient is offered employment or the opportunity to enter into any business venture as owner, partner, consultant, or other capacity during the two years following the Relationship, Recipient agrees to inform Recipient’s potential employer, partner, co-owner, and/or others involved in managing the business with which Recipient has an opportunity to be associated of Recipient’s obligations under this Agreement and also agrees to provide such person or persons with a copy of this Agreement.

(b)Recipient agrees to inform the Company of all employment and business ventures which Recipient enters into during the two years following the Relationship, and Recipient also authorizes the Company to provide copies of this Agreement to Recipient’s employer, partner, co-owner, and/or others involved in managing the business with which Recipient becomes employed or associated and to make such persons aware of Recipient’s obligations under this Agreement. Recipient further agrees that, upon written request by the Company, Recipient shall respond to the Company in writing regarding the status of Recipient’s engagement or proposed engagement with any party during the two years following the Relationship.

9.Termination Certification. Upon the termination of the Relationship, Recipient shall immediately sign and deliver to the Company the “Termination Certification” attached hereto as Exhibit B; however, Recipient’s failure to sign and deliver the Termination Certification shall in no way diminish Recipient’s continuing obligations under this Agreement. Recipient shall also keep the Company advised of Recipient’s primary address for a period of three (3) years after the termination of the Relationship, so that the Company can contact Recipient regarding Recipient’s continuing obligations provided by this Agreement.

10.Miscellaneous.

(a)Further Assurances. Recipient agrees to promptly execute and deliver, both during and after the end of the Relationship, such additional instrument, documents, or oaths, as the Company may request for the purpose of carrying out terms and purposes of this Agreement.

(b)Governing Law. All issues and questions concerning the construction, validity, enforcement, and interpretation of this Agreement and the exhibits hereto shall be governed by, and construed in accordance with, the laws of the State of New Hampshire, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of New Hampshire or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New Hampshire.

(c)Jurisdiction; Venue; Service of Process; Waiver of Jury Trial. Each of the parties hereto knowingly, voluntarily, and irrevocably (i) submits to the exclusive jurisdiction and venue of any state or federal court sitting in the State of New Hampshire, in any action or proceeding arising out of or relating to this Agreement and agrees that all claims in respect of the action or proceedings may be heard and determined in any such court, (ii) expressly submits to the personal jurisdiction and venue of such court for the purposes hereof and expressly waives any claim of improper venue and any claim that such courts are an inconvenient forum, provided that the Company or its successors or assigns may seek injunctive or equitable relief from any court in any jurisdiction, and (iii) agrees that the other party to this Agreement may file an original counterpart or a copy of this Agreement with any court as written evidence of the consents, waivers and agreements of the parties. Each party hereby irrevocably consents to the service of process of any of the aforementioned courts in any such suit, action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to (A) if to the Company, to the Company’s primary business office, and (B) if to Recipient, to Recipient’s address as set forth in the Company’s records, with such service of process to become effective ten (10) days after such mailing. EACH PARTY ALSO KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(d)Equitable Relief. Recipient acknowledges and agrees that, by virtue of Recipient’s Relationship, the Services provided, and the access to and use of Company Confidential Information, any violation by Recipient of any of the undertakings contained in this Agreement would cause the Company immediate, substantial, and irreparable injury for which the Company has no adequate remedy at law. Accordingly, Recipient agrees and consents to the entry of an injunction or other equitable relief (including but not limited to temporary restraining orders, preliminary injunctions and permanent injunctions) by a court of competent jurisdiction restraining any violation or threatened violation of any undertaking contained in this Agreement, in addition to and without prejudice to any other rights or remedies that the Company may have for a breach of this Agreement. Recipient waives posting of any bond otherwise necessary to secure such injunction or other equitable relief (or, where such a bond or security cannot be waived, Recipient agrees that a $1,000 bond shall be adequate). Rights and remedies provided in this Agreement are cumulative and shall be in addition to rights and remedies otherwise available to the Company under any other agreement or applicable law.

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(e)Administrative Relief. To the extent the Relationship is that of an employee, RECIPIENT UNDERSTANDS THAT THIS AGREEMENT DOES NOT PROHIBIT RECIPIENT FROM PURSUING AN ADMINISTRATIVE CLAIM WITH A LOCAL, STATE, OR FEDERAL ADMINISTRATIVE BODY OR GOVERNMENT AGENCY THAT IS AUTHORIZED TO ENFORCE OR ADMINISTER LAWS RELATED TO EMPLOYMENT, INCLUDING, BUT NOT LIMITED TO, THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION (OR EQUIVALENT STATE AGENCY), THE NATIONAL LABOR RELATIONS BOARD, OR THE WORKERS’ COMPENSATION BOARD.

(f)Entire Agreement. This Agreement, including the Exhibit(s) to this Agreement, sets forth the entire agreement and understanding between the Company and Recipient with respect to the subject matter herein and supersedes all prior and contemporaneous discussions, understanding, representations and agreements, whether or written or oral, between the Company and Recipient, relating to the subject matter of this Agreement (but expressly does not supersede, amend, release, limit or terminate any non-competition, non-solicitation, non-interference, non-disparagement or other similar obligation of the Recipient to the Company or any affiliate thereof under any previously executed agreement). Recipient represents and warrants that Recipient is not relying on, and hereby disclaims any reliance upon, any statement or representation of any kind or nature not expressly contained in this Agreement. For clarity, (i) Recipient’s obligations to the Company under this Agreement are separate from, and in addition to, any of Recipient’s obligations to the Company under any other agreement, and (ii) the execution of this Agreement does not release, limit or terminate any liability of, or breach by, Recipient under any confidentiality and invention assignment agreement or similar agreement previously executed by Recipient.

(g)Severability; Construction. The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision. Headings are used in this Agreement for reference only and shall not be considered when interpreting this Agreement.

(h)Applicability to Past Activities. Recipient agrees that if and to the extent that, during any Prior Engagement Period (defined below): (i) Recipient received access to any information that would have been Company Confidential Information if Recipient received access to such information during the Relationship; or (ii) Recipient authored, discovered, developed, invented, conceived, or reduced to practice any Invention, including any Intellectual Property Rights with respect thereto, that would have been a Company Invention if authored, discovered, developed, invented, conceived, or reduced to practice during the Relationship; then any such information shall be deemed Company Confidential Information hereunder and any such Invention shall be deemed a Company Invention hereunder, and this Agreement shall apply to such information or Invention as if authored, discovered, developed, invented, conceived, or reduced to practice under this Agreement. For purposes of this Agreement, “Prior Engagement Period” means any period of time prior to the date of this Agreement and/or the Relationship that Recipient provided services to the Company or to a predecessor in interest thereof.

(i)Amendments and Waivers. Except as provided in Section 10(g), no modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, shall be effective unless in a writing signed by Recipient and a duly authorized officer of the Company. No delay or failure to require performance of any provision of this Agreement shall constitute a waiver of that provision as to that or any other instance. Waiver by the Company of a breach of any provision of this Agreement shall not operate as a waiver of any other or subsequent breach. Any refusal or failure of the Company or its successors or assigns to enforce any of the restrictive covenants set forth in this Agreement against Recipient, for any reason, shall not constitute an act of precedent or a defense to the enforcement by the Company or its successors or assigns of the restrictive covenants set forth herein.

(j)Successors and Assigns. This Agreement will be binding upon Recipient’s heirs, executors, assigns, administrators, and other legal representatives, and shall be for the benefit of the Company, its successors, and its assigns. There are no intended third-party beneficiaries to this Agreement, except as may be expressly otherwise stated. The Company may freely assign this Agreement and any of its rights and obligations under this Agreement. Recipient may not assign, whether voluntarily or by operation of law, any of Recipient’s rights and obligations under this Agreement, except with the prior written consent of the Company.

(k)Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt or: (i) personal delivery to the party to be notified, (ii) when sent, if sent by electronic mail or facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, (iii) five days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt. All notices and communications shall be addressed to the party to be notified at such party’s address as set forth on the signature page, as subsequently modified by written notice, or if no address is specified on the signature page, at the most recent address set forth in the Company’s books and records.

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(l)Protected Activities. Nothing in this Agreement shall in any way limit or prohibit Recipient from engaging for a lawful purpose in any Protected Activity. For purposes of this Agreement, “Protected Activity” means filing a charge or complaint, or otherwise communicating, cooperating, or participating with, any state, federal, or other governmental agency, including the Securities and Exchange Commission, the Equal Engagement Opportunity Commission, and the National Labor Relations Board. Notwithstanding any restrictions set forth in this Agreement, Recipient is not required to obtain authorization from the Company prior to disclosing information to, or communicating with, such agencies, nor is Recipient obligated to advise the Company as to any such disclosures or communications. Notwithstanding, in making any such disclosures or communications, Recipient shall take all reasonable precautions to prevent any unauthorized use or disclosure of any information that may constitute Company Confidential Information to any parties other than the relevant government agencies. “Protected Activity” does not include the disclosure of any Company attorney-client privileged communications, and that any such disclosure without the Company’s written consent shall constitute a material breach of this Agreement.

(m)Advice of Counsel. Recipient acknowledges THAT, IN EXECUTING THIS AGREEMENT, Recipient Has HAD THE OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND Recipient Has read and understands ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT SHALL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR PREPARATION HEREOF.

(n)Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original, and all of which together shall constitute one and the same agreement. Execution of an electronic copy shall have the same force and effect as execution of an original, and an electronic signature shall be deemed an original and valid signature.

(o)Electronic Delivery. The Company may, in its sole discretion, decide to deliver any documents related to this Agreement or any notices required by applicable law by email or any other electronic means. Recipient hereby consents to (i) conduct business electronically (ii) receive such documents and notices by such electronic delivery and (iii) sign documents electronically and agrees to participate through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

[SIGNATURES ON FOLLOWING PAGE]

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The parties have executed this Agreement on the respective dates set forth below, to be effective as of the Effective Date first above written.

COMPANY:
FLEXENERGY ENERGY SYSTEMS, INC.
By:	/s/ Wes Kimmel
Name:	Wes Kimmel
Title:	Chief Financial Officer
Address:
112 Corporate Drive, Suite 3
Portsmouth, NH 03801
Email:	wes.kimmel@flexenergy.com
RECIPIENT:
Mark Schnepel
(Print Recipient Name)
/s/ Mark G. Schnepel
(Signature of Recipient)
Address:
[***]
[***]
Email:	[***]

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EXHIBIT A

LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP
EXCLUDED UNDER SECTION 3(g)

The following is a list of all Inventions that, as of the Effective Date: (1) Recipient made, and/or (2) belong solely to Recipient or belong to Recipient jointly with others or in which Recipient has an interest, and that relate in any way to any of the Company’s actual or proposed businesses, products, services, or research and development, and which are not assigned to the Company:

        Title        
   Date    Identifying Number
or Brief Description

Except as indicated above on this exhibit, Recipient has no inventions, improvements or original works to disclose pursuant to Section 3(a) of this Agreement.

___ Additional pages attached

RECIPIENT:

Mark Schnepel

(Print Recipient Name)

/s/ Mark G. Schnepel

(Signature of Recipient)

December 13, 2021

(Date)

 

EXHIBIT B

TERMINATION CERTIFICATION

This Termination Certification (this “Certification”) is delivered pursuant to the Confidential Information and Invention Assignment Agreement (the “Agreement”) between the undersigned and FlexEnergy Energy Systems, Inc., a Delaware corporation, its subsidiaries, affiliates, successors or assigns (collectively, the “Company”). Capitalized terms not otherwise defined in this Certification have the meanings given in the Agreement.

Recipient certifies that Recipient does not have in Recipient’s possession, nor has Recipient failed to return, any Company property, including, but not limited to, Company Confidential Information, Associated Third Party Confidential Information, all Company equipment including all Company Electronic Media Equipment, all tangible embodiments of the Company Inventions, all electronically stored information and passwords to access such property, Company credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, photographs, charts, any other documents and property, and reproductions of any of the foregoing items, including, without limitation, those records maintained pursuant to Section 3(d) of the Agreement.

Recipient further certifies that Recipient has complied with all the terms of the Agreement signed by Recipient, including the reporting of any Inventions (as defined therein), conceived or made by Recipient (solely or jointly with others) covered by the Agreement, and Recipient acknowledges Recipient’s continuing obligations under the Agreement.

Recipient further agrees that, in compliance with the Agreement, Recipient shall preserve as confidential all Company Confidential Information, including all Trade Secrets, and take all reasonable precautions to prevent any unauthorized use or disclosure of Company Confidential Information.

RECIPIENT:

Mark Schnepel

(Print Recipient Name)

(Signature of Recipient)

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EX-10.6

Exhibit 10.6

FlexEnergy ENERGY SYSTEMS, INC.

EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (this “Agreement”) is entered by and between FlexEnergy Energy Systems, Inc., a Delaware corporation (the “Company”), and Wes Kimmel (“Executive”).

1.Duties and Scope of Employment.

(a)Title and Duties. As of the Effective Date (as defined in Section 3 below), Executive will be employed and serve as Chief Financial Officer of the Company. During the Employment Term, and without any additional compensation in connection with such service, Executive shall also serve as an officer of such affiliates of the Company as the Board may determine from time to time. During the Employment Term (as defined in Section 3 below), Executive will have authority and render such business and professional services in the performance of Executive’s duties as are customarily associated with Executive’s position within the Company and Executive agrees to perform such other duties and functions as may from time to time be reasonably determined by the Board. The “Board” means (i) the board of directors of FlexEnergy Green Solutions, Inc. (“FGS”) if the Company is a direct or indirect subsidiary of FGS; or (ii) the board of directors or analogous governing body of the Company if the Company is not a direct or indirect subsidiary of FGS.

(b)Obligations. During the Employment Term, and excluding any periods of vacation, sick leave, or other leave to which the Executive is entitled, Executive will perform Executive’s duties faithfully and to the best of Executive’s ability and will devote such time as reasonably necessary to fulfill Executive’s responsibilities in the position. Executive and the Company agree that the Company represents Executive’s principal business focus. Except as may otherwise be approved by the Company from time to time, Executive’s services shall be primarily performed at the Company’s office at Portsmouth, New Hampshire, or other locations less than 50 miles from such location determined by the Company. Executive agrees to travel as reasonably necessary to fulfill Executive’s responsibilities in the position. During the Employment Term, Executive agrees that Executive shall maintain loyalty to the Company, shall take no action that would be injurious to the Company interests, and shall comply with all rules, regulations and policies of the Company. During the Employment Term, it shall not be a violation of this Agreement for Executive to (i) serve on up to two (2) civic or charitable boards or committees (and other board and committees from time to time as approved by the Board), (ii) deliver lectures, fulfill speaking engagements or teach at educational institutions, or (iii) manage personal investments and business endeavors, so long as such activities do not significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with this Agreement.

(c)Executive’s Employability. Executive represents and warrants that: (i) Executive has the right to execute, deliver and perform Executive’s duties under this Agreement, and (ii) Executive is not a party to any other agreements, arrangements or obligations (e.g., confidentiality agreements, noncompetition agreements), whether written, oral or implied, which include terms that would limit Executive’s ability to execute, deliver and perform Executive’s duties under this Agreement or which are otherwise inconsistent with this Agreement. This warranty will remain in full force and effect throughout the Employment Term (as defined in Section 3 below).

2.Compensation.

(a)Base Salary. During the Employment Term, the Company will pay Executive as compensation for Executive’s services a base salary at rate of $24,625.00 per month (the “Base Salary”). The Base Salary will be paid in regular installments in accordance with the Company’s normal payroll practices, subject to applicable deductions and withholdings. The first and last payment will be adjusted, if necessary, to reflect a commencement or termination date other than the first or last working day of a pay period.

(b)Annual Bonus. Executive shall be eligible for an annual bonus (collectively the “Annual Bonus”) during the Employment Term in a target amount equal to 50% of Base Salary, to be earned based on such targets, criteria, terms and conditions as be determined by the Board (or a duly authorized committee thereof) in its sole discretion, subject to the terms of this Agreement. Any such Annual Bonus (i) will only be determined and awarded after the completion of the audited financial statements for FGS with respect to the applicable annual period for which the Annual Bonus is to be earned; (ii) will only be awarded and paid if both (A) Executive remains employed with the Company during the full annual period for which the Annual Bonus is to be earned and (B) (I) Executive remains employed with the Company through the award and payment of the Annual Bonus or (II) subject to Section 4(b), Executive’s employment with the Company is terminated by the Company without Cause between the last day of the annual period for which the Annual Bonus is to be earned and the date on which the Annual Bonus would otherwise be paid; and (iii) will be paid as soon as practicable, but not later than 45 days, after the completion and public release of audited financial statements for FGS with respect to the applicable annual period for which the Annual Bonus is earned.

(c)Equity Incentives.

(i)Incentive Award Plan Eligibility. Executive shall be eligible to participate in, and receive one or more grants under, the FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan (the “Incentive Plan”). Any such awards and the terms and conditions thereof shall be subject to the discretion of the board of directors of FGS and set forth in award documentation as such board of directors deems reasonably necessary in connection with any such award.

(ii)Issuance of Shares One Year After IPO. The Company agrees to cause the issuance to Executive under the Incentive Plan (pursuant to then-current forms of award agreement under the Incentive Plan), after the one (1) year anniversary of the IPO (as defined in Section 3 below), of an amount of shares of common stock of FGS equal to 2.5% of the total number of shares initially available under the Plan if (A) Executive remains employed by the Company throughout the one (1)-year period immediately following the IPO, (B) Executive is terminated by the Company without Cause (defined below) during one (1)-year period immediately following the IPO, or (C) Executive terminates this Agreement for Good Reason.  For the avoidance of doubt, no shares will be issued to Executive if Executive fails to remain employed by the Company during the one (1)-year period immediately following the IPO under any other circumstances (ex. resignation by Executive without Good Reason, termination by the Company for Cause).

(iii)Stock Option Awards.

(1)Initial Award. Without limiting Sections 2(c)(i) or 2(c)(ii) above, the Company will recommend to the FGS board of directors that Executive receive a stock option award to purchase shares of common stock of FGS, at an exercise price determined by the FGS board of directors in accordance with the requirements of the Incentive Plan, for (A) common stock of FGS in an amount equal to 2% of the total number of shares initially available under the Plan, to be initially vested and exercisable upon grant, and (B) common stock of FGS in an amount equal to 8% of the total number of shares initially available under the Plan, to vest and become exercisable over a four (4)-year period with 25% vesting on each anniversary of the IPO (defined below) subject to Executive’s continuous service through the applicable anniversary.

(2)Additional IPO Award. Without limiting Sections 2(c)(i) or 2(c)(ii) above, in recognition of extraordinary efforts with respect to the IPO, the Company will recommend to the FGS board of directors that Executive receive an additional stock option award to purchase shares of common stock of FGS, at an exercise price determined by the FGS board of directors in accordance with the requirements of the Incentive Plan, for shares of common stock of FGS in an amount equal to 1.5% of the total number of shares initially available under the Plan, to be initially vested and exercisable upon grant.

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(3)Additional Award Terms. The Company will recommend in connection with the foregoing recommendations that (A) any such stock option award not be subject to any adjustment pursuant to Section 12 of the Incentive Plan, without Executive’s written consent, that would reduce the number of shares subject to the stock option or increase the exercise price applicable to the stock option (except to provide equitable adjustment with respect to a reverse stock split or other event specified in Section 12(i) of the Incentive Plan having a substantively similar effect on the outstanding capital of FGS), and (B) any such stock option award otherwise be subject to the general terms and conditions of the Incentive Plan.

(4)Acknowledgement. Notwithstanding the foregoing, it is hereby acknowledged and agreed that no stock option award to Executive has been approved by the FGS board of directors, and Executive has no right to receive (and neither the Company nor FGS has any obligation to issue) any stock option award unless and until the FGS board of directors has actually approved any such stock option award and the full terms thereof (including the applicable exercise price).

(d)Expense Reimbursement. During the Employment Term, the Executive shall be entitled to reimbursement of reasonable out-of-pocket business expenses incurred by Executive in furtherance of Company’s business in accordance with Company’s policies with respect thereto as in effect from time to time (the “Expense Reimbursement”). All reimbursements provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A including, where applicable, the requirement that (i) any reimbursement is for expenses incurred during Executive’s lifetime (or during a shorter period of time specified in this Agreement); (ii) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year; (iii) the reimbursement of an eligible expense shall be made no later than the last day of the calendar year following the year in which the expense is incurred; and (iv) the right to reimbursement or in kind benefits is not subject to liquidation or exchange for another benefit.

(e)Vacation. Executive shall be entitled to a minimum of three (3) weeks paid vacation per year, in accordance with the Company’s standard vacation policy.

(f)Employee Benefits. During the Employment Term, Executive will be considered a full-time employee and be entitled to participate in the employee benefit plans and programs currently and hereafter maintained by the Company of general applicability to other Employees of Executive’s classification at the Company (the “Benefits”). The Company reserves the right to cancel or change the Benefit plans and programs it offers to its employees at any time. In the event of any dispute between this Agreement and the terms of any Benefit summary plan description, the terms of the summary plan description shall control.

3.Effective Date; Term of Employment.

(a)Employment Term; Effective Date. The “Employment Term” under this Agreement will commence on the Effective Date and will continue until the Executive’s employment terminated by either the Company or Executive as provided in Section 3(b) of this Agreement. This Agreement shall only become a legally effective agreement binding on Executive and the Company on the closing date (the “Effective Date”) of an initial public offering of the common stock of FGS pursuant to a registration statement filed under the Securities Act of 1933, as amended (an “IPO”). If an IPO does not close on or before January 31, 2022, then this Agreement shall thereafter be void and no legal force or effect.

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(b)Termination. Notwithstanding anything else contained in this Agreement, Executive’s employment hereunder shall terminate upon the earliest to occur of the following:

(i) Death. Immediately upon Executive’s death.

(ii)Termination by Executive.

(1)Generally. If terminated by Executive without Good Reason, upon written notice by Executive to the Board that Executive is terminating employment (a “Resignation Notice”), which termination shall be effective 60 days after the date of such notice, or such earlier date as specified in writing by the Company in its sole discretion during such 60-day period; or

(2)For Good Reason. If terminated by Executive for Good Reason, upon written notice by Executive to Company that Executive is terminating Executive’s employment for Good Reason and that sets forth the factual basis supporting the Good Reason, which termination shall be effective 30 days after the date of such notice, or such earlier date as specified in writing by the Company in its sole discretion during such 30-day period. For the avoidance of doubt, such termination shall not constitute a termination for Good Reason if Company cures the conditions identified in Executive’s notice as provided in Section 3(d)(iii).

(iii)Termination by the Company.

(1)For Cause. If terminated by the Company for Cause (defined below), upon written notice by the Company to Executive that Executive’s employment is being terminated for Cause, which termination shall be effective on the date of such notice or such later date as specified in writing by the Company;

(2)Without Cause or Disability. If terminated by the Company for reasons other than for Cause or Disability, upon written notice by Company to Executive that Executive’s employment is being terminated, which termination shall be effective immediately after the date of such notice or such later date as specified in writing by the Company; or

(3)For Disability. If terminated by the Company because of Executive’s Disability (defined below), upon written notice by the Company to Executive that Executive’s employment is being terminated as a result of Executive’s Disability, which termination shall be effective 30 days after the date of such notice or such later date as specified in writing by the Company, unless within such period Executive becomes capable of rendering services of the character contemplated hereby (and a physician chosen by the Company so certifies in writing) and Executive in fact resumes such services.

(c)Deemed Termination for Cause. Notwithstanding anything in this Agreement to the contrary, if (i) the Company at any time determines that Cause existed at the time of Executive’s termination or written notice thereof, (ii) Executive has breached or breaches the terms of Section 5, then upon written notice by the Company to Executive (i) the Executive’s termination shall be deemed be (or have been) terminated by the Company for Cause pursuant to Section 3(b)(iii)(1) (including for purposes of Section 4 and Section 6(g)(ii)(1)), (ii) the Company may immediately cease payments of any Basic Severance Payments and/or any Extended Severance Payments that may otherwise be due to Executive, and (iii) the Company may recover from Executive any Basic Severance Payments and/or any Extended Severance Payments that may have already been paid to Executive. The cessation and recovery of such any payments shall be in addition to, and not as an alternative to, any other remedies at law or in equity available to the Company with respect to the matters constituting Cause, including, without limitation, the right to specific performance and/or injunctive or other relief.

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(d)Certain Definitions.

(i)Definition of Cause. For purposes of this Agreement, “Cause” means any of the following: (A) conviction of, or the entry of a plea of guilty or no contest to, a felony, a crime of moral turpitude, or any other crime that causes the Company public disgrace or disrepute, or which materially and adversely affects the Company’s operations or financial performance or the relationship the Company has with its customers; (B) gross negligence or willful misconduct with respect to the Company, including, without limitation fraud, embezzlement, theft or proven dishonesty in the course of Executive’s employment or other service; (C) alcohol abuse or use of either illegal drugs or controlled drugs (other than in accordance with a physician’s prescription); (D) refusal to perform any lawful, material obligation or fulfill any duty (other than any duty or obligation of the type described in clause (F) below) to the Company (other than due to a disability, as determined by the Committee), which refusal, if curable, is not cured within 15 days after delivery of written notice thereof (and for the avoidance of doubt, the relevant refused obligation or duty will be specifically identified in such written notice); (E) material breach of any agreement with or duty owed to the Company, which breach, if curable, is not cured within 15 days after the delivery of written notice thereof (and for the avoidance of doubt, if applicable, the relevant breached duty will be specifically identified in such written notice); (F) any breach of any obligation or duty to the Company (whether arising by statute, common law or agreement) relating to confidentiality, non-competition, non-solicitation, trade secrets, and/or proprietary rights; (G) material violation of the Company’s written policies or codes of conduct, including those related to discrimination, harassment, performance of illegal or unethical practices, and ethical misconduct; or (H) in the case of a director, repeated failure to participate in Board meetings (including meetings of any Board committee of which the director is a member) on a regular basis despite having received proper notice of meetings in advance.

(ii)Definition of Disability. For purposes of this Agreement, “Disability” means Executive’s inability to perform one or more of the essential functions of Executive’s job due to Executive’s physical or mental impairment, with or without reasonable accommodation as required by law, for any period aggregating more than 120 days in any 365 consecutive day period; provided however, that (A) if the Company determines that Executive has become Disabled, the Company shall notify Executive of its determination; (B) Executive may then request a reasonable accommodation (as that term is defined under the Americans with Disabilities Act) from the Company to assist in his/her return to work; (C) the Company will determine whether Executive’s request can be reasonably accommodated without undue hardship no later than 30 days after Executive requests an accommodation (with additional time being provided in the event of Executive or Executive’s medical provider delaying in providing information that is necessary to the Company’s determination); and (D) in the event Executive’s request cannot be reasonably accommodated (and/or presents an undue hardship), the Company may, by notice given in the manner provided in this Agreement, terminate Executive’s employment hereunder.

(iii)Definition of Good Reason. For purposes of this Agreement, “Good Reason” means any of the following within the prior 90 days without Executive’s approval: (A) any material diminution of Executive’s authority, duties or responsibilities with or to the Company, other than (i) a paid leave of absence at the direction of and approved by the Board or (ii) an unpaid administrative leave imposed for the purposes of investigating or addressing misconduct by Executive; (B) the Board assigns Executive duties or responsibilities that are materially inconsistent with Executive’s position; (C) any material breach of this Agreement by the Company, including, without limitation, a reduction in Executive’s Base Salary below the amount specified in Section 2(a) without Executive’s consent; or (D) a change in the geographic location at which Executive must primarily perform services to a location more than 50 miles from Portsmouth, New Hampshire without Executive’s approval. Executive must give the Company written notice of Executive’s intention to terminate employment for Good Reason, which notice must state the grounds on which the proposed termination for Good Reason is based. Executive must provide such written notice of the occurrence of these grounds no later than 90 days after their initial occurrence. The Company may remedy these condition(s) within 15 days of receiving notice from Executive and no “Good Reason” will exist if the Company remedies such condition(s) during such 15-day period.

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(iv) Definition of Change in Control Period. For purposes of this Agreement, a “Change in Control Period ” means the one (1)-year period commencing six (6)-months prior to a Change in Control (as defined in the Incentive Plan).

(e)Transition Assistance. For a period of 30 days following the effective date of Executive’s resignation, Executive shall make himself or herself available to the Company and/or its agents (i) for the purpose of facilitating an efficient transition of Executive’s job related responsibilities and duties to other designated individuals, and (ii) to respond to questions from the Company and/or its agents regarding information and/or activities in which Executive was engaged while employed by the Company; provided that the foregoing time period is based on Executive’s reasonable efforts to cooperate, Executive will not be entitled to additional compensation for such availability and cooperation; and further provided that such assistance shall be reasonable and not substantially interfere or conflict with Executive’s responsibilities to any new employer.

4.Payments upon Termination.

(a)Generally; Accrued Obligations. If Executive’s employment is terminated for any reason, then the Company shall pay Executive the Accrued Obligations promptly following the effective date of such termination. “Accrued Obligations” means (A) the portion of Executive’s Base Salary that has accrued prior to any termination of Executive’s employment with Company and has not yet been paid, any bonus that has been awarded to Executive as of the date of termination of Executive’s employment but has not yet been paid to Executive, (B) and the amount of any unreimbursed Expense Reimbursement. Executive’s entitlement to any other compensation or benefit under any plan of Company shall be governed by and determined in accordance with the terms of such plans, except as otherwise specified in this Agreement.

(b)Termination by the Company without Cause or Termination for Good Reason. If the Company terminates Executive’s employment without Cause or the Executive terminates Executive’s employment for Good Reason, then, in addition to the Accrued Obligations, and subject to (A) the Executive signing a separation and release agreement in the form attached as Exhibit A, and as such form may be updated by the Company from time to time at any time to conform with changes in applicable laws (a “General Release”) and (B) the General Release becoming effective and irrevocable, all within 60 days after the date of termination (or such shorter period as set forth in the General Release), the Company shall pay Executive:

(i)the Basic Severance Payments, or

(ii)if the Board, in its sole discretion, elects (by written notice to Executive within 10 days following the termination of Executive’s employment) that the Company will pay Extended Severance Payments to Executive instead of the Basic Severance Payments pursuant to Section 4(b)(i), the Extended Severance Payments (instead of the Basic Severance Payments); and

if applicable pursuant to Section 2(b), an Annual Bonus with respect to the preceding annual period.

(c)Terminations without Cause during a Change in Control Period. If the Company terminates Executive’s employment without Cause during a Change in Control Period, then, in addition to the Accrued Obligations, and subject to (i) the Executive signing a General Release and (ii) the General Release becoming effective and irrevocable, all within 60 days after the date of termination (or such shorter period as set forth in the General Release), the Company shall pay Executive the Extended Severance Payments.

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(d)COBRA Premiums.

(i) Subject to Section 4(d)(ii), if (A) Executive is entitled to Basic Severance Payments or Extended Severance Payments (including, without limitation, Executive’s timely execution and delivery of a General Release that has become effective and irrevocable), and (B) Executive is eligible for and timely and properly elects continuation health care coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), then the Company will pay or promptly reimburse the COBRA premium amounts required for the continued coverage of Executive and Executive’s dependents (if any) under the Company’s group health care plans at the same levels that would have applied if Executive’s employment had not terminated (if possible) until the end of the Basic Severance Term or Extended Severance Term, as applicable (or until such earlier time as Executive ceases to be eligible for COBRA coverage, if earlier) (the “COBRA Premiums”). Notwithstanding the foregoing, if the Company determines, in its sole discretion, that it cannot pay the COBRA Premium without a substantial risk of violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company instead shall pay Executive a monthly cash payment equal to the applicable COBRA Premium for that month.

(ii)If, however, health care insurance benefits are available to Executive from a new employer, the Company shall have no further obligation relating to payment of additional COBRA Premiums. Executive agrees to promptly inform the Company if and when health care insurance benefits are available from a new employer, and to reimburse the Company for any amounts paid with respect to COBRA Premiums to the extent paid after health care insurance benefits are available to Executive from a new employer.

(e)Certain Definitions.

(i)Basic Severance Payments; Basic Severance Term. For purposes of this Agreement, “Basic Severance Payments” means, to the extent applicable, the monthly cash severance at the Base Salary rate, less standard withholdings and deductions, to be paid during the Basic Severance Term. For purposes of this Agreement, “Basic Severance Term” means the six (6)-month period immediately following the termination date of Executive’s employment.

(ii)Extended Severance Payments; Extended Severance Term. For purposes of this Agreement, “Extended Severance Payments” means, to the extent applicable, the monthly cash severance at the Base Salary rate, less standard withholdings and deductions, to be paid during the applicable Extended Severance Term. For purposes of this Agreement, “Extended Severance Term” means the one (1)-year period immediately following the termination date of Executive’s employment.

(f)Execution of General Release. For the avoidance of doubt, the Company shall not be obligated to pay Executive any severance payments unless a General Release has been timely executed and delivered by Executive and such General Release has become effective and irrevocable.

(g)Limited Rights to Severance Payments. For clarity, (i) entitlement to severance payments of any kind pursuant to this Agreement shall only be possible if (A) the Company terminates Executive’s employment without Cause, or (B) Executive terminates this Agreement for Good Reason; and (ii) no severance payment obligations shall arise out of (W) a termination of this Agreement by the Company with Cause, (X) a termination of this Agreement by the Executive without Good Reason, or (Y) a termination of this Agreement due to Executive’s death or Disability.

(h)No Continued Vesting. For the avoidance of doubt, vesting of any grants under the Incentive Plan or any other stock, stock option or other incentive awards shall cease upon the date of any termination of Executive’s employment, and shall not continue to vest for the remainder of any Noncompetition Period, Non-Solicitation Period or during any applicable Basic Severance Term or Extended Severance Term.

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(i) Execution of General Release. In accordance with Section 4(b), Section 4(c) and Section 4(d), to receive the payments set forth in those Sections, Executive’s or Executive’s estate’s, if applicable, General Release must be executed, effective and irrevocable before the expiration of 60 days after the date of termination. The payments specified in these Sections will begin as soon as practicable (not to exceed 30 days) after the General Release is executed, effective and irrevocable, but if the 60-day period could span two (2) tax years, the payments must be made in the later year. For example, if the Company terminates Executive’s employment without Cause on December 15, Executive has 60 days—until February 13 —for a General Release to be sign and become effective and irrevocable. In this case, payments due in accordance with Section 4(b), Section 4(c) or Section 4(d) may not begin until the following year, even if the release was signed, effective and irrevocable in December. If Executive’s or Executive’s estate’s, if applicable, General Release is not executed, effective and irrevocable before the end of the 60-day-period, then the Executive and Executive’s estate forfeit, on behalf of Executive and all who might claim through Executive, the payments that would otherwise be due under the applicable Section of this Agreement.

5.Confidentiality and Invention Assignment Agreement. Executive has executed, and as applicable shall execute, the Company’s Confidentiality and Invention Assignment Agreement, the current form of is attached as Exhibit B, and as updated from time to time (“CIIA”), the provisions of which are hereby incorporated by reference and shall govern the Executive’s obligations and responsibilities with regard to the Company Confidential Information (as that term is defined in the CIIA), the assignment of intellectual property, and other matters. Executive agrees to comply with the terms of the CIIA. To the extent that any provision of the CIIA conflicts with any provision in this Agreement, the provisions requiring Executive to comply with the higher standard shall govern.

6.Restrictive Covenants.

(a)Acknowledgement. Executive agrees that, during the Employment Term, Executive (i) has a duty of loyalty to the Company, and (ii) shall not engage in or undertake any action that conflicts with the undivided loyalty owed by Executive to the Company. Executive represents and warrants that Executive has no other agreements, relationships, or commitments to any other person or entity that conflict with the provisions of this Agreement, Executive’s obligations to the Company under this Agreement, or Executive’s ability to perform Executive’s duties to the Company. Executive acknowledges and agrees that: (A) Executive’s employment with the Company has brought Executive into close contact with Confidential Information of the Company and its customers, vendors, suppliers, employees, and independent contractors; and (B) the agreements and covenants contained in this Section 6 are essential, reasonable, and no broader than necessary to protect the reasonable business interests and goodwill of the Company. Executive further acknowledges, represents, and agrees that the terms of this Section 6 do not and will not pose an undue hardship on Executive, and that Executive will be able to maintain gainful employment notwithstanding the terms of this Section 6. Executive further acknowledges, represents, and agrees that he/she has received valuable consideration (including, but not limited to, a payment of five hundred dollars ($500.00) that is expressly for the purposes of serving as consideration for this Section 6) that is sufficient to support the promises being made by Executive herein. Accordingly, Executive covenants and agrees to the following restrictive covenants.

(b)Non-Solicitation of Company Employees and Contractors. Executive agrees that during the Non-Solicitation Period (defined below), Executive shall not directly or indirectly (i) hire, employ, recruit, solicit, lure or entice away, or in any other manner persuade or attempt to persuade, any employee of the Company to discontinue such employee’s employment with the Company or (ii) solicit or encourage any independent contractor providing services to the Company to terminate or diminish its relationship with the Company; provided, that, the foregoing shall not be breached by general advertisements not targeted at employees or independent contractors of the Company.

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(c) Non-Solicitation of Company Customers. Executive agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly (i) solicit or assist in the solicitation by any third party of any Covered Customer (defined below) for the purpose of providing services or products that compete with, or are similar to, the service or product offerings of the Company, except when such solicitation is done on behalf of the Company, or (ii) discourage any Covered Customer from obtaining of services or products from the Company.

(d)Non-Interference with Vendors and Service Providers. Executive agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly negatively influence or otherwise interfere with the Company’s relationships with vendors, suppliers, consultants, advisors, or other service providers of the Company.

(e)Non-Competition with the Company. Executive agrees that, during the Non-Competition Period, Executive shall not directly or indirectly, as a director, manager, member, stockholder, partner, owner, employee, consultant, or agent of any business, or in any other capacity, other than on behalf of the Company, organize, establish, own, operate, manage, control, engage in, participate in, invest in, permit Executive’s name to be used by, act as a consultant or advisor to, render services for (alone or in association with any person, firm, corporation, or other entity), or otherwise assist any person or entity that engages in or owns, invests in, operates, manages, or controls any venture or enterprise in all or a part of the Restricted Area, that engages in (A) the manufacture, sale, lease, service or other manner of offering of products or services that provide natural gas or hydrogen fueled distributed power generation with a single unit nameplate capacity of up to 5MW (which excludes, for the avoidance of doubt, the manufacture, sale, lease, service or other manner of offering of batteries, solar or wind powered energy generation equipment, or electrochemical (non-combustion) powered fuel cells), (B) the manufacture, sale, lease, service or other manner of offering of heat exchanger/transfer products that can operate with gases at a temperature above 1000° Fahrenheit or (C) any other new line of business, products or services offered or in development by FGS or any direct or indirect subsidiary thereof during the prior six months of the Employment Term and in which Executive has had material involvement (the “Restricted Business”). Notwithstanding the foregoing, nothing in this Agreement shall prevent Executive from owning, directly or indirectly, for passive investment purposes not intended to circumvent this Agreement, less than 2% of the publicly traded common equity securities of any company engaged in the Business (so long as Executive has no power to manage, operate, advise, consult with, or control the competing enterprise and no power, alone or in conjunction with other affiliated parties, to select a director, manager, general partner, or similar governing official of the competing enterprise other than in connection with the normal and customary voting powers afforded Executive in connection with any permissible equity ownership). Notwithstanding the foregoing, nothing in this Section 6(e) shall be deemed to restrict Executive from employment (and potentially associated ownership therein) with a private equity firm, venture capital firm, family office investment firm, structured debt financing or infrastructure investment firm (including such a firm focused on the energy industry), so long as (i) Executive shall not have responsibility for, nor provide any work or services directly for or the direct benefit of, any person or entity (whether an actual portfolio, prospective portfolio or otherwise) engaged in the Restricted Business, and (ii) Executive complies with Executive’s other continuing confidentiality, non-solicitation, non-interference, non-disparagement and other associated obligations under this Agreement in connection with Executive’s employment with such private equity firm.

(f)Non-Disparagement. Executive also agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly (i) disparage the Company, its affiliates and their respective directors, officers, managers, managers, employees, or agents, or (ii) make any public statement that could reasonably be expected to materially and adversely affects the reputation, brand, or business of the Company. This provision does not apply to any statements made to governmental agencies for the purposes of asserting, or participating in any investigation by such agencies concerning, Executive’s statutory rights. In the event of a termination of Executive’s employment (other than a termination for Cause, including pursuant to Section 3(c)), subject to a General Release for Executive being signed, delivered, effective and irrevocable, and further subject to Executive’s compliance and continuing compliance with Executive’s continuing obligations of this Agreement (including this Section 6), then the Company shall cause the FGS board of directors and FGS executive officers (while such individuals serve in such capacities) not to disparage Executive during the remainder of the Non-Solicitation Period. This provision does not apply to any statements or other disclosures by the Company, the FGS board of directors or FGS executive officers for the purpose of or necessary for compliance with federal or state securities laws, as well as rules of any securities exchange on which any securities of the Company, including FGS, are then traded.

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(g)Certain Defined Terms. The following terms, when used in this Section 6, will have the respective meanings set forth below:

(i)“Restricted Area” means the area within the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided however if any court of competent jurisdiction determines that the geographic scope of such Restricted Area is unreasonable, the “Restricted Area” means with respect to the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company, the area within each state or territory thereof for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided however if any court of competent jurisdiction determines that the geographic scope of such Restricted Area is unreasonable, the “Restricted Area” means with respect to the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company, the area within each county or similar jurisdiction thereof for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided, however if any court of competent jurisdiction determines that the geographic scope of such Applicable Area is unenforceable, the “Restricted Area” means within 50 miles of any location at which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company.

(ii)“Non-Competition Period” means:

(1)the period during Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company if Executive’s employment (A) is terminated by the Company for Cause, (B) is terminated by the Company without Cause during a Change in Control Period, or (C) is terminated by Executive other than for Good Reason.

(2)the period during Executive’s employment with the Company and for the six (6)-month period after the end of Executive’s employment with the Company if Executive’s employment is terminated in any circumstances not provided in Section 6(g)(ii)(1)(A), (B) or (C) above; provided, however, that the Board may, in its sole discretion, elect (by written notice to Executive within 10 days following the termination of Executive’s employment) that the Company will pay Extended Severance Payments to Executive (instead of any Basic Severance Payments), in which case the “Non-Competition Period” instead means the period during the Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company.

(iii)“Non-Solicitation Period” means the period during Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company.

(iv)“Company” includes the Company and any of the Company’s affiliates.

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(v) “Covered Customers” means persons; firms; associations; partnerships; corporations; limited liability companies; institutions, local, state, federal and foreign entities or agencies; and other entities (A) to which the Company provided services or products before or during Executive’s employment with the Company, (B) in relation to which Executive has provided any of the Services, or (C) that the Company (or Executive in connection with the Services) has contacted or solicited with respect to the provision of services or products before or during Executive’s employment with the Company.

(vi)An “employee” or “independent contractor” of the Company is any person who is an employee or independent contractor, respectively, of any of the Company on the date hereof or who becomes an employee or independent contractor of the Company during Executive’s employment with the Company.

(h)Remedies. If Executive breaches any of the provisions contained in this Section 6, the Company shall have the remedies set forth below, each of which shall be enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to the Company at law or in equity. The provisions of this Section 6 are intended to be for the benefit of the Company and its affiliates, and any of the Company or its affiliate may enforce such provisions. Executive recognizes and acknowledges that a breach of the covenants contained in this Section 6 will cause irreparable harm to the goodwill and business of the Company, the exact amount of which will be difficult to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, in the event of an alleged or threatened breach by Executive of any of the provisions of this Section 6, the Company may, in addition to all other rights and remedies existing in its favor, seek specific performance and/or injunctive or other relief in order to enforce or prevent any violations of the provisions hereof. Additionally, if Executive breaches Executive’s obligations under Section 5 or Section 6, then the Company may immediately cease payments of any Basic Severance Payments and/or any Extended Severance Payments and may recover any Basic Severance Payments and/or any Extended Severance Payments paid to Executive after such breach. The cessation and recovery of such payments shall be in addition to, and not as an alternative to, any other remedies at law or in equity available to the Company including, without limitation, the right to specific performance and/or injunctive or other relief.

(i)Severability. In the event any provision of this Section 6 shall be determined by a court of competent jurisdiction to be unenforceable by reason of its extending for too great a period of time or over too great a geographical area or by reason of its being too extensive in any other respect, it will be interpreted to extend only over the maximum period of time for which it may be enforceable, over the maximum geographical area as to which it may be enforceable, or to the maximum extent in all other respects as to which it may be enforceable, all as determined by such court in such action. If any provision of this Agreement, or any part thereof, is held to be invalid or unenforceable because of the scope or duration of or the area covered by such provision, the parties agree that the court making such determination shall reduce the scope, duration and/or area of such provision (and shall substitute appropriate provisions for any such invalid or unenforceable provisions) in order to make such provision enforceable to the fullest extent permitted by law and/or shall delete specific words and phrases, and such modified provision shall then be enforceable and shall be enforced. In the event that any court determines that the time period or the area, or both, are unreasonable and that any of the covenants is to that extent invalid or unenforceable, the parties agree that such covenants will remain in full force and effect, first, for the greatest time period, and second, in the greatest geographical area that would not render them unenforceable.

(j)Enforceability. The Parties each acknowledge that the other party acted in good faith in the negotiation and execution of the provisions in this Section 6. In particular, the Parties acknowledge that given the nature of Executive’s duties and responsibilities (and Executive’s associated influence over the Company’s business and its relationships with its customers), the restrictions and duration of the obligations set forth in this Section 6 are reasonable and no broader than necessary to protect the legitimate business interests of the Company and the goodwill thereof. Executive further acknowledges that the restrictions and duration of this Section 6 do not and will not impose an unreasonable hardship upon Executive. The Parties further agree that the requirements of this Section 6 shall survive the termination of Executive’s employment with the Company.

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(k)Waiver or Inapplicability of Non-Competition Obligations. Executive may submit to the Board a written description setting out a reasonable description (including without limitation the identity of any associated employer and other relevant parties) of any contemplated activity that would or may otherwise violate or contravene Executive’s obligations under Section 6(e) (the “Specified Activity”), and request that the Board waive or otherwise confirm the inapplicability of Executive’s obligations under Section 6(e) with respect to such Specified Activity. If and to the extent the Board confirms in writing to Executive the waiver or inapplicability of Executive’s obligations under Section 6(e) with respect to the Specified Activity (such waiver or confirmation, not to be unreasonably withheld based on the interests of the Company), then Executive shall thereafter have no liability or obligation under Section 6(e) with respect to the Specified Activity.

7.Assignment. This Agreement will be binding upon and inure to the benefit of (a) the heirs, executors and legal representatives of Executive upon Executive’s death and (b) any successor of the Company. Any such successor of the Company will be deemed substituted for the Company under the terms of this Agreement for all purposes. For this purpose, “successor” means any person, firm, corporation or other business entity which at any time, whether by purchase, merger or otherwise, directly or indirectly acquires all or substantially all of the assets or business of the Company. None of the rights of Executive to receive any form of compensation or benefits pursuant to this Agreement may be assigned or transferred except by will or the laws of descent and distribution. None of the obligations of Executive under this Agreement may be assigned or transferred. Any other attempted assignment, transfer, conveyance or other disposition of Executive’s right to compensation or other benefits will be null and void.

8.Notices. All notices, requests, demands and other communications called for under this Agreement will be in writing and will be delivered personally by hand or by courier, mailed by United States first-class mail, postage prepaid, or sent by email or by other electronic means directed to the party to be notified at the address or email address indicated for such party on the signature page to this Agreement, or at such other address or email address as such party may designate by 10 days’ advance written notice to the other parties hereto. All such notices and other communications will be deemed given upon personal delivery, three (3) days after the date of mailing, or when sent if given via email or other electronic means.

9.Severability. In the event that any provision(s) of this Agreement becomes or is declared by an arbitrator or a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement will continue in full force and effect without such provision(s).

10.Arbitration.

READ THE FOLLOWING ARBITRATION PROVISION CAREFULLY. IT LIMITS CERTAIN OF YOUR RIGHTS, INCLUDING YOUR RIGHT TO OBTAIN REDRESS THROUGH COURT ACTION

(a)Executive and the Company agree that other than any claims (by Company or Executive) for injunctive relief, any dispute or controversy arising out of, relating to, or in connection with this Agreement, or the interpretation, validity, construction, performance, breach, or termination thereof, will be settled by binding arbitration to be held in New Hampshire in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association (the “Rules”). The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator will be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having jurisdiction.

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(b) The arbitrator(s) will apply New Hampshire law to the merits of any dispute or claim, without reference to rules of conflicts of law. The arbitration proceedings will be governed by federal arbitration law and by the Rules, without reference to state arbitration law.

(c)EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EXECUTIVE AGREES TO SUBMIT ANY CLAIMS (OTHER THAN THOSE FOR INJUNCTIVE RELIEF) WHICH ARISE OUT OF, RELATE TO, OR ARE IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION THEREOF TO BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EXECUTIVE’S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, CLAIMS OF DISCRIMINATION, HARASSMENT, OR RETALIATION, OTHER THAN CLAIMS FOR INJUNCTIVE RELIEF.

(d)The Parties each acknowledge and agree that they have had ample time to consider the terms of this arbitration agreement, that they each negotiated it at arms-length with equal bargaining power,

Executive Signature Signifying Agreement To Arbitration

11.Integration/Waiver. This Agreement, its exhibits, and the confidentiality and invention assignment agreement described in Section 5 above represent the entire agreement and understanding between the parties as to the subject matter herein and supersede all prior or contemporaneous agreements whether written or oral, including without limitation any employment agreement previously signed by Executive. To the extent that any provision of the CIIA conflicts with any provision in this Agreement, the provisions requiring Executive to comply with the higher standard shall govern. No waiver, alteration or modification of any of the provisions of this Agreement will be binding unless in writing and signed by duly authorized representatives of the parties hereto.

12.Tax Withholding. All payments made pursuant to this Agreement will be subject to applicable taxes and other withholdings or deductions authorized or required by law.

13.Governing Law; Consent to Personal Jurisdiction. THIS AGREEMENT WILL BE GOVERNED BY THE LAWS OF THE STATE OF NEW HAMPSHIRE WITHOUT REGARD FOR CONFLICTS OF LAWS PRINCIPLES. EACH PARTY EXPRESSLY CONSENTS TO THE PERSONAL JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN THE DISTRICT OF NEW HAMPSHIRE SUBJECT TO THE ARBITRATION PROVISION SET FORTH IN SECTION 10.

14.Attorneys’ Fees. In the event of arbitration or litigation arising from or relating to this Agreement, each party shall be responsible for such party’s own attorneys’ fees and costs and expenses including expert witness fees.

15.Construction of Agreement. The parties have participated jointly in the negotiating and drafting of this Agreement. If a question concerning intent or interpretation arises, no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of authorship.

16.Captions. Titles or captions contained in this Agreement are for convenience and are not intended to affect the substantive meaning of any provision.

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17. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

18.Code Section 409A. To the fullest extent applicable, amount and other benefits payable under this Agreement are intended to be exempt from the definition of “nonqualified deferred compensation” under section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”) in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, notwithstanding anything in the Agreement to the contrary, to the extent that any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement must be interpreted and administered to the extent possible, or amended, to comply with the applicable requirements of Section 409A with respect to these amounts or benefits.

[Signature page follows]

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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year first above written.

“COMPANY”
FlexEnergy Energy Systems, Inc.
By:	/s/ Mark G. Schnepel

Name: Mark G. Schnepel

Title:	Chief Executive Officer
Date:	December 13, 2021
Address:
112 Corporate Drive, Suite 3
Portsmouth, NH 03801
Attn.: Board of Directors
Email:	Mark.Schnepel@flexenergy.com
“EXECUTIVE”
/s/ Wes Kimmel
Wes Kimmel
Date:	December 13, 2021
Address:
[***]
[***]
Email:	[***]

Exhibit A

Form of General Release

SEVERANCE AGREEMENT AND RELEASE

You are advised to consult with an attorney before executing this Agreement.

This Severance Agreement and Release (the “Agreement”) is entered into knowingly and voluntarily by and between Wes Kimmel (“Employee”) and FlexEnergy Energy Systems, Inc., a Delaware corporation (“Company”). Employee and the Company may be collectively referred to as the “Parties.”

RECITALS

A.       Employee was employed as an executive of the Company.

B.       Employee’s employment ended on or about ___________ (“Separation Date”).

C.       The Company and Employee desire to resolve any and all issue(s) between them under the terms of this Agreement, including, but not limited to, any issue(s) arising out of or relating to Employee’s employment with the Company and the separation thereof.

AGREEMENT

In consideration of the promises set forth below, the sufficiency of which is acknowledged, the Parties agree as follows:

I.       Consideration. In consideration of Employee’s execution, non-revocation, and compliance with the full terms of this Agreement, the Company will pay to Employee severance and certain other payments as expressly set forth in Sections 4(b), 4(c) and 4(d) of Employee’s Executive Employment Agreement, dated December 13, 2021 (the “Severance Payment”). The Severance Payment will be subject to applicable withholdings and be made available to Employee according to the time frame set forth in Section 4 of Employee’s Executive Employment Agreement.

II.        Representations and Warranties. Employee understands and expressly acknowledges and agrees that:

· Employee has the sole right and exclusive authority to execute this Agreement;

· Employee has not sold, assigned, transferred, conveyed or otherwise disposed of any of the claims, demands, obligations, or causes of action referred to in this Agreement;

· No other person or entity has or has had an interest in the claims, demands, obligations, or causes of action referred to in this Agreement;

· The Severance Payment that Employee will receive in exchange for signing this Agreement is in addition to anything of value to which Employee is already entitled;

· Employee has been properly and timely paid all wages and/or other amounts due.

· The Severance Payment provided for in this Agreement is all that Employee will ever receive from the Company or any Released Parties (defined below) for any and all claims, demands, obligations, or causes of action released in this Agreement;

· This Agreement and its terms shall not be construed as an admission of any liability whatsoever on the part of the Company or any Released Parties described in this Agreement; To the contrary, liability is and always has been expressly denied;

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· As of the date of execution of this Agreement, Employee has no work-related illness or injury and has not filed any workers’ compensation claims relating to his employment with the Company; and

· The foregoing representations and warranties are essential terms of this Agreement and, as such, Employee affirms that each of those representations and warranties is accurate as of the date of Employee’s execution of this Agreement.

III.        Release of Claims.

A.       Employee, for himself, his marital community (if any), his agents, heirs, executors, administrators, and assigns, knowingly and voluntarily fully releases and discharges forever:

· FlexEnergy Energy Systems, Inc. and its parent, subsidiary, and affiliated entities;

· The Company’s past and present owners, directors, officers, partners, managers, agents, shareholders, employees, attorneys, investors, accountants, insurers, and representatives; and

· The predecessors, successors, and assigns of the above entities or individuals and the spouses of these individuals

(collectively referred to as the “Released Parties”) from any and all agreements, debts, claims, demands, actions, judgments, causes of action, and liabilities of every kind or nature, known or unknown, that Employee, individually or as a member of a class, ever had or now has under the laws of any jurisdiction, including, without limitation, the state in which Employee worked for the Company.

B.       Without limiting Paragraph III.A in any way, Employee knowingly and voluntarily releases any and all claims arising under: the Civil Rights Acts of 1866, 1871, 1964 and 1991; any and all state law pertaining to the employer-employee relationship; the Employee Retirement Income Security Act of 1974; the Rehabilitation Act of 1973; the Occupational Safety and Health Act; the Health Insurance Portability and Accountability Act; the Americans with Disabilities Act; the National Labor Relations Act; the Family and Medical Leave Act; the Patient Protection and Affordable Care Act; the Equal Pay Act; the Worker Adjustment and Retraining Notification Act; any whistleblower statute; any statute concerning the making or enforcing of contracts; and all similar provisions under all other federal, state, and local laws.

C.       Without limiting Paragraphs III.A and B in any way, Employee also voluntarily releases all equitable claims and all common law claims, including without limitation claims of or for: breach of an express or an implied contract; breach of the covenant of good faith and fair dealing; unpaid wages, salary, commissions, incentive pay, fringe benefits, severance, vacation, bonuses or other benefits; unjust enrichment; negligent or intentional interference with contractual relations; negligent or intentional interference with prospective economic relations; estoppel; fraud; negligence; negligent or intentional misrepresentation; personal injury; slander; libel; defamation; false light; injurious falsehood; invasion of privacy; wrongful discharge; failure to hire; retaliatory discharge; constructive discharge; negligent or intentional infliction of emotional distress; negligent hiring, supervision or retention; loss of consortium; punitive damages; and any claims that may relate to drug and/or alcohol testing.

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D.      Employee further acknowledges and agrees that the release contained in this Agreement is a general release, and that he further waives and releases any and all claims which exist as of this date, including those of which he does not know or suspect to exist, whether through ignorance, oversight, error, negligence, or otherwise, and which, if known, would materially affect his decision to sign this Agreement. It is Employee’s intent to waive any and all claims arising up to and including the Effective Date of this Agreement, whether such claims are known to Employee or not.

E.       Employee acknowledges and agrees that the release contained in this Agreement waives any right Employee has to recover damages or other individual relief in any charge or lawsuit brought by Employee, as well as in any charge or lawsuit brought by any governmental agency charged with enforcing any law, whether federal, state or local (any “Governmental Agency”).

F. Nothing in this Agreement is intended to nor shall the Agreement be interpreted to release or waive Employee’s rights to (i) file an administrative charge with any Governmental Agency (as defined in Section III.E); or (ii) cooperate with or participate in any Governmental Agency charge, investigation or lawsuit. However, as noted in Section III.E, should Employee elect to file or cooperate with or participate in such a charge, Employee has waived his right to recover damages or other individual relief in connection with such a charge.

G.       This Agreement shall not be interpreted to release or require the release of the Company or the Released Parties from any claims or rights arising after the date this Agreement is signed, or release or require the release of any claims or rights that the law prohibits Employee from releasing in this Agreement.

IV. Employee Understands This Agreement. Employee acknowledges that Employee has had the opportunity to consult an attorney of Employee’s own choosing before entering into this Agreement. Employee represents and warrants that Employee has read all of the terms of this Agreement; and that Employee fully understands and voluntarily accepts these terms, which Employee acknowledges are written in plain language that Employee can and does understand. Employee further acknowledges and agrees that all of Employee’s questions about this Agreement, if any, have been fully answered. Employee further acknowledges and agrees that Employee has been given a reasonable period of time within which to consider this Agreement.

V.       Confidentiality. Employee agrees that the existence, terms and conditions of this Agreement, including the amount of severance furnished under the Agreement, are strictly confidential, and that with the exception of his spouse (if any) and/or attorney (if any), Employee has not and will not, either directly or indirectly, or through any other person, agent or representative, disclose any of the above information, except as required by order of a court of competent jurisdiction, or as may be necessary to protect or enforce rights under this Agreement, or as may be reasonably necessary for obtaining legal advice or for financial reporting or other purposes as required by law, including those set forth in Section III.F. This Agreement does not prohibit Employee from disclosing information that, by law, Employee has an express right to disclose.

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VI.       Return of Company Property. Prior to execution of this Agreement, Employee will return to the Company all of the Company’s property in his possession and/or control, including but not limited to all keys, credit cards, access codes, and documents (original and copies, whether in electronic or other format) relating in any way to the Company. By signing this Agreement, Employee affirms that he has no such property remaining in his possession and/or control. Employee must comply fully with this paragraph before the Company is obligated to perform under the Agreement.

VII.       Time to Consider and Revoke Agreement; Effective Date.

A.       Employee has twenty-one (21) days from the receipt of this Agreement to decide whether to sign it and is advised to consult with an attorney before doing so. Employee understands that he may use as much of this twenty-one (21) day period as he wishes prior to signing. Employee is not to sign this Agreement unless he fully understands its provisions and is signing it voluntarily.

B.       After Employee has signed this Agreement, Employee has seven (7) calendar days to change his mind and notify the Company in writing that Employee has revoked this Agreement (“Revocation Period”). If Employee so revokes this Agreement, this Agreement will be null and void, and will have no force or effect. For this revocation to be effective, written notice must be sent in a manner that complies with the notice provisions of Employee’s Executive Employment Agreement and must be received by the Company on or before the seventh (7^th) calendar day after the day Employee signs the Agreement.

C.       If Employee: (1) complies with Section VI above; (2) signs and delivers this Agreement within the time frames and in accordance with the provisions of subsection A of this Paragraph; and (3) does not cancel or revoke the Agreement within seven (7) calendar days after Employee signs this Agreement, this Agreement shall become effective on the eighth (8^th) calendar day after Employee signed it (the “Effective Date”).

D.       Employee understands that if he revokes this Agreement, it shall not be effective or enforceable and Employee will not receive any Severance Payment.

VIII.       OWBPA Acknowledgement. Employee acknowledges and agrees that the release set forth in Paragraph III releases all claims under the Age Discrimination in Employment Act (“ADEA”). Employee further acknowledges and agrees that: (1) his release and waiver of any claim under the ADEA is knowing and voluntary; (2) he has been informed by this writing to consult with his attorney prior to executing this Agreement; (3) the consideration furnished under this Agreement is in addition to anything of value to which he is already entitled; (4) Employee has read and fully understands this Agreement and understands that he is waiving any and all age discrimination claims; (5) Employee is not waiving any rights or claims related to the validity of this release (as it pertains to age discrimination claims) and/or claims that may arise after this Agreement is executed; and (6) Employee has been given up to 21 days to consider this Agreement before signing it.

IX.       Attorneys’ Fees and Costs. In the event of litigation arising out of or relating to any alleged breach of this Agreement, the prevailing party shall be entitled to an award of reasonable attorneys’ fees and costs.

X.       Waiver. No waiver of any of the terms of this Agreement shall constitute a waiver of any other terms, whether or not similar, nor shall any waiver be a continuing waiver. No waiver shall be binding unless executed in writing by the party making the waiver. The Company or Employee may waive any provision of this Agreement intended for its/his benefit, but such waiver shall in no way excuse the other from the performance of any of its/his other obligations under this Agreement.

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XI.       Severability. In the event that any provision(s) of this Agreement is found to be unenforceable for any reason whatsoever, the unenforceable provision shall be considered to be severable, and the remainder of this Agreement shall continue in full force and effect.

XII.       Choice of Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New Hampshire, without regard to the principles of conflicts of law, except to the extent those laws are preempted by federal law.

XIII.       Subsequent Modifications. The terms of this Agreement may be altered or amended, in whole or in part, only upon the signed written agreement of all Parties to this Agreement. No oral agreement may modify any term of this Agreement.

XIV.       Entire Agreement. This Agreement is the final, complete and exclusive statement and expression of the agreement among the parties hereto with relation to the subject matter of this Agreement, it being understood that there are no oral representations, understandings or agreements covering the same subject matter as this Agreement. This Agreement supersedes, and cannot be varied, contradicted or supplemented by evidence of any prior or contemporaneous discussions, correspondence, or oral or written agreements of any kind. This Agreement does not, however, supersede, extinguish, or otherwise modify any confidentiality obligations of Employee, or any post-employment obligations of Employee, that may exist under separate agreements. Such confidentiality obligations remain in full force and effect.

XV.       Execution. This Agreement may be executed in counterparts with the same force and effect as if all signatures appeared on one document.

It is so agreed.

DATED:
	Wes Kimmel
	FlexEnergy Energy Systems, Inc.
DATED:	By:
	Name:
	Title:

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Exhibit B

Form of Confidentiality and Invention Assignment Agreement

CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT

THIS CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT (this “Agreement”) is dated as of December 13, 2021 (the “Effective Date”) between FlexEnergy Energy Systems, Inc., a Delaware corporation, its subsidiaries, affiliates, successors or assigns (the “Company”), and the undersigned recipient (“Recipient”).

1.The Relationship. Unless the parties otherwise agree in writing, this Agreement applies during and to Recipient’s service relationship with the Company, whether as an employee, independent contractor, advisor or otherwise (collectively, the “Relationship”). Recipient understands that during the Relationship, the Company intends to provide Recipient with information, including Company Confidential Information (as defined below), without which Recipient would not be able to perform Recipient’s duties to the Company. Recipient acknowledges that the Company is relying on Recipient’s execution and delivery of this Agreement as an inducement to establish and/or maintain the Relationship, and that without this Agreement the Company would not continue with a Relationship with Recipient. The services to be rendered to the Company during the Relationship are referred to as the “Services.” Any rights of Recipient to monetary or other compensation in connection with the Services constitute further consideration for Recipient’s obligations under this Agreement. Recipient acknowledges that Recipient’s obligations under this Agreement survive a termination of the Relationship.

2.Confidential Information.

(a)Company Confidential Information. Recipient understands that “Company Confidential Information” means all non-public, confidential or proprietary information and physical material (including any and all combinations of individual items of information) that the Company has or will develop, author, invent, conceive, discover, acquire, create, compile, discover, and/or own, that has value in or to the Company’s business. Company Confidential Information includes both information disclosed by the Company to Recipient (directly or indirectly, in writing, orally, graphically, by machine-readable format, by inspection of tangible objects, or otherwise), and information authored, discovered, developed, invented, conceived, learned, or reduced to practice by Recipient during the course the Relationship. Company Confidential Information also includes all non-public, confidential or proprietary information of which the unauthorized disclosure could be detrimental to the interests of the Company, whether or not such information is expressly identified as Company Confidential Information.

(i)By example, and without limitation, Company Confidential Information includes: (A) trade secrets (including but not limited to any information that is a Trade Secret as defined by the any Uniform Trade Secrets Act, similar state law, or the Defense of Trade Secrets Act (“Trade Secrets”)), inventions, ideas, processes, formulas, algorithms, software in source or object code, data, protocols, programs, works of authorship, information fixed in any tangible medium of expression, logos, trademarks, service marks, trade names, trade dress, mask works, know-how, improvements, discoveries, developments, designs and drawings, techniques, schematics, new products, machines, apparatus, systems, articles of manufacture, compounds, formulations, configurations, compositions of matter, biological materials, and any other proprietary technologies, in each of the forgoing cases whether or not patentable, copyrightable, or otherwise legally protectable, and all Intellectual Property Rights (as defined below) therein (all of the foregoing collectively, “Inventions”); (B) information regarding research, development, prototypes, samples, plant and equipment, new products, hardware configurations, marketing and selling, business plans, budgets and unpublished financial statements, licenses, prices and costs, margins, discounts, credit terms, pricing and billing practices, quoting procedures, methods of obtaining business, forecasts, future plans and potential strategies, financial projections and business strategies, operational plans, financing and capital-raising plans, activities and agreements, internal services and operational manuals, methods of conducting Company business, suppliers and supplier information, and purchasing; (C) information regarding customers and potential customers of Company, including customer lists, names, representatives, their needs or desires with respect to the types of products or services offered by Company, proposals, bids, contracts and their contents and parties, the type and quantity of products and services provided or sought to be provided to customers and potential customers of Company and other non-public information relating to customers and potential customers; (D) information regarding any of Company’s business partners and their services, including names, representatives, proposals, bids, contracts and their contents and parties, the type and quantity of products and services received by Company, and other non-public information relating to business partners; (E) information regarding Company personnel, employee lists, compensation, and employee skills; (F) other Company documents, agreements, files, reports, notes, and materials; and (G) any other non-public information which a competitor of Company could use to the competitive disadvantage of Company. Without limiting the foregoing, Recipient specifically acknowledges that the customer lists and sales lead lists of the Company are confidential and not readily known to the Company’s competitors, that such customers are particularly important to the Company’s business, that business relationships between such customers and the Company would normally continue unless interfered with, and that solicitation of such customers by Recipient, following the termination of the Relationship, would cause injury to the Company’s business.

(ii)Notwithstanding the foregoing, Company Confidential Information does not include any such information which Recipient establishes (A) was in the public domain at the time of disclosure by the Company to Recipient (other than as a result of, directly or indirectly, any violation of this Agreement or other wrongful action or omission by Recipient); (B) is in the public domain after disclosure by the Company to Recipient (other than as a result of, directly or indirectly, any violation of this Agreement or other wrongful action or omission by Recipient); or (C) was in Recipient’s rightful possession, without confidentiality obligations, at the time of disclosure by the Company as demonstrated by Recipient’s written records in existence immediately prior to the time of the disclosure; provided that any combination of individual items of information shall not be deemed to be within any of the foregoing exceptions merely because one or more of the individual items are within such exception, unless the combination as a whole is within such exception. Also, if the Relationship is that of an employee, this Agreement shall not limit Recipient’s rights to discuss the terms and working conditions of the Relationship to the extent protected by applicable law.

(b)Nature and Ownership of Company Confidential Information. Recipient understands and acknowledges that (i) the Relationship creates a relationship of confidence and trust with respect to the Company Confidential Information, and that the Company has a protectable interest therein, (ii) during the Relationship, Recipient will receive and have access to Company Confidential Information, (iii) because of the nature of the Company’s business, the protection of such Company Confidential Information is of vital concern to the Company, and (iv) the Company Confidential Information represents one of the most important assets of the Company and enhances the Company’s opportunity for maintaining business and future growth. Recipient further (A) acknowledges and agrees that the Company retains sole and exclusive ownership of all Company Confidential Information (including all associated Intellectual Property Rights (defined below)), (B) acknowledges and agrees that Recipient obtains no title or interest in or to any Company Confidential Information, and (C) agrees to assign, and hereby assigns, to the Company (and successors and designees) any rights or interests that Recipient may have or acquire in any Company Confidential Information.

(c)Nonuse and Nondisclosure; Compelled Disclosure.

(i)Recipient agrees that during and after the Relationship, except as permitted under this Section 2(c) or Section 10(l), Recipient shall hold Company Confidential Information in strict confidence, and take all reasonable precautions to prevent any unauthorized use or disclosure of Company Confidential Information. Recipient shall not (A) use the Company Confidential Information for any purpose whatsoever other than for the benefit of the Company in the course of the Relationship, or (B) disclose the Company Confidential Information to any third party without the prior written authorization of the Company. Recipient understands that Recipient’s unauthorized use or disclosure of Company Confidential Information may lead to immediate termination of the Relationship and additional legal action by the Company. Recipient shall immediately notify the Company, in writing, of any known or perceived disclosure or misappropriation of the Company's Proprietary Information of which Recipient is aware, whether such disclosure or misappropriation is a result of a negligent or an intentional act of Recipient or a third party.

(ii)Notwithstanding anything to the contrary, during and following the Relationship, Recipient shall hold in strictest confidence the Company’s Trade Secrets that come into Recipient’s knowledge during the Relationship, and shall not directly or indirectly disclose, publish, or make use of at any time such Trade Secrets for so long as the information remains a Trade Secret or the obligations of this Agreement are effective, whichever is longer. If Recipient has any questions regarding what data or information constitutes a Trade Secret, Recipient agrees to contact the appropriate person(s) at the Company for written clarification.

(iii)If Recipient is required to disclose any Company Confidential Information pursuant to applicable federal, state or local law, regulation or a valid order issued by a court or governmental agency of competent jurisdiction (a “Legal Order”), prior to such disclosure Recipient shall use best efforts to provide the Company with (A) prompt written notice of such requirement so that the Company may seek, at its sole cost and expense, a protective order or other remedy; and (B) reasonable assistance in opposing such disclosure or seeking a protective order or other limitations on disclosure. If, after providing such notice and assistance as required herein, Recipient remains required by a Legal Order to disclose any Company Confidential Information, the Recipient (or its Representatives or other persons to whom such Legal Order is directed) shall disclose no more than that portion of the Company Confidential Information which, in the written opinion of the Recipient's legal counsel, such Legal Order specifically requires the Recipient to disclose.

(d)Associated Third Party Information. Recipient recognizes that the Company has received, and in the future will receive, from third parties associated with the Company, such as the Company’s customers, suppliers, licensors, licensees, advisors, independent contractors, partners or collaborators (“Associated Third Parties”), their confidential or proprietary information (“Associated Third Party Confidential Information”), subject to a duty on the Company’s part to maintain the confidentiality of such Associated Third Party Confidential Information and to use it only for certain limited purposes. By way of example, Associated Third Party Confidential Information may include the habits or practices of Associated Third Parties, the technology of Associated Third Parties, requirements of Associated Third Parties, and information related to the business conducted between the Company and such Associated Third Parties. Recipient agrees at all times during the Relationship and thereafter, that Recipient owes the Company and its Associated Third Parties a duty to hold all such Associated Third Party Confidential Information in the strictest confidence, and not to use it or to disclose it to any other third party except as necessary in carrying out Recipient’s work for the Company consistent with the Company’s agreement with such Associated Third Parties. Recipient further agrees to comply with any and all Company policies and guidelines that may be adopted from time to time regarding Associated Third Parties and Associated Third Party Confidential Information. Recipient understands that Recipient’s unauthorized use or disclosure of Associated Third Party Confidential Information or violation of any Company policies during or after the Relationship may lead to disciplinary action, up to, and including, immediate termination and additional legal action by the Company. Recipient understands that Recipient’s unauthorized use or disclosure of Company Confidential Information may lead to immediate termination of the Relationship and additional legal action by the Company.

(e)Former Employer Confidential Information. Recipient agrees that during the Relationship, Recipient has not and shall not improperly access, download, upload, store, use, disclose, or induce the Company to access, use or disclose any proprietary information or trade secrets of any former employer or other person or entity with which Recipient has an obligation of confidentiality. Recipient further agrees that Recipient has not brought, and shall not bring, onto the Company’s premises or transfer onto the Company’s technology systems any unpublished document, proprietary information, or trade secrets or other confidential information belonging to any third party unless disclosure to, and use by, the Company has been consented to, in writing, by such third party.

(f)Defend Trade Secrets Act. Misappropriation of a trade secret of the Company in breach of this Agreement may subject Recipient to criminal liability under the Defend Trade Secrets Act of 2016 (the “DTSA”), entitle the Company to injunctive relief, and require Recipient to pay compensatory damages, double damages, and attorneys’ fees. Notwithstanding any other provision of this Agreement, the Company hereby notifies Recipient in accordance with the DTSA that Recipient will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, in each case solely for the purpose of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. The Company further notifies Recipient that if Recipient files a lawsuit for retaliation by the Company for reporting a suspected violation of law, Recipient may disclose the Company’s trade secrets to Recipient’s attorney and use the trade secret information in the court proceeding if Recipient files any document containing the trade secret under seal and does not disclose the trade secret except pursuant to court order.

(g)Other Rights. For the absence of doubt, this Agreement is intended to supplement, and not to supersede, any rights the Company may have in law or equity with respect to the protection of trade secrets or confidential or proprietary information.

3.Inventions.

(a)Company Inventions. For purposes of this Agreement, “Company Inventions” means any and all prior, existing and future Inventions solely or jointly authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (solely or jointly with others) (i) in connection with, relating to, or as a result of, the services performed for the Company, (ii) with the use of Company’s equipment, supplies, facilities, or Company Confidential Information, or (iii) otherwise relating to the Company’s actual or anticipated businesses, products, services, or research and development, except as otherwise provided in Section 3(g) or Section 3(h) below.

(b)Assignment of Company Inventions.

(i)Recipient agrees that all right, title, and interest in and to any and all Company Inventions are the sole property of the Company. Recipient also agrees to promptly make full written disclosure to the Company of any Company Inventions. Recipient agrees to deliver and assign, and hereby irrevocably assigns, fully to the Company (and its successors and designees) all of Recipient’s right, title, and interest in and to the Company Inventions. Recipient expressly agrees that this assignment includes a present conveyance to the Company of ownership of any of the Company Inventions that are not yet in existence. Recipient hereby waives and irrevocably quitclaims to the Company (and successors and designees) any and all claims, of any nature whatsoever, that Recipient now has or may hereafter have for infringement of any and all of the Company Inventions. Upon the Company’s request, Recipient further agrees to assign to a Company-designated third party, including without limitation the United States, all of Recipient’s right, title, and interest in and to any particular Company Invention(s).

(ii)Recipient further acknowledges that for any Company Invention, Company, in its sole discretion, may make an application for patent as the applicant under 37 CFR 1.46 as a juristic entity under 37 CFR § 1.31. Recipient further acknowledges that all original works of authorship that are made by Recipient (solely or jointly with others) within the scope of and during the period of the Relationship and that are protectable by Copyright are “works made for hire,” as that term is defined in the United States Copyright Act. “Copyright” means the exclusive legal right to reproduce, perform, display, distribute and make derivative works of a work of authorship (as a literary, musical, or artistic work) recognized by the laws of any jurisdiction or country. Recipient understands and agrees that Recipient has no right to publish on, submit for publishing, or use for any publication any work product protected by this Section, except as necessary to perform services for Company. Recipient further waives all of Recipient’s rights under the United States Copyright Act and under any other country’s copyright law, including any rights provided in 17 U.S.C. § 106 and 106A, for any and all purposes for which such work product and any derivative works thereof may be used to the full extent now or hereafter permitted by the laws of the United States of America or the laws of any other country.

(c)Moral Rights; Non-Assignable and Non-Licensable Rights. The assignment to the Company of the Company Inventions includes all rights of attribution, paternity, integrity, modification, disclosure, withdrawal, special, and any other similar rights throughout the world that may be known as or referred to as “moral rights,” “artist’s rights,” “droit moral,” or the like recognized by the laws of any jurisdiction or country (collectively, “Moral Rights”). To the extent that Moral Rights cannot be assigned under applicable law, Recipient hereby waives and agrees not to enforce any and all Moral Rights, including, without limitation, any limitation on subsequent modification, to the extent permitted under applicable law. Recipient further acknowledges and agrees that neither Recipient’s successors-in-interest nor legal heirs retain any Moral Rights in any Company Inventions (and any Intellectual Property Rights with respect thereto). To the extent any of the rights, title, and interests in and to Company Inventions cannot be assigned by Recipient to the Company, Recipient hereby grants to Company an exclusive, royalty-free, perpetual, irrevocable, transferable, worldwide, fully paid-up license (with the right to grant and authorize multiple tiers of sublicenses) to make, have made, use, import, offer for sale, sell, reproduce, distribute, modify, adapt, prepare derivative works of, display, perform, and otherwise exploit such Company Inventions, without restriction, including, without limitation, as part of, or in connection with, such Company Invention, and to practice any method related thereto. To the extent any of the rights, title, or interests in and to Company Inventions can neither be assigned nor licensed by Recipient to the Company, Recipient hereby irrevocably waives and agrees never to assert the non-assignable and non-licensable rights, title, and interests against the Company, any of the Company’s successors in interest, or any of the Company’s customers.

(d)Maintenance of Records. Recipient agrees to keep and maintain adequate, current, accurate and authentic written records of Company Inventions authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (solely or jointly with others) during the term of the Relationship. The records may be in the form of notes, sketches, drawings, flow charts, electronic files, reports, data or recordings, or any other format that may be specified by the Company. As between the Company and Recipient, the records are and shall be available to and remain the sole property of the Company at all times. Recipient agrees not to remove such records from the Company’s place of business except as expressly permitted by Company policy which may, from time to time, be revised at the sole election of the Company for the purpose of furthering the Company’s business. Recipient agrees to deliver all such records (including any copies thereof) to the Company upon the termination of the Relationship as provided in Section 5.

(e)Cooperation in Perfecting Rights. Recipient agrees to assist the Company, or its designee, at the Company’s expense, in every appropriate way to secure the Company’s, or its designee’s, rights in the Company Inventions and any Copyrights, patents, trademarks, mask work rights, Moral Rights, or other intellectual property rights recognized by the laws of any jurisdiction or country (collectively, “Intellectual Property Rights”) relating thereto in any and all countries, including the disclosure to the Company or its designee of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments, recordations, and all other instruments that the Company or its designee shall deem appropriate or necessary in order to apply for, register, obtain, maintain, defend, enforce and transfer such rights, or if not transferable, waive and agree never to assert such rights, and in order to deliver, assign and convey to the Company (and successors and designees) the sole and exclusive right, title, and interest in and to such Company Inventions and any Intellectual Property Rights relating thereto, and testifying in a suit or other proceeding relating to such Company Inventions. Recipient further agrees that Recipient’s obligation to execute or cause to be executed, when it is in Recipient’s power to do so, any such instrument or papers shall continue during and at all times after the end of the Relationship and until the expiration of the last such intellectual property right to expire in any country of the world.

(f)Attorney-in-Fact. Recipient agrees that, if the Company is unable because of Recipient unavailability, mental or physical incapacity, or for any other reason to secure Recipient’s signature with respect to any Company Inventions, including, without limitation, for the purpose of applying for or pursuing any application for any United States or foreign Intellectual Property Rights registrations covering the Company Inventions assigned to the Company in Section 3(b), then Recipient hereby irrevocably designates and appoints the Company and its duly authorized officers and agents as Recipient’s agent and attorney-in-fact, to act for and on Recipient’s behalf to execute and file any instruments, papers and oaths, and to do all other lawfully permitted acts with respect to such Company Inventions to further the prosecution and issuance of Intellectual Property Rights registrations with the same legal force and effect as if executed by Recipient. This power of attorney shall be deemed coupled with an interest, shall be irrevocable, and shall not be affected by Recipient’s subsequent incapacity.

(g)Prior Inventions. Recipient represents that Exhibit A provides a complete list describing with particularity any and all Inventions that, as of the Effective Date: (i) Recipient (or any Recipient assignee(s)) owns or has an interest, (ii) that may relate to the Company’s actual or anticipated businesses, products, services, or research and development, and (iii) that are not assigned to the Company under this Agreement (“Prior Inventions”); or, if no such list is attached, Recipient represents that there are no Prior Inventions, and to the extent such Prior Inventions do exist and are not listed on Exhibit A, Recipient hereby forever waives any and all rights or claims of ownership to such Prior Inventions. Recipient understands that Recipient’s listing of any Inventions on Exhibit A does not constitute an acknowledgement by the Company of the existence or extent of such Inventions, nor of Recipient’s ownership of such Inventions. Recipient shall not incorporate any Prior Inventions listed on Exhibit A, Prior Inventions required to be listed on Exhibit A or Inventions otherwise owned by any third party into any Company Invention without the Company’s prior written permission. Whether or not Recipient receives written permission, unless the Company otherwise specifically agrees in writing, Recipient hereby irrevocably grants to the Company a nonexclusive, royalty-free, perpetual, irrevocable, transferable, worldwide, fully paid-up license (with the right to grant and authorize multiple tiers of sublicenses) to make, have made, use, import, offer for sale, sell, reproduce, distribute, modify, adapt, prepare derivative works of, display, perform, and otherwise exploit such Inventions, without restriction, including, without limitation, as part of, or in connection with, such Invention, and to practice any method related thereto.

(h)Exception to Assignments. Subject to the requirements of applicable state law, if any, Recipient understands that the Company Inventions shall not include, and the provisions of this Agreement requiring assignment of inventions to the Company do not apply to, any invention (an “Excluded Invention”) that qualifies fully for exclusion under the provisions of applicable state law, if any, other than those Company Inventions that are covered by a contract between the Company and the United States or any of its agencies that require full title to such Company Invention to be in the United States. In order to assist in the determination of which Inventions qualify for such exclusion, Recipient shall advise the Company promptly in writing, during the Relationship and for a period of 12 months immediately thereafter, of all Inventions that Recipient believes are Excluded Inventions pursuant to this Section 3(h) that solely or jointly authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (i) in connection with, relating to, or as a result of, the services performed for the Company, (ii) with the use of Company’s equipment, supplies, facilities, or Company Confidential Information, or (iii) otherwise relating to the Company’s actual or anticipated businesses, products, services, or research and development.

4.No Conflicting Obligations.

(a)Current Obligations. Recipient agrees that, during the Relationship, Recipient (i) has a duty of loyalty to the Company, (ii) shall not engage in or undertake any other employment, occupation, consulting, or commitment that is directly related to Company’s actual or anticipated businesses, products, services, or research and development, and (iii) shall not engage in any other activities or enter any agreements that conflict with this Agreement or Recipient’s other obligations to the Company. Without limiting the generality of the foregoing, Recipient further agrees that Recipient shall not, directly or indirectly through another person or entity, during the Relationship (A) anywhere in the world, render services of any nature to any person or entity who engages in any business that competes with the Company, (B) solicit or induce any employee or service provided of the Company to leave the employ or service of the Company, (C) make any statement or do any act intended to cause the existing or potential customers of the Company to use the products or services of a competitor to the Company, or (D) induce any customer or other business relation of the Company to cease doing business with or negatively alter its business with the Company.

(b)Prior Relationships. Without limiting Section 4(a), Recipient represents and warrants that Recipient has no other agreements, relationships, or commitments to any other person or entity that conflict with the provisions of this Agreement, Recipient’s obligations to the Company under this Agreement, or Recipient’s ability to perform the services for which Recipient is being engaged by the Company. Recipient further agrees that if Recipient has signed a confidentiality agreement or similar type of agreement with any former client, employer or other third party, Recipient shall comply with the terms of any such agreement to the extent that its terms are lawful under applicable law. Recipient represents and warrants that after undertaking a careful search (including searches of Recipient’s computers, cell phones, electronic devices, and documents), Recipient have returned all property and confidential information belonging to all prior clients, employers and/or other third parties for which Recipient has performed services in accordance with the terms of Recipient’s applicable agreement. Recipient acknowledges and agrees that Recipient has provided the Company with copies of all agreements (e.g., non-competition agreements, non-solicitation of customers agreements, non-solicitation of employees agreements, confidentiality agreements, inventions agreements, etc.), if any, with a current or former client, employer, or any other third party, that may relate to or restrict Recipient’s ability to perform services for the Company, or fulfill any obligation Recipient may have to the Company. Moreover, Recipient agrees to fully indemnify the Company, its directors, officers, managers, members, agents, employees, investors, shareholders, administrators, affiliates, divisions, subsidiaries, predecessor and successor entities, and assigns for all verdicts, judgments, settlements, and other losses incurred by any of them resulting from Recipient’s breach of Recipient’s obligations under any agreement with a third party to which Recipient is a party or obligation to which Recipient is bound, as well as any reasonable attorneys’ fees and costs if the plaintiff is the prevailing party in such an action, except as prohibited by law.

5.Return of Company Materials.

(a)Definition of Electronic Media Equipment and Electronic Media Systems. For purposes of this Agreement, “Electronic Media Equipment” includes, but is not limited to, computers, external storage devices, thumb drives, handheld electronic devices, telephone equipment, and other electronic media devices. For purposes of this Agreement, “Electronic Media Systems” includes, but is not limited to, computer servers, messaging and email systems or accounts, and web-based services (including cloud-based information storage accounts), whether provided for Recipient’s use directly by the Company or by third-party providers on behalf of the Company.

(b)Return of Company Property. Recipient acknowledges and agrees that anything that Recipient creates or works on for the Company while performing the Services belongs solely to the Company and that Recipient cannot remove, retain, or use such information without the Company’s express written permission. Accordingly, upon a termination of the Relationship for any reason or upon the Company’s request at any other time, Recipient shall immediately deliver to the Company, and shall not keep in Recipient’s possession, recreate, or deliver to anyone else, any and all Company property, including, but not limited to, Company Confidential Information, Associated Third Party Confidential Information, all equipment including all Electronic Media Equipment, all tangible embodiments of the Company Inventions, all information electronically stored on any Electronic Media Equipment or Electronic Media System and passwords to access the same, Company credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, photographs, charts, drafts, any other documents and property, and reproductions of any of the foregoing items, including, without limitation, those records maintained pursuant to Section 3(d). In connection with Recipient’s obligation to return information to the Company, Recipient shall not copy, delete, or alter any information, including personal information voluntarily created or stored, contained upon Electronic Media Equipment or Electronic Media Systems before Recipient returns the information to the Company.

(c)Return of Company Information on Personal Electronic Media Equipment. In addition, if Recipient has used any personal Electronic Media Equipment or personal Electronic Media Systems to create, receive, store, review, prepare or transmit any Company information, including, but not limited to, Company Confidential Information, Recipient shall make a prompt and reasonable search for such information in good faith, including reviewing any personal Electronic Media Equipment or personal Electronic Media Systems to locate such information and, if Recipient locates such information, Recipient shall notify the Company of that fact, provide the Company with a computer-useable copy of all such Company information from those equipment and systems, and then permanently delete and expunge any Company Confidential Information from the Electronic Media Equipment and Electronic Media Systems, as applicable. Recipient shall cooperate reasonably with the Company to verify that the necessary copying and deletion is completed (including providing the Company access to the Electronic Media Equipment or Electronic Media System as reasonably requested to verify that the necessary copying and/or deletion is completed) and upon request providing a sworn declaration confirming the return of information and property and deletion and non-possession of information.

6.Use of Technology Systems.

(a)Recipient acknowledges and agrees that Recipient has no reasonable expectation of privacy in any computer, handheld device, telephone, voicemail, email, or other technology system that is used to conduct the business of the Company. All information, data, and messages created, received, sent, or stored in these systems are, at all times, the property of the Company. As such, the Company has the right to audit and search all such items and systems, with or without notice, to ensure that the Company is licensed to use the software on the Company’s devices in compliance with the Company’s software licensing policies, to ensure compliance with the Company’s policies, and for any other business-related purposes in the Company’s sole discretion. Recipient is not permitted to add any unlicensed, unauthorized, or non-compliant applications to the Company’s technology systems, including, without limitation, open source or free software not authorized by the Company, and Recipient shall refrain from copying unlicensed software onto the Company’s technology systems or using non-licensed software or websites. Recipient understands that it is Recipient’s responsibility to comply with the Company’s policies governing use of the Company’s documents and the internet, email, telephone, and technology systems to which Recipient will have access in connection with the Relationship.

(b)Recipient agrees not to incorporate into any Company software or otherwise deliver to Company any software code licensed under the GNU General Public License or Lesser General Public License or any other license that, by its terms, requires or conditions the use or distribution of such code on the disclosure, licensing, or distribution of any source code owned or licensed by Company except in strict compliance with Company’s policies, if any, allowing the use of such software.

(c)Recipient is aware that the Company has or may acquire software and systems that are capable of accessing, monitoring and recording all Company network traffic to and from any computer, handheld device, telephone, voicemail, email, or other technology system Recipient may use to access the Company’s internal networks. The Company reserves the right to access, review, copy, and delete any of the information, data, or messages accessed through these systems, with or without notice to Recipient and/or in Recipient’s absence. This includes, but is not limited to, all e-mail messages sent or received, all website visits, all chat sessions, all news group activity (including groups visited, messages read, and postings by Recipient), and all file transfers into and out of the Company’s internal networks. The Company further reserves the right to retrieve previously deleted messages from e-mail or voicemail and monitor usage of the Internet, including websites visited and any information Recipient has downloaded. In addition, the Company may review Internet and technology systems activity and analyze usage patterns, and may choose to publicize this data to assure that technology systems are devoted to legitimate business purposes.

(d)Recipient acknowledges and agrees that Recipient has no expectation of privacy in Company property. Recipient agrees that any Company property situated on Company premises, or held by third-party providers for the benefit of the Company, is subject to inspection by Company personnel at any time with or without further notice. Any property situated on the Company’s premises, including disks and other storage media, filing cabinets or other work areas, is subject to inspection by Company personnel at any time with or without notice. Recipient also acknowledges and agrees that as it relates to the Company’s desire to protect its confidential and proprietary information, Recipient has no expectation of privacy as to any personal Electronic Media Equipment or personal Electronic Media Systems that Recipient uses for Company purposes. Recipient further agrees that the Company, at the Company’s sole discretion, may have access to such personal Electronic Media Equipment or personal Electronic Media Systems to retrieve, destroy, or ensure the permanent deletion of Company information from such equipment or systems.

7. No Change to Duration of Relationship. Recipient understands and acknowledges that this Agreement does not alter, amend or expand upon any rights Recipient may have in the duration of any independent contractor, employment or other service relationship with the Company under any other agreement or under applicable law. Except as expressly otherwise agreed in writing and signed by the president or chief executive officer of the Company (or another properly authorized officer of the Company), Recipient understands and acknowledges that (a) the Relationship is and shall remain for no specified term and constitutes an “at-will” arrangement, (b) the Relationship may be terminated at any time, with or without good cause or reason or for any or no cause or reason, at Recipient’s option or at the Company’s option, with or without prior notice, and (c) that the Company may modify Recipient’s role, position, duties and/or compensation, as applicable, from time to time as the Company deems necessary.

8.Publication of this Agreement to Subsequent Employer or Business Associates.

(a)If Recipient is offered employment or the opportunity to enter into any business venture as owner, partner, consultant, or other capacity during the two years following the Relationship, Recipient agrees to inform Recipient’s potential employer, partner, co-owner, and/or others involved in managing the business with which Recipient has an opportunity to be associated of Recipient’s obligations under this Agreement and also agrees to provide such person or persons with a copy of this Agreement.

(b)Recipient agrees to inform the Company of all employment and business ventures which Recipient enters into during the two years following the Relationship, and Recipient also authorizes the Company to provide copies of this Agreement to Recipient’s employer, partner, co-owner, and/or others involved in managing the business with which Recipient becomes employed or associated and to make such persons aware of Recipient’s obligations under this Agreement. Recipient further agrees that, upon written request by the Company, Recipient shall respond to the Company in writing regarding the status of Recipient’s engagement or proposed engagement with any party during the two years following the Relationship.

9.Termination Certification. Upon the termination of the Relationship, Recipient shall immediately sign and deliver to the Company the “Termination Certification” attached hereto as Exhibit B; however, Recipient’s failure to sign and deliver the Termination Certification shall in no way diminish Recipient’s continuing obligations under this Agreement. Recipient shall also keep the Company advised of Recipient’s primary address for a period of three (3) years after the termination of the Relationship, so that the Company can contact Recipient regarding Recipient’s continuing obligations provided by this Agreement.

10.Miscellaneous.

(a)Further Assurances. Recipient agrees to promptly execute and deliver, both during and after the end of the Relationship, such additional instrument, documents, or oaths, as the Company may request for the purpose of carrying out terms and purposes of this Agreement.

(b)Governing Law. All issues and questions concerning the construction, validity, enforcement, and interpretation of this Agreement and the exhibits hereto shall be governed by, and construed in accordance with, the laws of the State of New Hampshire, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of New Hampshire or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New Hampshire.

(c)Jurisdiction; Venue; Service of Process; Waiver of Jury Trial. Each of the parties hereto knowingly, voluntarily, and irrevocably (i) submits to the exclusive jurisdiction and venue of any state or federal court sitting in the State of New Hampshire, in any action or proceeding arising out of or relating to this Agreement and agrees that all claims in respect of the action or proceedings may be heard and determined in any such court, (ii) expressly submits to the personal jurisdiction and venue of such court for the purposes hereof and expressly waives any claim of improper venue and any claim that such courts are an inconvenient forum, provided that the Company or its successors or assigns may seek injunctive or equitable relief from any court in any jurisdiction, and (iii) agrees that the other party to this Agreement may file an original counterpart or a copy of this Agreement with any court as written evidence of the consents, waivers and agreements of the parties. Each party hereby irrevocably consents to the service of process of any of the aforementioned courts in any such suit, action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to (A) if to the Company, to the Company’s primary business office, and (B) if to Recipient, to Recipient’s address as set forth in the Company’s records, with such service of process to become effective ten (10) days after such mailing. EACH PARTY ALSO KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(d)Equitable Relief. Recipient acknowledges and agrees that, by virtue of Recipient’s Relationship, the Services provided, and the access to and use of Company Confidential Information, any violation by Recipient of any of the undertakings contained in this Agreement would cause the Company immediate, substantial, and irreparable injury for which the Company has no adequate remedy at law. Accordingly, Recipient agrees and consents to the entry of an injunction or other equitable relief (including but not limited to temporary restraining orders, preliminary injunctions and permanent injunctions) by a court of competent jurisdiction restraining any violation or threatened violation of any undertaking contained in this Agreement, in addition to and without prejudice to any other rights or remedies that the Company may have for a breach of this Agreement. Recipient waives posting of any bond otherwise necessary to secure such injunction or other equitable relief (or, where such a bond or security cannot be waived, Recipient agrees that a $1,000 bond shall be adequate). Rights and remedies provided in this Agreement are cumulative and shall be in addition to rights and remedies otherwise available to the Company under any other agreement or applicable law.

(e)Administrative Relief. To the extent the Relationship is that of an employee, RECIPIENT UNDERSTANDS THAT THIS AGREEMENT DOES NOT PROHIBIT RECIPIENT FROM PURSUING AN ADMINISTRATIVE CLAIM WITH A LOCAL, STATE, OR FEDERAL ADMINISTRATIVE BODY OR GOVERNMENT AGENCY THAT IS AUTHORIZED TO ENFORCE OR ADMINISTER LAWS RELATED TO EMPLOYMENT, INCLUDING, BUT NOT LIMITED TO, THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION (OR EQUIVALENT STATE AGENCY), THE NATIONAL LABOR RELATIONS BOARD, OR THE WORKERS’ COMPENSATION BOARD.

(f)Entire Agreement. This Agreement, including the Exhibit(s) to this Agreement, sets forth the entire agreement and understanding between the Company and Recipient with respect to the subject matter herein and supersedes all prior and contemporaneous discussions, understanding, representations and agreements, whether or written or oral, between the Company and Recipient, relating to the subject matter of this Agreement (but expressly does not supersede, amend, release, limit or terminate any non-competition, non-solicitation, non-interference, non-disparagement or other similar obligation of the Recipient to the Company or any affiliate thereof under any previously executed agreement). Recipient represents and warrants that Recipient is not relying on, and hereby disclaims any reliance upon, any statement or representation of any kind or nature not expressly contained in this Agreement. For clarity, (i) Recipient’s obligations to the Company under this Agreement are separate from, and in addition to, any of Recipient’s obligations to the Company under any other agreement, and (ii) the execution of this Agreement does not release, limit or terminate any liability of, or breach by, Recipient under any confidentiality and invention assignment agreement or similar agreement previously executed by Recipient.

(g)Severability; Construction. The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision. Headings are used in this Agreement for reference only and shall not be considered when interpreting this Agreement.

(h)Applicability to Past Activities. Recipient agrees that if and to the extent that, during any Prior Engagement Period (defined below): (i) Recipient received access to any information that would have been Company Confidential Information if Recipient received access to such information during the Relationship; or (ii) Recipient authored, discovered, developed, invented, conceived, or reduced to practice any Invention, including any Intellectual Property Rights with respect thereto, that would have been a Company Invention if authored, discovered, developed, invented, conceived, or reduced to practice during the Relationship; then any such information shall be deemed Company Confidential Information hereunder and any such Invention shall be deemed a Company Invention hereunder, and this Agreement shall apply to such information or Invention as if authored, discovered, developed, invented, conceived, or reduced to practice under this Agreement. For purposes of this Agreement, “Prior Engagement Period” means any period of time prior to the date of this Agreement and/or the Relationship that Recipient provided services to the Company or to a predecessor in interest thereof.

(i)Amendments and Waivers. Except as provided in Section 10(g), no modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, shall be effective unless in a writing signed by Recipient and a duly authorized officer of the Company. No delay or failure to require performance of any provision of this Agreement shall constitute a waiver of that provision as to that or any other instance. Waiver by the Company of a breach of any provision of this Agreement shall not operate as a waiver of any other or subsequent breach. Any refusal or failure of the Company or its successors or assigns to enforce any of the restrictive covenants set forth in this Agreement against Recipient, for any reason, shall not constitute an act of precedent or a defense to the enforcement by the Company or its successors or assigns of the restrictive covenants set forth herein.

(j)Successors and Assigns. This Agreement will be binding upon Recipient’s heirs, executors, assigns, administrators, and other legal representatives, and shall be for the benefit of the Company, its successors, and its assigns. There are no intended third-party beneficiaries to this Agreement, except as may be expressly otherwise stated. The Company may freely assign this Agreement and any of its rights and obligations under this Agreement. Recipient may not assign, whether voluntarily or by operation of law, any of Recipient’s rights and obligations under this Agreement, except with the prior written consent of the Company.

(k)Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt or: (i) personal delivery to the party to be notified, (ii) when sent, if sent by electronic mail or facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, (iii) five days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt. All notices and communications shall be addressed to the party to be notified at such party’s address as set forth on the signature page, as subsequently modified by written notice, or if no address is specified on the signature page, at the most recent address set forth in the Company’s books and records.

(l)Protected Activities. Nothing in this Agreement shall in any way limit or prohibit Recipient from engaging for a lawful purpose in any Protected Activity. For purposes of this Agreement, “Protected Activity” means filing a charge or complaint, or otherwise communicating, cooperating, or participating with, any state, federal, or other governmental agency, including the Securities and Exchange Commission, the Equal Engagement Opportunity Commission, and the National Labor Relations Board. Notwithstanding any restrictions set forth in this Agreement, Recipient is not required to obtain authorization from the Company prior to disclosing information to, or communicating with, such agencies, nor is Recipient obligated to advise the Company as to any such disclosures or communications. Notwithstanding, in making any such disclosures or communications, Recipient shall take all reasonable precautions to prevent any unauthorized use or disclosure of any information that may constitute Company Confidential Information to any parties other than the relevant government agencies. “Protected Activity” does not include the disclosure of any Company attorney-client privileged communications, and that any such disclosure without the Company’s written consent shall constitute a material breach of this Agreement.

(m)Advice of Counsel. Recipient acknowledges THAT, IN EXECUTING THIS AGREEMENT, Recipient Has HAD THE OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND Recipient Has read and understands ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT SHALL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR PREPARATION HEREOF.

(n)Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original, and all of which together shall constitute one and the same agreement. Execution of an electronic copy shall have the same force and effect as execution of an original, and an electronic signature shall be deemed an original and valid signature.

(o)Electronic Delivery. The Company may, in its sole discretion, decide to deliver any documents related to this Agreement or any notices required by applicable law by email or any other electronic means. Recipient hereby consents to (i) conduct business electronically (ii) receive such documents and notices by such electronic delivery and (iii) sign documents electronically and agrees to participate through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

[SIGNATURES ON FOLLOWING PAGE]

The parties have executed this Agreement on the respective dates set forth below, to be effective as of the Effective Date first above written.

COMPANY:
FLEXENERGY ENERGY SYSTEMS, INC.
By:	/s/ Mark G. Schnepel

Name: Mark G. Schnepel

Title:    Chief Executive Officer

Address:
112 Corporate Drive, Suite 3
Portsmouth, NH 03801
Email:	Mark.Schnepel@flexenergy.com
RECIPIENT:
Wes Kimmel
(Print Recipient Name)
/s/ Wes Kimmel
(Signature of Recipient)
Address:
[***]
[***]
Email:	[***]

EXHIBIT A

LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP
EXCLUDED UNDER SECTION 3(g)

The following is a list of all Inventions that, as of the Effective Date: (1) Recipient made, and/or (2) belong solely to Recipient or belong to Recipient jointly with others or in which Recipient has an interest, and that relate in any way to any of the Company’s actual or proposed businesses, products, services, or research and development, and which are not assigned to the Company:

        Title            Date    Identifying Number
or Brief Description

Except as indicated above on this exhibit, Recipient has no inventions, improvements or original works to disclose pursuant to Section 3(a) of this Agreement.

___ Additional pages attached

RECIPIENT:

Wes Kimmel

(Print Recipient Name)

/s/ Wes Kimmel

(Signature of Recipient)

December 13, 2021

(Date)

EXHIBIT B

TERMINATION CERTIFICATION

This Termination Certification (this “Certification”) is delivered pursuant to the Confidential Information and Invention Assignment Agreement (the “Agreement”) between the undersigned and FlexEnergy Energy Systems, Inc., its subsidiaries, affiliates, successors or assigns (collectively, the “Company”). Capitalized terms not otherwise defined in this Certification have the meanings given in the Agreement.

Recipient certifies that Recipient does not have in Recipient’s possession, nor has Recipient failed to return, any Company property, including, but not limited to, Company Confidential Information, Associated Third Party Confidential Information, all Company equipment including all Company Electronic Media Equipment, all tangible embodiments of the Company Inventions, all electronically stored information and passwords to access such property, Company credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, photographs, charts, any other documents and property, and reproductions of any of the foregoing items, including, without limitation, those records maintained pursuant to Section 3(d) of the Agreement.

Recipient further certifies that Recipient has complied with all the terms of the Agreement signed by Recipient, including the reporting of any Inventions (as defined therein), conceived or made by Recipient (solely or jointly with others) covered by the Agreement, and Recipient acknowledges Recipient’s continuing obligations under the Agreement.

Recipient further agrees that, in compliance with the Agreement, Recipient shall preserve as confidential all Company Confidential Information, including all Trade Secrets, and take all reasonable precautions to prevent any unauthorized use or disclosure of Company Confidential Information.

RECIPIENT:

Wes Kimmel

(Print Recipient Name)

(Signature of Recipient)

(Date)

EX-10.7

Exhibit 10.7

FLEX LEASING POWER & SERVICE LLC

EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (this “Agreement”) is entered by and between Flex Leasing Power & Service LLC, a Delaware limited liability company (the “Company”), and Doug Baltzer (“Executive”).

1.Duties and Scope of Employment.

(a)Title and Duties. As of the Effective Date (as defined in Section 3 below), Executive will be employed and serve as President of the Company. During the Employment Term, and without any additional compensation in connection with such service, Executive shall also serve as an officer of such affiliates of the Company as the Board may determine from time to time. During the Employment Term (as defined in Section 3 below), Executive will have authority and render such business and professional services in the performance of Executive’s duties as are customarily associated with Executive’s position(s) provided above, and Executive agrees to perform such other duties and functions as may from time to time be reasonably determined by the Board. The “Board” means (i) the board of directors of FlexEnergy Green Solutions, Inc. (“FGS”) if the Company is a direct or indirect subsidiary of FGS; or (ii) the board of directors or analogous governing body of the Company if the Company is not a direct or indirect subsidiary of FGS.

(b)Obligations. During the Employment Term, and excluding any periods of vacation, sick leave, or other leave to which the Executive is entitled, Executive will perform Executive’s duties faithfully and to the best of Executive’s ability and will devote such time as reasonably necessary to fulfill Executive’s responsibilities in the position. Executive and the Company agree that the Company represents Executive’s principal business focus. Except as may otherwise be approved by the Company from time to time, Executive’s services shall be primarily performed at the Company’s office at Greenwood Village, Colorado, or other locations less than 50 miles from such location determined by the Company. Executive agrees to travel as reasonably necessary to fulfill Executive’s responsibilities in the position. During the Employment Term, Executive agrees that Executive shall maintain loyalty to the Company, shall take no action that would be injurious to the Company interests, and shall comply with all rules, regulations and policies of the Company. During the Employment Term, it shall not be a violation of this Agreement for Executive to (i) serve on up to two (2) civic or charitable boards or committees (and other board and committees from time to time as approved by the Board), (ii) deliver lectures, fulfill speaking engagements or teach at educational institutions, or (iii) manage personal investments and business endeavors, so long as such activities do not significantly interfere with the performance of the Executive’s responsibilities as an employee of the Company in accordance with this Agreement.

(c)Executive’s Employability. Executive represents and warrants that: (i) Executive has the right to execute, deliver and perform Executive’s duties under this Agreement, and (ii) Executive is not a party to any other agreements, arrangements or obligations (e.g., confidentiality agreements, noncompetition agreements), whether written, oral or implied, which include terms that would limit Executive’s ability to execute, deliver and perform Executive’s duties under this Agreement or which are otherwise inconsistent with this Agreement. This warranty will remain in full force and effect throughout the Employment Term (as defined in Section 3 below).

2.Compensation.

(a)Base Salary. During the Employment Term, the Company will pay Executive as compensation for Executive’s services a base salary at rate of $24,625.00 per month (the “Base Salary”). The Base Salary will be paid in regular installments in accordance with the Company’s normal payroll practices, subject to applicable deductions and withholdings. The first and last payment will be adjusted, if necessary, to reflect a commencement or termination date other than the first or last working day of a pay period.

(b)Annual Bonus. Executive shall be eligible for an annual bonus (collectively the “Annual Bonus”) during the Employment Term in a target amount equal to 50% of Base Salary, to be earned based on such targets, criteria, terms and conditions as be determined by the Board (or a duly authorized committee thereof) in its sole discretion, subject to the terms of this Agreement. Any such Annual Bonus (i) will only be determined and awarded after the completion of the audited financial statements for FGS with respect to the applicable annual period for which the Annual Bonus is to be earned; (ii) will only be awarded and paid if both (A) Executive remains employed with the Company during the full annual period for which the Annual Bonus is to be earned and (B) (I) Executive remains employed with the Company through the award and payment of the Annual Bonus or (II) subject to Section 4(b), Executive’s employment with the Company is terminated by the Company without Cause between the last day of the annual period for which the Annual Bonus is to be earned and the date on which the Annual Bonus would otherwise be paid; and (iii) will be paid as soon as practicable, but not later than 45 days, after the completion and public release of audited financial statements for FGS with respect to the applicable annual period for which the Annual Bonus is earned.

(c)Equity Incentives.

(i)Incentive Award Plan Eligibility. Executive shall be eligible to participate in, and receive one or more grants under, the FlexEnergy Green Solutions, Inc. 2021 Incentive Award Plan (the “Incentive Plan”). Any such awards and the terms and conditions thereof shall be subject to the discretion of the board of directors of FGS and set forth in award documentation as such board of directors deems reasonably necessary in connection with any such award.

(ii)Issuance of Shares One Year After IPO. The Company agrees to cause the issuance to Executive under the Incentive Plan (pursuant to then-current forms of award agreement under the Incentive Plan), after the one (1) year anniversary of the IPO (as defined in Section 3 below), of an amount of shares of common stock of FGS equal to 1.2% of the total number of shares initially available under the Plan if (A) Executive remains employed by the Company throughout the one (1)-year period immediately following the IPO, (B) Executive is terminated by the Company without Cause (defined below) during one (1)-year period immediately following the IPO, or (C) Executive terminates this Agreement for Good Reason.  For the avoidance of doubt, no shares will be issued to Executive if Executive fails to remain employed by the Company during the one (1)-year period immediately following the IPO under any other circumstances (ex. resignation by Executive without Good Reason, termination by the Company for Cause).

(iii)Initial Stock Option Award. Without limiting Sections 2(c)(i) or 2(c)(ii) above, the Company will recommend to the FGS board of directors that Executive receive a stock option award to purchase, (A) at an exercise price determined by the FGS board of directors in accordance with the requirements of the Incentive Plan, (B) (I) shares of common stock of FGS in an amount equal to 2% of the total number of shares initially available under the Plan, to be initially vested and exercisable upon grant, and (II) shares of common stock of FGS in an amount equal to 8% of the total number of shares initially available under the Plan, to vest and become exercisable over a four (4)-year period with 25% vesting on each anniversary of the IPO (defined below) subject to Executive’s continuous service through the applicable anniversary, (C) not subject to any adjustment pursuant to Section 12 of the Incentive Plan, without Executive’s written consent, that would reduce the number of shares subject to the stock option or increase the exercise price applicable to the stock option (except to provide equitable adjustment with respect to a reverse stock split or other event specified in Section 12(i) of the Incentive Plan having a substantively similar effect on the outstanding capital of FGS), and (D) otherwise subject to the general terms and conditions of the Incentive Plan. Notwithstanding the foregoing, it is hereby acknowledged and agreed that no stock option award to Executive has been approved by the FGS board of directors, and Executive has no right to receive (and neither the Company nor FGS has any obligation to issue) any stock option award unless and until the FGS board of directors has actually approved any such stock option award and the full terms thereof (including the applicable exercise price).

(d)Expense Reimbursement. During the Employment Term, the Executive shall be entitled to reimbursement of reasonable out-of-pocket business expenses incurred by Executive in furtherance of Company’s business in accordance with Company’s policies with respect thereto as in effect from time to time (the “Expense Reimbursement”). All reimbursements provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A including, where applicable, the requirement that (i) any reimbursement is for expenses incurred during Executive’s lifetime (or during a shorter period of time specified in this Agreement); (ii) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year; (iii) the reimbursement of an eligible expense shall be made no later than the last day of the calendar year following the year in which the expense is incurred; and (iv) the right to reimbursement or in kind benefits is not subject to liquidation or exchange for another benefit.

(e)Vacation. Executive shall be entitled to a minimum of three (3) weeks paid vacation per year, in accordance with the Company’s standard vacation policy.

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(f)Employee Benefits. During the Employment Term, Executive will be considered a full-time employee and be entitled to participate in the employee benefit plans and programs currently and hereafter maintained by the Company of general applicability to other Employees of Executive’s classification at the Company (the “Benefits”). The Company reserves the right to cancel or change the Benefit plans and programs it offers to its employees at any time. In the event of any dispute between this Agreement and the terms of any Benefit summary plan description, the terms of the summary plan description shall control.

3.Effective Date; Term of Employment.

(a)Employment Term; Effective Date. The “Employment Term” under this Agreement will commence on the Effective Date and will continue until the Executive’s employment terminated by either the Company or Executive as provided in Section 3(b) of this Agreement. This Agreement shall only become a legally effective agreement binding on Executive and the Company on the closing date (the “Effective Date”) of an initial public offering of the common stock of FGS pursuant to a registration statement filed under the Securities Act of 1933, as amended (an “IPO”). If an IPO does not close on or before January 31, 2022, then this Agreement shall thereafter be void and no legal force or effect.

(b)Termination. Notwithstanding anything else contained in this Agreement, Executive’s employment hereunder shall terminate upon the earliest to occur of the following:

(i)Death. Immediately upon Executive’s death.

(ii)Termination by Executive.

(1)Generally. If terminated by Executive without Good Reason, upon written notice by Executive to the Board that Executive is terminating employment (a “Resignation Notice”), which termination shall be effective 60 days after the date of such notice, or such earlier date as specified in writing by the Company in its sole discretion during such 60-day period; or

(2)For Good Reason. If terminated by Executive for Good Reason, upon written notice by Executive to Company that Executive is terminating Executive’s employment for Good Reason and that sets forth the factual basis supporting the Good Reason, which termination shall be effective 30 days after the date of such notice, or such earlier date as specified in writing by the Company in its sole discretion during such 30-day period. For the avoidance of doubt, such termination shall not constitute a termination for Good Reason if Company cures the conditions identified in Executive’s notice as provided in Section 3(d)(iii).

(iii)Termination by the Company.

(1)For Cause. If terminated by the Company for Cause (defined below), upon written notice by the Company to Executive that Executive’s employment is being terminated for Cause, which termination shall be effective on the date of such notice or such later date as specified in writing by the Company;

(2)Without Cause or Disability. If terminated by the Company for reasons other than for Cause or Disability, upon written notice by Company to Executive that Executive’s employment is being terminated, which termination shall be effective immediately after the date of such notice or such later date as specified in writing by the Company; or

(3)For Disability. If terminated by the Company because of Executive’s Disability (defined below), upon written notice by the Company to Executive that Executive’s employment is being terminated as a result of Executive’s Disability, which termination shall be effective 30 days after the date of such notice or such later date as specified in writing by the Company, unless within such period Executive becomes capable of rendering services of the character contemplated hereby (and a physician chosen by the Company so certifies in writing) and Executive in fact resumes such services.

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(c)Deemed Termination for Cause. Notwithstanding anything in this Agreement to the contrary, if (i) the Company at any time determines that Cause existed at the time of Executive’s termination or written notice thereof, (ii) Executive has breached or breaches the terms of Section 5, then upon written notice by the Company to Executive (i) the Executive’s termination shall be deemed be (or have been) terminated by the Company for Cause pursuant to Section 3(b)(iii)(1) (including for purposes of Section 4 and Section 6(g)(ii)(1)), (ii) the Company may immediately cease payments of any Basic Severance Payments and/or any Extended Severance Payments that may otherwise be due to Executive, and (iii) the Company may recover from Executive any Basic Severance Payments and/or any Extended Severance Payments that may have already been paid to Executive. The cessation and recovery of such any payments shall be in addition to, and not as an alternative to, any other remedies at law or in equity available to the Company with respect to the matters constituting Cause, including, without limitation, the right to specific performance and/or injunctive or other relief.

(d)Certain Definitions.

(i)Definition of Cause. For purposes of this Agreement, “Cause” means any of the following: (A) conviction of, or the entry of a plea of guilty or no contest to, a felony, a crime of moral turpitude, or any other crime that causes the Company public disgrace or disrepute, or which materially and adversely affects the Company’s operations or financial performance or the relationship the Company has with its customers; (B) gross negligence or willful misconduct with respect to the Company, including, without limitation fraud, embezzlement, theft or proven dishonesty in the course of Executive’s employment or other service; (C) alcohol abuse or use of either illegal drugs or controlled drugs (other than in accordance with a physician’s prescription); (D) refusal to perform any lawful, material obligation or fulfill any duty (other than any duty or obligation of the type described in clause (F) below) to the Company (other than due to a disability, as determined by the Committee), which refusal, if curable, is not cured within 15 days after delivery of written notice thereof (and for the avoidance of doubt, the relevant refused obligation or duty will be specifically identified in such written notice); (E) material breach of any agreement with or duty owed to the Company, which breach, if curable, is not cured within 15 days after the delivery of written notice thereof (and for the avoidance of doubt, if applicable, the relevant breached duty will be specifically identified in such written notice); (F) any breach of any obligation or duty to the Company (whether arising by statute, common law or agreement) relating to confidentiality, non-competition, non-solicitation, trade secrets, and/or proprietary rights; (G) material violation of the Company’s written policies or codes of conduct, including those related to discrimination, harassment, performance of illegal or unethical practices, and ethical misconduct; or (H) in the case of a director, repeated failure to participate in Board meetings (including meetings of any Board committee of which the director is a member) on a regular basis despite having received proper notice of meetings in advance.

(ii)Definition of Disability. For purposes of this Agreement, “Disability” means Executive’s inability to perform one or more of the essential functions of Executive’s job due to Executive’s physical or mental impairment, with or without reasonable accommodation as required by law, for any period aggregating more than 120 days in any 365 consecutive day period; provided however, that (A) if the Company determines that Executive has become Disabled, the Company shall notify Executive of its determination; (B) Executive may then request a reasonable accommodation (as that term is defined under the Americans with Disabilities Act) from the Company to assist in his/her return to work; (C) the Company will determine whether Executive’s request can be reasonably accommodated without undue hardship no later than 30 days after Executive requests an accommodation (with additional time being provided in the event of Executive or Executive’s medical provider delaying in providing information that is necessary to the Company’s determination); and (D) in the event Executive’s request cannot be reasonably accommodated (and/or presents an undue hardship), the Company may, by notice given in the manner provided in this Agreement, terminate Executive’s employment hereunder.

(iii)Definition of Good Reason. For purposes of this Agreement, “Good Reason” means any of the following within the prior 90 days without Executive’s approval: (A) any material diminution of Executive’s authority, duties or responsibilities with or to the Company, other than (i) a paid leave of absence at the direction of and approved by the Board or (ii) an unpaid administrative leave imposed for the purposes of investigating or addressing misconduct by Executive; (B) the Board assigns Executive duties or responsibilities that are materially inconsistent with Executive’s position; (C) any material breach of this Agreement by the Company, including without limitation a reduction in Executive’s Base Salary below the amount specified in Section 2(a) without Executive’s consent; or (D) a change in the geographic location at which Executive must primarily perform services to a location more than 50 miles from Greenwood Village, Colorado without Executive’s approval. Executive must give the Company written notice of Executive’s intention to terminate employment for Good Reason, which notice must state the grounds on which the proposed termination for Good Reason is based. Executive must provide such written notice of the occurrence of these grounds no later than 90 days after their initial occurrence. The Company may remedy these condition(s) within 15 days of receiving notice from Executive and no “Good Reason” will exist if the Company remedies such condition(s) during such 15-day period.

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(iv)Definition of Change in Control Period. For purposes of this Agreement, a “Change in Control Period ” means the one (1)-year period commencing six (6)-months prior to a Change in Control (as defined in the Incentive Plan).

(e)Transition Assistance. For a period of 30 days following the effective date of Executive’s resignation, Executive shall make himself or herself available to the Company and/or its agents (i) for the purpose of facilitating an efficient transition of Executive’s job related responsibilities and duties to other designated individuals, and (ii) to respond to questions from the Company and/or its agents regarding information and/or activities in which Executive was engaged while employed by the Company; provided that the foregoing time period is based on Executive’s reasonable efforts to cooperate, Executive will not be entitled to additional compensation for such availability and cooperation; and further provided that such assistance shall be reasonable and not substantially interfere or conflict with Executive’s responsibilities to any new employer.

4.Payments upon Termination.

(a) Generally; Accrued Obligations. If Executive’s employment is terminated for any reason, then the Company shall pay Executive the Accrued Obligations promptly following the effective date of such termination. “Accrued Obligations” means (A) the portion of Executive’s Base Salary that has accrued prior to any termination of Executive’s employment with Company and has not yet been paid, any bonus that has been awarded to Executive as of the date of termination of Executive’s employment but has not yet been paid to Executive, (B) and the amount of any unreimbursed Expense Reimbursement. Executive’s entitlement to any other compensation or benefit under any plan of Company shall be governed by and determined in accordance with the terms of such plans, except as otherwise specified in this Agreement.

(b)Termination by the Company without Cause or Termination for Good Reason. If the Company terminates Executive’s employment without Cause or the Executive terminates Executive’s employment for Good Reason, then, in addition to the Accrued Obligations, and subject to (A) the Executive signing a separation and release agreement in the form attached as Exhibit A, and as such form may be updated by the Company from time to time at any time to conform with changes in applicable laws (a “General Release”) and (B) the General Release becoming effective and irrevocable, all within 60 days after the date of termination (or such shorter period as set forth in the General Release), the Company shall pay Executive:

(i)the Basic Severance Payments, or

(ii)if the Board, in its sole discretion, elects (by written notice to Executive within 10 days following the termination of Executive’s employment) that the Company will pay Extended Severance Payments to Executive instead of the Basic Severance Payments pursuant to Section 4(b)(i), the Extended Severance Payments (instead of the Basic Severance Payments); and if applicable pursuant to Section 2(b), an Annual Bonus with respect to the preceding annual period.

(c)Terminations without Cause during a Change in Control Period. If the Company terminates Executive’s employment without Cause during a Change in Control Period, then, in addition to the Accrued Obligations, and subject to (i) the Executive signing a General Release and (ii) the General Release becoming effective and irrevocable, all within 60 days after the date of termination (or such shorter period as set forth in the General Release), the Company shall pay Executive the Extended Severance Payments.

(d)COBRA Premiums.

(i)Subject to Section 4(d)(ii), if (A) Executive is entitled to Basic Severance Payments or Extended Severance Payments (including, without limitation, Executive’s timely execution and delivery of a General Release that has become effective and irrevocable), and (B) Executive is eligible for and timely and properly elects continuation health care coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), then the Company will pay or promptly reimburse the COBRA premium amounts required for the continued coverage of Executive and Executive’s dependents (if any) under the Company’s group health care plans at the same levels that would have applied if Executive’s employment had not terminated (if possible) until the end of the Basic Severance Term or Extended Severance Term, as applicable (or until such earlier time as Executive ceases to be eligible for COBRA coverage, if earlier) (the “COBRA Premiums”). Notwithstanding the foregoing, if the Company determines, in its sole discretion, that it cannot pay the COBRA Premium without a substantial risk of violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company instead shall pay Executive a monthly cash payment equal to the applicable COBRA Premium for that month.

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(ii) If, however, health care insurance benefits are available to Executive from a new employer, the Company shall have no further obligation relating to payment of additional COBRA Premiums. Executive agrees to promptly inform the Company if and when health care insurance benefits are available from a new employer, and to reimburse the Company for any amounts paid with respect to COBRA Premiums to the extent paid after health care insurance benefits are available to Executive from a new employer.

(e)Certain Definitions.

(i)Basic Severance Payments; Basic Severance Term. For purposes of this Agreement, “Basic Severance Payments” means, to the extent applicable, the monthly cash severance at the Base Salary rate, less standard withholdings and deductions, to be paid during the Basic Severance Term. For purposes of this Agreement, “Basic Severance Term” means the six (6)-month period immediately following the termination date of Executive’s employment.

(ii)Extended Severance Payments; Extended Severance Term. For purposes of this Agreement, “Extended Severance Payments” means, to the extent applicable, the monthly cash severance at the Base Salary rate, less standard withholdings and deductions, to be paid during the applicable Extended Severance Term. For purposes of this Agreement, “Extended Severance Term” means the one (1)-year period immediately following the termination date of Executive’s employment.

(f)Execution of General Release. For the avoidance of doubt, the Company shall not be obligated to pay Executive any severance payments unless a General Release has been timely executed and delivered by Executive and such General Release has become effective and irrevocable.

(g)Limited Rights to Severance Payments. For clarity, (i) entitlement to severance payments of any kind pursuant to this Agreement shall only be possible if (A) the Company terminates Executive’s employment without Cause, or (B) Executive terminates this Agreement for Good Reason; and (ii) no severance payment obligations shall arise out of (W) a termination of this Agreement by the Company with Cause, (X) a termination of this Agreement by the Executive without Good Reason, or (Y) a termination of this Agreement due to Executive’s death or Disability.

(h)No Continued Vesting. For the avoidance of doubt, vesting of any grants under the Incentive Plan or any other stock, stock option or other incentive awards shall cease upon the date of any termination of Executive’s employment, and shall not continue to vest for the remainder of any Noncompetition Period, Non-Solicitation Period or during any applicable Basic Severance Term or Extended Severance Term.

(i)Execution of General Release. In accordance with Section 4(b), Section 4(c) and Section 4(d), to receive the payments set forth in those Sections, Executive’s or Executive’s estate’s, if applicable, General Release must be executed, effective and irrevocable before the expiration of 60 days after the date of termination. The payments specified in these Sections will begin as soon as practicable (not to exceed 30 days) after the General Release is executed, effective and irrevocable, but if the 60-day period could span two (2) tax years, the payments must be made in the later year. For example, if the Company terminates Executive’s employment without Cause on December 15, Executive has 60 days—until February 13 —for a General Release to be sign and become effective and irrevocable. In this case, payments due in accordance with Section 4(b), Section 4(c) or Section 4(d) may not begin until the following year, even if the release was signed, effective and irrevocable in December. If Executive’s or Executive’s estate’s, if applicable, General Release is not executed, effective and irrevocable before the end of the 60-day-period, then the Executive and Executive’s estate forfeit, on behalf of Executive and all who might claim through Executive, the payments that would otherwise be due under the applicable Section of this Agreement.

5. Confidentiality and Invention Assignment Agreement. Executive has executed, and as applicable shall execute, the Company’s Confidentiality and Invention Assignment Agreement, the current form of is attached as Exhibit B, and as updated from time to time (“CIIA”), the provisions of which are hereby incorporated by reference and shall govern the Executive’s obligations and responsibilities with regard to the Company Confidential Information (as that term is defined in the CIIA), the assignment of intellectual property, and other matters. Executive agrees to comply with the terms of the CIIA. To the extent that any provision of the CIIA conflicts with any provision in this Agreement, the provisions requiring Executive to comply with the higher standard shall govern.

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6.Restrictive Covenants.

(a)Acknowledgement. Executive agrees that, during the Employment Term, Executive (i) has a duty of loyalty to the Company, and (ii) shall not engage in or undertake any action that conflicts with the undivided loyalty owed by Executive to the Company. Executive represents and warrants that Executive has no other agreements, relationships, or commitments to any other person or entity that conflict with the provisions of this Agreement, Executive’s obligations to the Company under this Agreement, or Executive’s ability to perform Executive’s duties to the Company. Executive acknowledges and agrees that: (A) Executive’s employment with the Company has brought Executive into close contact with Confidential Information of the Company and its customers, vendors, suppliers, employees, and independent contractors; and (B) the agreements and covenants contained in this Section 6 are essential, reasonable, and no broader than necessary to protect the reasonable business interests and goodwill of the Company. Executive further acknowledges, represents, and agrees that the terms of this Section 6 do not and will not pose an undue hardship on Executive, and that Executive will be able to maintain gainful employment notwithstanding the terms of this Section 6. Executive further acknowledges, represents, and agrees that he/she has received valuable consideration (including, but not limited to, a payment of five hundred dollars ($500.00) that is expressly for the purposes of serving as consideration for this Section 6) that is sufficient to support the promises being made by Executive herein. Accordingly, Executive covenants and agrees to the following restrictive covenants.

(b)Non-Solicitation of Company Employees and Contractors. Executive agrees that during the Non-Solicitation Period (defined below), Executive shall not directly or indirectly (i) hire, employ, recruit, solicit, lure or entice away, or in any other manner persuade or attempt to persuade, any employee of the Company to discontinue such employee’s employment with the Company or (ii) solicit or encourage any independent contractor providing services to the Company to terminate or diminish its relationship with the Company; provided, that, the foregoing shall not be breached by general advertisements not targeted at employees or independent contractors of the Company.

(c)Non-Solicitation of Company Customers. Executive agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly (i) solicit or assist in the solicitation by any third party of any Covered Customer (defined below) for the purpose of providing services or products that compete with, or are similar to, the service or product offerings of the Company, except when such solicitation is done on behalf of the Company, or (ii) discourage any Covered Customer from obtaining of services or products from the Company.

(d)Non-Interference with Vendors and Service Providers. Executive agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly negatively influence or otherwise interfere with the Company’s relationships with vendors, suppliers, consultants, advisors, or other service providers of the Company.

(e)Non-Competition with the Company. Executive agrees that, during the Non-Competition Period, Executive shall not directly or indirectly, as a director, manager, member, stockholder, partner, owner, employee, consultant, or agent of any business, or in any other capacity, other than on behalf of the Company, organize, establish, own, operate, manage, control, engage in, participate in, invest in, permit Executive’s name to be used by, act as a consultant or advisor to, render services for (alone or in association with any person, firm, corporation, or other entity), or otherwise assist any person or entity that engages in or owns, invests in, operates, manages, or controls any venture or enterprise in all or a part of the Restricted Area, that engages in (A) the manufacture, sale, lease, service or other manner of offering of products or services that provide natural gas or hydrogen fueled distributed power generation with a single unit nameplate capacity of up to 5MW (which excludes, for the avoidance of doubt, the manufacture, sale, lease, service or other manner of offering of batteries, solar or wind powered energy generation equipment, or electrochemical (non-combustion) powered fuel cells), (B) the manufacture, sale, lease, service or other manner of offering of heat exchanger/transfer products that can operate with gases at a temperature above 1000° Fahrenheit or (C) any other new line of business, products or services offered or in development by FGS or any direct or indirect subsidiary thereof during the prior six months of the Employment Term and in which Executive has had material involvement (the “Restricted Business”). Notwithstanding the foregoing, nothing in this Agreement shall prevent Executive from owning, directly or indirectly, for passive investment purposes not intended to circumvent this Agreement, less than 2% of the publicly traded common equity securities of any company engaged in the Business (so long as Executive has no power to manage, operate, advise, consult with, or control the competing enterprise and no power, alone or in conjunction with other affiliated parties, to select a director, manager, general partner, or similar governing official of the competing enterprise other than in connection with the normal and customary voting powers afforded Executive in connection with any permissible equity ownership).

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(f)Non-Disparagement. Executive also agrees that, during the Non-Solicitation Period, Executive shall not directly or indirectly (i) disparage the Company, its affiliates and their respective directors, officers, managers, managers, employees, or agents, or (ii) make any public statement that could reasonably be expected to materially and adversely affects the reputation, brand, or business of the Company. This provision does not apply to any statements made to governmental agencies for the purposes of asserting, or participating in any investigation by such agencies concerning, Executive’s statutory rights. In the event of a termination of Executive’s employment (other than a termination for Cause, including pursuant to Section 3(c)), subject to a General Release for Executive being signed, delivered, effective and irrevocable, and further subject to Executive’s compliance and continuing compliance with Executive’s continuing obligations of this Agreement (including this Section 6), then the Company shall cause the FGS board of directors and FGS executive officers (while such individuals serve in such capacities) not to disparage Executive during the remainder of the Non-Solicitation Period. This provision does not apply to any statements or other disclosures by the Company, the FGS board of directors or FGS executive officers for the purpose of or necessary for compliance with federal or state securities laws, as well as rules of any securities exchange on which any securities of the Company, including FGS, are then traded.

(g)Certain Defined Terms. The following terms, when used in this Section 6, will have the respective meanings set forth below:

(i)“Restricted Area” means the area within the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided however if any court of competent jurisdiction determines that the geographic scope of such Restricted Area is unreasonable, the “Restricted Area” means with respect to the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company, the area within each state or territory thereof for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided however if any court of competent jurisdiction determines that the geographic scope of such Restricted Area is unreasonable, the “Restricted Area” means with respect to the United States, Canada and each other country and territory for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company, the area within each county or similar jurisdiction thereof for which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company; provided, however if any court of competent jurisdiction determines that the geographic scope of such Applicable Area is unenforceable, the “Restricted Area” means within 50 miles of any location at which the Company has provided products or services or in which the Company has otherwise done business during Executive’s employment with the Company.

(ii)“Non-Competition Period” means:

(1)the period during Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company if Executive’s employment (A) is terminated by the Company for Cause, (B) is terminated by the Company without Cause during a Change in Control Period, or (C) is terminated by Executive other than for Good Reason.

(2)the period during Executive’s employment with the Company and for the six (6)-month period after the end of Executive’s employment with the Company if Executive’s employment is terminated in any circumstances not provided in Section 6(g)(ii)(1)(A), (B) or (C) above; provided, however, that the Board may, in its sole discretion, elect (by written notice to Executive within 10 days following the termination of Executive’s employment) that the Company will pay Extended Severance Payments to Executive (instead of any Basic Severance Payments), in which case the “Non-Competition Period” instead means the period during the Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company.

(iii)“Non-Solicitation Period” means the period during Executive’s employment with the Company and for the one (1)-year period after the end of Executive’s employment with the Company.

(iv)“Company” includes the Company and any of the Company’s affiliates.

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(v)“Covered Customers” means persons; firms; associations; partnerships; corporations; limited liability companies; institutions, local, state, federal and foreign entities or agencies; and other entities (A) to which the Company provided services or products before or during Executive’s employment with the Company, (B) in relation to which Executive has provided any of the Services, or (C) that the Company (or Executive in connection with the Services) has contacted or solicited with respect to the provision of services or products before or during Executive’s employment with the Company.

(vi)An “employee” or “independent contractor” of the Company is any person who is an employee or independent contractor, respectively, of any of the Company on the date hereof or who becomes an employee or independent contractor of the Company during Executive’s employment with the Company.

(h)Remedies. If Executive breaches any of the provisions contained in this Section 6, the Company shall have the remedies set forth below, each of which shall be enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to the Company at law or in equity. The provisions of this Section 6 are intended to be for the benefit of the Company and its affiliates, and any of the Company or its affiliate may enforce such provisions. Executive recognizes and acknowledges that a breach of the covenants contained in this Section 6 will cause irreparable harm to the goodwill and business of the Company, the exact amount of which will be difficult to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, in the event of an alleged or threatened breach by Executive of any of the provisions of this Section 6, the Company may, in addition to all other rights and remedies existing in its favor, seek specific performance and/or injunctive or other relief in order to enforce or prevent any violations of the provisions hereof. Additionally, if Executive breaches Executive’s obligations under Section 5 or Section 6, then the Company may immediately cease payments of any Basic Severance Payments and/or any Extended Severance Payments and may recover any Basic Severance Payments and/or any Extended Severance Payments paid to Executive after such breach. The cessation and recovery of such payments shall be in addition to, and not as an alternative to, any other remedies at law or in equity available to the Company including, without limitation, the right to specific performance and/or injunctive or other relief.

(i)Severability. In the event any provision of this Section 6 shall be determined by a court of competent jurisdiction to be unenforceable by reason of its extending for too great a period of time or over too great a geographical area or by reason of its being too extensive in any other respect, it will be interpreted to extend only over the maximum period of time for which it may be enforceable, over the maximum geographical area as to which it may be enforceable, or to the maximum extent in all other respects as to which it may be enforceable, all as determined by such court in such action. If any provision of this Agreement, or any part thereof, is held to be invalid or unenforceable because of the scope or duration of or the area covered by such provision, the parties agree that the court making such determination shall reduce the scope, duration and/or area of such provision (and shall substitute appropriate provisions for any such invalid or unenforceable provisions) in order to make such provision enforceable to the fullest extent permitted by law and/or shall delete specific words and phrases, and such modified provision shall then be enforceable and shall be enforced. In the event that any court determines that the time period or the area, or both, are unreasonable and that any of the covenants is to that extent invalid or unenforceable, the parties agree that such covenants will remain in full force and effect, first, for the greatest time period, and second, in the greatest geographical area that would not render them unenforceable.

(j)Enforceability. The Parties each acknowledge that the other party acted in good faith in the negotiation and execution of the provisions in this Section 6. In particular, the Parties acknowledge that given the nature of Executive’s duties and responsibilities (and Executive’s associated influence over the Company’s business and its relationships with its customers), the restrictions and duration of the obligations set forth in this Section 6 are reasonable and no broader than necessary to protect the legitimate business interests of the Company and the goodwill thereof. Executive further acknowledges that the restrictions and duration of this Section 6 do not and will not impose an unreasonable hardship upon Executive. The Parties further agree that the requirements of this Section 6 shall survive the termination of Executive’s employment with the Company.

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(k)Waiver or Inapplicability of Non-Competition Obligations. Executive may submit to the Board a written description setting out a reasonable description (including without limitation the identity of any associated employer and other relevant parties) of any contemplated activity that would or may otherwise violate or contravene Executive’s obligations under Section 6(e) (the “Specified Activity”), and request that the Board waive or otherwise confirm the inapplicability of Executive’s obligations under Section 6(e) with respect to such Specified Activity. If and to the extent the Board confirms in writing to Executive the waiver or inapplicability of Executive’s obligations under Section 6(e) with respect to the Specified Activity (such waiver or confirmation, not to be unreasonably withheld based on the interests of the Company), then Executive shall thereafter have no liability or obligation under Section 6(e) with respect to the Specified Activity.

7.Assignment. This Agreement will be binding upon and inure to the benefit of (a) the heirs, executors and legal representatives of Executive upon Executive’s death and (b) any successor of the Company. Any such successor of the Company will be deemed substituted for the Company under the terms of this Agreement for all purposes. For this purpose, “successor” means any person, firm, corporation or other business entity which at any time, whether by purchase, merger or otherwise, directly or indirectly acquires all or substantially all of the assets or business of the Company. None of the rights of Executive to receive any form of compensation or benefits pursuant to this Agreement may be assigned or transferred except by will or the laws of descent and distribution. None of the obligations of Executive under this Agreement may be assigned or transferred. Any other attempted assignment, transfer, conveyance or other disposition of Executive’s right to compensation or other benefits will be null and void.

8. Notices. All notices, requests, demands and other communications called for under this Agreement will be in writing and will be delivered personally by hand or by courier, mailed by United States first-class mail, postage prepaid, or sent by email or by other electronic means directed to the party to be notified at the address or email address indicated for such party on the signature page to this Agreement, or at such other address or email address as such party may designate by 10 days’ advance written notice to the other parties hereto. All such notices and other communications will be deemed given upon personal delivery, three (3) days after the date of mailing, or when sent if given via email or other electronic means.

9.Severability. In the event that any provision(s) of this Agreement becomes or is declared by an arbitrator or a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement will continue in full force and effect without such provision(s).

10.Arbitration. READ THE FOLLOWING ARBITRATION PROVISION CAREFULLY. IT LIMITS CERTAIN OF YOUR RIGHTS, INCLUDING YOUR RIGHT TO OBTAIN REDRESS THROUGH COURT ACTION

(a)Executive and the Company agree that other than any claims (by Company or Executive) for injunctive relief, any dispute or controversy arising out of, relating to, or in connection with this Agreement, or the interpretation, validity, construction, performance, breach, or termination thereof, will be settled by binding arbitration to be held in Colorado in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association (the “Rules”). The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator will be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having jurisdiction.

(b)The arbitrator(s) will apply Colorado law to the merits of any dispute or claim, without reference to rules of conflicts of law. The arbitration proceedings will be governed by federal arbitration law and by the Rules, without reference to state arbitration law.

(c)EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EXECUTIVE AGREES TO SUBMIT ANY CLAIMS (OTHER THAN THOSE FOR INJUNCTIVE RELIEF) WHICH ARISE OUT OF, RELATE TO, OR ARE IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION THEREOF TO BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EXECUTIVE’S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO, CLAIMS OF DISCRIMINATION, HARASSMENT, OR RETALIATION, OTHER THAN CLAIMS FOR INJUNCTIVE RELIEF.

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(d)The Parties each acknowledge and agree that they have had ample time to consider the terms of this arbitration agreement, that they each negotiated it at arms-length with equal bargaining power,

/s/ Doug Baltzer

Executive Signature Signifying Agreement To Arbitration

11.Integration/Waiver. This Agreement, its exhibits, and the confidentiality and invention assignment agreement described in Section 5 above represent the entire agreement and understanding between the parties as to the subject matter herein and supersede all prior or contemporaneous agreements whether written or oral, including without limitation any employment agreement previously signed by Executive. To the extent that any provision of the CIIA conflicts with any provision in this Agreement, the provisions requiring Executive to comply with the higher standard shall govern. No waiver, alteration or modification of any of the provisions of this Agreement will be binding unless in writing and signed by duly authorized representatives of the parties hereto.

12.Tax Withholding. All payments made pursuant to this Agreement will be subject to applicable taxes and other withholdings or deductions authorized or required by law.

13.Governing Law; Consent to Personal Jurisdiction. THIS AGREEMENT WILL BE GOVERNED BY THE LAWS OF THE STATE OF COLORADO WITHOUT REGARD FOR CONFLICTS OF LAWS PRINCIPLES. EACH PARTY EXPRESSLY CONSENTS TO THE PERSONAL JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN THE DISTRICT OF COLORADO SUBJECT TO THE ARBITRATION PROVISION SET FORTH IN SECTION 10.

14.Attorneys’ Fees. In the event of arbitration or litigation arising from or relating to this Agreement, each party shall be responsible for such party’s own attorneys’ fees and costs and expenses including expert witness fees.

15.Construction of Agreement. The parties have participated jointly in the negotiating and drafting of this Agreement. If a question concerning intent or interpretation arises, no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of authorship.

16.Captions. Titles or captions contained in this Agreement are for convenience and are not intended to affect the substantive meaning of any provision.

17.Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

18.Code Section 409A. To the fullest extent applicable, amount and other benefits payable under this Agreement are intended to be exempt from the definition of “nonqualified deferred compensation” under section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”) in accordance with one or more of the exemptions available under the final Treasury regulations promulgated under Section 409A and, notwithstanding anything in the Agreement to the contrary, to the extent that any such amount or benefit is or becomes subject to Section 409A due to a failure to qualify for an exemption from the definition of nonqualified deferred compensation in accordance with such final Treasury regulations, this Agreement must be interpreted and administered to the extent possible, or amended, to comply with the applicable requirements of Section 409A with respect to these amounts or benefits.

[Signature page follows]

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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year first above written.

“COMPANY”
Flex Leasing Power & Service LLC
By:	/s/ Wes Kimmel
Name:	Wes Kimmel
Title:	Chief Financial Officer
Date:	December 13, 2021
Address:
112 Corporate Drive, Suite 3
Portsmouth, NH 03801
Attn.: Board of Directors
Email:	wes.kimmel@flexenergy.com
“EXECUTIVE”
/s/ Doug Baltzer
Doug Baltzer
Date:	December 13, 2021
Address:
[***]
[***]
Email:	[***]

Exhibit A

Form of General Release

SEVERANCE AGREEMENT AND RELEASE

You are advised to consult with an attorney before executing this Agreement.

This Severance Agreement and Release (the “Agreement”) is entered into knowingly and voluntarily by and between Doug Baltzer (“Employee”) and Flex Leasing Power & Service LLC, a Delaware limited liability company (“Company”). Employee and the Company may be collectively referred to as the “Parties.”

RECITALS

A.       Employee was employed as an executive of the Company.

B.       Employee’s employment ended on or about _______________ (“Separation Date”).

C.       The Company and Employee desire to resolve any and all issue(s) between them under the terms of this Agreement, including, but not limited to, any issue(s) arising out of or relating to Employee’s employment with the Company and the separation thereof.

AGREEMENT

In consideration of the promises set forth below, the sufficiency of which is acknowledged, the Parties agree as follows:

I.       Consideration. In consideration of Employee’s execution, non-revocation, and compliance with the full terms of this Agreement, the Company will pay to Employee severance and certain other payments as expressly set forth in Sections 4(b), 4(c) and 4(d) of Employee’s Executive Employment Agreement, dated December 13, 2021 (the “Severance Payment”). The Severance Payment will be subject to applicable withholdings and be made available to Employee according to the time frame set forth in Section 4 of Employee’s Executive Employment Agreement.

II.        Representations and Warranties. Employee understands and expressly acknowledges and agrees that:

· Employee has the sole right and exclusive authority to execute this Agreement;

· Employee has not sold, assigned, transferred, conveyed or otherwise disposed of any of the claims, demands, obligations, or causes of action referred to in this Agreement;

· No other person or entity has or has had an interest in the claims, demands, obligations, or causes of action referred to in this Agreement;

· The Severance Payment that Employee will receive in exchange for signing this Agreement is in addition to anything of value to which Employee is already entitled;

· Employee has been properly and timely paid all wages and/or other amounts due.

· The Severance Payment provided for in this Agreement is all that Employee will ever receive from the Company or any Released Parties (defined below) for any and all claims, demands, obligations, or causes of action released in this Agreement;

· This Agreement and its terms shall not be construed as an admission of any liability whatsoever on the part of the Company or any Released Parties described in this Agreement; To the contrary, liability is and always has been expressly denied;

· As of the date of execution of this Agreement, Employee has no work-related illness or injury and has not filed any workers’ compensation claims relating to his employment with the Company; and

· The foregoing representations and warranties are essential terms of this Agreement and, as such, Employee affirms that each of those representations and warranties is accurate as of the date of Employee’s execution of this Agreement.

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III.        Release of Claims.

A.       Employee, for himself, his marital community (if any), his agents, heirs, executors, administrators, and assigns, knowingly and voluntarily fully releases and discharges forever:

· Flex Leasing Power & Service LLC and its parent, subsidiary, and affiliated entities;

· The Company’s past and present owners, directors, officers, partners, managers, agents, shareholders, employees, attorneys, investors, accountants, insurers, and representatives; and

· The predecessors, successors, and assigns of the above entities or individuals and the spouses of these individuals

(collectively referred to as the “Released Parties”) from any and all agreements, debts, claims, demands, actions, judgments, causes of action, and liabilities of every kind or nature, known or unknown, that Employee, individually or as a member of a class, ever had or now has under the laws of any jurisdiction, including, without limitation, the state in which Employee worked for the Company.

B.       Without limiting Paragraph III.A in any way, Employee knowingly and voluntarily releases any and all claims arising under: the Civil Rights Acts of 1866, 1871, 1964 and 1991; any and all state law pertaining to the employer-employee relationship; the Employee Retirement Income Security Act of 1974; the Rehabilitation Act of 1973; the Occupational Safety and Health Act; the Health Insurance Portability and Accountability Act; the Americans with Disabilities Act; the National Labor Relations Act; the Family and Medical Leave Act; the Patient Protection and Affordable Care Act; the Equal Pay Act; the Worker Adjustment and Retraining Notification Act; any whistleblower statute; any statute concerning the making or enforcing of contracts; and all similar provisions under all other federal, state, and local laws.

C.       Without limiting Paragraphs III.A and B in any way, Employee also voluntarily releases all equitable claims and all common law claims, including without limitation claims of or for: breach of an express or an implied contract; breach of the covenant of good faith and fair dealing; unpaid wages, salary, commissions, incentive pay, fringe benefits, severance, vacation, bonuses or other benefits; unjust enrichment; negligent or intentional interference with contractual relations; negligent or intentional interference with prospective economic relations; estoppel; fraud; negligence; negligent or intentional misrepresentation; personal injury; slander; libel; defamation; false light; injurious falsehood; invasion of privacy; wrongful discharge; failure to hire; retaliatory discharge; constructive discharge; negligent or intentional infliction of emotional distress; negligent hiring, supervision or retention; loss of consortium; punitive damages; and any claims that may relate to drug and/or alcohol testing.

D.        Employee further acknowledges and agrees that the release contained in this Agreement is a general release, and that he further waives and releases any and all claims which exist as of this date, including those of which he does not know or suspect to exist, whether through ignorance, oversight, error, negligence, or otherwise, and which, if known, would materially affect his decision to sign this Agreement. It is Employee’s intent to waive any and all claims arising up to and including the Effective Date of this Agreement, whether such claims are known to Employee or not.

E.         Employee acknowledges and agrees that the release contained in this Agreement waives any right Employee has to recover damages or other individual relief in any charge or lawsuit brought by Employee, as well as in any charge or lawsuit brought by any governmental agency charged with enforcing any law, whether federal, state or local (any “Governmental Agency”).

F.        Nothing in this Agreement is intended to nor shall the Agreement be interpreted to release or waive Employee’s rights to (i) file an administrative charge with any Governmental Agency (as defined in Section III.E); or (ii) cooperate with or participate in any Governmental Agency charge, investigation or lawsuit. However, as noted in Section III.E, should Employee elect to file or cooperate with or participate in such a charge, Employee has waived his right to recover damages or other individual relief in connection with such a charge.

G.       This Agreement shall not be interpreted to release or require the release of the Company or the Released Parties from any claims or rights arising after the date this Agreement is signed, or release or require the release of any claims or rights that the law prohibits Employee from releasing in this Agreement.

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IV.        Employee Understands This Agreement. Employee acknowledges that Employee has had the opportunity to consult an attorney of Employee’s own choosing before entering into this Agreement. Employee represents and warrants that Employee has read all of the terms of this Agreement; and that Employee fully understands and voluntarily accepts these terms, which Employee acknowledges are written in plain language that Employee can and does understand. Employee further acknowledges and agrees that all of Employee’s questions about this Agreement, if any, have been fully answered. Employee further acknowledges and agrees that Employee has been given a reasonable period of time within which to consider this Agreement.

V.       Confidentiality. Employee agrees that the existence, terms and conditions of this Agreement, including the amount of severance furnished under the Agreement, are strictly confidential, and that with the exception of his spouse (if any) and/or attorney (if any), Employee has not and will not, either directly or indirectly, or through any other person, agent or representative, disclose any of the above information, except as required by order of a court of competent jurisdiction, or as may be necessary to protect or enforce rights under this Agreement, or as may be reasonably necessary for obtaining legal advice or for financial reporting or other purposes as required by law, including those set forth in Section III.F. This Agreement does not prohibit Employee from disclosing information that, by law, Employee has an express right to disclose.

VI.       Return of Company Property. Prior to execution of this Agreement, Employee will return to the Company all of the Company’s property in his possession and/or control, including but not limited to all keys, credit cards, access codes, and documents (original and copies, whether in electronic or other format) relating in any way to the Company. By signing this Agreement, Employee affirms that he has no such property remaining in his possession and/or control. Employee must comply fully with this paragraph before the Company is obligated to perform under the Agreement.

VII.       Time to Consider and Revoke Agreement; Effective Date.

A.       Employee has twenty-one (21) days from the receipt of this Agreement to decide whether to sign it and is advised to consult with an attorney before doing so. Employee understands that he may use as much of this twenty-one (21) day period as he wishes prior to signing. Employee is not to sign this Agreement unless he fully understands its provisions and is signing it voluntarily.

B.       After Employee has signed this Agreement, Employee has seven (7) calendar days to change his mind and notify the Company in writing that Employee has revoked this Agreement (“Revocation Period”). If Employee so revokes this Agreement, this Agreement will be null and void, and will have no force or effect. For this revocation to be effective, written notice must be sent in a manner that complies with the notice provisions of Employee’s Executive Employment Agreement and must be received by the Company on or before the seventh (7^th) calendar day after the day Employee signs the Agreement.

C.       If Employee: (1) complies with Section VI above; (2) signs and delivers this Agreement within the time frames and in accordance with the provisions of subsection A of this Paragraph; and (3) does not cancel or revoke the Agreement within seven (7) calendar days after Employee signs this Agreement, this Agreement shall become effective on the eighth (8^th) calendar day after Employee signed it (the “Effective Date”).

D.       Employee understands that if he revokes this Agreement, it shall not be effective or enforceable and Employee will not receive any Severance Payment.

VIII.       OWBPA Acknowledgement. Employee acknowledges and agrees that the release set forth in Paragraph III releases all claims under the Age Discrimination in Employment Act (“ADEA”). Employee further acknowledges and agrees that: (1) his release and waiver of any claim under the ADEA is knowing and voluntary; (2) he has been informed by this writing to consult with his attorney prior to executing this Agreement; (3) the consideration furnished under this Agreement is in addition to anything of value to which he is already entitled; (4) Employee has read and fully understands this Agreement and understands that he is waiving any and all age discrimination claims; (5) Employee is not waiving any rights or claims related to the validity of this release (as it pertains to age discrimination claims) and/or claims that may arise after this Agreement is executed; and (6) Employee has been given up to 21 days to consider this Agreement before signing it.

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IX.       Attorneys’ Fees and Costs. In the event of litigation arising out of or relating to any alleged breach of this Agreement, the prevailing party shall be entitled to an award of reasonable attorneys’ fees and costs.

X.       Waiver. No waiver of any of the terms of this Agreement shall constitute a waiver of any other terms, whether or not similar, nor shall any waiver be a continuing waiver. No waiver shall be binding unless executed in writing by the party making the waiver. The Company or Employee may waive any provision of this Agreement intended for its/his benefit, but such waiver shall in no way excuse the other from the performance of any of its/his other obligations under this Agreement.

XI.       Severability. In the event that any provision(s) of this Agreement is found to be unenforceable for any reason whatsoever, the unenforceable provision shall be considered to be severable, and the remainder of this Agreement shall continue in full force and effect.

XII.       Choice of Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, without regard to the principles of conflicts of law, except to the extent those laws are preempted by federal law.

XIII.       Subsequent Modifications. The terms of this Agreement may be altered or amended, in whole or in part, only upon the signed written agreement of all Parties to this Agreement. No oral agreement may modify any term of this Agreement.

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XIV.       Entire Agreement. This Agreement is the final, complete and exclusive statement and expression of the agreement among the parties hereto with relation to the subject matter of this Agreement, it being understood that there are no oral representations, understandings or agreements covering the same subject matter as this Agreement. This Agreement supersedes, and cannot be varied, contradicted or supplemented by evidence of any prior or contemporaneous discussions, correspondence, or oral or written agreements of any kind. This Agreement does not, however, supersede, extinguish, or otherwise modify any confidentiality obligations of Employee, or any post-employment obligations of Employee, that may exist under separate agreements. Such confidentiality obligations remain in full force and effect.

XV.       Execution. This Agreement may be executed in counterparts with the same force and effect as if all signatures appeared on one document.

It is so agreed.

DATED:
	Doug Baltzer
	Flex Leasing Power & Service LLC
DATED:	By:
	Name:
	Title:

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Exhibit B

Form of Confidentiality and Invention Assignment Agreement

 

CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT

THIS CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT (this “Agreement”) is dated as of December 13, 2021 (the “Effective Date”) between Flex Leasing Power & Service LLC, a Delaware limited liability company, its subsidiaries, affiliates, successors or assigns (the “Company”), and the undersigned recipient (“Recipient”).

1.The Relationship. Unless the parties otherwise agree in writing, this Agreement applies during and to Recipient’s service relationship with the Company, whether as an employee, independent contractor, advisor or otherwise (collectively, the “Relationship”). Recipient understands that during the Relationship, the Company intends to provide Recipient with information, including Company Confidential Information (as defined below), without which Recipient would not be able to perform Recipient’s duties to the Company. Recipient acknowledges that the Company is relying on Recipient’s execution and delivery of this Agreement as an inducement to establish and/or maintain the Relationship, and that without this Agreement the Company would not continue with a Relationship with Recipient. The services to be rendered to the Company during the Relationship are referred to as the “Services.” Any rights of Recipient to monetary or other compensation in connection with the Services constitute further consideration for Recipient’s obligations under this Agreement. Recipient acknowledges that Recipient’s obligations under this Agreement survive a termination of the Relationship.

2.Confidential Information.

(a)Company Confidential Information. Recipient understands that “Company Confidential Information” means all non-public, confidential or proprietary information and physical material (including any and all combinations of individual items of information) that the Company has or will develop, author, invent, conceive, discover, acquire, create, compile, discover, and/or own, that has value in or to the Company’s business. Company Confidential Information includes both information disclosed by the Company to Recipient (directly or indirectly, in writing, orally, graphically, by machine-readable format, by inspection of tangible objects, or otherwise), and information authored, discovered, developed, invented, conceived, learned, or reduced to practice by Recipient during the course the Relationship. Company Confidential Information also includes all non-public, confidential or proprietary information of which the unauthorized disclosure could be detrimental to the interests of the Company, whether or not such information is expressly identified as Company Confidential Information.

(i)By example, and without limitation, Company Confidential Information includes: (A) trade secrets (including but not limited to any information that is a Trade Secret as defined by the any Uniform Trade Secrets Act, similar state law, or the Defense of Trade Secrets Act (“Trade Secrets”)), inventions, ideas, processes, formulas, algorithms, software in source or object code, data, protocols, programs, works of authorship, information fixed in any tangible medium of expression, logos, trademarks, service marks, trade names, trade dress, mask works, know-how, improvements, discoveries, developments, designs and drawings, techniques, schematics, new products, machines, apparatus, systems, articles of manufacture, compounds, formulations, configurations, compositions of matter, biological materials, and any other proprietary technologies, in each of the forgoing cases whether or not patentable, copyrightable, or otherwise legally protectable, and all Intellectual Property Rights (as defined below) therein (all of the foregoing collectively, “Inventions”); (B) information regarding research, development, prototypes, samples, plant and equipment, new products, hardware configurations, marketing and selling, business plans, budgets and unpublished financial statements, licenses, prices and costs, margins, discounts, credit terms, pricing and billing practices, quoting procedures, methods of obtaining business, forecasts, future plans and potential strategies, financial projections and business strategies, operational plans, financing and capital-raising plans, activities and agreements, internal services and operational manuals, methods of conducting Company business, suppliers and supplier information, and purchasing; (C) information regarding customers and potential customers of Company, including customer lists, names, representatives, their needs or desires with respect to the types of products or services offered by Company, proposals, bids, contracts and their contents and parties, the type and quantity of products and services provided or sought to be provided to customers and potential customers of Company and other non-public information relating to customers and potential customers; (D) information regarding any of Company’s business partners and their services, including names, representatives, proposals, bids, contracts and their contents and parties, the type and quantity of products and services received by Company, and other non-public information relating to business partners; (E) information regarding Company personnel, employee lists, compensation, and employee skills; (F) other Company documents, agreements, files, reports, notes, and materials; and (G) any other non-public information which a competitor of Company could use to the competitive disadvantage of Company. Without limiting the foregoing, Recipient specifically acknowledges that the customer lists and sales lead lists of the Company are confidential and not readily known to the Company’s competitors, that such customers are particularly important to the Company’s business, that business relationships between such customers and the Company would normally continue unless interfered with, and that solicitation of such customers by Recipient, following the termination of the Relationship, would cause injury to the Company’s business.

(ii)Notwithstanding the foregoing, Company Confidential Information does not include any such information which Recipient establishes (A) was in the public domain at the time of disclosure by the Company to Recipient (other than as a result of, directly or indirectly, any violation of this Agreement or other wrongful action or omission by Recipient); (B) is in the public domain after disclosure by the Company to Recipient (other than as a result of, directly or indirectly, any violation of this Agreement or other wrongful action or omission by Recipient); or (C) was in Recipient’s rightful possession, without confidentiality obligations, at the time of disclosure by the Company as demonstrated by Recipient’s written records in existence immediately prior to the time of the disclosure; provided that any combination of individual items of information shall not be deemed to be within any of the foregoing exceptions merely because one or more of the individual items are within such exception, unless the combination as a whole is within such exception. Also, if the Relationship is that of an employee, this Agreement shall not limit Recipient’s rights to discuss the terms and working conditions of the Relationship to the extent protected by applicable law.

 

(b)Nature and Ownership of Company Confidential Information. Recipient understands and acknowledges that (i) the Relationship creates a relationship of confidence and trust with respect to the Company Confidential Information, and that the Company has a protectable interest therein, (ii) during the Relationship, Recipient will receive and have access to Company Confidential Information, (iii) because of the nature of the Company’s business, the protection of such Company Confidential Information is of vital concern to the Company, and (iv) the Company Confidential Information represents one of the most important assets of the Company and enhances the Company’s opportunity for maintaining business and future growth. Recipient further (A) acknowledges and agrees that the Company retains sole and exclusive ownership of all Company Confidential Information (including all associated Intellectual Property Rights (defined below)), (B) acknowledges and agrees that Recipient obtains no title or interest in or to any Company Confidential Information, and (C) agrees to assign, and hereby assigns, to the Company (and successors and designees) any rights or interests that Recipient may have or acquire in any Company Confidential Information.

(c)Nonuse and Nondisclosure; Compelled Disclosure.

(i)Recipient agrees that during and after the Relationship, except as permitted under this Section 2(c) or Section 10(l), Recipient shall hold Company Confidential Information in strict confidence, and take all reasonable precautions to prevent any unauthorized use or disclosure of Company Confidential Information. Recipient shall not (A) use the Company Confidential Information for any purpose whatsoever other than for the benefit of the Company in the course of the Relationship, or (B) disclose the Company Confidential Information to any third party without the prior written authorization of the Company. Recipient understands that Recipient’s unauthorized use or disclosure of Company Confidential Information may lead to immediate termination of the Relationship and additional legal action by the Company. Recipient shall immediately notify the Company, in writing, of any known or perceived disclosure or misappropriation of the Company's Proprietary Information of which Recipient is aware, whether such disclosure or misappropriation is a result of a negligent or an intentional act of Recipient or a third party.

(ii)Notwithstanding anything to the contrary, during and following the Relationship, Recipient shall hold in strictest confidence the Company’s Trade Secrets that come into Recipient’s knowledge during the Relationship, and shall not directly or indirectly disclose, publish, or make use of at any time such Trade Secrets for so long as the information remains a Trade Secret or the obligations of this Agreement are effective, whichever is longer. If Recipient has any questions regarding what data or information constitutes a Trade Secret, Recipient agrees to contact the appropriate person(s) at the Company for written clarification.

(iii)If Recipient is required to disclose any Company Confidential Information pursuant to applicable federal, state or local law, regulation or a valid order issued by a court or governmental agency of competent jurisdiction (a “Legal Order”), prior to such disclosure Recipient shall use best efforts to provide the Company with (A) prompt written notice of such requirement so that the Company may seek, at its sole cost and expense, a protective order or other remedy; and (B) reasonable assistance in opposing such disclosure or seeking a protective order or other limitations on disclosure. If, after providing such notice and assistance as required herein, Recipient remains required by a Legal Order to disclose any Company Confidential Information, the Recipient (or its Representatives or other persons to whom such Legal Order is directed) shall disclose no more than that portion of the Company Confidential Information which, in the written opinion of the Recipient's legal counsel, such Legal Order specifically requires the Recipient to disclose.

(d)Associated Third Party Information. Recipient recognizes that the Company has received, and in the future will receive, from third parties associated with the Company, such as the Company’s customers, suppliers, licensors, licensees, advisors, independent contractors, partners or collaborators (“Associated Third Parties”), their confidential or proprietary information (“Associated Third Party Confidential Information”), subject to a duty on the Company’s part to maintain the confidentiality of such Associated Third Party Confidential Information and to use it only for certain limited purposes. By way of example, Associated Third Party Confidential Information may include the habits or practices of Associated Third Parties, the technology of Associated Third Parties, requirements of Associated Third Parties, and information related to the business conducted between the Company and such Associated Third Parties. Recipient agrees at all times during the Relationship and thereafter, that Recipient owes the Company and its Associated Third Parties a duty to hold all such Associated Third Party Confidential Information in the strictest confidence, and not to use it or to disclose it to any other third party except as necessary in carrying out Recipient’s work for the Company consistent with the Company’s agreement with such Associated Third Parties. Recipient further agrees to comply with any and all Company policies and guidelines that may be adopted from time to time regarding Associated Third Parties and Associated Third Party Confidential Information. Recipient understands that Recipient’s unauthorized use or disclosure of Associated Third Party Confidential Information or violation of any Company policies during or after the Relationship may lead to disciplinary action, up to, and including, immediate termination and additional legal action by the Company. Recipient understands that Recipient’s unauthorized use or disclosure of Company Confidential Information may lead to immediate termination of the Relationship and additional legal action by the Company.

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(e)Former Employer Confidential Information. Recipient agrees that during the Relationship, Recipient has not and shall not improperly access, download, upload, store, use, disclose, or induce the Company to access, use or disclose any proprietary information or trade secrets of any former employer or other person or entity with which Recipient has an obligation of confidentiality. Recipient further agrees that Recipient has not brought, and shall not bring, onto the Company’s premises or transfer onto the Company’s technology systems any unpublished document, proprietary information, or trade secrets or other confidential information belonging to any third party unless disclosure to, and use by, the Company has been consented to, in writing, by such third party.

(f)Defend Trade Secrets Act. Misappropriation of a trade secret of the Company in breach of this Agreement may subject Recipient to criminal liability under the Defend Trade Secrets Act of 2016 (the “DTSA”), entitle the Company to injunctive relief, and require Recipient to pay compensatory damages, double damages, and attorneys’ fees. Notwithstanding any other provision of this Agreement, the Company hereby notifies Recipient in accordance with the DTSA that Recipient will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, in each case solely for the purpose of reporting or investigating a suspected violation of law; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. The Company further notifies Recipient that if Recipient files a lawsuit for retaliation by the Company for reporting a suspected violation of law, Recipient may disclose the Company’s trade secrets to Recipient’s attorney and use the trade secret information in the court proceeding if Recipient files any document containing the trade secret under seal and does not disclose the trade secret except pursuant to court order.

(g)Other Rights. For the absence of doubt, this Agreement is intended to supplement, and not to supersede, any rights the Company may have in law or equity with respect to the protection of trade secrets or confidential or proprietary information.

3.Inventions.

(a)Company Inventions. For purposes of this Agreement, “Company Inventions” means any and all prior, existing and future Inventions solely or jointly authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (solely or jointly with others) (i) in connection with, relating to, or as a result of, the services performed for the Company, (ii) with the use of Company’s equipment, supplies, facilities, or Company Confidential Information, or (iii) otherwise relating to the Company’s actual or anticipated businesses, products, services, or research and development, except as otherwise provided in Section 3(g) or Section 3(h) below.

(b)Assignment of Company Inventions.

(i)Recipient agrees that all right, title, and interest in and to any and all Company Inventions are the sole property of the Company. Recipient also agrees to promptly make full written disclosure to the Company of any Company Inventions. Recipient agrees to deliver and assign, and hereby irrevocably assigns, fully to the Company (and its successors and designees) all of Recipient’s right, title, and interest in and to the Company Inventions. Recipient expressly agrees that this assignment includes a present conveyance to the Company of ownership of any of the Company Inventions that are not yet in existence. Recipient hereby waives and irrevocably quitclaims to the Company (and successors and designees) any and all claims, of any nature whatsoever, that Recipient now has or may hereafter have for infringement of any and all of the Company Inventions. Upon the Company’s request, Recipient further agrees to assign to a Company-designated third party, including without limitation the United States, all of Recipient’s right, title, and interest in and to any particular Company Invention(s).

(ii)Recipient further acknowledges that for any Company Invention, Company, in its sole discretion, may make an application for patent as the applicant under 37 CFR 1.46 as a juristic entity under 37 CFR § 1.31. Recipient further acknowledges that all original works of authorship that are made by Recipient (solely or jointly with others) within the scope of and during the period of the Relationship and that are protectable by Copyright are “works made for hire,” as that term is defined in the United States Copyright Act. “Copyright” means the exclusive legal right to reproduce, perform, display, distribute and make derivative works of a work of authorship (as a literary, musical, or artistic work) recognized by the laws of any jurisdiction or country. Recipient understands and agrees that Recipient has no right to publish on, submit for publishing, or use for any publication any work product protected by this Section, except as necessary to perform services for Company. Recipient further waives all of Recipient’s rights under the United States Copyright Act and under any other country’s copyright law, including any rights provided in 17 U.S.C. § 106 and 106A, for any and all purposes for which such work product and any derivative works thereof may be used to the full extent now or hereafter permitted by the laws of the United States of America or the laws of any other country.

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(c)Moral Rights; Non-Assignable and Non-Licensable Rights. The assignment to the Company of the Company Inventions includes all rights of attribution, paternity, integrity, modification, disclosure, withdrawal, special, and any other similar rights throughout the world that may be known as or referred to as “moral rights,” “artist’s rights,” “droit moral,” or the like recognized by the laws of any jurisdiction or country (collectively, “Moral Rights”). To the extent that Moral Rights cannot be assigned under applicable law, Recipient hereby waives and agrees not to enforce any and all Moral Rights, including, without limitation, any limitation on subsequent modification, to the extent permitted under applicable law. Recipient further acknowledges and agrees that neither Recipient’s successors-in-interest nor legal heirs retain any Moral Rights in any Company Inventions (and any Intellectual Property Rights with respect thereto). To the extent any of the rights, title, and interests in and to Company Inventions cannot be assigned by Recipient to the Company, Recipient hereby grants to Company an exclusive, royalty-free, perpetual, irrevocable, transferable, worldwide, fully paid-up license (with the right to grant and authorize multiple tiers of sublicenses) to make, have made, use, import, offer for sale, sell, reproduce, distribute, modify, adapt, prepare derivative works of, display, perform, and otherwise exploit such Company Inventions, without restriction, including, without limitation, as part of, or in connection with, such Company Invention, and to practice any method related thereto. To the extent any of the rights, title, or interests in and to Company Inventions can neither be assigned nor licensed by Recipient to the Company, Recipient hereby irrevocably waives and agrees never to assert the non-assignable and non-licensable rights, title, and interests against the Company, any of the Company’s successors in interest, or any of the Company’s customers.

(d)Maintenance of Records. Recipient agrees to keep and maintain adequate, current, accurate and authentic written records of Company Inventions authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (solely or jointly with others) during the term of the Relationship. The records may be in the form of notes, sketches, drawings, flow charts, electronic files, reports, data or recordings, or any other format that may be specified by the Company. As between the Company and Recipient, the records are and shall be available to and remain the sole property of the Company at all times. Recipient agrees not to remove such records from the Company’s place of business except as expressly permitted by Company policy which may, from time to time, be revised at the sole election of the Company for the purpose of furthering the Company’s business. Recipient agrees to deliver all such records (including any copies thereof) to the Company upon the termination of the Relationship as provided in Section 5.

(e)Cooperation in Perfecting Rights. Recipient agrees to assist the Company, or its designee, at the Company’s expense, in every appropriate way to secure the Company’s, or its designee’s, rights in the Company Inventions and any Copyrights, patents, trademarks, mask work rights, Moral Rights, or other intellectual property rights recognized by the laws of any jurisdiction or country (collectively, “Intellectual Property Rights”) relating thereto in any and all countries, including the disclosure to the Company or its designee of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments, recordations, and all other instruments that the Company or its designee shall deem appropriate or necessary in order to apply for, register, obtain, maintain, defend, enforce and transfer such rights, or if not transferable, waive and agree never to assert such rights, and in order to deliver, assign and convey to the Company (and successors and designees) the sole and exclusive right, title, and interest in and to such Company Inventions and any Intellectual Property Rights relating thereto, and testifying in a suit or other proceeding relating to such Company Inventions. Recipient further agrees that Recipient’s obligation to execute or cause to be executed, when it is in Recipient’s power to do so, any such instrument or papers shall continue during and at all times after the end of the Relationship and until the expiration of the last such intellectual property right to expire in any country of the world.

(f)Attorney-in-Fact. Recipient agrees that, if the Company is unable because of Recipient unavailability, mental or physical incapacity, or for any other reason to secure Recipient’s signature with respect to any Company Inventions, including, without limitation, for the purpose of applying for or pursuing any application for any United States or foreign Intellectual Property Rights registrations covering the Company Inventions assigned to the Company in Section 3(b), then Recipient hereby irrevocably designates and appoints the Company and its duly authorized officers and agents as Recipient’s agent and attorney-in-fact, to act for and on Recipient’s behalf to execute and file any instruments, papers and oaths, and to do all other lawfully permitted acts with respect to such Company Inventions to further the prosecution and issuance of Intellectual Property Rights registrations with the same legal force and effect as if executed by Recipient. This power of attorney shall be deemed coupled with an interest, shall be irrevocable, and shall not be affected by Recipient’s subsequent incapacity.

(g)Prior Inventions. Recipient represents that Exhibit A provides a complete list describing with particularity any and all Inventions that, as of the Effective Date: (i) Recipient (or any Recipient assignee(s)) owns or has an interest, (ii) that may relate to the Company’s actual or anticipated businesses, products, services, or research and development, and (iii) that are not assigned to the Company under this Agreement (“Prior Inventions”); or, if no such list is attached, Recipient represents that there are no Prior Inventions, and to the extent such Prior Inventions do exist and are not listed on Exhibit A, Recipient hereby forever waives any and all rights or claims of ownership to such Prior Inventions. Recipient understands that Recipient’s listing of any Inventions on Exhibit A does not constitute an acknowledgement by the Company of the existence or extent of such Inventions, nor of Recipient’s ownership of such Inventions. Recipient shall not incorporate any Prior Inventions listed on Exhibit A, Prior Inventions required to be listed on Exhibit A or Inventions otherwise owned by any third party into any Company Invention without the Company’s prior written permission. Whether or not Recipient receives written permission, unless the Company otherwise specifically agrees in writing, Recipient hereby irrevocably grants to the Company a nonexclusive, royalty-free, perpetual, irrevocable, transferable, worldwide, fully paid-up license (with the right to grant and authorize multiple tiers of sublicenses) to make, have made, use, import, offer for sale, sell, reproduce, distribute, modify, adapt, prepare derivative works of, display, perform, and otherwise exploit such Inventions, without restriction, including, without limitation, as part of, or in connection with, such Invention, and to practice any method related thereto.

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(h)Exception to Assignments. Subject to the requirements of applicable state law, if any, Recipient understands that the Company Inventions shall not include, and the provisions of this Agreement requiring assignment of inventions to the Company do not apply to, any invention (an “Excluded Invention”) that qualifies fully for exclusion under the provisions of applicable state law, if any, other than those Company Inventions that are covered by a contract between the Company and the United States or any of its agencies that require full title to such Company Invention to be in the United States. In order to assist in the determination of which Inventions qualify for such exclusion, Recipient shall advise the Company promptly in writing, during the Relationship and for a period of 12 months immediately thereafter, of all Inventions that Recipient believes are Excluded Inventions pursuant to this Section 3(h) that solely or jointly authored, discovered, developed, invented, conceived, or reduced to practice by Recipient (i) in connection with, relating to, or as a result of, the services performed for the Company, (ii) with the use of Company’s equipment, supplies, facilities, or Company Confidential Information, or (iii) otherwise relating to the Company’s actual or anticipated businesses, products, services, or research and development.

4.No Conflicting Obligations.

(a)Current Obligations. Recipient agrees that, during the Relationship, Recipient (i) has a duty of loyalty to the Company, (ii) shall not engage in or undertake any other employment, occupation, consulting, or commitment that is directly related to Company’s actual or anticipated businesses, products, services, or research and development, and (iii) shall not engage in any other activities or enter any agreements that conflict with this Agreement or Recipient’s other obligations to the Company. Without limiting the generality of the foregoing, Recipient further agrees that Recipient shall not, directly or indirectly through another person or entity, during the Relationship (A) anywhere in the world, render services of any nature to any person or entity who engages in any business that competes with the Company, (B) solicit or induce any employee or service provided of the Company to leave the employ or service of the Company, (C) make any statement or do any act intended to cause the existing or potential customers of the Company to use the products or services of a competitor to the Company, or (D) induce any customer or other business relation of the Company to cease doing business with or negatively alter its business with the Company.

(b)Prior Relationships. Without limiting Section 4(a), Recipient represents and warrants that Recipient has no other agreements, relationships, or commitments to any other person or entity that conflict with the provisions of this Agreement, Recipient’s obligations to the Company under this Agreement, or Recipient’s ability to perform the services for which Recipient is being engaged by the Company. Recipient further agrees that if Recipient has signed a confidentiality agreement or similar type of agreement with any former client, employer or other third party, Recipient shall comply with the terms of any such agreement to the extent that its terms are lawful under applicable law. Recipient represents and warrants that after undertaking a careful search (including searches of Recipient’s computers, cell phones, electronic devices, and documents), Recipient have returned all property and confidential information belonging to all prior clients, employers and/or other third parties for which Recipient has performed services in accordance with the terms of Recipient’s applicable agreement. Recipient acknowledges and agrees that Recipient has provided the Company with copies of all agreements (e.g., non-competition agreements, non-solicitation of customers agreements, non-solicitation of employees agreements, confidentiality agreements, inventions agreements, etc.), if any, with a current or former client, employer, or any other third party, that may relate to or restrict Recipient’s ability to perform services for the Company, or fulfill any obligation Recipient may have to the Company. Moreover, Recipient agrees to fully indemnify the Company, its directors, officers, managers, members, agents, employees, investors, shareholders, administrators, affiliates, divisions, subsidiaries, predecessor and successor entities, and assigns for all verdicts, judgments, settlements, and other losses incurred by any of them resulting from Recipient’s breach of Recipient’s obligations under any agreement with a third party to which Recipient is a party or obligation to which Recipient is bound, as well as any reasonable attorneys’ fees and costs if the plaintiff is the prevailing party in such an action, except as prohibited by law.

5.Return of Company Materials.

(a)Definition of Electronic Media Equipment and Electronic Media Systems. For purposes of this Agreement, “Electronic Media Equipment” includes, but is not limited to, computers, external storage devices, thumb drives, handheld electronic devices, telephone equipment, and other electronic media devices. For purposes of this Agreement, “Electronic Media Systems” includes, but is not limited to, computer servers, messaging and email systems or accounts, and web-based services (including cloud-based information storage accounts), whether provided for Recipient’s use directly by the Company or by third-party providers on behalf of the Company.

(b)Return of Company Property. Recipient acknowledges and agrees that anything that Recipient creates or works on for the Company while performing the Services belongs solely to the Company and that Recipient cannot remove, retain, or use such information without the Company’s express written permission. Accordingly, upon a termination of the Relationship for any reason or upon the Company’s request at any other time, Recipient shall immediately deliver to the Company, and shall not keep in Recipient’s possession, recreate, or deliver to anyone else, any and all Company property, including, but not limited to, Company Confidential Information, Associated Third Party Confidential Information, all equipment including all Electronic Media Equipment, all tangible embodiments of the Company Inventions, all information electronically stored on any Electronic Media Equipment or Electronic Media System and passwords to access the same, Company credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, photographs, charts, drafts, any other documents and property, and reproductions of any of the foregoing items, including, without limitation, those records maintained pursuant to Section 3(d). In connection with Recipient’s obligation to return information to the Company, Recipient shall not copy, delete, or alter any information, including personal information voluntarily created or stored, contained upon Electronic Media Equipment or Electronic Media Systems before Recipient returns the information to the Company.

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(c)Return of Company Information on Personal Electronic Media Equipment. In addition, if Recipient has used any personal Electronic Media Equipment or personal Electronic Media Systems to create, receive, store, review, prepare or transmit any Company information, including, but not limited to, Company Confidential Information, Recipient shall make a prompt and reasonable search for such information in good faith, including reviewing any personal Electronic Media Equipment or personal Electronic Media Systems to locate such information and, if Recipient locates such information, Recipient shall notify the Company of that fact, provide the Company with a computer-useable copy of all such Company information from those equipment and systems, and then permanently delete and expunge any Company Confidential Information from the Electronic Media Equipment and Electronic Media Systems, as applicable. Recipient shall cooperate reasonably with the Company to verify that the necessary copying and deletion is completed (including providing the Company access to the Electronic Media Equipment or Electronic Media System as reasonably requested to verify that the necessary copying and/or deletion is completed) and upon request providing a sworn declaration confirming the return of information and property and deletion and non-possession of information.

6.Use of Technology Systems.

(a)Recipient acknowledges and agrees that Recipient has no reasonable expectation of privacy in any computer, handheld device, telephone, voicemail, email, or other technology system that is used to conduct the business of the Company. All information, data, and messages created, received, sent, or stored in these systems are, at all times, the property of the Company. As such, the Company has the right to audit and search all such items and systems, with or without notice, to ensure that the Company is licensed to use the software on the Company’s devices in compliance with the Company’s software licensing policies, to ensure compliance with the Company’s policies, and for any other business-related purposes in the Company’s sole discretion. Recipient is not permitted to add any unlicensed, unauthorized, or non-compliant applications to the Company’s technology systems, including, without limitation, open source or free software not authorized by the Company, and Recipient shall refrain from copying unlicensed software onto the Company’s technology systems or using non-licensed software or websites. Recipient understands that it is Recipient’s responsibility to comply with the Company’s policies governing use of the Company’s documents and the internet, email, telephone, and technology systems to which Recipient will have access in connection with the Relationship.

(b)Recipient agrees not to incorporate into any Company software or otherwise deliver to Company any software code licensed under the GNU General Public License or Lesser General Public License or any other license that, by its terms, requires or conditions the use or distribution of such code on the disclosure, licensing, or distribution of any source code owned or licensed by Company except in strict compliance with Company’s policies, if any, allowing the use of such software.

(c)Recipient is aware that the Company has or may acquire software and systems that are capable of accessing, monitoring and recording all Company network traffic to and from any computer, handheld device, telephone, voicemail, email, or other technology system Recipient may use to access the Company’s internal networks. The Company reserves the right to access, review, copy, and delete any of the information, data, or messages accessed through these systems, with or without notice to Recipient and/or in Recipient’s absence. This includes, but is not limited to, all e-mail messages sent or received, all website visits, all chat sessions, all news group activity (including groups visited, messages read, and postings by Recipient), and all file transfers into and out of the Company’s internal networks. The Company further reserves the right to retrieve previously deleted messages from e-mail or voicemail and monitor usage of the Internet, including websites visited and any information Recipient has downloaded. In addition, the Company may review Internet and technology systems activity and analyze usage patterns, and may choose to publicize this data to assure that technology systems are devoted to legitimate business purposes.

(d)Recipient acknowledges and agrees that Recipient has no expectation of privacy in Company property. Recipient agrees that any Company property situated on Company premises, or held by third-party providers for the benefit of the Company, is subject to inspection by Company personnel at any time with or without further notice. Any property situated on the Company’s premises, including disks and other storage media, filing cabinets or other work areas, is subject to inspection by Company personnel at any time with or without notice. Recipient also acknowledges and agrees that as it relates to the Company’s desire to protect its confidential and proprietary information, Recipient has no expectation of privacy as to any personal Electronic Media Equipment or personal Electronic Media Systems that Recipient uses for Company purposes. Recipient further agrees that the Company, at the Company’s sole discretion, may have access to such personal Electronic Media Equipment or personal Electronic Media Systems to retrieve, destroy, or ensure the permanent deletion of Company information from such equipment or systems.

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7.No Change to Duration of Relationship. Recipient understands and acknowledges that this Agreement does not alter, amend or expand upon any rights Recipient may have in the duration of any independent contractor, employment or other service relationship with the Company under any other agreement or under applicable law. Except as expressly otherwise agreed in writing and signed by the president or chief executive officer of the Company (or another properly authorized officer of the Company), Recipient understands and acknowledges that (a) the Relationship is and shall remain for no specified term and constitutes an “at-will” arrangement, (b) the Relationship may be terminated at any time, with or without good cause or reason or for any or no cause or reason, at Recipient’s option or at the Company’s option, with or without prior notice, and (c) that the Company may modify Recipient’s role, position, duties and/or compensation, as applicable, from time to time as the Company deems necessary.

8.Publication of this Agreement to Subsequent Employer or Business Associates.

(a)If Recipient is offered employment or the opportunity to enter into any business venture as owner, partner, consultant, or other capacity during the two years following the Relationship, Recipient agrees to inform Recipient’s potential employer, partner, co-owner, and/or others involved in managing the business with which Recipient has an opportunity to be associated of Recipient’s obligations under this Agreement and also agrees to provide such person or persons with a copy of this Agreement.

(b)Recipient agrees to inform the Company of all employment and business ventures which Recipient enters into during the two years following the Relationship, and Recipient also authorizes the Company to provide copies of this Agreement to Recipient’s employer, partner, co-owner, and/or others involved in managing the business with which Recipient becomes employed or associated and to make such persons aware of Recipient’s obligations under this Agreement. Recipient further agrees that, upon written request by the Company, Recipient shall respond to the Company in writing regarding the status of Recipient’s engagement or proposed engagement with any party during the two years following the Relationship.

9.Termination Certification. Upon the termination of the Relationship, Recipient shall immediately sign and deliver to the Company the “Termination Certification” attached hereto as Exhibit B; however, Recipient’s failure to sign and deliver the Termination Certification shall in no way diminish Recipient’s continuing obligations under this Agreement. Recipient shall also keep the Company advised of Recipient’s primary address for a period of three (3) years after the termination of the Relationship, so that the Company can contact Recipient regarding Recipient’s continuing obligations provided by this Agreement.

10.Miscellaneous.

(a)Further Assurances. Recipient agrees to promptly execute and deliver, both during and after the end of the Relationship, such additional instrument, documents, or oaths, as the Company may request for the purpose of carrying out terms and purposes of this Agreement.

(b)Governing Law. All issues and questions concerning the construction, validity, enforcement, and interpretation of this Agreement and the exhibits hereto shall be governed by, and construed in accordance with, the laws of the State of Colorado, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Colorado or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Colorado.

(c)Jurisdiction; Venue; Service of Process; Waiver of Jury Trial. Each of the parties hereto knowingly, voluntarily, and irrevocably (i) submits to the exclusive jurisdiction and venue of any state or federal court sitting in the State of Colorado, in any action or proceeding arising out of or relating to this Agreement and agrees that all claims in respect of the action or proceedings may be heard and determined in any such court, (ii) expressly submits to the personal jurisdiction and venue of such court for the purposes hereof and expressly waives any claim of improper venue and any claim that such courts are an inconvenient forum, provided that the Company or its successors or assigns may seek injunctive or equitable relief from any court in any jurisdiction, and (iii) agrees that the other party to this Agreement may file an original counterpart or a copy of this Agreement with any court as written evidence of the consents, waivers and agreements of the parties. Each party hereby irrevocably consents to the service of process of any of the aforementioned courts in any such suit, action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to (A) if to the Company, to the Company’s primary business office, and (B) if to Recipient, to Recipient’s address as set forth in the Company’s records, with such service of process to become effective ten (10) days after such mailing. EACH PARTY ALSO KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(d)Equitable Relief. Recipient acknowledges and agrees that, by virtue of Recipient’s Relationship, the Services provided, and the access to and use of Company Confidential Information, any violation by Recipient of any of the undertakings contained in this Agreement would cause the Company immediate, substantial, and irreparable injury for which the Company has no adequate remedy at law. Accordingly, Recipient agrees and consents to the entry of an injunction or other equitable relief (including but not limited to temporary restraining orders, preliminary injunctions and permanent injunctions) by a court of competent jurisdiction restraining any violation or threatened violation of any undertaking contained in this Agreement, in addition to and without prejudice to any other rights or remedies that the Company may have for a breach of this Agreement. Recipient waives posting of any bond otherwise necessary to secure such injunction or other equitable relief (or, where such a bond or security cannot be waived, Recipient agrees that a $1,000 bond shall be adequate). Rights and remedies provided in this Agreement are cumulative and shall be in addition to rights and remedies otherwise available to the Company under any other agreement or applicable law.

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(e)Administrative Relief. To the extent the Relationship is that of an employee, RECIPIENT UNDERSTANDS THAT THIS AGREEMENT DOES NOT PROHIBIT RECIPIENT FROM PURSUING AN ADMINISTRATIVE CLAIM WITH A LOCAL, STATE, OR FEDERAL ADMINISTRATIVE BODY OR GOVERNMENT AGENCY THAT IS AUTHORIZED TO ENFORCE OR ADMINISTER LAWS RELATED TO EMPLOYMENT, INCLUDING, BUT NOT LIMITED TO, THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION (OR EQUIVALENT STATE AGENCY), THE NATIONAL LABOR RELATIONS BOARD, OR THE WORKERS’ COMPENSATION BOARD.

(f)Entire Agreement. This Agreement, including the Exhibit(s) to this Agreement, sets forth the entire agreement and understanding between the Company and Recipient with respect to the subject matter herein and supersedes all prior and contemporaneous discussions, understanding, representations and agreements, whether or written or oral, between the Company and Recipient, relating to the subject matter of this Agreement (but expressly does not supersede, amend, release, limit or terminate any non-competition, non-solicitation, non-interference, non-disparagement or other similar obligation of the Recipient to the Company or any affiliate thereof under any previously executed agreement). Recipient represents and warrants that Recipient is not relying on, and hereby disclaims any reliance upon, any statement or representation of any kind or nature not expressly contained in this Agreement. For clarity, (i) Recipient’s obligations to the Company under this Agreement are separate from, and in addition to, any of Recipient’s obligations to the Company under any other agreement, and (ii) the execution of this Agreement does not release, limit or terminate any liability of, or breach by, Recipient under any confidentiality and invention assignment agreement or similar agreement previously executed by Recipient.

(g)Severability; Construction. The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision. Headings are used in this Agreement for reference only and shall not be considered when interpreting this Agreement.

(h)Applicability to Past Activities. Recipient agrees that if and to the extent that, during any Prior Engagement Period (defined below): (i) Recipient received access to any information that would have been Company Confidential Information if Recipient received access to such information during the Relationship; or (ii) Recipient authored, discovered, developed, invented, conceived, or reduced to practice any Invention, including any Intellectual Property Rights with respect thereto, that would have been a Company Invention if authored, discovered, developed, invented, conceived, or reduced to practice during the Relationship; then any such information shall be deemed Company Confidential Information hereunder and any such Invention shall be deemed a Company Invention hereunder, and this Agreement shall apply to such information or Invention as if authored, discovered, developed, invented, conceived, or reduced to practice under this Agreement. For purposes of this Agreement, “Prior Engagement Period” means any period of time prior to the date of this Agreement and/or the Relationship that Recipient provided services to the Company or to a predecessor in interest thereof.

(i)Amendments and Waivers. Except as provided in Section 10(g), no modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, shall be effective unless in a writing signed by Recipient and a duly authorized officer of the Company. No delay or failure to require performance of any provision of this Agreement shall constitute a waiver of that provision as to that or any other instance. Waiver by the Company of a breach of any provision of this Agreement shall not operate as a waiver of any other or subsequent breach. Any refusal or failure of the Company or its successors or assigns to enforce any of the restrictive covenants set forth in this Agreement against Recipient, for any reason, shall not constitute an act of precedent or a defense to the enforcement by the Company or its successors or assigns of the restrictive covenants set forth herein.

(j)Successors and Assigns. This Agreement will be binding upon Recipient’s heirs, executors, assigns, administrators, and other legal representatives, and shall be for the benefit of the Company, its successors, and its assigns. There are no intended third-party beneficiaries to this Agreement, except as may be expressly otherwise stated. The Company may freely assign this Agreement and any of its rights and obligations under this Agreement. Recipient may not assign, whether voluntarily or by operation of law, any of Recipient’s rights and obligations under this Agreement, except with the prior written consent of the Company.

(k)Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt or: (i) personal delivery to the party to be notified, (ii) when sent, if sent by electronic mail or facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, (iii) five days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt. All notices and communications shall be addressed to the party to be notified at such party’s address as set forth on the signature page, as subsequently modified by written notice, or if no address is specified on the signature page, at the most recent address set forth in the Company’s books and records.

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(l) Protected Activities. Nothing in this Agreement shall in any way limit or prohibit Recipient from engaging for a lawful purpose in any Protected Activity. For purposes of this Agreement, “Protected Activity” means filing a charge or complaint, or otherwise communicating, cooperating, or participating with, any state, federal, or other governmental agency, including the Securities and Exchange Commission, the Equal Engagement Opportunity Commission, and the National Labor Relations Board. Notwithstanding any restrictions set forth in this Agreement, Recipient is not required to obtain authorization from the Company prior to disclosing information to, or communicating with, such agencies, nor is Recipient obligated to advise the Company as to any such disclosures or communications. Notwithstanding, in making any such disclosures or communications, Recipient shall take all reasonable precautions to prevent any unauthorized use or disclosure of any information that may constitute Company Confidential Information to any parties other than the relevant government agencies. “Protected Activity” does not include the disclosure of any Company attorney-client privileged communications, and that any such disclosure without the Company’s written consent shall constitute a material breach of this Agreement.

(m)Advice of Counsel. Recipient acknowledges THAT, IN EXECUTING THIS AGREEMENT, Recipient Has HAD THE OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND Recipient Has read and understands ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT SHALL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR PREPARATION HEREOF.

(n)Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original, and all of which together shall constitute one and the same agreement. Execution of an electronic copy shall have the same force and effect as execution of an original, and an electronic signature shall be deemed an original and valid signature.

(o)Electronic Delivery. The Company may, in its sole discretion, decide to deliver any documents related to this Agreement or any notices required by applicable law by email or any other electronic means. Recipient hereby consents to (i) conduct business electronically (ii) receive such documents and notices by such electronic delivery and (iii) sign documents electronically and agrees to participate through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

[SIGNATURES ON FOLLOWING PAGE]

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The parties have executed this Agreement on the respective dates set forth below, to be effective as of the Effective Date first above written.

COMPANY:
FLEX LEASING POWER & SERVICE LLC
By:	/s/ Wes Kimmel
Name:	Wes Kimmel
Title:	Chief Financial Officer
Address:
112 Corporate Drive, Suite 3
Portsmouth, NH 03801
Email:	wes.kimmel@flexenergy.com
RECIPIENT:
Doug Baltzer
(Print Recipient Name)
/s/ Doug Baltzer
(Signature of Recipient)
Address:
[***]
[***]
Email:	[***]

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EXHIBIT A

LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP
EXCLUDED UNDER SECTION 3(g)

The following is a list of all Inventions that, as of the Effective Date: (1) Recipient made, and/or (2) belong solely to Recipient or belong to Recipient jointly with others or in which Recipient has an interest, and that relate in any way to any of the Company’s actual or proposed businesses, products, services, or research and development, and which are not assigned to the Company:

        Title        
   Date    Identifying Number
or Brief Description

Except as indicated above on this exhibit, Recipient has no inventions, improvements or original works to disclose pursuant to Section 3(a) of this Agreement.

___ Additional pages attached

RECIPIENT:

Doug Baltzer

(Print Recipient Name)

/s/ Doug Baltzer

(Signature of Recipient)

December 13, 2021

(Date)

 

EXHIBIT B

TERMINATION CERTIFICATION

This Termination Certification (this “Certification”) is delivered pursuant to the Confidential Information and Invention Assignment Agreement (the “Agreement”) between the undersigned and Flex Leasing Power & Service LLC, a Delaware limited liability company, its subsidiaries, affiliates, successors or assigns (collectively, the “Company”). Capitalized terms not otherwise defined in this Certification have the meanings given in the Agreement.

Recipient certifies that Recipient does not have in Recipient’s possession, nor has Recipient failed to return, any Company property, including, but not limited to, Company Confidential Information, Associated Third Party Confidential Information, all Company equipment including all Company Electronic Media Equipment, all tangible embodiments of the Company Inventions, all electronically stored information and passwords to access such property, Company credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, photographs, charts, any other documents and property, and reproductions of any of the foregoing items, including, without limitation, those records maintained pursuant to Section 3(d) of the Agreement.

Recipient further certifies that Recipient has complied with all the terms of the Agreement signed by Recipient, including the reporting of any Inventions (as defined therein), conceived or made by Recipient (solely or jointly with others) covered by the Agreement, and Recipient acknowledges Recipient’s continuing obligations under the Agreement.

Recipient further agrees that, in compliance with the Agreement, Recipient shall preserve as confidential all Company Confidential Information, including all Trade Secrets, and take all reasonable precautions to prevent any unauthorized use or disclosure of Company Confidential Information.

RECIPIENT:

Doug Baltzer

(Print Recipient Name)

(Signature of Recipient)

(Date)

EX-10.13

Exhibit 10.13

 

AGREEMENT TO RENEW LEASE MADE THIS 15"' DAY OF DECEMBER, 2021; BElWEEN: BENNETT FINANCIAL CORP, (hereinafter called "the Landlord") -and- FLEX LEASING POWER ANO SERVICE ULC (hereinafter called "the Tenant") WHEREAS by a written lease agreement dated the 1•1 day of December, 2015 (the "Lease•), the Landlord leased to the Tenant the premises legally described as follows: CONDOMINIUM PLAN 1320815 UNIT2 AND 5000 UNDIVIDED ONE TEN THOUSANTH SHARES IN THE COMMON PROPERTY EXCEPTING THEREOUT ALL MINES AND MINERALS ANO WHEREAS the Term (as described in the Lease) of the Lease was renewed for a further year by a renewal agreement dated December 14, 2018 (the *First Renewal Agreement"); ANO WHEREAS the Term was subsequently renewed for a further year by a renewal agreement dated October 1st, 2019 (the "Second Renewal Agreemenr); AND WHEREAS the Tenn was subsequently renewed for a further year by a renewal agreement dated July 1, 2020 (the "Third Renewal Agreement"); AND WHEREAS the Landlord and the Tenant have agreed to renew the Lease for an additional term of 5 years subject to the terms herein; NOW THEREFORE in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which Is hereby acknowledged by the parties, the parties hereto agree as follows: 1. The Landlord has agreed with the Tenant to renew the Lease for a period of five (5) years to commence on the 1"1 day of January, 2022 and end on the 31st day of December, 2026 (the -Fourth Renewal Term•). 2. The Annual Basic Rent described In 1.1(g) of the Lease shall be $133,650.00 + GST ($16.50/sq ft+ GST) for the Fourth Renewal Term. 3. The Landlord and the Tenant agree that section 3.1 (a) of the Lease shall be amended to read as follows:

 

Page2 (a) Beginning on January 1, 2022, Annual Basic Rent for each Lease Year, payable In advance in equal consecutive monthly Instalments of $11,137.50 plus GST on the first day of each month In each year of the Fourth Renewal Term: 4. The Property Taxes shall be Invoiced by the Landlord and paid by the Tenant annually notwithstanding that Section 3.2 of the Lease requires payment of Property Taxes as a monthly installment. 5. The Landlord will add the following Improvements to the Building within the first year of the Fourth Renewal Term: (a) a 10 ton overhead crane; (b) 3 phase power 6. The Tenant and Landlord further agree that the Lease for this Fourth Renewal Term shall be on the same terms and conditions as the initial Lease. 7. All other terms and conditions of the Lease will continue in force and effect, except there shall be no right to renew the Lease unless by agreement between the Parties hereto. 8. This Agreement shall be binding upon and enure to the benefit of the heirs, executors, administrators, successors and assigns of the Parties hereto. 9. This Agreement may be signed and accepted In counterpart and delivered by facsimile or portable document format (pdf). IN WITNESS WHEREOF the Parties hereto have executed this agreement effective the day, month and year first above written. FLEX LEASING POWER AND SERVICE ULC Per: ~~ (authorized signatory)

EX-10.28

Exhibit 10.28

FIFTH AMENDMENT TO CREDIT AGREEMENT

This fifth amendment to Credit Agreement (this “Amendment”) is made and entered into on December 10, 2021 (the “Fifth Amendment Effective Date”), by and among Flex Leasing Power & Service LLC, a Delaware limited liability company (the “Company”), the other Borrowers and Loan Parties party hereto, Texas Capital Bank, in its capacity as Administrative Agent (the “Administrative Agent”), and the Lenders (as defined below) party hereto.

RECITALS:

WHEREAS, the Loan Parties are party to that certain Credit Agreement dated as of February 8, 2019 (as amended, restated, supplemented or otherwise modified, the “Credit Agreement”), by and among the Company, the other Borrowers from time to time party thereto, the other Loan Parties from time to time party thereto, the financial institutions from time to time party thereto as lenders (the “Lenders”) and the Administrative Agent. Capitalized terms used but not defined herein have the meaning set forth in the Credit Agreement, as amended hereby.

WHEREAS, the Company has advised the Administrative Agent and the Lenders that the report delivered by Deloitte & Touche LLP with respect to the audited financial statements of Borrower for the fiscal year ending December 31, 2020 (the “2020 Audited Financial Statements”) contains a qualification and assumption that the Borrower will continue as a going concern (such qualification and assumption, the “Specified Audited Financials Qualification”). The Borrowers have requested that the Lenders acknowledge and agree that the Specified Audited Financials Qualification does not constitute a “material qualification” for purposes of Section 6.1(a) of the Credit Agreement.

WHEREAS, the Company, the other Borrowers, the other Loan Parties, the Administrative Agent and the Lenders desire to amend the Credit Agreement as provided herein upon the terms and conditions set forth herein, including with respect to allowing FlexEnergy Green Solutions, Inc., a Delaware corporation (the “Parent”), to become the 100% equityholder of the Company and to consummate a Qualified IPO (as defined in the Credit Agreement, as amended hereby).

WHEREAS, the Company has advised the Administrative Agent and the Lenders that on the Specified Contribution Effective Date (as defined below), the Parent will issue to FlexEnergy Power Solutions, LLC, a Delaware limited liability company (the “Ultimate Parent”), its “Common Stock” (as defined in the Contribution Agreement referred to below) in exchange for the contribution by the Ultimate Parent of the “Contributed Interests” (as defined in the Contribution Agreement) pursuant to the terms and conditions of that certain Contribution Agreement dated as of the Specified Contribution Effective Date, between the Parent, as Company, and the Ultimate Parent (such agreement, the “Contribution Agreement”, and the contribution and other transactions contemplated thereby, the “Specified Contribution”). As a result of, and immediately after giving effect to, the Specified Contribution, the Parent will own 100% of the Equity Interests in the Company.

1

NOW THEREFORE, in consideration of the mutual agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

SECTION 1.Fifth Amendment Effective Date Lender Acknowledgment. In reliance on the representations, warranties, covenants and agreements contained in this Amendment, but subject to the satisfaction of each condition precedent set forth in Section 6 hereof, the Lenders hereby acknowledge and agree that, effective as of the Fifth Amendment Effective Date:

1.1 the Specified Audited Financials Qualification will be deemed to be non-material solely for the purpose of the Company providing audited financial statements with no material qualifications in accordance with Section 6.1(a) of the Credit Agreement. The Loan Parties hereby acknowledge that nothing contained herein, nor any past indulgence by the Administrative Agent or any Lender nor any other action or inaction on behalf of the Administrative Agent or any Lender, shall constitute or be deemed to constitute a consent to, or waiver of, any other action or inaction of the Company or any of the other Loan Parties which constitutes (or would constitute) a violation of any provision of the Credit Agreement or any other Loan Document, or which results (or would result) in a Default or Event of Default under the Credit Agreement or any other Loan Document, nor shall this Amendment constitute a course of conduct or dealing among the parties. The Administrative Agent and the Lenders shall have no obligation to (i) make a similar acknowledgement in the future with respect to any opinion or report containing the same, similar or other qualifications delivered in connection with the audited financial statements of the Company delivered to the Administrative Agent for any other fiscal year pursuant to Section 6.1(a) of the Credit Agreement or (ii) grant any future waivers, consents or amendments with respect to the Credit Agreement or any other Loan Document. The parties hereto agree that the accommodation with respect to the Specified Audited Financials Qualification herein shall constitute a one-time event and shall not waive, affect or diminish any right of the Administrative Agent and the Lenders to hereafter demand strict compliance with the Credit Agreement and the other Loan Documents;

1.2all prior obligations of the Company under the small business loan made to the Company on April 14, 2020 (the “PPP Loan”) pursuant to the federal Paycheck Protection Program provided in Section 7(a) of the Small Business Act of 1953, as amended by the Coronavirus Aid, Relief, and Economic Security Act (the “PPP”) did not constitute Debt for any purpose under the Credit Agreement (it being understood that such PPP Loan has been forgiven in accordance with the PPP); and

1.3all fees which are identified as “Amendment Fees” or “Waiver Fees” under the First Amendment, Second Amendment, Third Amendment, or Fourth Amendment, as applicable, were, to the extent deducted from Net Income, permitted, to be added back solely for the purposes of the definition of EBITDA solely as they related to the date in which the Loan Parties made payment of such fees to the Administrative Agent.

2

SECTION 2.Fifth Amendment Effective Date Amendments to the Loan Documents. In reliance upon the representations, warranties, covenants and conditions contained in this Amendment, and subject to the terms, and satisfaction of the conditions precedent set forth in Section 6 hereof, the applicable Loan Documents are hereby amended as follows:

2.1 Credit Agreement (Fifth Amendment Effective Date Amendments). The Credit Agreement (other than the signature pages, Exhibits and Schedules thereto except as expressly set forth in Section 2.2 and Section 2.3 below) is, effective as of the Fifth Amendment Effective Date (except with respect to the modifications set forth in Section 7.4(d) of the Credit Agreement, which modifications are effective as of July 9, 2020), hereby amended in its entirety to read as set forth in the attached Annex A.

2.2Amendment to Exhibit C of the Credit Agreement. Exhibit C of the Credit Agreement is, effective as of the Fifth Amendment Effective Date, hereby amended by replacing the reference to “FOR MONTH/YEAR ENDED” therein with “FOR MONTH/QUARTER/YEAR ENDED”.

2.3Omnibus Amendment to Loan Documents. Each reference to “Texas Capital Bank, National Association” in the Loan Documents (other than the Credit Agreement) is, effective as of the Fifth Amendment Effective Date, hereby replaced in its entirety with a reference to “Texas Capital Bank”.

SECTION 3.Specified Contribution Effective Date Amendments to the Credit Agreement. In reliance upon the representations, warranties, covenants and conditions contained in this Amendment, and subject to the terms, and satisfaction of the conditions precedent set forth in Section 7 hereof, the Credit Agreement is hereby amended as follows:

3.1Credit Agreement (Specified Contribution Effective Date Amendments). The Credit Agreement (other than the signature pages, Exhibits and Schedules thereto except as expressly set forth in Section 3.2 below) is, effective as of the Specified Contribution Effective Date, hereby amended in its entirety to read as set forth in the attached Annex B.

3.2Replacement of Schedule 5.13 to the Credit Agreement. Schedule 5.13 to the Credit Agreement is, effective as of the Specified Contribution Effective Date, hereby replaced in its entirety with Schedule 5.13 attached hereto as Annex C. Schedule 5.13 attached hereto as Annex C shall be deemed to be attached as Schedule 5.13 to the Credit Agreement as of the Specified Contribution Effective Date.

SECTION 4.Termination of Existing Parent Pledge Agreement. In reliance upon the representations, warranties, covenants and conditions contained in this Amendment, and subject to the terms, and satisfaction of the conditions precedent set forth in Section 7 hereof, the parties hereto hereby agree that, effective as of the Specified Contribution Effective Date, (a) the Ultimate Parent will be automatically released as of the Specified Contribution Effective Date from its obligations as a “Pledgor” and “guarantor”, as applicable, under that certain Pledge and Limited Guaranty Agreement dated as of February 8, 2019 (as amended, supplemented or otherwise modified from time to time, the “Existing Parent Pledge Agreement”), between the Ultimate Parent and the Administrative Agent, (b) any Liens created pursuant to the Existing Parent Pledge Agreement on the Equity Interests owned by the Ultimate Parent will automatically be released and (c) the Existing Parent Pledge Agreement (including the “Limited Guaranty” therein) will be terminated and of no further force and effect. Effective as of the Specified Contribution Effective Date, the Administrative Agent hereby (i) authorizes the Ultimate Parent (and its designees) to file all Uniform Commercial Code termination statements and other release documents, in each case, reasonably acceptable to the Administrative Agent, as are necessary to facilitate and effect and/or evidence the termination and release of all Liens and guarantees pursuant to this Section 4 and (ii) at the Loan Parties’ sole cost and expense, agrees to promptly execute or cause to be executed such other instruments, and to take or cause to be taken all such action or actions, reasonably requested by the Ultimate Parent to facilitate and effect and/or evidence the termination and release of all Liens and guarantees pursuant to this Section 4.

3

SECTION 5.Termination of Intercreditor Agreement. In reliance upon the representations, warranties, covenants and conditions contained in this Amendment, and subject to the terms, and satisfaction of the conditions precedent set forth in Section 7 hereof, the parties hereto (including the “Subordinated Lenders” identified on the signature pages hereto) hereby agree that, effective as of the Specified Contribution Effective Date and notwithstanding anything to the contrary contained in that certain Subordination and Intercreditor Agreement dated as of February 8, 2019 (the “Intercreditor Agreement”), by and among RNS Flex, LLC, Energy Special Situations Fund II, L.P., ESS Participation Fund II, L.P. and TRF Platform Holdings, LLC, the Ultimate Parent, the Borrower, each of the other Loan Parties party thereto from time to time, and Administrative Agent, the Intercreditor Agreement will be automatically terminated and of no force or effect.

SECTION 6.Conditions Precedent to Fifth Amendment Effective Date Amendments. The acknowledgment of the Administrative Agent and the Lenders contained in Section 1 hereof and the amendments to the Loan Documents contained in Section 2 hereof will, in each case, be effective as of the Fifth Amendment Effective Date on the condition that the following conditions precedent will have been satisfied:

6.1Counterparts. The Administrative Agent shall have received counterparts of this Amendment duly executed by each of the Loan Parties, the Administrative Agent and each Lender.

6.2Officer’s Fifth Amendment Effective Date Certificate. The Administrative Agent shall have received a certificate, signed by a Responsible Officer of the Company, dated as of the Fifth Amendment Effective Date, attaching a true, accurate and complete copy of the Management Services Agreement.

6.3Amendment Fee. The Administrative Agent shall have received, an amendment fee in an amount equal to $50,000.00, which fee shall be fully earned and due and payable in full in cash on the Fifth Amendment Effective Date.

6.4Expenses. The Administrative Agent shall have received payment or reimbursement of its out-of-pocket expenses in connection with this Amendment and any other out-of-pocket expenses of the Administrative Agent required to be paid or reimbursed pursuant to the Credit Agreement, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent.

6.5Other Documents. The Administrative Agent shall have been provided with such documents, instruments and agreements, and the Loan Parties shall have taken such actions, in each case as the Administrative Agent may reasonably require in connection with this Amendment and the transactions contemplated hereby.

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SECTION 7.Conditions Precedent to Specified Contribution Effective Date Amendments. The amendments to the Credit Agreement contained in Section 3 hereof, the termination of the Existing Parent Pledge Agreement contained in Section 4 and the termination of the Intercreditor Agreement contained in Section 5 hereof will, in each case, be effective automatically on the condition that the following conditions precedent will have been satisfied (the date upon which all such conditions are satisfied, the “Specified Contribution Effective Date”):

7.1Officer’s Certificate. The Administrative Agent shall have received a certificate of a Responsible Officer of the Parent attaching and/or setting forth (a) resolutions of the directors of the Parent with respect to the authorization of the Parent to execute and deliver the Loan Documents to which it is a party and to enter into the transactions contemplated in those documents, (b) the officers of the Parent who are authorized to sign the Loan Documents to which the Parent is a party and who will, until replaced by another officer or officers duly authorized for that purpose, act as its representative for the purposes of signing documents and giving notices and other communications in connection with the Credit Agreement and the other Loan Documents, as amended hereby, and the transactions contemplated thereby, (c) specimen signatures of each such authorized officer, (d) the articles, by-laws or other applicable organizational documents of the Parent, certified as being true and complete and (e) a certificate of the appropriate government officials of the state of incorporation or organization of Parent as to the existence and good standing of Parent dated as of a recent date hereof.

7.2Officer’s Specified Contribution Effective Date Certificate. The Administrative Agent shall have received a certificate, signed by a Responsible Officer of the Company, dated as of the Specified Contribution Effective Date, (a) stating that no Default has occurred and is continuing or would result from the transactions contemplated by the Specified Contribution, (b) stating that the representations and warranties contained in the Loan Documents are true and correct in all material respects (except that any representation and warranty that is qualified as to “materiality” or “Material Adverse Effect” shall be true and correct in all respects) as of such date, (c) attaching true, accurate and complete copies of the Contribution Agreement and (d) certifying that the Parent and the Ultimate Parent are consummating the Specified Contribution substantially in accordance with the Contribution Agreement.

7.3Parent Pledge Agreement. The Administrative Agent shall have received an executed counterpart from the Parent to the Parent Pledge Agreement (as defined in the Credit Agreement set forth on Annex B), which Parent Pledge Agreement shall be in form and substance satisfactory to the Administrative Agent and pursuant to which the Parent will pledge 100% of the Equity Interests in the Company (including, to the extent such Equity Interests are certificated, delivery to the Administrative Agent of original stock certificates evidencing such Equity Interests, together with an appropriate undated membership power for each certificate duly executed in blank by the registered owner thereof).

7.4Release of Ultimate Parent Security Interest. The Administrative Agent shall have received evidence satisfactory to it that the liens and security interests securing the “Parent Loans” (as defined in the modified Credit Agreement immediately prior to giving effect to this Amendment) on any Collateral shall have been released, terminated and of no further force and effect substantially contemporaneously with the closing of the Specified Contribution (including the filing of any UCC-3 amendments limiting the collateral securing the Parent Loans to the “Pledged Collateral” as defined in the Stock Pledge Agreement referred to below) pursuant to that certain Stock Pledge Agreement dated as of the Specified Contribution Effective Date, by and among the Ultimate Parent and the “Subordinated Lenders” (as defined in the modified Credit Agreement set forth on Annex A) party thereto (the “Stock Pledge Agreement”).

5

7.5Lien Searches. The Administrative Agent shall have received the results of UCC, tax lien and judgment lien searches showing all financing statements and other documents or instruments on file against the Parent in the appropriate filing offices, reflecting no Liens against any of the Collateral of the Parent.

7.6Financing Statements. The Administrative Agent shall have received UCC financing statements in form and substance satisfactory to the Administrative Agent reflecting Parent (solely with respect to its pledge of the Equity Interests in Company), as debtor, and Administrative Agent, as secured party, which are required to grant a Lien which secures the Obligations and covering such Collateral as Administrative Agent may request.

7.7Opinion of Counsel. The Administrative Agent shall have received a favorable opinion dated as of the Specified Contribution Effective Date and in form and substance reasonably satisfactory to the Administrative Agent of Fennemore Craig, P.C., legal counsel to the Parent and each Loan Party, as to such matters as Administrative Agent may reasonably request.

7.8KYC Requirements. The Administrative Agent and each of the Lenders shall have received from the Parent, to the extent requested by the Administrative Agent or such Lender at least three (3) Business Days prior to the Specified Contribution Effective Date, all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.

7.9Corporate Structure. The corporate structure, capital structure and other material debt instruments, material accounts and governing documents of Parent, the Company and its Subsidiaries shall be acceptable to Administrative Agent in its reasonable discretion.

The Administrative Agent is hereby authorized and directed to declare the amendments to the Credit Agreement contained in Section 3 hereof, the termination of the Existing Parent Pledge Agreement contained in Section 4 and the termination of the Intercreditor Agreement contained in Section 5 hereof to be effective on the Specified Contribution Effective Date. Such declaration shall be final, conclusive and binding upon the Lenders, the other parties to the Credit Agreement and the “Subordinated Lenders” identified on the signature pages hereto for all purposes.

SECTION 8.Representations and Warranties. Each Loan Party hereby represents and warrants to the Lenders the following:

8.1Representations and Warranties. After giving effect to this Amendment, the representations and warranties contained in the Credit Agreement, as amended hereby, and the other Loan Documents are true and correct in all material respects (without duplication of any materiality qualification applicable thereto) on and as of the date hereof as though made on and as of the date hereof, except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties were true and correct in all material respects as of such earlier date, and except for any change of facts expressly permitted under the provisions of the Credit Agreement and the other Loan Documents.

6

8.2No Default. After giving effect to this Amendment, no Default or Event of Default has occurred and is continuing as of the date hereof.

8.3Enforceability. This Amendment has been duly executed and delivered by such Loan Party, and the Credit Agreement, as amended hereby, constitutes a legal, valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

SECTION 9.Survival of Representations and Warranties. All representations and warranties made in this Amendment, including any Loan Document furnished in connection with this Amendment, shall survive the execution and delivery of this Amendment and the other Loan Documents, and no investigation by the Administrative Agent or any closing shall affect the representations and warranties or the right of the Administrative Agent or any Lender to rely upon them.

SECTION 10.Expenses. As provided in Section 11.1 of the Credit Agreement and subject to the limitations expressly set forth therein, the Borrowers hereby agree to pay on demand all legal and other fees, costs and expenses incurred by the Administrative Agent in connection with the negotiation, preparation, and execution of this Amendment and all related documents.

SECTION 11.   No Implied Waivers. No failure or delay on the part of the Administrative Agent or any Lender in exercising, and no course of dealing with respect to, any right, power or privilege under this Amendment, the Credit Agreement or any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege under this Amendment, the Credit Agreement or any other Loan Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege.

SECTION 12.Ratification and Affirmation of Loan Parties. Each of the Loan Parties hereby expressly (a) acknowledges the terms of this Amendment, (b) ratifies and affirms its obligations under the Loan Documents to which it is a party, (c) acknowledges, renews and extends its continued liability under the Loan Documents to which it is a party, and (d) agrees, with respect to each Loan Party that is a Guarantor, that its guarantee under the Guaranty remains in full force and effect with respect to the Obligations as amended hereby. Any and all of the terms and provisions of the Credit Agreement and the other Loan Documents shall, except as amended hereby, remain in full force and effect. The Loan Parties hereby extend the Liens securing the Obligations until the Obligations have been paid in full, and agree that the amendments and waivers herein contained shall in no manner affect or impair the Obligations or the Liens securing payment and performance thereof, all of which are ratified and confirmed.

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SECTION 13.     Severability. Any provision of this Amendment that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

SECTION 14.APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.

SECTION 15.Successors and Assigns. This Amendment is binding upon and shall inure to the benefit of the Administrative Agent, the Lenders and the Loan Parties and their respective successors and assigns, except the Loan Parties may not assign or transfer any of their rights or obligations hereunder without the prior written consent of the Administrative Agent, other than as expressly permitted under the terms of the Credit Agreement.

SECTION 16.Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original but all of which when taken together shall constitute but one and the same instrument. Delivery of an executed signature page of this Amendment by facsimile transmission or PDF electronic transmission shall be effective as delivery of a manually executed counterpart hereof.

SECTION 17.Effect of Consent. No consent or waiver, express or implied, by the Administrative Agent to or for any breach of or deviation from any covenant, condition or duty by the Borrowers shall be deemed a consent or waiver to or of any other breach of the same or any other covenant, condition or duty.

SECTION 18.Headings. The headings of this Amendment are for purposes of reference only and shall not limit or otherwise affect the meaning hereof.

SECTION 19.Reaffirmation of Loan Documents. This Amendment shall be deemed to be an amendment to the Credit Agreement, and the Credit Agreement, as amended hereby, and the other Loan Documents are hereby ratified, approved and confirmed in each and every respect. All references to the Credit Agreement herein and in any other document, instrument, agreement or writing shall hereafter be deemed to refer to the Credit Agreement as amended hereby.

SECTION 20.Loan Document. This Amendment constitutes a “Loan Document” under and as defined in the Credit Agreement.

SECTION 21.Entire Agreement. THE CREDIT AGREEMENT, THIS AMENDMENT, THE OTHER LOAN DOCUMENTS, AND ALL OTHER INSTRUMENTS, DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH THIS AMENDMENT REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES.

[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date set forth above.

BORROWERS:
FLEX LEASING POWER & SERVICE LLC, a Delaware limited liability company
By:	/s/ Wes Kimmel
Name:	Wes Kimmel
Title:	Chief Financial Officer
FLEX LEASING POWER AND SERVICE ULC, an Alberta unlimited liability corporation
By:	/s/ Doug Baltzer
Name:	Doug Baltzer
Title:	President

[Signature Page to Fifth Amendment To Credit Agreement
– Flex Leasing Power & Service LLC]

GUARANTORS:
FLEX POWER CO.,
a Delaware limited liability company
By:	/s/ Doug Baltzer
Name:	Doug Baltzer
Title:	President

[Signature Page to Fifth Amendment To Credit Agreement
– Flex Leasing Power & Service LLC]

ADMINISTRATIVE AGENT AND LENDER:
TEXAS CAPITAL BANK
By:	/s/ Dan Clubb
Name:      Dan Clubb
Title:        Senior Vice President

[Signature Page to Fifth Amendment To Credit Agreement
– Flex Leasing Power & Service LLC]

Solely with respect to Section 5 hereof:
RNS FLEX, LLC
By:	RNS Management, LLC, its Manager
By:	/s/ Thomas R. Denison
	Thomas R. Denison, Manager
ENERGY SPECIAL SITUATIONS FUND II, L.P.,
By:	Energy Special Situations Fund Management II, LLC,
its general partner
By:	/s/ Jonathan S. Linker
	Jonathan S. Linker, Manager
ESS PARTICIPATION FUND II, L.P.,
By:	Energy Special Situations Fund Management II, LLC,
its general partner
By:	/s/ Jonathan S. Linker
	Jonathan S. Linker, Manager
TRF PLATFORM HOLDINGS, LLC
By:	Intervale Capital Fund III, L.P., its manager
By:	Intervale Capital GP III, L.P., its general partner
By:	Intervale Capital Associates III LLC, its general partner
By:	/s/ Patrick Connelly
	Patrick Connelly, Authorized Person

[Signature Page to Fifth Amendment To Credit Agreement
– Flex Leasing Power & Service LLC]

ANNEX A

Conformed Credit Agreement (Fifth Amendment Effective Date)

[See Attached]

ANNEX A

Annex A to Fifth Amendment to Credit Agreement 

CREDIT AGREEMENT

among

FLEX LEASING POWER & SERVICE LLC
and
FLEX LEASING POWER AND SERVICE ULC,
as Borrowers,

and

THE OTHER LOAN PARTIES FROM TIME TO TIME PARTY HERETO,

THE LENDERS FROM TIME TO TIME PARTY HERETO

and

TEXAS CAPITAL BANK,
as Administrative Agent, Swing Line Lender and L/C Issuer

TEXAS CAPITAL BANK,
as Sole Lead Arranger and Sole Book Runner

DATED AS OF FEBRUARY 8, 2019

TABLE OF CONTENTS

Page

Article 1. DEFINITIONS		1
Section 1.1	Definitions	1
Section 1.2	Accounting Matters	49
Section 1.3	ERISA Matters	50
Section 1.4	Letter of Credit Amounts	50
Section 1.5	Other Definitional Provisions	50
Section 1.6	Interpretative Provision	50
Section 1.7	Times of Day	50
Section 1.8	Other Loan Documents	50
Section 1.9	Divisions	50
Section 1.10	Rates	51
Section 1.11	Rounding	51

Article 2. THE COMMITMENTS AND CREDIT EXTENSIONS		51
Section 2.1	The Loans	51
Section 2.2	Letters of Credit	52
Section 2.3	Swing Line Loans	60
Section 2.4	Fees	64
Section 2.5	Payments Generally; Administrative Agent’s Clawback	64
Section 2.6	Evidence of Debt	66
Section 2.7	Cash Collateral	66
Section 2.8	Interest; Payment Terms	68
Section 2.9	Voluntary Termination or Reduction of Commitments; Prepayments	70
Section 2.10	Uncommitted Increase in Commitments	71
Section 2.11	Cash Collateral Blocked Accounts	73
Section 2.12	Collection of Accounts	73
Section 2.13	Appointment of Borrower Representative	74
Section 2.14	Joint and Several Liability	75

Article 3. TAXES, YIELD PROTECTION AND INDEMNITY		76
Section 3.1	Increased Costs	76
Section 3.2	Illegality	77
Section 3.3	Alternate Rate of Interest	78
Section 3.4	Taxes	81
Section 3.5	Compensation for Losses	85
Section 3.6	Mitigation of Obligations; Replacement of Lenders	86
Section 3.7	Survival	87

Article 4. CONDITIONS PRECEDENT		87
Section 4.1	Initial Extension of Credit	87
Section 4.2	All Extensions of Credit	90

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Article 5. REPRESENTATIONS AND WARRANTIES		91
Section 5.1	Entity Existence	91
Section 5.2	Financial Statements; Etc.	92
Section 5.3	Action; No Breach	92
Section 5.4	Operation of Business	92
Section 5.5	Litigation and Judgments	93
Section 5.6	Rights in Properties; Liens	93
Section 5.7	Enforceability	93
Section 5.8	Approvals	93
Section 5.9	Taxes	94
Section 5.10	Use of Proceeds; Margin Securities	94
Section 5.11	ERISA	94
Section 5.12	Disclosure	95
Section 5.13	Subsidiaries	95
Section 5.14	Agreements	95
Section 5.15	Compliance with Laws	96
Section 5.16	Inventory	96
Section 5.17	Regulated Entities	96
Section 5.18	Environmental Matters	96
Section 5.19	Intellectual Property	97
Section 5.20	Anti-Corruption Laws; Sanctions; Etc.	97
Section 5.21	Patriot Act	97
Section 5.22	Insurance	97
Section 5.23	Solvency	98
Section 5.24	Security Documents	98
Section 5.25	Labor Matters	98
Section 5.26	Material Agreements	98
Section 5.27	Additional Representations of Guarantors	98
Section 5.28	Qualified ECP Guarantor. Each Borrower is a Qualified ECP Guarantor	98

Article 6. AFFIRMATIVE COVENANTS		99
Section 6.1	Reporting Requirements	99
Section 6.2	Maintenance of Existence; Conduct of Business	103
Section 6.3	Maintenance of Properties	103
Section 6.4	Taxes and Claims	103
Section 6.5	Insurance	104
Section 6.6	Inspection Rights	104
Section 6.7	Keeping Books and Records	105
Section 6.8	Compliance with Laws	105
Section 6.9	Compliance with Agreements	105
Section 6.10	Further Assurances	105
Section 6.11	ERISA	105
Section 6.12	Depository Relationship; Control Agreements; Blocked Accounts	105
Section 6.13	Additional Loan Parties	106
Section 6.14	Inventory; Collateral Access Agreements	106
Section 6.15	Certificates of Title	107
Section 6.16	Sanctions; Anti-Corruption Laws	107
Section 6.17	Post-Closing Obligations	107

ii

Article 7. NEGATIVE COVENANTS		108
Section 7.1	Debt	108
Section 7.2	Limitation on Liens	109
Section 7.3	Mergers, Etc.	110
Section 7.4	Restricted Payments	110
Section 7.5	Loans and Investments	111
Section 7.6	Limitation on Issuance of Equity	112
Section 7.7	Transactions With Affiliates	112
Section 7.8	Disposition of Assets	113
Section 7.9	Sale and Leaseback	113
Section 7.10	Prepayment of Debt	113
Section 7.11	Nature of Business	113
Section 7.12	Environmental Protection	113
Section 7.13	Accounting	114
Section 7.14	Burdensome Agreements	114
Section 7.15	Subsidiaries	114
Section 7.16	Amendments of Certain Documents	114
Section 7.17	Hedge Agreements	114
Section 7.18	Anti-Corruption Laws; Sanctions; Anti-Terrorism Law	115
Section 7.19	Negative Pledge	115
Section 7.20	Canadian Defined Benefit Plan	114
Article 8. FINANCIAL COVENANTS		115
Section 8.1	Leverage Ratio	115
Section 8.2	Fixed Charge Coverage Ratio	115
Article 9. DEFAULT		115
Section 9.1	Events of Default	115
Section 9.2	Remedies Upon Default	118
Section 9.3	Right to Cure Financial Covenant Non-Compliance	128
Section 9.4	Application of Funds	119
Section 9.5	Performance by Administrative Agent	120

iii

Article 10. AGENCY		121
Section 10.1	Appointment and Authority	121
Section 10.2	Rights as a Lender	121
Section 10.3	Exculpatory Provisions	121
Section 10.4	Reliance by Administrative Agent	123
Section 10.5	Delegation of Duties	123
Section 10.6	Resignation or Removal of Administrative Agent	123
Section 10.7	Non-Reliance on Administrative Agent and Other Lenders	125
Section 10.8	Administrative Agent May File Proofs of Claim	125
Section 10.9	Collateral and Guaranty Matters	126
Section 10.10	Bank Product Agreements	127
Section 10.11	Erroneous Payments	128
Article 11. MISCELLANEOUS		130
Section 11.1	Expenses	130
Section 11.2	INDEMNIFICATION	132
Section 11.3	Limitation of Liability	133
Section 11.4	No Duty	134
Section 11.5	Lenders Not Fiduciary	134
Section 11.6	Equitable Relief	134
Section 11.7	No Waiver; Cumulative Remedies	134
Section 11.8	Successors and Assigns	135
Section 11.9	Survival	139
Section 11.10	Amendment	139
Section 11.11	Notices	141
Section 11.12	Governing Law; Venue; Service of Process	143
Section 11.13	Counterparts	143
Section 11.14	Severability	144
Section 11.15	Headings	144
Section 11.16	Construction	144
Section 11.17	Independence of Covenants	144
Section 11.18	WAIVER OF JURY TRIAL	144
Section 11.19	Additional Interest Provision	145
Section 11.20	Ceiling Election	146
Section 11.21	USA Patriot Act	146
Section 11.22	Defaulting Lenders	146
Section 11.23	Sharing of Payments by Lenders	149
Section 11.24	Payments Set Aside	149
Section 11.25	Setoff	150
Section 11.26	Confidentiality	151
Section 11.27	Electronic Execution of Assignments and Certain Other Documents	152
Section 11.28	Acknowledgement and Consent to Bail-In of Affected Financial Institutions	152
Section 11.29	Keepwell	153
Section 11.30	NOTICE OF FINAL AGREEMENT	153
Section 11.31	Intercreditor Agreement	153
Section 11.32	Acknowledgement Regarding Any Supported QFCs	153

iv

Article 12. GUARANTY		154
Section 12.1	Guaranty	154
Section 12.2	Payment	154
Section 12.3	Agreements and Waivers	155
Section 12.4	Liability	156
Section 12.5	Subordination	157
Section 12.6	Subrogation	157
Section 12.7	Other Indebtedness or Obligations of Guarantors	157
Section 12.8	Costs and Expenses	158
Section 12.9	Exercising Rights, Etc.	158
Section 12.10	Benefit; Binding Effect	158
Section 12.11	Multiple Guarantors	158
Section 12.12	Additional Guarantors	159
Section 12.13	Reinstatement	159
Section 12.14	Maximum Liability	159

v

INDEX TO SCHEDULES
Schedule	Description of Schedule	Section
2.1	Commitments and Applicable Percentages	2.1
2.11	Blocked Accounts	2.11
5.5	Litigation and Judgments	5.5
5.6(b)	Owned Real Property	5.6
5.6(c)	Leased Real Property (Lessee)	5.6
5.9	Taxes	5.9
5.13	Parent; Subsidiaries	5.13
5.26	Material Agreements	5.26
7.1	Existing Debt	7.1
7.2	Existing Liens	7.2
7.5	Existing Investments	7.5
11.11	Notices	11.11

INDEX TO EXHIBITS
Exhibit	Description of Exhibit	Section
A	Assignment and Assumption	1.1
B	Borrowing Base Report	1.1
C	Compliance Certificate	1.1
D	Borrowing Request	1.1
E	Note	1.1
F	Swing Line Loan Request	1.1
G	Tax Forms	3.4(g)
H	Joinder Agreement	1.1

vi

CREDIT AGREEMENT

This CREDIT AGREEMENT dated as of February 8, 2019 (as the same may be amended, restated, supplemented or otherwise modified from time to time, this “Agreement”), is among FLEX LEASING POWER & SERVICE LLC, a Delaware limited liability company (“Company”), FLEX LEASING POWER AND SERVICE ULC, an Alberta unlimited liability corporation (“Canadian Borrower”; and together with Company and any Subsidiary of Company that becomes party hereto as a “Borrower” pursuant to Section 6.13(a), including their respective successors and assigns to the extent permitted by Section 11.8, individually, a “Borrower”, and collectively, “Borrowers”), each of the other Loan Parties from time to time party hereto, the Lenders from time to time party hereto, and TEXAS CAPITAL BANK, a national banking association, as Administrative Agent, Swing Line Lender and L/C Issuer.

RECITALS

The Borrowers have requested that Lenders extend credit to Borrowers as described in this Agreement. Lenders are willing to make such credit available to Borrowers upon and subject to the provisions, terms and conditions hereinafter set forth.

NOW THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto agree as follows:

Article 1.

DEFINITIONS

Section 1.1Definitions. As used in this Agreement, all exhibits, appendices and schedules hereto and in any note, certificate, report or other Loan Document made or delivered pursuant to this Agreement, the following terms will have the meanings given such terms in this Article 1 or in the provision, section or recital referred to below:

“Account” means an account, as defined in the UCC or the PPSA, as applicable.

“Account Agings” has the meaning set forth in Section 6.1(l).

“Additional Guarantor” has the meaning set forth in Section 12.12.

“Adjusted Eurodollar Rate” means, with respect to any Loan for any Interest Period or day, as applicable, an interest rate per annum equal to the Eurodollar Rate for such Interest Period or day multiplied by the Statutory Reserve Rate; provided, however, if the Eurodollar Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.

“Administrative Agent” means Texas Capital Bank, in its capacity as administrative agent under any of the Loan Documents, until the appointment of a successor administrative agent pursuant to the terms of this Agreement and, thereafter, shall mean such successor administrative agent.

CREDIT AGREEMENT – Page 1

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by or reasonably acceptable to Administrative Agent.

“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.

“Affiliate” means, as to any Person, any other Person that directly or indirectly, through one or more intermediaries, Controls or is Controlled by, or is under common Control with, such Person; provided, however, in no event shall any Lender be deemed an Affiliate of Parent, any Borrower or any of their respective Subsidiaries or Affiliates. Notwithstanding the foregoing, for purposes of clause (e), clause (n), and clause (r) of the definition of “Eligible Accounts”, the term “Affiliate” solely with respect to any Loan Party shall exclude any portfolio company (other than Parent, any Loan Party or any of their respective Subsidiaries) of the Permitted Holders and their Affiliates engaged in the business of producing goods or providing services that, but for this sentence, would otherwise be an Affiliate of any Permitted Holder or of Parent, any Loan Party or any of their respective Subsidiaries.

“Affiliated Debt” has the meaning set forth in Section 12.5.

“Agent Parties” means, collectively, Administrative Agent or any of its Related Parties.

“Agreement” has the meaning set forth in the introductory paragraph hereto, and includes all schedules, exhibits and appendices attached or otherwise identified therewith.

“Annualized Debt Service” means, for any date of determination, the sum of all regularly scheduled principal payments and all Cash Interest Expense that are paid or payable in respect of all Debt of Company and its Subsidiaries on a consolidated basis in accordance with GAAP (other than scheduled payments of principal on Debt which pay such Debt in full, but only to the extent such final payment is greater than the scheduled principal payment immediately preceding such final payment) for the trailing three month period then ending on such date multiplied by four (4).

“Annualized EBITDA” means, for any date of determination, the sum of (a)(i) EBITDA of Company and its Subsidiaries on a consolidated basis in accordance with GAAP for the trailing three month period then ending on such date (without giving effect to the amount of any Specified EBITDA Equity Contribution that is deemed to be EBITDA for any fiscal quarter included in the trailing four fiscal quarter period pursuant to Section 9.3) multiplied by (ii) four (4), plus (b) the amount of any Specified EBITDA Equity Contribution that is deemed to be EBITDA for any fiscal quarter included in the trailing four fiscal quarter period pursuant to Section 9.3.

“Anti-Corruption Laws” means all state, provincial, territorial or federal Laws, rules, and regulations applicable to the Loan Parties or any of their Affiliates from time to time concerning or relating to bribery or corruption, including the FCPA, the Bank Secrecy Act, the Corruption of Foreign Public Officials Act (Canada), and other similar anti-corruption legislation in other jurisdictions.

“Anti-Terrorism Laws” has the meaning set forth in Section 5.21.

CREDIT AGREEMENT – Page 2

“Applicable Margin” means the applicable percentages per annum set forth below, based upon the Leverage Ratio, as set forth in the most recent Compliance Certificate received by Administrative Agent for each fiscal quarter or the last month of each fiscal quarter from time to time pursuant to Section 6.1(d), as applicable:

Pricing Level	Leverage Ratio	Base Rate Loans	Eurodollar Rate Loans and Letter of Credit Fee
1	≤ 2.00:1.00	1.50%	2.50%
2	>2.00:1.00 but ≤ 2.50:1.00	1.75%	2.75%
3	>2.50:1.00	2.00%	3.00%

Any increase or decrease in the Applicable Margin resulting from a change in the Leverage Ratio shall become effective as of the first day immediately following the date a Compliance Certificate is delivered for each fiscal quarter or the last month of each fiscal quarter from time to time pursuant to Section 6.1(d), as applicable; provided that if such Compliance Certificate is not delivered when due in accordance with such Section, then upon the request of the Required Lenders, Pricing Level 3 shall apply as of the first day after the date on which such Compliance Certificate was required to have been delivered and shall remain in effect until the date on which such Compliance Certificate is delivered. The Applicable Margin from the Closing Date through the date such Compliance Certificate is delivered pursuant to Section 6.1(d) in respect of the last month of the second fiscal quarter of Company ending after the Closing Date shall be determined based upon Pricing Level 2.

If, as a result of any restatement of or other adjustment to the financial statements of Company or for any other reason, the Borrower Representative or the Required Lenders determine that (i) the Leverage Ratio as calculated by Company as of any applicable date was inaccurate and (ii) a proper calculation of the Leverage Ratio would have resulted in higher pricing for such period, Borrowers shall immediately and retroactively be obligated to pay to Administrative Agent for the account of the applicable Lenders, L/C Issuer or Swing Line Lender, as the case may be, promptly on demand by Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to any Loan Party under the Bankruptcy Code of the United States, automatically and without further action by Administrative Agent, any Lender, L/C Issuer or Swing Line Lender), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period. This paragraph shall not limit the rights of Administrative Agent, any Lender, L/C Issuer or Swing Line Lender, as the case may be, including the rights available under Article 2 or under Article 9. Each Borrower’s obligations under this paragraph shall survive the termination of the Commitments and the repayment of all other Obligations hereunder.

“Applicable Percentage” means, with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of such Lender’s Commitment at such time divided by the aggregate Commitments of all Lenders; provided that if the Commitments have been terminated pursuant to the terms hereof, then the Applicable Percentage of each Lender shall be determined based upon the Applicable Percentage of such Lender immediately prior to such termination and after giving effect to any subsequent assignments made pursuant to the terms hereof.

CREDIT AGREEMENT – Page 3

“Applicable Rate” means (a) in the case of a Base Rate Loan, the Base Rate plus the Applicable Margin; and (b) in the case of a Eurodollar Rate Loan, the Adjusted Eurodollar Rate plus the Applicable Margin.

“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arranger” means Texas Capital Bank in its capacity as sole lead arranger and sole book runner.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 11.8), and accepted by Administrative Agent, in substantially the form of Exhibit A or any other form approved by Administrative Agent.

“Authorized Party” has the meaning set forth in Section 11.11(d)(iii).

“Availability” means, as of any date, the difference between (a) an amount equal to the lesser of (i) the Borrowing Base in effect on such date and (ii) the aggregate amount of the Commitments of the Lenders on such date less (b) the total Revolving Credit Exposure of the Lenders on such date.

“Availability Reserves” shall mean, as of any date of determination, such amounts as Administrative Agent may from time to time establish and revise in its Permitted Discretion: (a) to reflect events, conditions, contingencies or risks which, as determined by Administrative Agent, do or may affect either (i) the Collateral or any other Property which is security for the Obligations, (ii) the assets, business or prospects of the Loan Parties, (iii) the security interests and other rights of any Secured Party in the Collateral (including the enforceability, perfection and priority thereof), (b) to reflect Administrative Agent’s belief that any collateral report or financial information furnished by or on behalf of the Loan Parties to Administrative Agent is or may have been incomplete, inaccurate or misleading in any material respect, (c) in respect of Rent Reserves, Bank Products and Hedge Agreements and (d) in respect of any state of facts which Administrative Agent determines constitutes a Default or an Event of Default or may, with notice or passage of time or both, constitute a Default or an Event of Default. Without limiting the foregoing, the Administrative Agent, in its Permitted Discretion, may establish and/or increase Availability Reserves (but without duplication) in respect of: (A) any reserve established by the Administrative Agent on account of statutory claims, deemed trusts, or inventory subject to rights of suppliers under Section 81.1 of the BIA or similar rights of reclamation under Section 81.2 of the BIA, or under any other applicable Law, (B) employee or employee benefit related liabilities and any other claims which may have priority over the claims of the Administrative Agent and the Lenders, including Canadian Priority Payables, (C) liabilities arising under or in respect of any Canadian Pension Plan which, if not paid, could result in a Lien on any of the assets of any Credit Party, which Lien could reasonably be expected to have priority over, or rank pari passu with, the Liens of the Administrative Agent, (D) claims by Her Majesty the Queen in Right of Canada made pursuant to Section 224(1.2) or 224(1.3) of the ITA, (E) claims pursuant to any provision of the Canada Pension Plan or the Employment Insurance Act (Canada) that refers to subsection 224(1.2) of the ITA and provides for the collection of a contribution (as defined in the Canada Pension Plan), or employee’s premium or employer’s premium (as defined in the Employment Insurance Act (Canada)), or a premium under Part VII.1 of that Act, and of any related interest, penalties or other amounts, (F) claims pursuant to any provision of provincial legislation that has a similar purpose to subsection 224(1.2) of the ITA, or that refers to that subsection, to the extent that it provides for the collection of a sum, and of any related interest, penalties or other amounts, where the sum has been withheld or deducted by a person from a payment to another person and is in respect of a tax similar in nature to the income tax imposed on individuals under the ITA or is of the same nature as a contribution under the Canada Pension Plan if the province is a “province providing a comprehensive pension plan” as defined in subsection 3(1) of the Canada Pension Plan and the provincial legislation establishes a “provincial pension plan” as defined in that subsection, which claims could reasonably be expected to have priority over, or rank pari passu with, the Liens of the Administrative Agent.

CREDIT AGREEMENT – Page 4

“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, any tenor for such Benchmark or payment period for interest calculated with reference to such Benchmark, as applicable, that is or may be used for determining the length of an Interest Period pursuant to this Agreement as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to Section 3.3(e).

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” means, (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing Law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).

“Bank Product Agreements” means those certain agreements entered into from time to time between any Loan Party and a Bank Product Provider in connection with any of the Bank Products, including without limitation, Hedge Agreements.

“Bank Product Obligations” means all obligations, liabilities, contingent reimbursement obligations, fees, and expenses owing by any Loan Party or any of its Subsidiaries to any Bank Product Provider pursuant to or evidenced by the Bank Product Agreements and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all such amounts that any Loan Party or such Subsidiary is obligated to reimburse to any Bank Product Provider as a result of such Bank Product Provider purchasing participations or executing indemnities or reimbursement obligations with respect to the Bank Products provided to any Loan Party or such Subsidiaries pursuant to the Bank Product Agreements. For the avoidance of doubt, the Bank Product Obligations arising under any Hedge Agreement shall be determined by the Hedge Termination Value thereof.

CREDIT AGREEMENT – Page 5

“Bank Product Provider” means any Lender or Affiliate of a Lender (or any Person that was a Lender or an Affiliate of a Lender at the time the relevant Hedge Agreement was entered into) that provides Bank Products to the Loan Parties from time to time.

“Bank Products” means any service provided to, facility extended to, or transaction entered into with, any Loan Party by any Bank Product Provider consisting of (a) deposit accounts, (b) cash management services, including treasury, depository, return items, overdraft, controlled disbursement, merchant store value cards, e-payables services, electronic funds transfer, interstate depository network, automatic clearing house transfer (including the Automated Clearing House processing of electronic funds transfers through the direct Federal Reserve Fedline system) and other cash management arrangements maintained with any Bank Product Provider, (c) debit cards, stored value cards, and credit cards (including commercial credit cards (including so-called “procurement cards” or “P-cards”)) and debit card and credit card processing services or (d) Hedge Agreements.

“Base Rate” means, for any day, a rate of interest per annum equal to the highest of (a) the Prime Rate for such day; (b) the sum of the Federal Funds Rate for such day plus one half of one percent (0.5%); and (c) the Adjusted Eurodollar Rate for such day plus one percent (1.00%). Notwithstanding the foregoing, in no event shall the Base Rate be less than 1.00%.

“Base Rate Borrowing” means, as to any Borrowing, the Base Rate Loans comprising such Borrowing.

“Base Rate Loan” means a Loan bearing interest based on the Base Rate.

“Benchmark” means, initially, USD LIBOR; provided that if a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have occurred with respect to USD LIBOR or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 3.3(b).

“Benchmark Replacement” means, for any Available Tenor, the first alternative set forth in the order below that can be determined by Administrative Agent for the applicable Benchmark Replacement Date:

(a)the BSBY Rate;

(b)the sum of: (i) Term SOFR and (ii) the related Benchmark Replacement Adjustment;

(c)the sum of: (i) Daily Simple SOFR and (ii) the related Benchmark Replacement Adjustment;

CREDIT AGREEMENT – Page 6

(d) the sum of: (i) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower Representative as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (A) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (B) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for U.S. dollar-denominated syndicated credit facilities at such time and (ii) the related Benchmark Replacement Adjustment;

provided that, (x) in the case of clause (a), no BSBY Transition Event shall have occurred and the BSBY Rate is available and readily determinable as determined by the Administrative Agent in its sole discretion and (y) in the case of clause (b), such Unadjusted Benchmark Replacement is displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion. If the Benchmark Replacement as determined pursuant to clause (a), (b), (c) or (d) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.

“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest Period and Available Tenor for any setting of such Unadjusted Benchmark Replacement:

(a)        for purposes of clauses (a) and (b) of the definition of “Benchmark Replacement,” the first alternative set forth in the order below that can be determined by the Administrative Agent:

(i)       the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Interest Period that has been selected or recommended by the Relevant Governmental Body for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for the applicable Corresponding Tenor;

(ii)       the spread adjustment (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Interest Period that would apply to the fallback rate for a derivative transaction referencing the ISDA Definitions to be effective upon an index cessation event with respect to such Benchmark for the applicable Corresponding Tenor; and

(b)        for purposes of clause (c) of the definition of “Benchmark Replacement,” the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Administrative Agent and the Borrower Representative for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body on the applicable Benchmark Replacement Date or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated syndicated credit facilities;

provided that, in the case of clause (a) above, such adjustment is displayed on a screen or other information service that publishes such Benchmark Replacement Adjustment from time to time as selected by the Administrative Agent in its reasonable discretion.

CREDIT AGREEMENT – Page 7

“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definitions of “Adjusted Eurodollar Rate”, “Base Rate”, “Business Day”, “Eurodollar Rate”, or “Interest Period,” the timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

“Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current Benchmark:

(a)        in the case of clauses (a) or (b) of the definition of “Benchmark Transition Event”, the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof);

(b)        in the case of clause (c) of the definition of “Benchmark Transition Event,” the date of the public statement or publication of information referenced therein; or

(c)        in the case of an Early Opt-in Election, the sixth (6th) Business Day after the date notice of such Early Opt-in Election is provided to the Lenders, so long as the Administrative Agent has not received, by 5:00 p.m. on the fifth (5th) Business Day after the date notice of such Early Opt-in Election is provided to the Lenders, written notice of objection to such Early Opt-in Election from Lenders comprising the Required Lenders;

provided that if the then-current Benchmark is BSBY, “Benchmark Replacement Date” shall mean the BSBY Replacement Date.

For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred in the case of clauses (a) or (b) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

CREDIT AGREEMENT – Page 8

“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:

(a)a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

(b)a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Board of Governors, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

(c)a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are no longer representative; or

(d)if the then current Benchmark is BSBY, the occurrence of a BSBY Transition Event.

For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).

“Benchmark Unavailability Period” means the period (if any) (a) beginning at the time that a Benchmark Replacement Date pursuant to clauses (a) or (b) of the definition thereof has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 3.3 and (b) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 3.3.

“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“BHC Act Affiliate” means, as to any Person, an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such Person.

CREDIT AGREEMENT – Page 9

“BIA” means the Bankruptcy and Insolvency Act (Canada), as amended from time to time, and any successor statute, together with the regulations promulgated thereunder.

“Blocked Accounts” has the meaning set forth in Section 2.11.

“Board of Governors” means the Board of Governors of the Federal Reserve System of the U.S.

“Borrower” or “Borrowers” has the meaning set forth in the introductory paragraph hereto.

“Borrower Materials” has the meaning set forth in Section 11.11(e).

“Borrower Representative” has the meaning set forth in Section 2.13(a).

“Borrowing” means a Revolving Credit Borrowing or a Swing Line Borrowing, as the context may require.

“Borrowing Base” means, as of any date, an amount equal to the sum of, without duplication:

(a)        eighty-five percent (85%) of the Borrowers’ Eligible Accounts, plus

(b)        fifty percent (50%) of the Borrowers’ Eligible Inventory, valued at the lower of cost or market value, determined on a weighted average cost basis; provided, that the maximum amount of Eligible Inventory of the Borrowers that may be included in the Borrowing Base pursuant to this clause (b) after giving effect to the advance rate set forth herein shall not exceed $3,000,000, plus

(c)        the lesser of (i) the product of eighty percent (80%) of the Net Orderly Liquidation Value of the Borrowers’ Eligible Generator Units as determined pursuant to the most recent generator appraisal ordered, received and relied upon by Administrative Agent pursuant to Section 6.6(c) and (ii) ninety-five percent (95%) of the net book value of the Borrowers’ Eligible Generator Units; provided that (A) the value of Eligible Generator Units included in the Borrowing Base pursuant to clause (c)(i) after giving effect to the advance rate set forth herein shall be reduced, on the first day of each calendar month following the Closing Date, based on a 7-year straight line amortization schedule until Administrative Agent receives a new appraisal at which time the Net Orderly Liquidation Value will reset, and (B) the value of Eligible Generator Units included in the Borrowing Base pursuant to this clause (c) after giving effect to the advance rate set forth herein shall be reduced, on the date any item of Eligible Generator Units ceases to be Eligible Generator Units for any reason (including as a result of any sale, transfer or other disposition thereof or any casualty or condemnation event with respect thereto), by the amount then included in the Borrowing Base with respect to such item of Eligible Generator Units, plus

CREDIT AGREEMENT – Page 10

(d)        the lesser of (i) the product of eighty percent (80%) of the Net Orderly Liquidation Value of the Borrowers’ Eligible Field Units as determined pursuant to the most recent field unit appraisal ordered, received and relied upon by Administrative Agent pursuant to Section 6.6(c) and (ii) ninety-five percent (95%) of the net book value of the Borrowers’ Eligible Field Units; provided that (A) the value of Eligible Field Units included in the Borrowing Base pursuant to clause (d)(i) after giving effect to the advance rate set forth herein shall be reduced, on the first day of each calendar month following the First Amendment Effective Date, based on a 5-year straight line amortization schedule until Administrative Agent receives a new appraisal at which time the Net Orderly Liquidation Value will reset, and (B) the value of Eligible Field Units included in the Borrowing Base pursuant to this clause (d) after giving effect to the advance rate set forth herein shall be reduced, on the date any item of Eligible Field Units ceases to be Eligible Field Units for any reason (including as a result of any sale, transfer or other disposition thereof or any casualty or condemnation event with respect thereto), by the amount then included in the Borrowing Base with respect to such item of Eligible Field Units, plus

(e)        eighty percent (80%) of the Net Invoice Cost of the Borrowers’ Eligible New Generator Units, minus

(f)         an amount equal to all Canadian Priority Payables, minus

(g)        without duplication of any amounts deducted pursuant to clause (f) above, any Availability Reserves established by Administrative Agent in its Permitted Discretion.

“Borrowing Base Report” means, as of any date of preparation, a certificate substantially the form of Exhibit B (including, without limitation, a Canadian Priority Payables report in substantially the form attached thereto), or in any other form agreed to in writing by Borrowers and Administrative Agent, prepared by and certified by a Responsible Officer of the Borrower Representative.

“Borrowing Request” means a writing, substantially in the form of Exhibit D, properly completed and signed by the Borrower Representative, requesting a Revolving Credit Borrowing.

“BSBY” means the Bloomberg Short-Term Bank Yield Index rate.

“BSBY Rate” means:

(a) for any Interest Period with respect to a BSBY Rate Loan, the rate per annum equal to the BSBY Screen Rate two Business Days prior to the commencement of such Interest Period with a term equivalent to such Interest Period; provided that if the rate is not published on such determination date then BSBY Rate means the BSBY Screen Rate on the first Business Day immediately prior thereto; and

(b)for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to the BSBY Screen Rate with a term of one month commencing that day;

provided that if the BSBY Rate determined in accordance with the foregoing provisions of this definition would otherwise be less than 0%, the BSBY Rate shall be deemed to be 0% for purposes of this Agreement.

“BSBY Replacement Date” has the meaning set forth in Section 3.3(b)(vii).

CREDIT AGREEMENT – Page 11

“BSBY Screen Rate” means the Bloomberg Short-Term Bank Yield Index rate administered by Bloomberg and published on the applicable Reuters screen page (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time).

“BSBY Transition Event” means the occurrence of any of the events described in Section 3.3(b)(vii)(A) or (B).

“Business Day” means (a) for all purposes, a weekday, Monday through Friday, except a legal holiday or a day on which banking institutions in Dallas, Texas are authorized or required by Law to be closed, and (b) for purposes of the calculation of the Eurodollar Rate, a day that satisfies the requirements of clause (a) and that is a day on which commercial banks in the City of London, England are open for business and dealing in offshore Dollars. Unless otherwise provided, the term “days” when used herein means calendar days.

“Canada” means, collectively, Canada and each province and territory thereof.

“Canadian AML Legislation” means the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and other applicable anti-money laundering, anti-terrorist financing, government sanction and “know your client” laws within Canada (including any guidelines or orders thereunder).

“Canadian Borrower” has the meaning set forth in the introductory paragraph hereto.

“Canadian Defined Benefit Plan” means a “registered pension plan”, as that term is defined in subsection 248(1) of the ITA, which is or was sponsored, administered or contributed to, or required to be contributed to by, any Loan Party or under which any Loan Party has any actual or potential liability, and which contains a “defined benefit provision”, as defined in subsection 147.1(1) of the ITA.

“Canadian Pension Plan” means any pension plan to which a Loan Party contributes (or to which there is or may be an obligation to contribute by a Loan Party) or has made contributions on behalf of its employees and which is required to be registered under Canadian provincial or federal pension benefits standards legislation.

“Canadian Priority Payables” means, with respect to Canadian Borrower, any amount payable by Canadian Borrower which is secured by a Lien which ranks, or is capable of ranking, prior to or pari passu with the Liens created by the Security Documents in respect of any Eligible Accounts or Eligible Inventory, including amounts owing for wages, vacation pay, severance pay (to the extent capable of ranking prior to the Liens under the Security Documents under applicable Law), employee deductions, sales tax, excise tax, Tax payable pursuant to the ETA (net of GST input credits), income tax, workers compensation, government royalties, pension fund obligations, Canadian Pension Plan obligations (including in respect of unpaid or unremitted Canadian Pension Plan contributions, amounts representing any unfunded liability, solvency deficiency or wind-up deficiency whether or not due with respect to a Canadian Pension Plan (including “normal cost”, “special payments” and any other payments in respect of any funding deficiency or shortfall)), real property tax and other statutory or other claims that have or may have priority over, or rank pari passu with, such Liens created by the Security Documents.

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“Canadian Security Agreement” means that certain Canadian Pledge and Security Agreement (including any and all supplements thereto), dated as of the Third Amendment Effective Date, among Canadian Borrower and Administrative Agent, for the benefit of Administrative Agent and the other Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Capital Expenditure” means, with respect to any Person, any expenditure by such Person for (a) an asset which will be used in a year or years subsequent to the year in which the expenditure is made and which asset is properly classified in relevant financial statements of such Person as equipment, real Property, a fixed asset or a similar type of capitalized asset in accordance with GAAP or (b) an asset relating to or acquired in connection with an acquired business, and any and all acquisition costs related to clause (a) or (b) above.

“Capitalized Lease Obligation” means, with respect to any Person, the amount of Debt under a lease of Property by such Person that would be shown as a liability on a balance sheet of such Person prepared for financial reporting purposes in accordance with GAAP.

“Cash Collateralize” means to pledge and deposit with or deliver to Administrative Agent, for the benefit of one or more of L/C Issuer or Lenders, as collateral for L/C Obligations or obligations of Lenders to fund participations in respect of L/C Obligations, cash or deposit account balances or, if Administrative Agent and L/C Issuer shall agree in their sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to Administrative Agent and L/C Issuer. “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.

“Cash Interest Expense” means, for any Person for any period, total interest expense in respect of all outstanding Debt actually paid or that is payable by such Person during such period, including, without limitation, all commissions, discounts, and other fees and charges with respect to letters of credit and all net costs under Hedge Agreements in respect of interest rates to the extent such costs are allocable to such period, but excluding interest expense not payable in cash, all as determined in accordance with GAAP.

“CFC” means a “controlled foreign corporation” as defined in Section 957 of the Code.

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any Law, rule, regulation or treaty, (b) any change in any Law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the U.S., Canadian or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, implemented, adopted or issued.

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“Change of Control” means an event or series of events by which (a) the Permitted Holders shall cease for any reason (i) to have record and beneficial ownership (directly or indirectly) of more than 50% of the outstanding voting Equity Interests of Parent on a fully diluted basis or (ii) to Control Parent; (b) the Permitted Holders shall cease to have the ability to elect (either through share ownership or contractual voting rights) a majority of the board of directors or equivalent governing body of Parent; (c) Parent shall cease to own, free and clear of all Liens or other encumbrances (other than Permitted Liens), directly or indirectly, at least 100% of the outstanding direct or indirect Equity Interests of Company on a fully diluted basis; (d) Company shall cease to own, free and clear of all Liens or other encumbrances (other than Permitted Liens), directly or indirectly, at least 100% of the outstanding direct or indirect Equity Interests of any other Loan Party on a fully diluted basis; or (e) a “change of control”, “fundamental change” or any comparable term under the Parent Loan Documents shall have occurred.

“Closing Date” means the first date all the conditions precedent in Section 4.1 are satisfied or waived in accordance with Section 11.10.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor statute, together with the regulations promulgated thereunder.

“Collateral” means substantially all of the Property of the Loan Parties and their Subsidiaries as described in the Security Documents, including 100% of the Equity Interests in Company and any other Loan Party, together with any other Property and collateral described in the Security Documents, including, among other things, any Property which may now or hereafter secure the Obligations or any part thereof (but which in no event will include any Excluded Asset).

“Collateral Access Agreement” means a landlord waiver, mortgagee waiver, bailee letter or similar acknowledgment of any lessor, warehouseman, processor or other Person in possession of any Collateral or on whose Property any Collateral is located, in form and substance reasonably satisfactory to Administrative Agent.

“Commitment” means, as to each Lender, its obligation to (a) make Revolving Credit Loans to Borrowers pursuant to Section 2.1(a), (b) purchase participations in L/C Obligations, and (c) purchase participations in Swing Line Loans, in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Lender’s name on Schedule 2.1 under the caption “Commitment” or opposite such caption in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be (a) terminated or reduced from time to time in accordance with Section 2.9(a), (b) increased from time to time in accordance with Section 2.10 or (c) otherwise adjusted from time to time in accordance with this Agreement.

“Commitment Fee Rate” means, with respect to the commitment fees payable hereunder, the applicable percentages per annum set forth below under the caption “Commitment Fee Rate” as determined based on the daily average unused amount of the Commitments during any fiscal month in accordance with Section 2.4(c);

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Pricing Level	Daily Average Unused Amount	Commitment Fee Rate
1	≤  50% of the Commitments	0.225%
2	> 50% of the Commitments	0.475%

“Commodity Account Control Agreement” has the meaning assigned to such term in the applicable Security Agreement.

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

“Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of the Loan Parties pursuant to any Loan Document or the transactions contemplated therein which is distributed to Administrative Agent, any Lender, L/C Issuer or Swing Line Lender by means of electronic communications pursuant to Section 11.11(d), including through the Platform.

“Company” has the meaning set forth in the introductory paragraph hereto.

“Compliance Certificate” means a certificate, substantially in the form of Exhibit C, or in any other form agreed to by Company and Administrative Agent, prepared by and certified by a Responsible Officer of Company.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Constituent Documents” means (a) in the case of a corporation, its articles or certificate of incorporation and bylaws; (b) in the case of a general partnership, its partnership agreement; (c) in the case of a limited partnership, its certificate of limited partnership or certificate of formation, as applicable, and partnership agreement; (d) in the case of a trust, its trust agreement; (e) in the case of a joint venture, its joint venture agreement; (f) in the case of a limited liability company, its articles of organization, operating agreement, regulations and/or other organizational and governance documents and agreements; and (g) in the case of any other entity, its organizational and governance documents and agreements.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have correlative meanings thereto.

“Control Agreements” means, collectively, the Commodity Account Control Agreements, the Deposit Account Control Agreements and the Securities Account Control Agreements, in each case, as the same may be amended, restated, supplemented or otherwise modified from time to time.

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“Corresponding Tenor” means, with respect to any Available Tenor, as applicable, either a tenor (including overnight) or an interest payment period having approximately the same length (disregarding business day adjustment) as such Available Tenor.

“Covered Entity” means any of the following: (a) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (b) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (c) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

“Covered Party” has the meaning set forth in Section 11.32.

“Credit Extension” means each of (a) a Borrowing and (b) an L/C Credit Extension.

“Cure Amount” has the meaning set forth in Section 9.3.

“Cure Right” has the meaning set forth in Section 9.3.

“Currency Date” has the meaning set forth in Section 11.2(b).

“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being established by the Administrative Agent in accordance with the conventions for this rate selected or recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for syndicated business loans; provided, that if the Administrative Agent decides that any such convention is not administratively feasible for the Administrative Agent, then the Administrative Agent may establish another convention in its reasonable discretion.

“Debt” means, of any Person as of any date of determination (without duplication): (a) all obligations of such Person for borrowed money; (b) all obligations of such Person evidenced by bonds, notes, debentures, or other similar instruments; (c) all obligations of such Person to pay the deferred purchase price of Property or services, except trade accounts payable of such Person arising in the ordinary course of business that are not past due by more than ninety (90) days; (d) all Capitalized Lease Obligations of such Person; (e) all Debt or other obligations of others Guaranteed by such Person; (f) all obligations secured by a Lien existing on Property owned by such Person, whether or not the obligations secured thereby have been assumed by such Person or are non-recourse to the credit of such Person; (g) any other obligation for borrowed money or other financial accommodations which in accordance with GAAP would be shown as a liability on the balance sheet of such Person; (h) any repurchase obligation or liability of a Person with respect to Accounts, chattel paper or notes receivable sold by such Person; (i) any liability under a sale and leaseback transaction that is not a Capitalized Lease Obligation; (j) any obligation under any so called “synthetic leases;” (k) any obligation arising with respect to any other transaction that is the functional equivalent of borrowing but which does not constitute a liability on the balance sheets of a Person; (l) all payment and reimbursement obligations of such Person (whether contingent or otherwise) in respect of letters of credit, bankers’ acceptances, surety or other bonds and similar instruments; (m) all liabilities of such Person in respect of unfunded vested benefits under any Plan; (n) all Hedge Obligations of such Person, valued at the Hedge Termination Value thereof; and (o) all obligations of such Person in respect of Disqualified Equity Interests.

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For all purposes, the Debt of any Person shall include the Debt of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Debt is expressly made non-recourse to such Person.

“Debtor Relief Laws” means Title 11 of the United States Code, the BIA, the Companies’ Creditors Arrangement Act (Canada), and the Winding-Up and Restructuring Act (Canada), in each case, as now or hereafter in effect, or any other applicable Law, domestic or foreign, as now or hereafter in effect, relating to bankruptcy, insolvency, liquidation, receivership, reorganization, assignment for the benefit of creditors, moratorium, arrangement or composition, extension or adjustment of debts, or similar Laws affecting the rights of creditors (including any applicable corporations legislation to the extent the relief sought under such corporations legislation relates to or involves the compromise, settlement, adjustment or arrangement of debt).

“Default” means an Event of Default or the occurrence of an event or condition which with notice or lapse of time or both would become an Event of Default.

“Default Interest Rate” means (a) when used with respect to Obligations other than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Margin, if any, applicable to a Base Rate Loan plus (iii) two percent (2%) per annum; provided, however, that with respect to a Eurodollar Rate Loan, the Default Interest Rate shall be an interest rate equal to the interest rate (including any Applicable Margin) otherwise applicable to such Loan plus two percent (2%) per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to the Applicable Margin plus two percent (2%) per annum; provided, however, in no event shall the Default Interest Rate exceed the Maximum Rate.

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

“Defaulting Lender” means, subject to Section 11.22(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two (2) Business Days of the date such Loans were required to be funded hereunder, or (ii) pay to Administrative Agent, the L/C Issuer, the Swing Line Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swing Line Loans) within two (2) Business Days of the date when due, (b) has notified the Borrower Representative, Administrative Agent, L/C Issuer or Swing Line Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect, (c) has failed, within three (3) Business Days after written request by Administrative Agent or the Borrower Representative, to confirm in writing to Administrative Agent and the Borrower Representative that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by Administrative Agent and the Borrower Representative), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver, custodian, conservator, trustee, monitor, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity, or (iii) become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 11.22(b)) upon delivery of written notice of such determination to the Borrower Representative and each Lender.

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“Deposit Account Control Agreement” has the meaning assigned to such term in the applicable Security Agreement.

“Disposition” means any sale, lease, sub-lease, license, transfer, assignment, conveyance, release, loss or other disposition, or entry into any contract the performance of which would result in any of the foregoing, of any interest in Property, or of any interest in a Subsidiary that owns Property, in any transaction or event or series of transactions or events, and “Dispose” has the correlative meaning thereto.

“Disqualified Equity Interest” means any Equity Interest that, by its terms (or the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (a) matures or is mandatorily redeemable (other than solely for Equity Interests that are not Disqualified Equity Interests), pursuant to a sinking fund obligation or otherwise (except as a result of a change of control or asset sale so long as any rights of the holders thereof upon the occurrence of a change of control or asset sale event shall be subject to the prior repayment in full of the Loans and all other Obligations that are accrued and payable and the termination of the Commitments), (b) is redeemable at the option of the holder thereof, in whole or in part, (c) provides for scheduled payments of dividends in cash, or (d) is or becomes convertible into or exchangeable for Debt or any other Equity Interests that would constitute Disqualified Equity Interests, in each case, prior to the date that is ninety-one days after the Maturity Date; provided that if such Equity Interests are issued pursuant to a plan for the benefit of employees of any Loan Party or any of its Subsidiaries or by any such plan to such employees, such Equity Interests shall not constitute Disqualified Equity Interests solely because they may be required to be repurchased by any Loan Party or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations or as a result of such employee’s termination, death or disability.

“Dollars” and “$” mean lawful money of the U.S.

“Domestic Subsidiary” means any Subsidiary that is organized under the Laws of any political subdivision of the U.S.

“Early Opt-in Election” means, if the then-current Benchmark is USD LIBOR, the occurrence of:

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(a) a notification by the Administrative Agent to (or the request by the Borrower Representative to the Administrative Agent to notify) each of the other parties hereto that at least five currently outstanding U.S. dollar-denominated syndicated credit facilities at such time contain (as a result of amendment or as originally executed) a BSBY-based rate (or, alternatively, a SOFR-based rate, including SOFR, a term SOFR or any other rate based upon SOFR) as a benchmark rate (and such syndicated credit facilities are identified in such notice and are publicly available for review), and

(b)the joint election by the Administrative Agent and the Borrower Representative to trigger a fallback from USD LIBOR and the provision by the Administrative Agent of written notice of such election to the Lenders.

“EBITDA” means, for any Person for any period, an amount equal to: (a) Net Income plus (b) the sum (in each case, without duplication) of the following to the extent deducted in the calculation of Net Income: (i) interest expense; (ii)  Taxes based on income or profits; (iii) depreciation; (iv) amortization; (v)  losses that are unusual and infrequently occurring determined in accordance with GAAP; (vi) other non-recurring expenses reducing such Net Income which do not represent a cash item in such period or any future period; (vii) any amendment, waiver or consent fees (but excluding, for the avoidance of doubt, any upfront, structuring, commitment, arrangement or underwriting fees) paid by the Loan Parties to the Administrative Agent and/or the Lenders in connection with any amendment, waiver, or consent entered into in connection with this Agreement, and (viii) the amount of any Specified EBITDA Equity Contribution that is deemed to be EBITDA for any fiscal quarter included in the trailing four fiscal quarter period pursuant to Section 9.3; minus (c) the sum (in each case, without duplication) of the following to the extent included in the calculation of Net Income: (i) income tax credits; (ii) gains that are unusual and infrequently occurring determined in accordance with GAAP; and (iii) all non-recurring, non-cash items increasing Net Income.

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“Electronic Record” has the meaning assigned to that term in, and shall be interpreted in accordance with, 15 U.S.C. 7006.

“Electronic Signature” has the meaning assigned to that term in, and shall be interpreted in accordance with, 15 U.S.C. 7006.

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“Eligible Accounts” means, as of any applicable period of determination thereof, all Accounts of Borrowers (net of service charges, interest and finance fees) created in the ordinary course of business that Administrative Agent determines are eligible as the basis for the extension of the Credit Extensions. Without limiting the foregoing, no Account shall be an Eligible Account if:

(a)it does not comply in all material respects with all applicable Laws, rules, and regulations, including, without limitation, usury Laws, the Federal Truth in Lending Act, and Regulation Z of the Board of Governors of the Federal Reserve System;

(b)it has been outstanding for more than ninety (90) days past the original date of invoice or sixty (60) days after the original date payment is due;

(c)(i) the goods giving rise to it have not been delivered to the account debtor and do not constitute a final sale or (ii) the services giving rise to it have not been performed for the account debtor;

(d)it represents a progress billing or retainage, or relates to services for which a performance, surety or completion bond or similar assurance has been issued;

(e)it arises from a sale to an Affiliate, from a sale on a cash-on-delivery, bill-and-hold, sale-or-return, sale-on-approval, consignment, or other repurchase or return basis, or from a sale for personal, family or household purposes;

(f)it is not subject to a duly perfected, first priority Lien in favor of Administrative Agent;

(g)it is subject to any Lien other than (i) a Lien in favor of Administrative Agent, or (ii) a Permitted Lien which does not have priority over the Lien in favor of Administrative Agent;

(h)it arises out of a contract with or order from, an account debtor that, by its terms, prohibits or makes void or unenforceable the grant of a security interest by the applicable Borrower to Administrative Agent in and to such Account;

(i)it does not conform with a covenant or representation herein or in the other Loan Documents;

(j)it is owing by a creditor or supplier of any Loan Party or any Subsidiary thereof, or is otherwise subject to a potential offset, counterclaim, dispute, deduction, discount, recoupment, reserve, defense, chargeback, credit or allowance that has been asserted in writing;

(k)the account debtor is insolvent or the subject of any bankruptcy or insolvency proceeding, or has made an assignment for the benefit of creditors, suspended normal business operations, dissolved, liquidated, terminated its existence, ceased to pay its debts as they become due, or suffered a receiver or trustee to be appointed for any of its assets or affairs;

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(l) it is evidenced by chattel paper or an instrument;

(m)a default exists under the Account by any party thereto;

(n)it is owed by an Affiliate, employee, officer, director or shareholder of Parent, any Loan Party or any of their Subsidiaries;

(o)it is owed in currency other than Dollars by the account debtor;

(p)the account debtor is organized or has its principal offices or assets outside the United States or Canada;

(q)the Account is owed by an individual or a Sanctioned Person;

(r)if more than twenty-five percent (25%) of the aggregate balances then outstanding on all Accounts owed by such account debtor and its Affiliates are unpaid for more than (i) sixty (60) days after the original date payment is due or (ii) ninety (90) days past the dates of their original invoices;

(s)it is owing by a Governmental Authority, unless the account debtor is (i) the U.S. or any department, agency, or instrumentality thereof and the Account has been assigned to Administrative Agent in compliance with the Federal Assignment of Claims Act of 1940; or (ii) the government of Canada (or any political subdivision thereof), or any department, agency, Crown corporation or instrumentality thereof and (A) the Financial Administration Act (Canada), as amended, or any comparable requirements under any other Canadian federal, provincial, territorial or municipal law regarding the assignment of Crown debts, has been duly complied with and any other steps necessary to perfect the Lien of the Administrative Agent in such Account have been completed and (B) all consents, licenses, approvals or authorizations of, or registrations or declarations with, any Governmental Authority required to be obtained, effected or given in connection with the execution, delivery and performance of such Account by each party obligated thereunder, or in connection with the enforcement and collection thereof by the Administrative Agent, have been duly obtained, effected or given and are in full force and effect;

(t)it includes a billing for interest, fees or late charges;

(u)when aggregated with all other Accounts owed, without duplication, (i) by an Investment Grade Account Debtor and its Affiliates to which such Account relates exceeds thirty-five percent (35%) of all Eligible Accounts owed by all of Borrowers’ account debtors; (ii) by a Non-Investment Grade Account Debtor and its Affiliates to which such Account relates exceeds twenty-five percent (25%) of all Eligible Accounts owed by all of Borrowers’ account debtors or (iii) solely for purposes of calculating the Borrowing Base in any period on or prior to December 31, 2019, by QEP Resources, Inc. and its Affiliates to which such Account relates exceeds thirty-five percent (35%) of all Eligible Accounts owed by all of Borrowers’ account debtors; provided, however, that, in each case under the foregoing clauses (i) through (iii), if such aggregate exceeds such percentage of all Eligible Accounts, only such excess shall be ineligible; and

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(v) Administrative Agent otherwise reasonably determines it be ineligible.

The amount of the Eligible Accounts owed by an account debtor to any Borrower shall be reduced by the amount of all “contra accounts” and other obligations owed, whether by such Borrower or any other Loan Party or Subsidiary, to such account debtor. Administrative Agent shall have the right to create and adjust eligibility standards and related services from time to time in its reasonable discretion.

“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 11.8(b)(iii), (v) and (vi) (subject to such consents, if any, as may be required under Section 11.8(b)(iii)).

“Eligible Field Units” means the Eligible Inventory owned by the Borrowers consisting of Field Units.

“Eligible Generator Units” means the Eligible Inventory owned by the Borrowers consisting of Generator Units.

“Eligible Inventory” means, as of any applicable period of determination thereof, all Inventory of Borrowers that Administrative Agent determines is eligible as the basis for the extension of the Credit Extensions. Without limiting the foregoing, no Inventory shall be Eligible Inventory if:

(a)it is not subject to a duly perfected, first priority Lien in favor of Administrative Agent (including, in the case of Inventory of Canadian Borrower, perfected by registration in the jurisdiction in which such Inventory is located);

(b)it is subject to any Lien other than (i) a Lien in favor of Administrative Agent or (ii) a Permitted Lien which does not have priority over the Lien in favor of Administrative Agent;

(c)it is consigned to or from third parties;

(d)it is slow-moving, obsolete, unserviceable, perishable or spoiled, unless such Inventory can be (i) used or repurposed to create new Inventory of the Borrowers or (ii) sold to another customer of a Borrower;

(e)it is accounted for on the books of a Borrower as burden or overhead;

(f)comprised of packaging and shipping supplies, materials, boxes or containers (in each case, other than such packaging and shipping supplies, materials, boxes or containers that constitute actual Inventory of the Borrowers);

(g)it is used, damaged or defective, unless such Inventory can be (i) used or repurposed to create new Inventory of the Borrowers or (ii) sold to another customer of a Borrower;

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(h) it is located on premises not owned by the Borrowers (other than a customer site or location), unless either: (i) Administrative Agent shall have received a Collateral Access Agreement with respect thereto, executed by the mortgagee, lessor, contract warehouseman, bailor or such other Person, as the case may be, and segregated or otherwise separately identifiable from goods of others, if any, stored on the premises and such Collateral Access Agreement shall remain in full force and effect; or (ii) Administrative Agent shall have established a Rent Reserve with respect to such premises in an amount satisfactory to Administrative Agent;

(i)it is located at any customer site or location or is in the possession of a customer of any Borrower, unless either: (i) Administrative Agent shall have received a Collateral Access Agreement from such customer; or (ii) such Inventory is subject to a valid uptime energy, servicing or lease agreement with terms acceptable to Administrative Agent in effect at such time; provided that for any Inventory located at any customer site or location or in the possession of any customer, which in each case is located in Canada, and subject to a “lease for a term of more than one year” (as defined in the PPSA), all registrations necessary or desirable to preserve, protect and perfect such Borrower’s interests in such leased Inventory shall have been made under the PPSA in the applicable jurisdiction;

(j)it is located outside of the continental United States or Canada, or is located in any jurisdiction in Canada in which the Administrative Agent does not hold a valid, perfected Lien (and for greater certainty is not located in Quebec unless the Administrative Agent has received a valid registered first priority deed of hypothec from Canadian Borrower);

(k)it is a sample item, is in-transit or is subject to any warehouse receipt or negotiable document;

(l)it constitutes work in process or raw materials; provided that Generator Units and Field Units are not raw materials;

(m)it is subject to repossession under the BIA except to the extent the applicable vendor has entered into an agreement with the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent, waiving its right to repossession;

(n)it has been acquired from a Sanctioned Person; or

(o)Administrative Agent otherwise determines it to be ineligible in its Permitted Discretion.

Administrative Agent shall have the right to create and adjust eligibility standards from time to time in its reasonable discretion.

“Eligible New Generator Units” means the Eligible Inventory owned by the Borrowers consisting of New Generator Units.

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“Environmental Laws” means any and all federal, state, provincial, territorial and local Laws, regulations, judicial decisions, orders, decrees, plans, rules, permits, licenses, and other governmental restrictions and requirements pertaining to health, safety, or the environment, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §9601 et seq., the Resource Conservation and Recovery Act, 42 U.S.C. §6901 et seq., the Federal Water Pollution Control Act, as amended by the Clean Water Act, 33 U.S.C. §1251 et seq., the Clean Air Act, 42 U.S.C. §7401 et seq., the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. §11001 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. §5101 et seq., the Toxic Substances Control Act, 15 U.S.C. §2601 et seq., the Oil Pollution Act of 1990, 33 U.S.C. §2701 et seq., the Safe Drinking Water Act, 42 U.S.C. §300f et seq., the Occupational Safety and Health Act, 29 U.S.C. §651 et seq., the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. §136 et seq., the Endangered Species Act, U.S.C. §1531 et seq., the National Environmental Policy Act, 42 U.S.C. §4321 et seq., the Rivers and Harbors Appropriation Act of 1899, 33 U.S.C. §407, all similar state statutes and local ordinances, and all regulations promulgated under any of those statutes, and all administrative and judicial actions respecting such legislation, all as amended from time to time.

“Environmental Liabilities” means, as to any Person, all liabilities, obligations, responsibilities, Remedial Actions, losses, damages, punitive damages, consequential damages, treble damages, costs, and expenses (including, without limitation, all reasonable fees, disbursements and expenses of counsel, expert and consulting fees and costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand, by any Person, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, including any Environmental Law, permit, order or agreement with any Governmental Authority or other Person, arising from environmental, health or safety conditions or the Release or threatened Release of a Hazardous Material into the environment, resulting from the past, present, or future operations of such Person or its Affiliates.

“Equity Interests” means, as to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, together with the regulations promulgated thereunder.

“ERISA Affiliate” means any corporation or trade or business which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Code) as a Loan Party, is under common control (within the meaning of Section 414(c) of the Code) with a Loan Party, or is otherwise considered a single employer with a Loan Party pursuant to Sections 414(m) or (o) of the Code, for purposes of the provisions relating to Section 412 of the Code or Section 303 of ERISA.

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“ERISA Event” means (a) a Reportable Event with respect to a Plan, (b) a withdrawal by any Loan Party or any ERISA Affiliate from a Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations which is treated as such a withdrawal under Section 4062(e) of ERISA, (c) a complete or partial withdrawal by any Loan Party or any ERISA Affiliate from a Multiemployer Plan, (d) the filing of a notice of intent to terminate a Plan, the treatment of a Plan or Multiemployer Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Plan or Multiemployer Plan, (e) the occurrence of an event or condition which might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan or Multiemployer Plan, (f) the imposition of any liability to the PBGC under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon any Loan Party or any ERISA Affiliate, (g) the failure of any Loan Party or ERISA Affiliate to meet any funding obligations with respect to any Plan or Multiemployer Plan, or (h) a Plan becomes subject to the at-risk requirements in Section 303 of ERISA or Section 430 of the Code or is in endangered or critical status under Section 305 of ERISA or Section 432 of the Code.

“Erroneous Payment” has the meaning set forth in Section 10.11(a).

“Erroneous Payment Deficiency Assignment” has the meaning set forth in Section 10.12(d).

“Erroneous Payment Impacted Class” has the meaning set forth in Section 10.11(d).

“Erroneous Payment Return Deficiency” has the meaning set forth in Section 10.11(d).

“Erroneous Payment Subrogation Rights” has the meaning set forth in Section 10.11(d).

“ETA” means Part IX of the Excise Tax Act (Canada), as amended from time to time, and any successor statute.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“Eurodollar Rate” means, subject to the implementation of a Benchmark Replacement in accordance with Section 3.3:

(a)with respect to any Eurodollar Rate Loan for any Interest Period, the per annum rate appearing on the ICE Benchmark Administration LIBOR Rates Page (or on any successor or substitute page or service providing quotations of interest rates applicable to Dollar deposits in the London interbank market comparable to those currently provided on such page, as determined by Administrative Agent from time to time) at approximately 11:00 a.m., London time, on the related Eurodollar Rate Determination Date, as the rate for Dollar deposits with a maturity comparable to such Interest Period, and if such rate does not appear on such screen or service, or such screen or service shall cease to be available, then the Eurodollar Rate shall be the offered rate (as determined by Administrative Agent in its sole discretion; provided that no Benchmark Transition Event shall have occurred at such time) on such other screen or service that displays an average interest settlement rate for deposits in Dollars (for delivery on the first day of such Interest Period) by such other authoritative source (as is selected by Administrative Agent in its sole discretion; provided that no Benchmark Transition Event shall have occurred at such time) to major banks in the London interbank eurodollar market for a term equivalent to such Interest Period as of 11:00 a.m. on the relevant Eurodollar Rate Determination Date; and

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(b)with respect to any interest calculation with respect to a Base Rate Loan on any date, the per annum rate appearing on the ICE Benchmark Administration LIBOR Rates Page (or on any successor or substitute page or service providing quotations of interest rates applicable to Dollar deposits in the London interbank market comparable to those currently provided on such page, as determined by Administrative Agent from time to time) at approximately 11:00 a.m., London time, on the related Eurodollar Rate Determination Date for a term of one (1) month commencing on the date of calculation, and if such rate does not appear on such screen or service, or such screen or service shall cease to be available, then the Eurodollar Rate shall be the offered rate (as determined by Administrative Agent in its sole discretion; provided that no Benchmark Transition Event shall have occurred at such time) on such other screen or service that displays an average interest settlement rate for deposits in Dollars (for delivery on such date of calculation) by such other authoritative source (as is selected by Administrative Agent in its sole discretion; provided that no Benchmark Transition Event shall have occurred at such time) to major banks in the London interbank eurodollar market for a term of one (1) month as of 11:00 a.m. on the relevant Eurodollar Rate Determination Date.

Notwithstanding the foregoing, (x) in no event shall the Eurodollar Rate (including any Benchmark Replacement with respect thereto) be less than 0% and (y) unless otherwise specified in any amendment to this Agreement entered into in accordance with Section 3.3, in the event that a Benchmark Replacement with respect to the Eurodollar Rate is implemented then all references herein to the Eurodollar Rate shall be deemed references to such Benchmark Replacement. Each calculation by Administrative Agent of the Eurodollar Rate shall be conclusive and binding for all purposes absent manifest error.

“Eurodollar Rate Borrowing” means, as to any Borrowing, the Eurodollar Rate Loans comprising such Borrowing.

“Eurodollar Rate Determination Date” means a day that is two (2) Business Days prior to the beginning of the relevant Interest Period or prior to the applicable date, as applicable.

“Eurodollar Rate Loan” means each Loan bearing interest based on the Adjusted Eurodollar Rate where the Eurodollar Rate is determined pursuant to clause (a) of the definition thereof.

“Event of Default” has the meaning set forth in Section 9.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

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“Excluded Accounts” means any commodity account, deposit account or securities account (a) established solely as a payroll account and other zero-balance disbursement account, (b) held in a fiduciary capacity and established in connection with employee benefit plans in the ordinary course of business or pursuant to applicable legal requirements, or (c) with a balance in each such account individually not exceeding $100,000 at any time and the aggregate balance of all such accounts not exceeding $250,000.

“Excluded Assets” means, collectively:

(a)assets as to which Administrative Agent and Loan Parties agree in writing that the cost of creating or perfecting a pledge of, or a security interest in, such assets is excessive in relation to the value of the security to be afforded thereby;

(b)any rights or interest in any lease, contract, license or license agreement covering personal Property or real Property and/or such assets subject thereto, so long as under the terms of such lease, contract, license or license agreement, the grant of a security interest or Lien therein for the benefit of the Secured Parties (1) is prohibited, (2) would give any other party to such lease, contract, license or license agreement, instrument or indenture the right to terminate its obligations thereunder, or (3) is permitted only with the consent of another party (including, without limitation, any Governmental Authority) (or would render such lease, contract, license or license agreement cancelled, invalid or unenforceable) and such prohibition has not been or is not waived or the consent of the other party to such lease, contract, license or license agreement has not been or is not otherwise obtained; provided that, this exclusion shall in no way be construed to apply if any such prohibition is unenforceable under the UCC, the PPSA or any other Law (including any Debtor Relief Law) or so as to limit, impair or otherwise affect the unconditional continuing security interests in and Liens for the benefit of the Secured Parties upon any rights or interests in or to monies due or to become due under any such lease, contract, license or license agreement (including any receivables) and provided further that, with respect to any lease, contract, license or license agreement entered into after the Closing Date, the Loan Parties shall use commercially reasonable efforts to permit Liens for the benefit of the Secured Parties on each such lease, contract, license or license agreement and avoid prohibitions of the types described in clauses (1) through (3) above;

(c)any such account described in clause (b) of the definition of “Excluded Accounts”;

(d)any application for registration of a trademark filed in the United States Patent and Trademark Office on an intent to use basis to the extent that the grant of a security interest in any such trademark application would adversely affect the validity or enforceability or result in cancellation or voiding of such trademark application, provided, however, that such trademark applications shall no longer be considered Excluded Assets upon the filing of a Statement of Use or an Amendment to Allege Use has been filed and accepted in the United States Patent and Trademark Office; and

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(e)any assets that are subject to a Lien permitted under Section 7.2(g) if the contract or other agreement in which the Lien is granted (or the documentation providing for the Debt secured thereby) prohibits the creation of any other Lien on such assets; provided that immediately upon the ineffectiveness, lapse or termination of any such Lien permitted under Section 7.2(g), such assets shall no longer be considered Excluded Assets pursuant to this clause (e) and the Collateral shall include all such rights and interest in such assets as if such Lien permitted under Section 7.2(g) had never been in effect (unless such asset would constitute as an Excluded Asset under any other clause herein).

To the extent that such Property constitutes as an “Excluded Asset” due to the failure by any Loan Party to obtain a consent as described in clause (b) above, such Loan Party shall use commercially reasonable efforts to obtain such consent and, upon obtaining such consent, such Property shall cease to constitute as an “Excluded Asset”.

“Excluded Swap Obligation” means, with respect to any Loan Party, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Loan Party of, or the grant by such Loan Party of a Lien to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Loan Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to any “keepwell, support or other agreement” for the benefit of such Loan Party and any and all guarantees of such Loan Party’s Swap Obligations by any Borrower or any other Loan Party) at the time the Guarantee of such Loan Party, or a grant by such Loan Party of a Lien, becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or Lien is or becomes excluded in accordance with the first sentence of this definition.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the Laws of, or having its principal office or, in the case of any Lender, its applicable Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal or Canadian withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a Law in effect on the date on which (i) such Lender acquires such interest in such Loan or Commitment (other than pursuant to an assignment request by any Borrower under Section 3.6(b)) or (ii) such Lender changes its Lending Office, except in each case to the extent that, pursuant to Section 3.4, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its Lending Office, (c) Taxes attributable to such Recipient’s failure to comply with Section 3.4(g) and (d) any U.S. federal withholding Taxes imposed under FATCA.

“FASB ASC” means the Accounting Standards Codification of the Financial Accounting Standards Board.

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“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreement entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the Code.

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.

“Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published by the Federal Reserve Bank of New York, on the Business Day next succeeding such day, provided that (a) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average rate charged to Administrative Agent on such day on such transactions as determined by Administrative Agent.

“Fee Letter” means (a) the separate fee letter dated as of February 8, 2019, between Borrowers and Texas Capital Bank and (b) any other fee letter among Borrowers and Administrative Agent, Arranger and/or Texas Capital Bank concerning fees to be paid by Borrowers in connection with this Agreement including any amendments, restatements, supplements or modifications thereof. By its execution of this Agreement, each Lender acknowledges and agrees that Administrative Agent, Arranger and/or Texas Capital Bank may elect to treat as confidential and not share with Lenders any Fee Letters executed from time to time in connection with this Agreement.

“Field Units” means Inventory of the Borrowers generally consisting of diesel generators, oil and gas separators, electrical switchgear, and other related support equipment, which, in each case, are not part of any Generator Package.

“Fifth Amendment” means that certain Fifth Amendment to Credit Agreement dated as of the Fifth Amendment Effective Date, by and among the Company, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“Fifth Amendment Effective Date” means [__________], 2021.

“Financial Covenants” means the covenants set forth in Sections 8.1 and 8.2.

“First Amendment” means that certain First Amendment to Credit Agreement and First Amendment to Pledge and Security Agreement dated as of the First Amendment Effective Date, by and among the Company, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“First Amendment Effective Date” means January 27, 2020.

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“FGS” means FlexEnergy Green Solutions, Inc., a Delaware corporation.

“Fixed Charge Coverage Ratio” means, for any date of determination, the ratio of (a) Annualized EBITDA of Company and its Subsidiaries minus Unfinanced Capital Expenditures, to (b) Fixed Charges of Company and its Subsidiaries.

“Fixed Charges” means, for any Person for any date of determination, the sum of (a) Annualized Debt Service, plus (b) cash income taxes paid during the trailing twelve (12) fiscal month period then ending on such date, plus (c) the sum of distributions and dividends (including any Permitted Tax Distributions) made during the trailing twelve (12) fiscal month period then ending on such date.

“FlexEnergy” means FlexEnergy, Inc., a Delaware corporation.

“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the Fifth Amendment Effective Date or any modification, amendment or renewal of this Agreement or otherwise) with respect to USD LIBOR.

“Foreign Lender” means a Lender that is not a U.S. Person.

“Foreign Subsidiaries” means each Subsidiary other than a Domestic Subsidiary.

“Fourth Amendment” means that certain Fourth Amendment to Credit Agreement dated as of the Fourth Amendment Effective Date, by and among the Company, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“Fourth Amendment Effective Date” means June 29, 2021.

“Fraudulent Transfer Laws” has the meaning set forth in Section 12.14.

“Fronting Exposure” means, at any time there is a Lender that is a Defaulting Lender, (a) with respect to L/C Issuer, such Defaulting Lender’s Applicable Percentage of the Outstanding Amount of the L/C Obligations other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to Swing Line Lender, such Defaulting Lender’s Applicable Percentage of the Outstanding Amount of Swing Line Loans other than Swing Line Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders in accordance with the terms hereof.

“Fund” means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

“GAAP” means generally accepted accounting principles, applied on a consistent basis, as set forth in opinions of the Accounting Principles Board of the American Institute of Certified Public Accountants and/or in statements of the Financial Accounting Standards Board and/or their respective successors and which are applicable in the circumstances as of the date in question. Accounting principles are applied on a “consistent basis” when the accounting principles applied in a current period are comparable in all material respects to those accounting principles applied in a preceding period.

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“Generator Packages” means uptime energy power units, generally consisting of an engineered package of components, including, without limitation, a turbine engine, combustor, synchronous generator, recuperator, inlet guide vanes, generator braking resistor, and other control devices mounted on either a metal skid or trailer.

“Generator Units” means Inventory of the Borrowers consisting of completed Generator Packages. For the avoidance of doubt Generator Units will not include any Field Units.

“Governmental Authority” means the government of the U.S., Canada or any other nation, or any political subdivision thereof, whether state, provincial, territorial or local, and any agency, authority, instrumentality, regulatory body, court, central bank, tribal body or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank), and any group or body charged with setting financial accounting or regulatory capital rules or standards (including without limitation, the Financial Accounting Standards Board, the Bank for International Settlements or the Basel Committee on Banking Supervision or any successor or similar authority to any of the foregoing).

“GST” means the goods and services tax and all other amounts payable under the ETA or any similar legislation in any other jurisdiction of Canada, including (a) the Quebec sales tax imposed pursuant to an Act respecting the Québec sales tax and (b) all amounts payable as harmonized sales tax in the Provinces of Ontario, Nova Scotia, Newfoundland and Labrador, Prince Edward Island and New Brunswick under the ETA.

“Guarantee” by any Person means any obligation or liability, contingent or otherwise, of such Person directly or indirectly guaranteeing any Debt or other obligation of any other Person as well as any obligation or liability, direct or indirect, contingent or otherwise, of such Person (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation or liability (whether arising by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, goods, securities or services, to operate Property, to take-or-pay, or to maintain net worth or working capital or other financial statement conditions or otherwise) or (b) entered into for the purpose of indemnifying or assuring in any other manner the obligee of such Debt or other obligation or liability of the payment thereof or to protect the obligee against loss in respect thereof (in whole or in part); provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business. The term “Guarantee” used as a verb has a corresponding meaning.

“Guarantors” means, collectively, (a) each of the Borrowers with respect to the Obligations under any Bank Product Agreement to the extent that each such Borrower is not the primary obligor with respect thereto, (b) Flex Power Co., a Delaware corporation, and each other Subsidiary of Company (other than Borrowers) and (c) each Person (other than Parent) who from time to time Guarantees all or any part of the Obligations under the Loan Documents, including any Person who becomes a party to this Agreement pursuant to a Joinder Agreement.

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“Guaranty” means, collectively, the guaranty made by the Loan Parties party to this Agreement pursuant to Article 12 and each other written guaranty executed by one or more of the other Guarantors in favor of Administrative Agent, for the benefit of Secured Parties, in form and substance satisfactory to Administrative Agent.

“Hazardous Material” means any substance, product, waste, pollutant, material, chemical, contaminant, constituent, or other material which is or becomes listed, regulated, or addressed under any Environmental Law, including, without limitation, any petroleum and petroleum byproducts, natural gas, natural gas liquids, liquefied natural gas or synthetic gas usable for fuel (or mixture of natural gas and such synthetic gas), polychlorinated biphenyls, lead and lead-based paint, radon, radioactive materials, flammables and explosives, and mold.  “Hazardous Substances” shall include, without limitation, any hazardous or toxic substance, material or waste or any chemical, element, compound or mixture which is: (i) asbestos and asbestos-containing materials; (ii) designated as a “pollutant” or “toxic pollutant” pursuant to the Federal Water Pollution Control Act (33 U.S.C. Paragraph 1251 et seq.); (iii) defined as a “solid or hazardous waste” pursuant to the Federal Resource Conservation and Recovery Act (42 U.S.C. Paragraph 6901 et seq.); (iv) defined as “hazardous substances” pursuant to the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. Paragraph 9601 et seq.); (v) listed in the United States Department of Transportation Table (49 CFR 172.101) or by the Environmental Protection Agency as hazardous substances (40 CFR part 302); (vi) chemicals, elements, compounds, mixtures, substances, materials or wastes otherwise regulated under any applicable federal, state, provincial, territorial or local Environmental Laws; (vii) polychlorinated biphenyls; (viii) “pesticides” as defined in the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. §§ 136 et seq.; (ix) “contaminant” as defined in the Safe Drinking Water Act, 42 U.S.C. §§ 300f et seq.; (x) “extremely hazardous substances” as defined in the Emergency Planning and Community Right to Know Act, 42 U.S.C. §§ 11001 et seq.; (xi) “hazardous materials” as defined in the Hazardous Materials Transportation Act, 49 U.S.C. §§ 5101 et seq.; (xii) “hazardous air pollutants” as defined in the Clean Air Act, 42 U.S.C. §§ 7401 et seq.; and (xiii) “oil” as defined in the Oil Pollution Act of 1990, 33 U.S.C. §§ 2701 et seq.

“Hedge Agreement” means (a) any and all interest rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules and annexes, a “Master Agreement”), (c) any and all Master Agreements and any and all related confirmations and (d) any other agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

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“Hedge Obligations” means, at any time with respect to any Person, all indebtedness, liabilities, and obligations of such Person under or in connection with any Hedge Agreement, whether actual or contingent, due or to become due and existing or arising from time to time.

“Hedge Termination Value” means, in respect of any one or more Hedge Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and settlement amounts, early termination amounts or termination value(s) determined in accordance therewith, such settlement amounts, early termination amounts or termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more commercially reasonable mid-market or other readily available quotations provided by any dealer which is a party to such Hedge Agreement or any other recognized dealer in such Hedge Agreements (which may include a Lender or any Affiliate of a Lender).

“Honor Date” has the meaning set forth in Section 2.2(c)(i).

“Increase Effective Date” has the meaning set forth in Section 2.10(c).

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Borrowers or any other Loan Party under any Loan Document and (b) to the extent not otherwise described in clause (a), Other Taxes.

“Information” has the meaning set forth in Section 11.26.

“Intellectual Property” means all copyrights, copyrightable works, patents, patent applications, industrial designs, trademarks, service marks, trade names, brand names, trade dress, slogans, logos and Internet domain names and uniform resource locators, and the goodwill associated with any of the foregoing, and other types of intellectual or industrial property rights and foreign equivalent or counterpart rights and forms of protection of a similar or analogous nature to any of the foregoing or having similar effect in any jurisdiction throughout the world, and registrations and applications for registration of any of the foregoing, and all documentation and embodiments of the foregoing, in whatever form, now owned or hereafter acquired.

“Intercreditor Agreement” means that certain Subordination and Intercreditor Agreement dated as of the Closing Date, by and among Administrative Agent, the Subordinated Lenders, Parent, and the Loan Parties, as the same may be amended, amended and restated, supplemented or otherwise modified from time to time in accordance therewith and herewith.

“Interest Period” means with respect to any Eurodollar Rate Loan, the period commencing on the date such Loan becomes a Eurodollar Rate Loan (whether by the making of a Loan or its continuation or conversion) and ending on the numerically corresponding day in the calendar month that is one (1), two (2) or three (3) months thereafter (in each case subject to the availability of the Eurodollar Rate for such period), as the Borrower Representative may elect; provided that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (b) any Interest Period pertaining to a Eurodollar Rate Loan that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.

CREDIT AGREEMENT – Page 33

“Interest Rate” means the rate equal to the lesser of (a) the Maximum Rate and (b) the Applicable Rate.

“Inventory” means inventory, as defined in the UCC or PPSA, as applicable.

“Investment Grade Account Debtor” means, any account debtor whose securities are rated BBB- (or then equivalent grade) or higher by S&P or Baa3 (or then equivalent grade) or higher by Moody’s, or whose credit rating or credit quality has the characteristics of an Investment Grade Account Debtor as determined by Administrative Agent in its sole discretion.

“IRS” means the Internal Revenue Service or any entity succeeding to all or any of its functions.

“ISDA Definitions” means the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc. or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time by the International Swaps and Derivatives Association, Inc. or such successor thereto.

“ISP” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).

“Issuer Documents” means, with respect to any Letter of Credit, the Letter of Credit Application, and any other document, agreement and instrument entered into by L/C Issuer and any Borrower or in favor of L/C Issuer and relating to such Letter of Credit.

“ITA” means the Income Tax Act (Canada), as amended from time to time, and any successor statute, together with the regulations promulgated thereunder.

“Joinder Agreement” means a Joinder Agreement in the form of Exhibit H hereto.

“Judgment Currency” has the meaning set forth in Section 11.2(b).

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Applicable Percentage.

“L/C Borrowing” means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed by Borrowers on the date when made or refinanced as a Revolving Credit Borrowing.

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.

CREDIT AGREEMENT – Page 34

“L/C Issuer” means Texas Capital Bank in its capacity as issuer of Letters of Credit hereunder, or any successor issuer of Letters of Credit hereunder.

“L/C Obligations” means, as of any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts, including all L/C Borrowings. For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.4. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

“Laws” means, collectively, all international, foreign, federal, state, provincial, territorial and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.

“Lease” of any Person means all of the right, title and interest of such Person as lessee or licensee in, to and under a lease or license of land, improvements and/or fixtures.

“Lenders” means, (a) at any time prior to the termination of the Commitments, any Person that has a Commitment at such time, and (b) at any time after the termination of the Commitments, any Person that has Revolving Credit Exposure at such time. Unless the context otherwise requires, the term “Lenders” includes Swing Line Lender, L/C Issuer and their respective successors and assigns permitted hereunder.

“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower Representative and Administrative Agent.

“Letter of Credit” means any standby letter of credit issued hereunder providing for the payment of cash upon the honoring of a presentation thereunder.

“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by L/C Issuer.

“Letter of Credit Expiration Date” means the day that is seven (7) days prior to the Maturity Date (or, if such day is not a Business Day, the next preceding Business Day).

“Letter of Credit Fee” has the meaning set forth in Section 2.4(b).

“Letter of Credit Sublimit” means an amount equal to the lesser of (a) $5,000,000 and (b) the aggregate Commitments. The Letter of Credit Sublimit is part of, and not in addition to, the Commitments.

CREDIT AGREEMENT – Page 35

“Leverage Ratio” means, as of the last day of the last fiscal month of each fiscal quarter, the ratio of (i) all Debt of Company and its Subsidiaries, on a consolidated basis in accordance with GAAP, as of such date to (ii) Annualized EBITDA of Company and its Subsidiaries, on a consolidated basis in accordance with GAAP, as of such date.

“Lien” means, as to any Property of any Person, (a) any lien, mortgage, security interest, tax lien, pledge, charge, hypothecation, collateral assignment, preference, priority, or other encumbrance of any kind or nature whatsoever (including, without limitation, any conditional sale or title retention agreement), whether arising by contract, operation of law, or otherwise, affecting such Property and (b) the signing or filing of a financing statement which names the Person as debtor or the signing of any security agreement or the signing of any document authorizing a secured party to file any financing statement which names such Person as debtor.

“Loan” means an extension of credit by a Lender to any Borrower under Article 2 in the form of a Revolving Credit Loan or a Swing Line Loan.

“Loan Documents” means this Agreement, the First Amendment, the Second Amendment, the Third Amendment, the Fourth Amendment, each Guaranty, the Security Documents, the Notes, the Issuer Documents, and all other promissory notes, security agreements, deeds of trust, assignments, letters of credit, guaranties, and other instruments, documents, or agreements executed and delivered pursuant to or in connection with this Agreement or the Security Documents; provided that the term “Loan Documents” shall not include any Bank Product Agreement.

“Loan Party” means Borrowers, each other Guarantor or any other Person who is or becomes party to any agreement with any Secured Party that obligates such Person to pay or perform, or that Guarantees or secures payment or performance of, the Obligations under the Loan Documents or any part thereof. Notwithstanding the foregoing, the Parent shall not constitute as being a “Loan Party” for all purposes under the Loan Documents.

“Management Services Agreement” means that certain Management Services Agreement dated as of [________], 2021, between the Company and FlexEnergy Energy Systems, Inc., a Delaware corporation, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with Section 7.16.

“Material Adverse Effect” means any act, event, condition, or circumstance which could reasonably be expected to materially and adversely affect (a) the operations, business, Properties, liabilities (actual or contingent), or condition (financial or otherwise) of the Loan Parties and their Subsidiaries, taken as a whole; (b) the ability of any Loan Party to perform its obligations under any Loan Document to which it is a party; (c) the legality, validity, binding effect or enforceability against any Loan Party of any Loan Document to which it is a party; or (d) the rights, remedies and benefits available to, or conferred upon, Administrative Agent or any Secured Party under any Loan Documents.

“Maturity Date” means February 8, 2024, or such earlier date on which the Commitment of each Lender terminates as provided in this Agreement.

CREDIT AGREEMENT – Page 36

“Maximum Rate” means, at all times, the maximum rate of interest which may be charged, contracted for, taken, received or reserved by Lenders in accordance with applicable Law. The Maximum Rate shall be calculated in a manner that takes into account any and all fees, payments, and other charges in respect of the Loan Documents that constitute interest under applicable Law. Each change in any interest rate provided for herein based upon the Maximum Rate resulting from a change in the Maximum Rate shall take effect without notice to any Borrower at the time of such change in the Maximum Rate.

“Minimum Collateral Amount” means, at any time, (a) with respect to Cash Collateral consisting of cash or deposit account balances provided to reduce or eliminate Fronting Exposure during the time that a Defaulting Lender exists, an amount equal to 103% of the Fronting Exposure of L/C Issuer with respect to Letters of Credit issued and outstanding at such time, (b) with respect to Cash Collateral consisting of cash or deposit account balances provided in accordance with the provisions of Section 2.7(a)(i), (a)(ii) or (a)(iii), an amount equal to 103% of the Outstanding Amount of all L/C Obligations, and (c) otherwise, an amount determined by Administrative Agent and L/C Issuer in their sole discretion.

“Multiemployer Plan” means a multiemployer plan defined as such in Section 3(37) of ERISA to which contributions are being made or have been made by, or for which there is an obligation to make contributions by or there is any liability, contingent or otherwise, with respect to an Loan Party or any ERISA Affiliate and which is covered by Title IV of ERISA.

“Net Cash Proceeds” means:

(a)with respect to any Disposition by any Loan Party or any of its Subsidiaries the excess, if any, of (i) the sum of cash and cash equivalents received in connection with such transaction (including any cash or cash equivalents received by way of deferred payment pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received), over (ii) the sum of (A) the principal amount of any Debt that is secured by the applicable asset and that is required to be repaid in connection with such transaction (other than Debt under the Loan Documents), (B) the reasonable out-of-pocket expenses incurred by such Loan Party or such Subsidiary in connection with such transaction including legal, accounting, investment banking and other professional fees and (C) taxes paid or reasonably estimated to be payable within two years of the date of the relevant transaction as a result of any gain recognized in connection therewith; provided that, if (1) reserves established pursuant to subclause (A) exceeds the actual purchase price adjustment required to be paid in connection with such transactions, or (2) the amount of any estimated taxes pursuant to subclause (C) exceeds the amount of taxes actually required to be paid in cash in respect of such Disposition, in each case, the aggregate amount of such excess shall constitute Net Cash Proceeds.

(b)with respect to the sale or issuance of any Equity Interests by any Loan Party or any of its Subsidiaries, or the incurrence or issuance of any Debt by any Loan Party or any of its Subsidiaries, the excess of (i) the sum of the cash and cash equivalents received in connection with such transaction over (ii) the underwriting discounts and commissions, and other reasonable and customary out-of-pocket expenses, incurred by such Loan Party or such Subsidiary in connection therewith.

CREDIT AGREEMENT – Page 37

“Net Income” means, for any Person for any period, the net income (or loss) of such Person and its Subsidiaries on a consolidated basis as determined in accordance with GAAP; provided that Net Income shall exclude (a) the net income of any Subsidiary of such Person during such period to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary of such income is not permitted by operation of the terms of its Constituent Documents or any agreement, instrument or Law applicable to such Subsidiary during such period, except that such Person’s equity in any net loss of any such Subsidiary for such period shall be included in determining Net Income, and (b) any income (or loss) for such period of any other Person if such other Person is not a Subsidiary, except that Company’s equity in the net income of such Person for such period shall be included in Net Income up to the aggregate amount of cash actually distributed by such Person during such period to Company or a Subsidiary as a dividend or other distribution (and in the case of a dividend or other distribution to such Subsidiary, such Subsidiary is not precluded from further distributing such amount to Company as described in clause (a) of this proviso).

“Net Invoice Costs” means “hard costs” (i.e. the net invoice cost of Inventory excluding taxes, shipping, delivery, handling, installation, set-up costs or other soft costs) of any Inventory.

“Net Orderly Liquidation Value” means, with respect to Inventory of any Person, the orderly liquidation value thereof, expressed as a percentage of net book value, as determined in a manner acceptable to Administrative Agent by an appraiser acceptable to Administrative Agent, net of all costs of liquidation thereof.

“New Generator Units” means Generator Unites, whether held or deployed by the Borrowers in the ordinary course of business, and which are not included in the most recent appraisal ordered, received and relied upon by Administrative Agent pursuant to Section 6.6(c).

“Non-Consenting Lender” means any Lender that does not approve any consent, waiver or amendment that (a) requires the approval of all or all affected Lenders in accordance with the terms of Section 11.10 and (b) has been approved by the Required Lenders.

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

“Non-Investment Grade Account Debtor” means any account debtor which is not an Investment Grade Account Debtor.

“Notes” means a promissory note made by Borrowers in favor of a Lender evidencing Revolving Credit Loans or Swing Line Loans, as the case may be, made by such Lender, substantially in the form of Exhibit E.

“Obligations” means all obligations, indebtedness, and liabilities of Borrowers and each other Loan Party to Administrative Agent, each Lender and each other Secured Party now existing or hereafter arising, whether direct, indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, arising under or pursuant to this Agreement, any Bank Product Agreements or the other Loan Documents, and all interest accruing thereon (whether a claim for post-filing or post-petition interest is allowed in any bankruptcy, insolvency, reorganization or similar proceeding) and all attorneys’ fees and other expenses incurred in the enforcement or collection thereof and Erroneous Payment Subrogation Rights; provided that, as to any Loan Party, the “Obligations” shall exclude any Excluded Swap Obligations of such Loan Party.

CREDIT AGREEMENT – Page 38

“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Guaranties” has the meaning set forth in Section 12.11.

“Other Guarantors” has the meaning set forth in Section 12.11.

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.6).

“Outstanding Amount” means (a) with respect to the Revolving Credit Loans and the Swing Line Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Revolving Credit Loans and Swing Line Loans, as the case may be, occurring on such date, and (b) with respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements by Borrowers of Unreimbursed Amounts.

“Parent” means FlexEnergy Power Solutions, LLC, a Delaware limited liability company.

“Parent Loan” means the subordinated Debt of Parent owing to the Subordinated Lenders in an original aggregate principal amount of $18,000,000, which Debt is evidenced and governed by the Parent Loan Documents.

“Parent Loan Documents” means, collectively, (a) the Parent Loan Notes, and (b) any and all guarantees, notes, instruments, documents and agreements executed and delivered by Parent in connection with, or pursuant to, the issuance of the Parent Loan, in each case, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with Section 7.16(b).

“Parent Loan Notes” means, collectively, those certain secured promissory notes entered into from time to time, among Parent and the Subordinated Lenders, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with Section 7.16(b).

CREDIT AGREEMENT – Page 39

“Parent Pledge Agreement” means that certain Pledge and Limited Guaranty Agreement (including any and all supplements thereto), dated as of the Closing Date, among Parent and Administrative Agent, for the benefit of Administrative Agent and the other Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Participant” means any Person (other than (a) a natural Person, (b) a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural Person, (c) a Defaulting Lender, or (d) Parent, any of Parent’s Affiliates, any Subsidiaries of Parent or any other Loan Party) to which a participation is sold by any Lender in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it).

“Participant Register” means a register in the United States on which each Lender that sells a participation enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents.

“Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. 107-56, signed into law October 26, 2001).

“Payment Conditions” means, with respect to any Restricted Payment made pursuant to Section 7.4(e):

(a)       no Default or Event of Default shall have occurred and be continuing on the date of such Restricted Payment or would result after giving effect to such Restricted Payment;

(b)       solely with respect to any Restricted Payment made pursuant to Section 7.4(e), (i) after giving effect to and at all times during the ninety (90) consecutive day period immediately prior to such Restricted Payment, Availability shall be greater than or equal to $6,500,000; and (ii) the Fixed Charge Coverage Ratio for Company and its Subsidiaries for the most recently ended fiscal quarter calculated on a pro forma basis, after giving effect to such Restricted Payment shall be greater than 1.25 to 1.00; and

(c)       Administrative Agent shall have received a certificate of a Responsible Officer of the Borrower Representative demonstrating satisfaction of the foregoing conditions concurrently with any such Restricted Payment.

“Payment Date” means (a) in respect of each Base Rate Loan, the first day of each and every calendar month during the term of this Agreement, upon prepayment of such Loan and the Maturity Date, and (b) in respect of each Eurodollar Rate Loan, the last day of each Interest Period applicable to such Eurodollar Rate Loan (or the day that is three (3) months after the first day of such Interest Period if such Interest Period has a length of more than three (3) months) and the Maturity Date.

CREDIT AGREEMENT – Page 40

“PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to all or any of its functions under ERISA.

“Perfection Certificate” means, collectively, (a) that certain Perfection Certificate dated as of the Closing Date, executed by the Loan Parties at such time and addressed to Administrative Agent and (b) any other perfection certificate from time to time delivered to Administrative Agent, executed by the Loan Parties, in each case in form and substance reasonably satisfactory to Administrative Agent.

“Permitted Discretion” means a determination made in good faith and in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment.

“Permitted Holders” means, collectively, RNS Flex, LLC, ESS Participation Fund II, L.P., Energy Special Situations Fund II, L.P., Intervale Capital Fund III, L.P. and Intervale Capital Co-Investment Fund III, L.P.

“Permitted Liens” means those Liens permitted by Section 7.2.

“Permitted Tax Distributions” means, for any taxable period after the Fifth Amendment Effective Date during which time the Company is either a pass-through entity or a member of a consolidated tax group of which Parent is a member for federal income tax purposes, any Restricted Payment to Parent to permit Parent to pay federal income taxes and all relevant state and local income taxes in an amount not to exceed the lesser of (a) the amount of such taxes that Parent is required to pay to a Governmental Authority and (b) the amount of federal income taxes and all relevant state and local income taxes that the Borrowers and their Subsidiaries would have paid had the Borrowers and such Subsidiaries been a stand-alone corporate taxpayer or a stand-alone corporate group, taking into account any such income taxes directly paid or withheld at the level of any Borrower or such Subsidiary.

“Person” means any natural person, corporation, limited liability company, trust, association, company, partnership, joint venture, Governmental Authority, or other entity, and shall include such Person’s heirs, administrators, personal representatives, executors, successors and assigns.

“Plan” means any employee benefit or other plan, other than a Multiemployer Plan, established or maintained by, or for which there is an obligation to make contributions by or there is any liability, contingent or otherwise with respect to a Borrower or any ERISA Affiliate and which is covered by Title IV of ERISA or subject to Section 412 of the Code.

“Platform” means Debt Domain, Intralinks, Syndtrak or a substantially similar electronic transmission system.

“PPSA” means the Personal Property Security Act (Alberta) and the regulations thereunder, as from time to time in effect, provided, however, if attachment, perfection or priority of the Administrative Agent’s security interests in any Collateral are governed by the personal property security laws of any jurisdiction in Canada other than Alberta, PPSA shall mean those personal property security laws in such other jurisdiction for the purposes of the provisions hereof relating to such attachment, perfection or priority and for the definitions related to such provisions.

CREDIT AGREEMENT – Page 41

“Prime Rate” means the rate of interest per annum publicly announced from time to time by Texas Capital Bank as its prime rate in effect at its Principal Office; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective. Such rate is set by Texas Capital Bank as a general reference rate of interest, taking into account such factors as Texas Capital Bank may deem appropriate; it being understood that many of Texas Capital Bank’s commercial or other loans are priced in relation to such rate, that it is not necessarily the lowest or best rate actually charged to any customer and that Texas Capital Bank may make various commercial or other loans at rates of interest having no relationship to such rate.

“Principal Office” means the principal office of Administrative Agent, presently located at the address set forth on Schedule 11.11.

“Prohibited Transaction” means any transaction set forth in Section 406 of ERISA or Section 4975 of the Code.

“Property” of a Person means any and all property, whether real, personal, tangible, intangible or mixed, of such Person, or any other assets owned, operated or leased by such Person.

“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).

“QFC Credit Support” has the meaning set forth in Section 11.32.

“Qualified ECP Guarantor” means, at any time, each Loan Party with total assets exceeding $10,000,000 or that qualifies at such time as an “eligible contract participant” under the Commodity Exchange Act or any regulation promulgated thereunder and can cause another Person to qualify as an “eligible contract participant” at such time under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Qualified IPO” means the issuance by FGS of its common shares in an underwritten primary public offering (other than a public offering pursuant to a registration statement on Form S-1, Form S-8 or comparable filing in any other applicable jurisdiction) pursuant to an effective registration statement filed with the SEC or any other comparable Governmental Authority in any other applicable jurisdiction (whether alone or in connection with a secondary public offering) (a) generating (individually or in the aggregate together with any prior initial public offering) gross proceeds exceeding $15,000,000 and (b) occurring on or prior to January 31, 2022.

“Qualified IPO Expenses” means expenses actually incurred by either (a) prior to the consummation of the Qualified IPO, the Parent or (b) on or after the consummation of the Qualified IPO, FGS, that are, in either case, allocable to the Company in connection with the Qualified IPO from the period commencing on July 9, 2020 through and including February 28, 2022.

“Receipts” has the meaning set forth in Section 2.12(a).

“Recipient” means Administrative Agent, L/C Issuer, Swing Line Lender, or any Lender, as applicable.

CREDIT AGREEMENT – Page 42

“Reference Time” means, with respect to any setting of the then-current Benchmark, (a) if such Benchmark is USD LIBOR, 11:00 a.m. (London time) on the day that is two London banking days preceding the date of such setting, and (b) if such Benchmark is not USD LIBOR, the time determined by the Administrative Agent in its reasonable discretion.

“Register” means a register for the recordation of the names and addresses of Lenders, and the Commitments of, and principal amounts of and stated interest on the Loans owing to, each Lender pursuant to the terms hereof from time to time.

“Related Indebtedness” means any and all indebtedness paid or payable by any Borrower or any other Loan Party to Administrative Agent or any Lender pursuant to any Loan Document other than any Note.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, sub agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.

“Release” means, as to any Person, any release, spill, emission, leaking, pumping, injection, deposit, disposal, disbursement, leaching, or migration of Hazardous Materials into the indoor or outdoor environment or into or out of Property owned by such Person, including, without limitation, the movement of Hazardous Materials through or in the air, soil, surface water, ground water, or Property.

“Release Date” means the last to occur of the dates on which Liens securing the Obligations may be released pursuant to Section 10.9(a)(i)(x).

“Relevant Governmental Body” means the Board of Governors or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board of Governors or the Federal Reserve Bank of New York, or any successor thereto.

“Remedial Action” means all actions required to (a) clean up, remove, treat, or otherwise address Hazardous Materials in the indoor or outdoor environment, (b) prevent the Release or threat of Release or minimize the further Release of Hazardous Materials so that they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, or (c) perform pre-remedial studies and investigations and post-remedial monitoring and care.

“Removal Effective Date” has the meaning set forth in Section 10.6(b).

“Rent Reserve” means, with respect to any facility, warehouse distribution center, regional distribution center or depot where any Inventory subject to Liens arising by operation of law is located and with respect to which no Collateral Access Agreement is in effect, a reserve equal to (a) in the case of any leased location, all rent, charges and fees scheduled or customarily falling due for payment during a three (3) month period at such facility, warehouse distribution center, regional distribution center or depot where any Inventory (including any Generator Units and Field Units) are stored or located, and (b) in the case of any other location, an amount determined by Administrative Agent in its sole discretion in respect of liabilities owed to the applicable consignee, bailee, processor or warehouseman.

CREDIT AGREEMENT – Page 43

“Replacement Rate” has the meaning set forth in Section 3.3(b).

“Reportable Event” means any of the events set forth in Section 4043 of ERISA.

“Required Lenders” means, as of any date of determination, Lenders holding more than 66 2/3% of the sum of the (a) the Revolving Credit Exposure of all Lenders (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Obligations and Swing Line Loans being deemed “held” by such Lender for purposes of this definition) and (b) aggregate unused Commitments; provided that, if one Lender holds more than 66 2/3% but less than 100% of the sum of the Revolving Credit Exposure and the unused Commitments at such time, subject to the last sentence of Section 11.10, Required Lenders shall be at least two Lenders. The unused Commitment of, and the portion of the Revolving Credit Exposure of all Lenders held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

“Resignation Effective Date” has the meaning set forth in Section 10.6(a).

“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.

“Responsible Officer” means the chief executive officer, president, chief financial officer, vice president, vice president of finance or treasurer of a Loan Party (or the chief executive officer, president, chief financial officer, vice president, vice president of finance or treasurer of the general partner or managing member of a Loan Party, as applicable); solely for purposes of the delivery of incumbency certificates pursuant to Section 4.1, the secretary or assistant secretary of a Loan Party (or the secretary or any assistant secretary of the general partner or managing member of a Loan Party, as applicable) or any Person designated by a Responsible Officer to act on behalf of a Responsible Officer; provided that such designated Person may not designate any other Person to be a Responsible Officer. Any document delivered hereunder that is signed by a Responsible Officer of an Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Person and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

“Restricted Payment” means, collectively, (a) any dividend or other distribution (whether in cash, securities or other Property) with respect to any capital stock or other Equity Interest of Company or any Subsidiary, and (b) any payment (whether in cash, securities or other Property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any capital stock or other Equity Interest or on account of any return of capital to Company’s stockholders, partners or members (or the equivalent Person thereof).

“Revolving Credit Borrowing” means a borrowing consisting of simultaneous Revolving Credit Loans of the same Type and, in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Lenders pursuant to Section 2.1(a).

“Revolving Credit Exposure” means, as to any Lender at any time, the aggregate Outstanding Amount of its Revolving Credit Loans and such Lender’s participation in L/C Obligations and Swing Line Loans at such time.

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“Revolving Credit Facility” means, at any time, the aggregate amount of the Lenders’ Commitments at such time.

“Revolving Credit Loan” has the meaning set forth in Section 2.1(a).

“RICO” means the Racketeer Influenced and Corrupt Organization Act of 1970.

“Sanctioned Country” means, at any time, a country or territory which is itself the subject or target of any Sanctions.

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC, the U.S. Department of State or by the United Nations Security Council, the European Union, any European Union member state or Her Majesty’s Treasury of the United Kingdom, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person controlled by any such Person or Persons, in each case, to the extent dealings are prohibited or restricted with such Person under Sanctions.

“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by the U.S. government (including those administered by OFAC or the U.S. Department of State), the Canadian government (including those administered by the Department of Foreign Affairs, Trade and Development and Public Safety Canada), the United Nations Security Council, the European Union, any European Union member state or Her Majesty’s Treasury of the United Kingdom, or other relevant sanctions authority.

“SEC” means the Securities and Exchange Commission or any successor Governmental Authority.

“Second Amendment” means that certain Second Amendment to Credit Agreement dated as of August 28, 2020, by and among the Company, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“Secured Parties” means the collective reference to Administrative Agent, each Lender, L/C Issuer, Swing Line Lender, each Bank Product Provider, and any other Person the Obligations owing to which are, or are purported to be, secured by the Collateral under the terms of the Security Documents.

“Security Agreements” means, collectively, (a) the U.S. Security Agreement and (b) the Canadian Security Agreement.

“Security Documents” means (a) the Security Agreements, (b) the Control Agreements, (c) the Intercreditor Agreement, (d) the Parent Pledge Agreement and (e) every mortgage, security agreement, pledge agreement, mortgage, deed of trust, control agreement or other collateral security agreement required by or delivered to Administrative Agent from time to time that purport to create a Lien in favor of any of the Secured Parties to secure payment or performance of the Obligations or any portion thereof.

“Securities Account Control Agreement” has the meaning assigned to such term in the applicable Security Agreement.

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“SOFR” means, with respect to any Business Day, a rate per annum equal to the secured overnight financing rate for such Business Day published by the SOFR Administrator on the SOFR Administrator’s Website at approximately 8:00 a.m. (New York City time) on the immediately succeeding Business Day.

“SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

“SOFR Administrator’s Website” means the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.

“Specified EBITDA Equity Contribution” means any direct or indirect investment in the Company to cure a breach of Section 8.1 or Section 8.2 pursuant to Section 9.3 (and designated in writing at or about the time made as being a Specified EBITDA Equity Contribution) in cash in the form of a capital contribution (including the purchase of common Equity Interests issued by Company), directly or indirectly, to Company or the purchase of common Equity Interests issued by Parent (or other Equity Interests issued by Parent and reasonably acceptable to Administrative Agent, but not Disqualified Equity Interests) and the proceeds thereof distributed to Company.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one (1) and the denominator of which is the number one (1) minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board of Governors to which Administrative Agent is subject with respect to the Eurodollar Rate, for eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D of the Board of Governors). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurodollar Rate Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

“Subordinated Lenders” means, collectively, at any time, the holders of the Parent Loan Notes.

“Subsidiary” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of Company.

“Supported QFC” has the meaning set forth in Section 11.32.

“Sureties” has the meaning set forth in Section 12.3(b).

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“Swap Obligations” means, with respect to any Loan Party, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to Section 2.3.

“Swing Line Lender” means Texas Capital Bank in its capacity as provider of Swing Line Loans, or any successor swing line lender hereunder.

“Swing Line Loan” has the meaning set forth in Section 2.3(a).

“Swing Line Loan Request” means a writing, substantially in the form of Exhibit F, or in such other form agreed to by the Borrower Representative and Administrative Agent, properly completed and signed by the Borrower Representative, requesting a Swing Line Borrowing.

“Swing Line Sublimit” means an amount equal to the greater of (a) $5,000,000 and (b) 10% the aggregate Commitments in effect at any time. The Swing Line Sublimit is part of, and not in addition to, the Commitments.

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Tax Return” means any return (including any information report), report, statement, schedule, notice, form, or other document or information filed with or submitted to, or required to be filed with or submitted to, any Governmental Authority in connection with the determination, assessment, collection, or payment of any Tax or in connection with the administration, implementation, or enforcement of any Tax.

“Term SOFR” means, for the applicable Corresponding Tenor as of the applicable Reference Time, the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.

“Texas Capital Bank” means Texas Capital Bank, a Texas state-chartered bank, and its successors and assigns.

“Third Amendment” means that certain Third Amendment to Credit Agreement dated as of the Third Amendment Effective Date, by and among the Company, Canadian Borrower, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“Third Amendment Effective Date” means December 22, 2020.

“Trigger Period” means any period commencing on the first date on which (a) an Event of Default has occurred and is continuing or (b) Availability plus the amount, if any, by which the Borrowing Base on such date exceeds the aggregate Commitments of the Lenders then in effect, is less than the greater of (i) $3,500,000 and (ii) 10% of the aggregate Commitments then in effect, and continuing until the date upon which both (A) Availability (and solely to the extent such Trigger Period commenced only as a result of an event under subclause (b) above, plus the amount, if any, by which the Borrowing Base on such date exceeds the aggregate Commitments of the Lenders then in effect) has been equal to or greater than the greater of (x) $3,500,000 and (y) 10% of the aggregate Commitments then in effect, in each case, at all times during the preceding sixty (60) consecutive day period, and (B) no Event of Default has occurred and is continuing during such sixty (60) consecutive day period.

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“Type” means, with respect to a Loan, refers to whether such Loan is a Base Rate Loan or a Eurodollar Rate Loan, and, with respect to a Borrowing, refers to whether such Borrowing is a Base Rate Borrowing or a Eurodollar Rate Borrowing.

“UCC” means Chapters 1 through 11 of the Texas Business and Commerce Code.

“UK Financial Institution” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.

“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.

“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

“Unfinanced Capital Expenditures” means, for any date of determination, Capital Expenditures of Company and its Subsidiaries made during the trailing twelve (12) fiscal month period then ending on such date which are not financed from the proceeds of any Debt (other than the Revolving Credit Loans); provided that, only twenty percent (20%) of the portion of Capital Expenditures made during such period financed from the proceeds of Revolving Credit Loans which were exclusively used to acquire or construct any New Generator Units after January 31, 2019 shall be deemed to be Unfinanced Capital Expenditures; provided, further that in no event shall the amount of Unfinanced Capital Expenditures for any period be less than zero.

“Unfunded Pension Liability” means the excess, if any, of (a) the funding target as defined under Section 430(d) of the Code without regard to the special at-risk rules of Section 430(i) of the Code, over (b) the value of plan assets as defined under Section 430(g)(3)(A) of the Code determined as of the last day of each plan year, without regard to the averaging which may be allowed under Section 430(g)(3)(B) of the Code and reduced for any prefunding balance or funding standard carryover balance as defined and provided for in Section 430(f) of the Code.

“Unreimbursed Amount” has the meaning set forth in Section 2.2(c)(i).

“U.S.” or “United States” means the United States of America.

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“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code.

“U.S. Security Agreement” means that certain Pledge and Security Agreement (including any and all supplements thereto), dated as of the Closing Date, among the Loan Parties (other than Canadian Borrower) and Administrative Agent, for the benefit of Administrative Agent and the other Secured Parties, and any other pledge or security agreement entered into, after the date of this Agreement by any other Loan Party (as required by this Agreement or any other Loan Document, but excluding Canadian Borrower) or any other Person (other than Canadian Borrower) for the benefit of Administrative Agent and the other Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time

“U.S. Special Resolution Regimes” has the meaning set forth in Section 11.32.

“U.S. Tax Compliance Certificate” has the meaning specified in Section 3.4(g)(ii)(B)(3).

“USD LIBOR” means the London interbank offered rate for Dollars.

“Withholding Agent” means each of the Loan Parties and Administrative Agent.

“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.

Section 1.2Accounting Matters.

(a)Generally. All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the audited financial statements described in Section 5.2, except as otherwise specifically prescribed herein. Notwithstanding the foregoing or anything to the contrary herein, (i) for purposes of determining compliance with any covenant (including the computation of any Financial Covenant) contained herein, Debt of Company and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof, and the effects of FASB ASC 825 on financial liabilities shall be disregarded and (ii) any lease that is treated as an operating lease for purposes of GAAP as of December 15, 2018 shall continue to be treated as an operating lease (and any future lease, if it were in effect on December 15, 2018, that would be treated as an operating lease for purposes of GAAP as of December 15, 2018 shall be treated as an operating lease), in each case for purposes of this Agreement, notwithstanding any change in GAAP after December 15, 2018.

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(b)Changes in GAAP. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth herein, and either the Borrower Representative or the Required Lenders shall so request, Administrative Agent, Lenders and the Borrower Representative shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower Representative shall provide to Administrative Agent and Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

Section 1.3ERISA Matters. If, after the date hereof, there shall occur, with respect to ERISA, the adoption of any applicable Law, rule, or regulation, or any change therein, or any change in the interpretation or administration thereof by the PBGC or any other Governmental Authority, then either the Borrower Representative or Required Lenders may request a modification to this Agreement solely to preserve the original intent of this Agreement with respect to the provisions hereof applicable to ERISA, and the parties to this Agreement shall negotiate in good faith to complete such modification.

Section 1.4Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

Section 1.5Other Definitional Provisions. All definitions contained in this Agreement are equally applicable to the singular and plural forms of the terms defined. The words “hereof”, “herein”, and “hereunder” and words of similar import referring to this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Unless otherwise specified, all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear. Terms used herein that are defined in the UCC or the PPSA, as applicable, unless otherwise defined herein, shall have the meanings specified in the UCC or the PPSA, as applicable. Any definition of or reference to any agreement, instrument or other document shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document). Any reference to any Law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such Law and any reference to any Law or regulation shall, unless otherwise specified, refer to such Law or regulation as amended, modified or supplemented from time to time. Words denoting gender shall be construed to include the masculine, feminine and neuter, when such construction is appropriate; specific enumeration shall not exclude the general but shall be constructed as cumulative; the word “or” is not exclusive; the word “including” (in its various forms) means “including, without limitation”; in the computation of periods of time, the word “from” means “from and including” and the words “to” and “until” mean “to but excluding”; and all references to money refer to the legal currency of the U.S.

Section 1.6Interpretative Provision. For purposes of Section 9.1, a breach of a Financial Covenant shall be deemed to have occurred as of any date of determination thereof by Borrowers or the Required Lenders or as of the last date of any specified measurement period, regardless of when the financial statements or the Compliance Certificate reflecting such breach are delivered to Administrative Agent.

Section 1.7Times of Day. Unless otherwise specified, all references herein to times of day shall be references to central time (daylight or standard, as applicable).

Section 1.8Other Loan Documents. The other Loan Documents, including the Security Documents, contain representations, warranties, covenants, defaults and other provisions that are in addition to and not limited by, or a limitation of, similar provisions of this Agreement. Such provisions in such other Loan Documents may be different or more expansive than similar provisions of this Agreement and neither such differences nor such more expansive provisions shall be construed as a conflict.

Section 1.9Divisions. For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its Equity Interests at such time.

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Section 1.10Rates. The interest rate on Eurodollar Rate Loans and Base Rate Loans (when determined by reference to clause (c) of the definition of Base Rate) is determined by reference to USD LIBOR, which is derived from the London interbank offered rate. The London interbank offered rate is intended to represent the rate at which contributing banks may obtain short-term borrowings from each other in the London interbank market. On March 5, 2021, ICE Benchmark Administration (the “IBA”), the administrator of the London interbank offered rate, and the Financial Conduct Authority (the “FCA”), the regulatory supervisor of the IBA, announced in public statements (the “Announcements”) that the final publication or representativeness date for the London interbank offered rate for dollars for: (a) 1-week and 2-month tenor settings will be December 31, 2021 and (b) overnight, 1-month, 3-month, 6-month and 12-month tenor settings will be June 30, 2023. No successor administrator for the IBA was identified in such Announcements. As a result, it is possible that commencing immediately after such dates, the London interbank offered rate for such tenors may no longer be available or may no longer be deemed a representative reference rate upon which to determine the interest rate on Eurodollar Rate Loans or Base Rate Loans (when determined by reference to clause (c) of the definition of Base Rate). There is no assurance that the dates set forth in the Announcements will not change or that the IBA or the FCA will not take further action that could impact the availability, composition or characteristics of any London interbank offered rate. Public and private sector industry initiatives have been and continue, as of the date hereof, to be underway to implement new or alternative reference rates to be used in place of the London interbank offered rate. In the event that the London interbank offered rate or any other then-current Benchmark is no longer available or in certain other circumstances set forth in Section 3.3, such Section 3.3 provides a mechanism for determining an alternative rate of interest. The Administrative Agent will notify the Borrower Representative, pursuant to Section 3.3, of any change to the reference rate upon which the interest rate on Eurodollar Rate Loans and Base Rate Loans (when determined by reference to clause (c) of the definition of Base Rate) is based. However, the Administrative Agent does not warrant or accept any responsibility for, and shall not have any liability with respect to, (i) the continuation of, administration of, submission of, calculation of or any other matter related to the London interbank offered rate or other rates in the definition of “Eurodollar Rate” or with respect to any alternative, successor, or replacement rate thereto (including any then-current Benchmark or any Benchmark Replacement), including whether the composition or characteristics of any such alternative, successor or replacement rate (including any Benchmark Replacement), as it may or may not be adjusted pursuant to Section 3.3, will be similar to, or produce the same value or economic equivalence of, USD LIBOR or any other Benchmark, or have the same volume or liquidity as did the London interbank offered rate or any other Benchmark prior to its discontinuance or unavailability, or (ii) the effect, implementation or composition of any Benchmark Replacement Conforming Changes. The Administrative Agent and its Affiliates or other related entities may engage in transactions that affect the calculation of a Benchmark, any alternative, successor or replacement rate (including any Benchmark Replacement) or any relevant adjustments thereto and such transactions may be adverse to the Borrowers. The Administrative Agent may select information sources or services in its reasonable discretion to ascertain any Benchmark, any component definition thereof or rates referenced in the definition thereof, in each case pursuant to the terms of this Agreement, and shall have no liability to the Borrowers, any Lender or any other person or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.

Section 1.11Rounding. Any financial ratios required to be maintained by the Company pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

Article 2.

THE COMMITMENTS AND CREDIT EXTENSIONS

Section 2.1The Loans.

(a)Revolving Credit Borrowings. Subject to the terms and conditions of this Agreement, each Lender severally agrees to make one or more revolving credit loans (each such loan, a “Revolving Credit Loan”) to Borrowers from time to time from the Closing Date until the Maturity Date in an aggregate principal amount for such Lender at any time outstanding up to but not exceeding the amount of such Lender’s Commitment, provided that the Revolving Credit Exposure of all Lenders shall not exceed the lesser of (i) the aggregate amount of the Commitments of the Lenders and (ii) the Borrowing Base. Subject to the foregoing limitations, and the other terms and provisions of this Agreement, Borrowers may borrow, repay, and reborrow Revolving Credit Loans hereunder.

(b)Borrowing Procedure. Each Revolving Credit Borrowing, each conversion of a Borrowing from one Type to the other, and each continuation of a Eurodollar Rate Borrowing shall be made upon the Borrower Representative’s irrevocable notice to Administrative Agent, which may be given by telephone. Each such notice must be received by Administrative Agent not later than 11:00 a.m. (i) three (3) Business Days prior to the requested date of any Borrowing of, conversion to or continuation of a Eurodollar Rate Borrowing or of any conversion of a Eurodollar Rate Borrowing to a Base Rate Borrowing, and (ii) on the requested date of any Base Rate Borrowing. Each telephonic notice by the Borrower Representative pursuant to this Section 2.1(b) must be confirmed promptly by delivery to Administrative Agent of a written Borrowing Request, appropriately completed and signed by a Responsible Officer of the Borrower Representative. Each Borrowing of, conversion to or continuation of a Eurodollar Rate Borrowing shall be in a principal amount of $250,000 or a whole multiple of $50,000 in excess thereof. Except as provided in Sections 2.2(c) and 2.3(c), each Borrowing of or conversion to a Base Rate Borrowing shall be in a principal amount of $250,000 or a whole multiple of $50,000 in excess thereof; provided that a Base Rate Borrowing may be in an amount equal to Availability. Each Borrowing Request (whether telephonic or written) shall specify (A) whether the Borrower Representative is requesting a Revolving Credit Borrowing, a conversion of Borrowings from one Type to the other, or a continuation of Borrowings, (B) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (C) the principal amount of Borrowings to be borrowed, converted or continued, (D) the Type of Borrowings to be borrowed or to which existing Borrowings are to be converted, and (E) if applicable, the duration of the Interest Period with respect thereto. If the Borrower Representative fails to specify a Type of Borrowing in a Borrowing Request or if the Borrower Representative fails to give a timely notice requesting a conversion or continuation, then the applicable Borrowing shall be made as, or converted to, a Base Rate Borrowing. Any such automatic conversion to Base Rate Borrowings shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurodollar Rate Borrowing. If the Borrower Representative requests a Borrowing of, conversion to, or continuation of a Eurodollar Rate Borrowing in any such Borrowing Request, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one (1) month.

(c)Funding. Following receipt of a Borrowing Request, Administrative Agent shall promptly notify each Lender of the amount of its Applicable Percentage of the applicable Borrowing, and if no timely notice of a conversion or continuation is provided by the Borrower Representative, Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Borrowing as described in Section 2.1(b). In the case of a Revolving Credit Borrowing, each Lender shall make the amount of its Loan available to Administrative Agent in immediately available funds at Administrative Agent’s Principal Office not later than 1:00 p.m. on the Business Day specified in the applicable Borrowing Request. Upon satisfaction of the applicable conditions set forth in Section 4.2 (and, if such Borrowing is the initial Credit Extension, Section 4.1), Administrative Agent shall make all funds so received available to the applicable Borrower in like funds as received by Administrative Agent either by (i) crediting the account of the applicable Borrower on the books of Texas Capital Bank with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) Administrative Agent by the Borrower Representative; provided, however, that if, on the date the Borrowing Request with respect to such Borrowing is given by the Borrower Representative, there are L/C Borrowings outstanding, then the proceeds of such Borrowing, first, shall be applied to the payment in full of any such L/C Borrowings, and second, shall be made available to the applicable Borrower as provided above.

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(d)Continuations and Conversions. Except as otherwise provided herein, a Eurodollar Rate Borrowing may be continued or converted only on the last day of an Interest Period for such Eurodollar Rate Borrowing. During the existence of a Default, (i) no Loans may be requested as, converted to or continued as Eurodollar Rate Borrowings without the consent of the Required Lenders and (ii) unless repaid, each Eurodollar Rate Borrowing shall be converted to a Base Rate Borrowing at the end of the Interest Period applicable thereto.

(e)Notifications. Administrative Agent shall promptly notify the Borrower Representative and Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Borrowings upon determination of such interest rate. At any time that Base Rate Borrowings are outstanding, Administrative Agent shall notify the Borrower Representative and Lenders of any change in Texas Capital Bank’s prime rate used in determining the Base Rate promptly following the public announcement of such change.

(f)Interest Periods. After giving effect to all Borrowings, all conversions of Borrowings from one Type to the other, and all continuations of Borrowings as the same Type, there shall not be more than five (5) Interest Periods in effect with respect to Eurodollar Rate Borrowings.

Section 2.2Letters of Credit.

(a)The Letter of Credit Commitment.

(i)Subject to the terms and conditions set forth herein, (A) L/C Issuer agrees, in reliance upon the agreements of the Lenders set forth in this Section 2.2, (1) from time to time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit for the account of any Borrower, and to amend or extend Letters of Credit previously issued by it, in accordance with subsection (b) below, and (2) to honor drawings under the Letters of Credit; and (B) Lenders severally agree to participate in Letters of Credit issued for the account of any Borrower and any drawings thereunder; provided that immediately after giving effect to any L/C Credit Extension with respect to any Letter of Credit, (x) the Revolving Credit Exposure of all Lenders shall not exceed the lesser of (I) the aggregate amount of the Commitments of the Lenders and (II) the Borrowing Base, in each case in effect at such time, (y) the Revolving Credit Exposure of any Lender shall not exceed such Lender’s Commitment, and (z) the Outstanding Amount of the L/C Obligations shall not exceed the Letter of Credit Sublimit. Each request by the Borrower Representative for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by Borrowers that the L/C Credit Extension so requested complies with the conditions set forth in the proviso to the preceding sentence. Within the foregoing limits, and subject to the terms and conditions hereof, each Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly Borrowers may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.

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(ii)L/C Issuer shall not issue any Letter of Credit, if:

(A)subject to Section 2.2(b)(iii), the expiry date of the requested Letter of Credit would occur more than twelve (12) months after the date of issuance or last extension, unless Required Lenders have approved such expiry date; or

(B)the expiry date of the requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless all Lenders have approved such expiry date.

(iii)L/C Issuer shall not be under any obligation to issue any Letter of Credit if:

(A)any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain L/C Issuer from issuing the Letter of Credit, or any Law applicable to L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over L/C Issuer shall prohibit, or request that L/C Issuer refrain from, the issuance of letters of credit generally or the Letter of Credit in particular or shall impose upon L/C Issuer with respect to the Letter of Credit any restriction, reserve or capital requirement (for which L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which L/C Issuer in good faith deems material to it;

(B)the issuance of the Letter of Credit would violate one or more policies of L/C Issuer applicable to letters of credit generally;

(C)except as otherwise agreed by Administrative Agent and L/C Issuer, the Letter of Credit is in an initial stated amount less than $50,000;

(D)the Letter of Credit is to be denominated in a currency other than Dollars;

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(E) any Lender is at that time a Defaulting Lender, unless L/C Issuer has entered into arrangements, including the delivery of Cash Collateral, satisfactory to L/C Issuer (in its sole discretion) with Borrowers or such Lender to eliminate L/C Issuer’s actual or potential Fronting Exposure (after giving effect to Section 11.22(a)(iv)) with respect to the Defaulting Lender arising from either the Letter of Credit then proposed to be issued or that Letter of Credit and all other L/C Obligations as to which L/C Issuer has actual or potential Fronting Exposure, as it may elect in its sole discretion; or

(F)the Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing thereunder.

(iv)L/C Issuer shall not amend any Letter of Credit if L/C Issuer would not be permitted at such time to issue the Letter of Credit in its amended form under the terms hereof.

(v)L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) L/C Issuer would have no obligation at such time to issue the Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of the Letter of Credit does not accept the proposed amendment to the Letter of Credit.

(vi)L/C Issuer shall act on behalf of Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and L/C Issuer shall have all of the benefits and immunities (A) provided to Administrative Agent in Article 10 with respect to any acts taken or omissions suffered by L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in Article 10 included L/C Issuer with respect to such acts or omissions, and (B) as additionally provided herein with respect to L/C Issuer.

(b)Procedures for Issuance and Amendment of Letters of Credit.

(i)Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Borrower Representative delivered to L/C Issuer (with a copy to Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officer of the Borrower Representative. Such Letter of Credit Application may be sent by facsimile, by United States mail, by overnight courier, by electronic transmission using the system provided by L/C Issuer, by personal delivery or by any other means acceptable to L/C Issuer. Such Letter of Credit Application must be received by L/C Issuer and Administrative Agent not later than 11:00 a.m. at least two (2) Business Days (or such later date and time as Administrative Agent and L/C Issuer may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be. In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; (G) the purpose and nature of the requested Letter of Credit; and (H) such other matters as L/C Issuer may require. In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to L/C Issuer (1) the Letter of Credit to be amended; (2) the proposed date of amendment thereof (which shall be a Business Day); (3) the nature of the proposed amendment; and (4) such other matters as L/C Issuer may require. Additionally, the Borrower Representative shall furnish to L/C Issuer and Administrative Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, including any Issuer Documents, as L/C Issuer or Administrative Agent may require.

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(ii)Promptly after receipt of any Letter of Credit Application, L/C Issuer will confirm with Administrative Agent (by telephone or in writing) that Administrative Agent has received a copy of such Letter of Credit Application from the Borrower Representative and, if not, L/C Issuer will provide Administrative Agent with a copy thereof. Unless L/C Issuer has received written notice from Administrative Agent or any Loan Party, at least one (1) Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Article 4 shall not then be satisfied, then, subject to the terms and conditions hereof, L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the applicable Borrower or enter into the applicable amendment, as the case may be, in each case in accordance with L/C Issuer’s usual and customary business practices. Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Letter of Credit.

(iii)Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, L/C Issuer will also deliver to the Borrower Representative and Administrative Agent a true and complete copy of such Letter of Credit or amendment.

(c)Drawings and Reimbursements; Funding of Participations.

(i)Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, L/C Issuer shall notify the Borrower Representative and Administrative Agent thereof. Not later than 11:00 a.m. on the date of any payment by L/C Issuer under a Letter of Credit (each such date, an “Honor Date”), Borrowers shall reimburse L/C Issuer through Administrative Agent in an amount equal to the amount of such drawing. If Borrowers fail to so reimburse L/C Issuer by such time, Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such Lender’s Applicable Percentage thereof. In such event, Borrowers shall be deemed to have requested a Revolving Credit Borrowing to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, subject to the amount of Availability and the conditions set forth in Section 4.2 (other than the delivery of a Borrowing Request). Any notice given by L/C Issuer or Administrative Agent pursuant to this Section 2.2(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

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(ii)Each Lender shall upon any notice pursuant to Section 2.2(c)(i) make funds available (and Administrative Agent may apply Cash Collateral provided for this purpose) for the account of L/C Issuer at Administrative Agent’s Principal Office in an amount equal to its Applicable Percentage of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by Administrative Agent, whereupon, subject to the provisions of Section 2.2(c)(iii), each Lender that so makes funds available shall be deemed to have made a Revolving Credit Loan (or, if the conditions set forth in Section 4.2 are not satisfied, an L/C Borrowing as further described in clause (iii) below) to Borrowers in such amount. Administrative Agent shall remit the funds so received to L/C Issuer.

(iii)With respect to any Unreimbursed Amount that is not fully refinanced by a Revolving Credit Borrowing because the conditions set forth in Section 4.2 cannot be satisfied or for any other reason, Borrowers shall be deemed to have incurred from L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the Default Interest Rate. In such event, each Lender’s payment to Administrative Agent for the account of L/C Issuer pursuant to Section 2.2(c)(ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 2.2.

(iv)Until each Lender funds its Revolving Credit Loan or L/C Advance pursuant to this Section 2.2(c) to reimburse L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Applicable Percentage of such amount shall be solely for the account of L/C Issuer.

(v)Each Lender’s obligation to make Revolving Credit Loans or L/C Advances to reimburse L/C Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.2(c), shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against L/C Issuer, Borrowers or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Revolving Credit Loans (but not its obligation to fund it pro rata share of L/C Advances) pursuant to this Section 2.2(c) is subject to the conditions set forth in Section 4.2 (other than delivery by the Borrower Representative of a Borrowing Request). No such making of an L/C Advance shall relieve or otherwise impair the obligation of Borrowers to reimburse L/C Issuer for the amount of any payment made by L/C Issuer under any Letter of Credit, together with interest as provided herein.

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(vi)If any Lender fails to make available to Administrative Agent for the account of L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.2(c) by the time specified in Section 2.2(c)(ii), then, without limiting the other provisions of this Agreement, L/C Issuer shall be entitled to recover from such Lender (acting through Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to L/C Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by L/C Issuer in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by L/C Issuer in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Revolving Credit Loan included in the relevant Revolving Credit Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case may be. A certificate of L/C Issuer submitted to any Lender (through Administrative Agent) with respect to any amounts owing under this clause (vi) shall be conclusive absent manifest error.

(d)Repayment of Participations.

(i)At any time after L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.2(c), if Administrative Agent receives for the account of L/C Issuer any payment in respect of the related Unreimbursed Amount or interest thereon (whether directly from Borrowers or otherwise, including proceeds of Cash Collateral applied thereto by Administrative Agent), Administrative Agent will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by Administrative Agent.

(ii)If any payment received by Administrative Agent for the account of L/C Issuer pursuant to Section 2.2(c)(i) is required to be returned under any of the circumstances described in Section 11.24 (including pursuant to any settlement entered into by L/C Issuer in its discretion), each Lender shall pay to Administrative Agent for the account of L/C Issuer its Applicable Percentage thereof on demand of Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

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(e)Obligations Absolute. The obligation of Borrowers to reimburse L/C Issuer for each drawing under each Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

(i)any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document;

(ii)the existence of any claim, counterclaim, setoff, defense or other right that any Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), L/C Issuer or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

(iii)any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

(iv)waiver by L/C Issuer of any requirement that exists for L/C Issuer’s protection and not the protection of a Borrower or any waiver by L/C Issuer which does not in fact materially prejudice such Borrower;

(v)honor of a demand for payment presented electronically even if such Letter of Credit requires that demand be in the form of a draft;

(vi)any payment made by L/C Issuer in respect of an otherwise complying item presented after the date specified as the expiration date of, or the date by which documents must be received under such Letter of Credit if presentation after such date is authorized by the UCC, PPSA or the ISP, as applicable;

(vii)any payment by L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

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(viii)any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, any Borrower or any Subsidiary.

The applicable Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with such Borrower’s instructions or other irregularity, such Borrower will immediately notify L/C Issuer. Each Borrower shall be conclusively deemed to have waived any such claim against L/C Issuer and its correspondents unless such notice is given as aforesaid.

(f)Role of L/C Issuer. Each Lender and each Borrower agree that, in paying any drawing under a Letter of Credit, L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. None of L/C Issuer, Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of Required Lenders; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document. Each Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude such Borrower’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. None of L/C Issuer, Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of L/C Issuer shall be liable or responsible for any of the matters described in clauses (i) through (viii) of Section 2.2(e); provided, however, that anything in such clauses to the contrary notwithstanding, each Borrower may have a claim against L/C Issuer, and L/C Issuer may be liable to such Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by such Borrower which such Borrower proves were directly caused by L/C Issuer’s willful misconduct or gross negligence or L/C Issuer’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of the foregoing, L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason. L/C Issuer may send a Letter of Credit or conduct any communication to or from the beneficiary via the Society for Worldwide Interbank Financial Telecommunication message or overnight courier, or any other commercially reasonable means of communicating with a beneficiary.

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(g)Applicability of ISP; Limitation of Liability. Unless otherwise expressly agreed by L/C Issuer and the applicable Borrower when a Letter of Credit is issued,  the rules of the ISP shall apply to each standby Letter of Credit. Notwithstanding the foregoing, L/C Issuer shall not be responsible to any Borrower for, and L/C Issuer’s rights and remedies against such Borrower shall not be impaired by, any action or inaction of L/C Issuer required or permitted under any Law, order, or practice that is required or permitted to be applied to any Letter of Credit or this Agreement, including the Law or any order of a jurisdiction where L/C Issuer or the beneficiary is located, the practice stated in the ISP, or in the decisions, opinions, practice statements, or official commentary of the ICC Banking Commission, the Bankers Association for Finance and Trade - International Financial Services Association (BAFT-IFSA), or the Institute of International Banking Law & Practice, whether or not any Letter of Credit or other Issuer Document chooses such Law or practice.

(h)Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer. Borrowers shall pay directly to L/C Issuer for its own account a fronting fee at the rate per annum separately agreed between applicable Borrower and L/C Issuer, computed on the daily amount available to be drawn under such Letter of Credit and payable on a quarterly basis in arrears. Such fronting fee shall be due and payable on the first day after the end of each March, June, September and December in respect of the most recently-ended quarterly period (or portion thereof, in the case of the first payment), commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.4. In addition, Borrowers shall pay directly to L/C Issuer for its own account the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of L/C Issuer relating to letters of credit as from time to time in effect. Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

(i)Conflict with Issuer Documents. In the event of any conflict between the terms hereof and the terms of any Issuer Document, the terms hereof shall control.

Section 2.3Swing Line Loans.

(a)The Swing Line. Subject to the terms and conditions set forth herein, Swing Line Lender, in reliance upon the agreements of the other Lenders set forth in this Section 2.3, may in its sole discretion make loans (each such loan, a “Swing Line Loan”) to any Borrower from time to time on any Business Day during the period from the Closing Date to the Maturity Date in an aggregate amount not to exceed at any time outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans, when aggregated with the Applicable Percentage of the Outstanding Amount of Revolving Credit Loans and L/C Obligations of the Lender acting as Swing Line Lender, may exceed the amount of such Lender’s Commitment; provided, however, that (i) immediately after giving effect to any Swing Line Loan, (A) the Revolving Credit Exposure of all Lenders shall not exceed the lesser of (x) the aggregate amount of the Commitments of the Lenders and (y) the Borrowing Base, in each case in effect at such time, and (B) except as provided above with respect to the Swing Line Lender, the Revolving Credit Exposure of any Lender shall not exceed such Lender’s Commitment, (ii) no Borrower shall use the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan, and (iii) Swing Line Lender shall not be under any obligation to make any Swing Line Loan if it shall determine (which determination shall be in its sole discretion) that it has, or by such Credit Extension may have, Fronting Exposure. Within the foregoing limits, and subject to the other terms and conditions hereof, each Borrower may borrow under this Section 2.3, prepay under Section 2.9(b), and reborrow under this Section 2.3. Each Swing Line Loan shall bear interest as a Base Rate Loan. Immediately upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Swing Line Loan.

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(b)Borrowing Procedures. Each Swing Line Borrowing shall be made upon the Borrower Representative’s irrevocable notice to Swing Line Lender and Administrative Agent, which may be given by telephone. Each such notice must be received by Swing Line Lender and Administrative Agent not later than 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum of $100,000, and (ii) the requested borrowing date, which shall be a Business Day. Each such telephonic notice must be confirmed promptly by delivery to Swing Line Lender and Administrative Agent of a written Swing Line Loan Request, appropriately completed and signed by a Responsible Officer of the Borrower Representative. Any telephonic request for a Swing Line Loan by the Borrower Representative shall be promptly confirmed by submission of a properly completed Swing Line Loan Request, signed by a Responsible Officer of the Borrower Representative, to Swing Line Lender and Administrative Agent, but failure to deliver a Swing Line Loan Request shall not be a defense to payment of any Swing Line Borrowing. Neither Swing Line Lender nor Administrative Agent shall have any liability to any Borrower for any loss or damage suffered by such Borrower as a result of Swing Line Lender’s or Administrative Agent’s honoring of any requests, execution of any instructions, authorizations or agreements or reliance on any reports communicated to it telephonically, by facsimile or electronically and purporting to have been sent to Swing Line Lender or Administrative Agent by such Borrower and neither Swing Line Lender nor Administrative Agent shall have any duty to verify the origin of any such communication or the identity or authority of the Person sending it. Promptly after receipt by Swing Line Lender of any telephonic Swing Line Loan Request, Swing Line Lender will confirm with Administrative Agent (by telephone or in writing) that Administrative Agent has also received such Swing Line Loan Request and, if not, Swing Line Lender will notify Administrative Agent (by telephone or in writing) of the contents thereof. Unless Swing Line Lender has received notice (by telephone or in writing) from Administrative Agent prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing Swing Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the first proviso to the first sentence of Section 2.3(a), or (B) that one or more of the applicable conditions specified in Article 4 is not then satisfied, then, subject to the terms and conditions hereof, Swing Line Lender may, not later than 3:00 p.m. on the borrowing date specified in such Swing Line Loan Request, make the amount of its Swing Line Loan available to the applicable Borrower at its office by crediting the account of such Borrower on the books of Swing Line Lender in immediately available funds.

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(c)Refinancing of Swing Line Loans.

(i)Swing Line Lender at any time in its sole discretion may request, on behalf of Borrowers (which hereby irrevocably authorize Swing Line Lender to so request on its behalf), that each Lender make a Revolving Credit Loan in an amount equal to such Lender’s Applicable Percentage of the amount of Swing Line Loans then outstanding. Such request shall be made in writing (which written request shall be deemed to be a Borrowing Request for purposes hereof) and in accordance with the requirements of Section 2.1, subject to Availability and the conditions set forth in Section 4.2. Swing Line Lender shall furnish the Borrower Representative with a copy of the applicable Borrowing Request promptly after delivering such notice to Administrative Agent. Each Lender shall make an amount equal to its Applicable Percentage of the amount specified in such Borrowing Request available to Administrative Agent in immediately available funds (and Administrative Agent may apply Cash Collateral available with respect to the applicable Swing Line Loan) for the account of Swing Line Lender at Administrative Agent’s Principal Office not later than 1:00 p.m. on the day specified in such Borrowing Request, whereupon, subject to Section 2.3(c)(ii), each Lender that so makes funds available shall be deemed to have made a Revolving Credit Loan to Borrowers in such amount. Administrative Agent shall remit the funds so received to Swing Line Lender.

(ii)If for any reason any Swing Line Loan cannot be refinanced by such a Revolving Credit Borrowing in accordance with Section 2.3(c)(i), the request for Revolving Credit Loans submitted by Swing Line Lender as set forth herein shall be deemed to be a request by Swing Line Lender that each Lender fund its risk participation in the relevant Swing Line Loan and each Lender’s payment to Administrative Agent for the account of Swing Line Lender pursuant to Section 2.3(c)(i) shall be deemed payment in respect of such participation.

(iii)If any Lender fails to make available to Administrative Agent for the account of Swing Line Lender any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.3(c) by the time specified in Section 2.3(c)(i), Swing Line Lender shall be entitled to recover from such Lender (acting through Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to Swing Line Lender at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by Swing Line Lender in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by Swing Line Lender in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Revolving Credit Loan included in the relevant Revolving Credit Borrowing or funded participation in the relevant Swing Line Loan, as the case may be. A certificate of Swing Line Lender submitted to any Lender (through Administrative Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error.

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(iv)Each Lender’s obligation to make Revolving Credit Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this Section 2.3(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against Swing Line Lender, Borrowers or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Revolving Credit Loans pursuant to this Section 2.3(c) is subject to Availability and the conditions set forth in Section 4.2. No such funding of risk participations shall relieve or otherwise impair the obligation of Borrowers to repay Swing Line Loans, together with interest as provided herein.

(d)Repayment of Participations.

(i)At any time after any Lender has purchased and funded a risk participation in a Swing Line Loan, if Swing Line Lender receives any payment on account of such Swing Line Loan, Swing Line Lender will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by Swing Line Lender.

(ii)If any payment received by Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by Swing Line Lender under any of the circumstances described in Section 11.24 (including pursuant to any settlement entered into by Swing Line Lender in its discretion), each Lender shall pay to Swing Line Lender its Applicable Percentage thereof on demand of Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned, at a rate per annum equal to the Federal Funds Rate. Administrative Agent will make such demand upon the request of Swing Line Lender. The obligations of Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

(e)Interest for Account of Swing Line Lender. Swing Line Lender shall be responsible for invoicing Borrowers for interest on the Swing Line Loans. Until each Lender funds its Revolving Credit Loan or risk participation pursuant to this Section 2.3 to refinance such Lender’s Applicable Percentage of any Swing Line Loan, interest in respect of such Applicable Percentage shall be solely for the account of Swing Line Lender.

(f)Payments to Swing Line Lender or Lenders. Borrowers shall make all payments of principal and interest in respect of the Swing Line Loans to Administrative Agent for the account of Swing Line Lender or Lenders, as applicable.

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Section 2.4Fees.

(a)Fees. Borrowers agree to pay to Administrative Agent and Arranger, for the account of Administrative Agent, Arranger and each Lender, as applicable, fees, in the amounts and on the dates set forth in any Fee Letter.

(b)Letter of Credit Fees. Borrowers shall pay to Administrative Agent for the account of each Lender in accordance, subject to Section 11.22, with its Applicable Percentage a Letter of Credit fee (the “Letter of Credit Fee”) equal to the Applicable Margin for Eurodollar Rate Loans times the daily amount available to be drawn under such Letter of Credit. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.4. Letter of Credit Fees shall be (i) due and payable in arrears on the first day after the end of each March, June, September and December, commencing with the first such date to occur after the issuance or renewal of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand and (ii) computed on a quarterly basis in arrears. If there is any change in the Applicable Margin for Eurodollar Rate Loans during any quarter, the daily amount available to be drawn under each standby Letter of Credit shall be computed and multiplied by the Applicable Margin for Eurodollar Rate Loan separately for each period during such quarter that such Applicable Margin for Eurodollar Rate Loans was in effect. Notwithstanding anything to the contrary contained herein while any Event of Default exists, all Letter of Credit Fees shall accrue at the Default Interest Rate.

(c)Commitment Fees. Borrowers agree to pay to Administrative Agent for the account of each Lender in accordance, subject to Section 11.22, with its Applicable Percentage a commitment fee on the daily average unused amount of the Commitment of such Lender for the period from and including the date of this Agreement to and including the Maturity Date (including at any time during which one or more of the conditions in Article 4 is not met), at a rate equal to the applicable Commitment Fee Rate. For the purpose of calculating the commitment fee hereunder, the Commitment of each Lender shall be deemed utilized by the amount of all outstanding Revolving Credit Loans and L/C Obligations, but excluding the amount of any outstanding Swing Line Loans, owing to such Lender whether directly or by participation. Accrued commitment fees shall be payable monthly in arrears on the first day of each and every calendar month during the terms of this Agreement and on the Maturity Date.

Section 2.5Payments Generally; Administrative Agent’s Clawback.

(a)General. All payments of principal, interest, and other amounts to be made by any Borrower under this Agreement and the other Loan Documents shall be made to Administrative Agent for the account of Administrative Agent, L/C Issuer, or Swing Line Lender or the pro rata accounts of the applicable Lenders, as applicable, at the Principal Office in Dollars and immediately available funds, without setoff, deduction, or counterclaim, and free and clear of all taxes at the time and in the manner provided herein. Payments by check or draft shall not constitute payment in immediately available funds until the required amount is actually received by Administrative Agent in full. Payments in immediately available funds received by Administrative Agent in the place designated for payment on a Business Day prior to 11:00 a.m. at such place of payment shall be credited prior to the close of business on the Business Day received, while payments received by Administrative Agent on a day other than a Business Day or after 11:00 a.m. on a Business Day shall not be credited until the next succeeding Business Day. If any payment of principal or interest on the Notes shall become due and payable on a day other than a Business Day, then such payment shall be made on the next succeeding Business Day. Any such extension of time for payment shall be included in computing interest which has accrued and shall be payable in connection with such payment. Administrative Agent is hereby authorized upon notice to the Borrower Representative to charge the account of Borrowers maintained with Administrative Agent for each payment of principal, interest and fees as it becomes due hereunder.

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(b)Funding by Lenders; Presumption by Administrative Agent. Unless Administrative Agent shall have received notice from a Lender that such Lender will not make available to Administrative Agent such Lender’s share of a Borrowing, Administrative Agent may assume that such Lender has made such share available on such date in accordance with this Agreement and may, in reliance upon such assumption, make available to Borrowers a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to Administrative Agent, then the applicable Lender and Borrowers severally agree to pay to Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to Borrowers to but excluding the date of payment to Administrative Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation, and (ii) in the case of a payment to be made by Borrowers, the interest rate applicable to the applicable Borrowing. If Borrowers and such Lender shall pay such interest to Administrative Agent for the same or an overlapping period, Administrative Agent shall promptly remit to Borrowers the amount of such interest paid by Borrowers for such period. If such Lender pays its share of the applicable Borrowing to Administrative Agent, then the amount so paid shall constitute such Lender’s Loan. Any payment by Borrowers shall be without prejudice to any claim Borrowers may have against a Lender that shall have failed to make such payment to Administrative Agent.

(c)Payments by Borrowers; Presumption by Administrative Agent. Unless Administrative Agent shall have received notice from the Borrower Representative prior to the date on which any payment is due to Administrative Agent for the account of L/C Issuer, Swing Line Lender or the applicable Lenders hereunder that Borrowers will not make such payment, Administrative Agent may assume that Borrowers have made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to L/C Issuer, Swing Line Lender or the applicable Lenders the amount due. In such event, if Borrowers have not in fact made such payment, then each of L/C Issuer, Swing Line Lender and the applicable Lenders, as applicable, severally agrees to repay to Administrative Agent forthwith on demand the amount so distributed to L/C Issuer, Swing Line Lender, or such Lender, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation.

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(d)Cash Dominion. During any Trigger Period, all funds credited to the Blocked Accounts shall be promptly applied by Administrative Agent to the Obligations whether or not such Obligations shall have, by its terms, matured, such application to be made to principal or interest or expenses as Administrative Agent may elect; provided, however, Administrative Agent need not apply or give credit for any item included in such sums until one Business Day after the final collection thereof; provided, further, however, that Administrative Agent’s failure to so apply any such sums shall not be a waiver of Administrative Agent’s right to so apply such sums or any other sums at any time during a Trigger Period. Notwithstanding anything herein to the contrary, to the extent any funds credited to the Blocked Accounts constitute Net Cash Proceeds (i) from any Disposition not otherwise permitted by Section 7.8 or (ii) from the incurrence of any Debt not permitted by Section 7.1, the application of such Net Cash Proceeds shall be subject to Section 2.9(c).

Section 2.6Evidence of Debt.

(a)The Loans made by Swing Line Lender and each Lender shall be evidenced by one or more accounts or records maintained by Swing Line Lender or such Lender and by Administrative Agent in the ordinary course of business; provided that such Lender or Administrative Agent may, in addition, request that such Loans be evidenced by the Notes. The Credit Extensions made by L/C Issuer shall be evidenced by one or more accounts or records maintained by L/C Issuer and by Administrative Agent in the ordinary course of business. The accounts or records maintained by Administrative Agent, Swing Line Lender, L/C Issuer, and each Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made to any Borrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of any Borrower hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and records maintained by L/C Issuer, Swing Line Lender, or any Lender and the accounts and records of Administrative Agent in respect of such matters, the accounts and records of Administrative Agent shall control in the absence of manifest error.

(b)In addition to the accounts and records referred to in subsection (a) above, each Lender and Administrative Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans. In the event of any conflict between the accounts and records maintained by Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of Administrative Agent shall control in the absence of manifest error.

Section 2.7Cash Collateral.

(a)Certain Credit Support Events. If (i) L/C Issuer has honored any full or partial drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing, (ii) as of the Letter of Credit Expiration Date, any L/C Obligation for any reason remains outstanding, (iii) any Borrower shall be required to provide Cash Collateral pursuant to Section 9.2, or (iv) if there is more than one Lender at such time of determination, there shall exist a Lender that is a Defaulting Lender, Borrowers shall immediately (in the case of clause (iii) above) or within one (1) Business Day (in all other cases) following any request by Administrative Agent or L/C Issuer, provide Cash Collateral in an amount not less than the applicable Minimum Collateral Amount (determined in the case of Cash Collateral provided pursuant to clause (iv) above, after giving effect to Sections 11.22(a)(iv) and 11.22(a)(v) and any Cash Collateral provided by the Defaulting Lender).

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(b)Grant of Security Interest. Each Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants to (and subjects to the control of) Administrative Agent, for the benefit of Administrative Agent, L/C Issuer and Lenders, and agrees to maintain, a first priority security interest in all such Cash Collateral, and all other Property so provided as Collateral pursuant hereto, and in all proceeds of the foregoing, all as security for the obligations to which such Cash Collateral may be applied pursuant to Section 2.7(c). If at any time Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than Administrative Agent or L/C Issuer as herein provided, or that the total amount of such Cash Collateral is less than the Minimum Collateral Amount, Borrowers will, promptly upon demand by Administrative Agent, pay or provide to Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency. All Cash Collateral (other than credit support not constituting funds subject to deposit) shall be maintained in one or more blocked, non-interest bearing deposit accounts at Texas Capital Bank. Borrowers shall pay on demand therefor from time to time all customary account opening, activity and other administrative fees and charges in connection with the maintenance and disbursement of Cash Collateral.

(c)Application. Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under any of this Section 2.7 or Sections 2.2, 9.2 or 11.22 in respect of Letters of Credit shall be held and applied to the satisfaction of the specific L/C Obligations, obligations to fund participations therein (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) and other obligations for which the Cash Collateral was so provided, prior to any other application of such Property as may otherwise be provided for herein.

(d)Release. Cash Collateral (or the appropriate portion thereof) provided to reduce Fronting Exposure or to secure other obligations shall be released promptly following (i) the elimination of the applicable Fronting Exposure or other obligations giving rise thereto, including by the termination of Defaulting Lender status of the applicable Lender (or, as appropriate, its assignee following compliance with Section 11.8(b)(vii)) or (ii) the determination by Administrative Agent and L/C Issuer that there exists excess Cash Collateral; provided, however, (x) any such release shall be without prejudice to, and any disbursement or other transfer of Cash Collateral shall be and remain subject to, any other Lien conferred under the Loan Documents and the other applicable provisions of the Loan Documents, and (y) the Person providing Cash Collateral and L/C Issuer may agree that Cash Collateral shall not be released but instead held to support future anticipated Fronting Exposure or other obligations.

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Section 2.8Interest; Payment Terms.

(a)Revolving Credit Loans – Payment of Principal and Interest; Revolving Nature. The unpaid principal amount of each Borrowing of the Revolving Credit Loans shall, subject to the following sentence and Section 2.8(e), bear interest at the applicable Interest Rate. If at any time such rate of interest would exceed the Maximum Rate but for the provisions thereof limiting interest to the Maximum Rate, then any subsequent reduction shall not reduce the rate of interest on the Revolving Credit Loans below the Maximum Rate until the aggregate amount of interest accrued on the Revolving Credit Loans equals the aggregate amount of interest which would have accrued on the Revolving Credit Loans if the interest rate had not been limited by the Maximum Rate. All accrued but unpaid interest on the principal balance of the Revolving Credit Loans shall be payable on each Payment Date and on the Maturity Date, provided that interest accruing at the Default Interest Rate pursuant to Section 2.8(e) shall be payable on demand. The then Outstanding Amount of the Revolving Credit Loans and all accrued but unpaid interest thereon shall be due and payable on the Maturity Date. The unpaid principal balance of the Revolving Credit Loans at any time shall be the total amount advanced hereunder by Lenders less the amount of principal payments made thereon by or for Borrowers, which balance may be endorsed on the Notes from time to time by Lenders or Swing Line Lender, as applicable, or otherwise noted in Lenders’, Swing Line Lender’s and/or Administrative Agent’s records, which notations shall be, absent manifest error, conclusive evidence of the amounts owing hereunder from time to time.

(b)Computation Period. Interest on the Loans and all other amounts payable by Borrowers hereunder on a per annum basis shall be computed on the basis of a 360-day year and the actual number of days elapsed (including the first day but excluding the last day) unless such calculation would result in a usurious rate or to the extent such Loan bears interest based upon the Base Rate, in which case interest shall be calculated on the basis of a 365-day year or 366-day year, as the case may be. In computing the number of days during which interest accrues, the day on which funds are initially advanced shall be included regardless of the time of day such advance is made, and the day on which funds are repaid shall be included unless repayment is credited prior to the close of business on the Business Day received. Each determination by Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error.

(c)Unconditional Payment. Each Borrower is and shall be obligated to pay all principal, interest and any and all other amounts which become payable under any of the Loan Documents absolutely and unconditionally and without any abatement, postponement, diminution or deduction whatsoever and without any reduction for counterclaim or setoff whatsoever. If at any time any payment received by Administrative Agent hereunder shall be deemed by a court of competent jurisdiction to have been a voidable preference or fraudulent conveyance under any Debtor Relief Law, then the obligation to make such payment shall survive any cancellation or satisfaction of the Obligations under the Loan Documents and shall not be discharged or satisfied with any prior payment thereof or cancellation of such Obligations, but shall remain a valid and binding obligation enforceable in accordance with the terms and provisions hereof, and such payment shall be immediately due and payable upon demand.

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(d)Partial or Incomplete Payments. Subject to Section 9.3, if at any time insufficient funds are received by and available to Administrative Agent to pay fully all amounts of principal, L/C Borrowings, interest, fees and other amounts then due hereunder, such funds shall be applied (i) first, to pay interest, fees and other amounts then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest, fees and other amounts then due to such parties, and (ii) second, to pay principal and L/C Borrowings then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal or L/C Borrowings, as applicable, then due to such parties. Remittances in payment of any part of the Obligations under the Loan Documents other than in the required amount in immediately available funds at the place where such Obligations are payable shall not, regardless of any receipt or credit issued therefor, constitute payment until the required amount is actually received by Administrative Agent in full in accordance herewith and shall be made and accepted subject to the condition that any check or draft may be handled for collection in accordance with the practice of the collecting bank or banks. Acceptance by Administrative Agent of any payment in an amount less than the full amount then due shall be deemed an acceptance on account only, and the failure to pay the entire amount then due shall be and continue to be an Event of Default.

(e)Default Interest Rate. For so long as any Event of Default exists, regardless of whether or not there has been an acceleration of the Loans, and at all times after the maturity of the Loans (whether by acceleration or otherwise), and in addition to all other rights and remedies of Administrative Agent or Lenders hereunder, (i) interest shall accrue on the Outstanding Amount of the Loans at the Default Interest Rate, (ii) interest shall accrue on any past due amount (other than the Outstanding Amount of the Loans) at the Default Interest Rate and (iii) upon the request of the Required Lenders, interest shall accrue on the principal amount of all other outstanding Obligations at the Default Interest Rate, and such accrued interest shall be immediately due and payable. Each Borrower acknowledges that it would be extremely difficult or impracticable to determine Administrative Agent’s or Lenders’ actual damages resulting from any late payment or Event of Default, and such accrued interest are reasonable estimates of those damages and do not constitute a penalty.

(f)Interest Act (Canada). For the purposes of the Interest Act (Canada) and disclosure thereunder, whenever any interest or any fee to be paid under any Loan Document is to be calculated on the basis of a 360-day year, 365-day year or 366-day year, the yearly rate of interest to which the rate used in such calculation is equivalent is the rate so used multiplied by the actual number of days in the calendar year in which the same is to be ascertained and divided by 360, 365 or 366, as applicable. The rates of interest under this Agreement are nominal rates, and not effective rates or yields. The principle of deemed reinvestment of interest does not apply to any interest calculation under this Agreement. Each Borrower acknowledges and confirms that this Section 2.8(f) satisfies the requirements of Section 4 of the Interest Act (Canada) to the extent it applies to the expression or statement of any interest payable under any Loan Document and that it is able to calculate the yearly rate or percentage of interest payable under any Loan Document based upon the methodology set out in this Section 2.8(f). Any provision of this Agreement that would oblige Canadian Borrower to pay any fine, penalty or rate of interest on any arrears of principal or interest secured by a mortgage on real property or hypothec on immovables that has the effect of increasing the charge on arrears beyond the rate of interest payable on principal money not in arrears shall not apply to Canadian Borrower, which shall be required to pay interest on money in arrears at the same rate of interest payable on principal money not in arrears.

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Section 2.9Voluntary Termination or Reduction of Commitments; Prepayments.

(a)Voluntary Termination or Reduction of Commitments. The Borrower Representative may, upon written notice to Administrative Agent, terminate the Commitments, or from time to time permanently reduce the Commitments; provided that (i) any such notice shall be received by Administrative Agent not later than 11:00 a.m. three (3) Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of $2,500,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the Borrower Representative shall not terminate or reduce the Commitments if, (A) immediately after giving effect thereto and to any concurrent prepayments hereunder, the Revolving Credit Exposure of all Lenders would exceed the lesser of (x) the aggregate amount of the Commitments of the Lenders and (y) the Borrowing Base, in each case in effect at such time or (B) the aggregate amount of the Commitments of the Lenders would be less than $10,000,000 (unless with respect to this clause (B), the aggregate Commitments are reduced to $0) and (iv) if, immediately after giving effect to any reduction of the Commitments, the Letter of Credit Sublimit or Swing Line Sublimit exceeds the amount of the Revolving Credit Facility, such sublimit shall be automatically reduced by the amount of such excess. Administrative Agent will promptly notify Lenders of any such notice of termination or reduction of the Commitments. Any reduction of the Commitments shall be applied to the Commitment of each Lender according to its Applicable Percentage. All fees accrued until the effective date of any termination of the Commitments shall be paid on the effective date of such termination.

(b)Voluntary Prepayments. Subject to the conditions set forth below, Borrowers shall have the right, at any time and from time to time upon at least three (3) Business Days’ prior written notice to Administrative Agent, to prepay the principal of the Revolving Credit Loans or the Swing Line Loans in full or in part. If there is a prepayment of all or any portion of the principal of the Revolving Credit Loans or the Swing Line Loans on or before the Maturity Date, whether voluntary or because of acceleration or otherwise, such prepayment shall also include any and all accrued but unpaid interest on the amount of principal being so prepaid through and including the date of prepayment, plus any other sums which have become due to Lenders under the other Loan Documents on or before the date of prepayment, but which have not been fully paid.

(c)Mandatory Prepayment of Revolving Credit Facility. Borrowers shall make a prepayment of the Revolving Credit Loans or the Swing Line Loans upon the occurrence of any of the following:

(i)If at any time the Revolving Credit Exposure of the Lenders exceeds the lesser of (A) the aggregate amount of the Commitments of the Lenders and (B) the Borrowing Base, in each case in effect at such time, then Borrowers shall immediately prepay the entire amount of such excess to Administrative Agent, for the ratable account of Lenders, and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such excess; provided, however, that no Borrower shall be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.9(c) unless after the prepayment in full of the Revolving Credit Loans and Swing Line Loans the Revolving Credit Exposure of the Lenders exceeds the lesser of (x) the aggregate amount of the Commitments of the Lenders and (y) the Borrowing Base, in each case in effect at such time.

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(ii)Concurrently with the receipt by any Loan Party of any Net Cash Proceeds from a Disposition not permitted by Section 7.8, the Borrowers shall prepay the Loans in an amount equal to 100% of such Net Cash Proceeds.

(iii)Concurrently with the receipt by any Loan Party of any Net Cash Proceeds from the incurrence of any Debt not permitted by Section 7.1, the Borrowers shall prepay the Loans in an amount equal to 100% of such Net Cash Proceeds.

(iv)Upon the receipt by any Loan Party of any cash proceeds of a Specified EBITDA Equity Contribution pursuant to Section 9.3, Borrowers shall prepay an aggregate principal amount of Loans equal to all Net Cash Proceeds received therefrom immediately upon receipt thereof by any such Loan Party or such Subsidiary.

(v)Upon the receipt by FGS of any cash proceeds in connection with a Qualified IPO which are to be contributed to the Company, Borrowers shall prepay an aggregate principal amount of Loans equal to at least $5,000,000 (or such lesser amount necessary for the Revolving Credit Exposure to equal $0) received therefrom.

Each prepayment required by this Section 2.9(c) shall be applied, first, to any Base Rate Borrowings then outstanding, and, second, to any Eurodollar Rate Borrowings then outstanding, and if more than one Eurodollar Rate Borrowing is then outstanding, to such Eurodollar Rate Borrowings in such order as the Borrower Representative may direct, or if the Borrower Representative fails to so direct, as Administrative Agent shall elect.

Section 2.10Uncommitted Increase in Commitments.

(a)Request for Increase. Provided that no Default or Event of Default shall have occurred and be continuing, upon written notice to Administrative Agent (which shall promptly notify the Lenders), Borrowers may from time to time, request an increase in the aggregate Commitments by an amount not to exceed $15,000,000 (with the aggregate Commitments not to exceed $45,000,000 after giving effect to all such increases implemented pursuant to this Section 2.10); provided that (i) any such request for an increase shall be in a minimum amount of $5,000,000, and (ii) Borrowers may make a maximum of three such requests. To achieve the full amount of a requested increase, and subject to the approval of Administrative Agent and L/C Issuer, Borrowers may (A) request that one or more Lenders increase their Commitment, (B) invite all Lenders to increase their respective Commitment, and/or (C) invite additional Eligible Assignees to become Lenders pursuant to a joinder agreement in form and substance satisfactory to Administrative Agent and its counsel. Nothing contained in this Section 2.10 shall constitute, or otherwise be deemed to be, a commitment on the party of any Lender to increase its Commitment hereunder at any time.

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(b)Notification by Administrative Agent; Additional Lenders. In the event the Borrowers invite all Lenders to increase their respective Commitment, then at the time of sending such notice, Borrowers (in consultation with Administrative Agent) shall specify the time period within which each Lender is requested to respond (which shall in no event be less than ten (10) Business Days from the date of delivery of such notice to the Lenders). Each Lender shall notify Administrative Agent within such time period whether or not it agrees to increase its Commitment and, if so, whether by an amount equal to, greater than, or less than its Applicable Percentage of such requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment. Administrative Agent shall notify Borrowers and each Lender of the Lenders’ responses to each request made hereunder.

(c)Effective Date and Allocations. If the Commitments are increased in accordance with this Section 2.10, Administrative Agent and Borrowers shall determine the effective date (the “Increase Effective Date”) and the final allocation of such increase. Administrative Agent shall promptly notify Borrowers and the Lenders of the final allocation of such increase and the Increase Effective Date.

(d)Conditions to Effectiveness of Increase. As a condition precedent to such increase, Borrowers shall deliver to Administrative Agent a certificate of each Loan Party dated as of the Increase Effective Date (in sufficient copies for each Lender) signed by a Responsible Officer of such Loan Party, in each case in form and substance satisfactory to Administrative Agent, (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such increase, and (ii) in the case of Borrowers, certifying that, before and after giving effect to such increase, (A) the representations and warranties contained in Article 5 and the other Loan Documents are true and correct in all material respects (other than such representation or warranty expressly qualified by materiality or by reference to Material Adverse Effect) on and as of the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (other than such representation or warranty expressly qualified by materiality or by reference to Material Adverse Effect) as of such earlier date, (B) no Default exists and (C) Borrowers are in pro forma compliance with the financial covenants contained in Sections 8.1 and 8.2.

(e)Pro Rata Treatment; Etc. On the Increase Effective Date, (i) any Lender increasing (or, in the case of any newly added Lender, extending) its Commitment shall make available to Administrative Agent such amounts in immediately available funds as Administrative Agent shall determine, for the benefit of the other Lenders, as being required in order to cause, after giving effect to such increase or addition and the use of such amounts to make payments to such other Lenders, each Lender’s portion of the outstanding Revolving Credit Loans of all the Lenders to equal its revised Applicable Percentage of such outstanding Revolving Credit Loans, and Administrative Agent shall make such other adjustments among the Lenders with respect to the Revolving Credit Loans then outstanding and amounts of principal, interest, commitment fees and other amounts paid or payable with respect thereto as shall be necessary, in the opinion of Administrative Agent, in order to effect such reallocation and (ii)  Borrowers shall be deemed to have repaid and reborrowed all outstanding Revolving Credit Loans as of the date of any increase (or addition) in the Commitments (with such reborrowing to consist of the Types of Revolving Credit Loans, with related Interest Periods if applicable, specified in a notice delivered by the Borrower Representative, in accordance with the requirements of Section 2.1(b)). The deemed payments made pursuant to clause (ii) of the immediately preceding sentence shall be accompanied by payment of all accrued interest on the amount prepaid and, in respect of each Eurodollar Rate Loan, shall be subject to the provisions of Section 3.5 if the deemed payment occurs other than on the last day of the related Interest Periods. Within a reasonable time after the effective date of any increase or addition, Administrative Agent shall, and is hereby authorized and directed to, revise Schedule 2.1 to reflect such increase or addition and shall distribute such revised Schedule 2.1 to each of the Lenders and the Borrowers, whereupon such revised Schedule 2.1 shall replace the old Schedule 2.1 and become part of this Agreement.

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(f)Conflicting Provisions. This Section shall supersede any provisions in Sections 11.10 or 11.23 to the contrary.

Section 2.11Cash Collateral Blocked Accounts. Subject to Section 6.12, each Borrower shall establish with Administrative Agent or any banks acceptable to Administrative Agent, certain lockboxes and blocked accounts (collectively “Blocked Accounts”), for the benefit of Administrative Agent, for the deposit of all receipts and collections in accordance with Section 2.12 hereof, pursuant to executed Deposit Account Control Agreements in form and substance satisfactory to Administrative Agent, in its reasonable discretion. At all times during a Trigger Period, each Borrower shall cause all receipts and collections of any accounts receivable to be deposited in such Blocked Accounts to be pledged to Administrative Agent, for the benefit of the Secured Parties, and, pursuant to Section 2.5(d), forwarded on a daily basis to an account held by Administrative Agent. During a Trigger Period, proceeds received from such Blocked Accounts shall be applied against any Obligations owing by any Borrower to the Lenders and shall be applied in accordance with Section 2.5(d) hereof. Only Administrative Agent shall have the right to direct withdrawals from such Blocked Accounts. Except as otherwise agreed to by Administrative Agent, each bank at which any such Blocked Account is maintained shall waive any right of offset such bank may otherwise have in such Blocked Account and the items deposited therein. Borrowers shall pay all fees and charges as may be required by any depository in which such Blocked Accounts are opened. Subject to Section 6.12, each Borrower shall, contemporaneously with the execution of this Agreement, provide Administrative Agent with the duly executed Deposit Account Control Agreements related to such Blocked Accounts. Subject to Section 6.12, each Borrower covenants and agrees to notify all of its customers and account debtors in writing on or before the date set forth in Section 6.12 directing such customers and account debtors to forward all current and future remittances and/or payments owed to such Borrower to the Blocked Accounts. The Blocked Accounts as of the Closing Date are set forth in Schedule 2.11.

Section 2.12Collection of Accounts.

(a)All receipts of cash, cash equivalents, checks, credit card receipts, drafts, instruments, and other items of payment arising out of the sale of inventory or other Property of the Loan Parties or the creation of accounts receivable, including without limitation, insurance proceeds and tax refunds (referred to as “Receipts”), and all Property of the Loan Parties in which Administrative Agent has a security interest or Lien, shall be deposited daily into one or more of the Blocked Accounts, and shall be held in trust by such Loan Party for Administrative Agent until so deposited.

(b)In the event, notwithstanding the provisions of this Section, any Loan Party receives or otherwise has dominion and control of any Receipts, or any proceeds or collections of any Property of the Loan Parties in which Administrative Agent has a security interest or Lien, such Receipts, proceeds, and collections shall be held in trust by such Loan Party for Administrative Agent and shall not be commingled with any of such Loan Party’s other funds or deposited in any account of such Loan Party other than a Blocked Account.

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Section 2.13Appointment of Borrower Representative.

(a)Each Borrower hereby irrevocably appoints and constitutes Flex Leasing Power & Service LLC, a Delaware limited liability company (in such capacity, the “Borrower Representative”), as its agent to request and receive the proceeds of any Loan, Letter of Credit or any other extension of credit hereunder (and to otherwise act on behalf of such Borrower pursuant to this Agreement and the other Loan Documents) from the Lenders in the name or on behalf of each such Borrower. The Lenders may disburse such proceeds only to a bank account of a Borrower without notice to any other Borrower or any other Loan Party.

(b)Each Loan Party hereby irrevocably appoints and constitutes the Borrower Representative as its agent to (i) receive statements of account and all other notices from Administrative Agent with respect to the Obligations or otherwise under or in connection with this Agreement and the other Loan Documents; (ii) execute and deliver Borrowing Base Reports and all other notices, certificates and documents to be executed and/or delivered by any Loan Party under this Agreement or the other Loan Documents; and (iii) otherwise act on behalf of such Loan Party pursuant to this Agreement and the other Loan Documents.

(c)The authorizations contained in this Section 2.13 are coupled with an interest and shall be irrevocable, and the Lenders may rely on any notice, request, information supplied by the Borrower Representative, every document executed by the Borrower Representative, every agreement made by the Borrower Representative or other action taken by the Borrower Representative in respect of any Borrower or other Loan Party as if the same were supplied, made or taken by such Borrower or such Loan Party. Without limiting the generality of the foregoing, the failure of one or more Borrowers or other Loan Parties to join in the execution of any writing in connection herewith shall not relieve any Borrower or other Loan Party from obligations in respect of such writing.

(d) No purported termination of the appointment of the Borrower Representative as agent shall be effective without the prior written consent of Administrative Agent.

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(e)Any notice given by or to the Borrower Representative hereunder shall constitute and be deemed to be notice given by or to all Borrowers, jointly and severally. Notice given by Administrative Agent to the Borrower Representative hereunder or pursuant to any other Loan Documents in accordance with the terms hereof or thereof shall constitute notice to all Borrowers. The knowledge of any Borrower shall be imputed to all Borrowers and any consent by the Borrower Representative or any Borrower shall constitute the consent of and shall bind all Borrowers.

(f)The Borrower Representative hereby accepts the appointment by each Loan Party to act as the agent of the Loan Parties pursuant to this Section 2.13. The Borrower Representative shall ensure that the disbursement of any Loans, the issuance of any Letters of Credit or other extension of credit hereunder to each Borrower requested by or paid to or for the account of such Borrower shall be paid to or for the account of such Borrower.

Section 2.14Joint and Several Liability. The Borrowers shall be jointly and severally liable for all Obligations due to the Secured Parties under this Agreement, regardless of which Borrower actually receives any Loans, Letters of Credit or other extensions of credit hereunder or the amount of such Loans or Letters of Credit received or the manner in which Administrative Agent accounts for such Loans, Letters of Credit or other extensions of credit on its books and records. The Obligations with respect to the Loans and Letters of Credit or other extensions of credit made to a Borrower, and the Obligations arising as a result of the joint and several liability of a Borrower hereunder, shall be primary obligations of all the Borrowers. The Obligations arising as a result of the joint and several liability of a Borrower hereunder with respect to the Loans, Letters of Credit or other extensions of credit made to the other Borrowers hereunder shall, to the fullest extent permitted by law, be unconditional irrespective of (a) the validity or enforceability, avoidance or subordination of the Obligations of the other Borrowers or of any promissory note or other document evidencing all or any part of the Obligations of the other Borrowers, (b) the absence of any attempt to collect the Obligations from the other Borrowers, any other Loan Party or any other security therefor, or the absence of any other action to enforce the same, (c) the failure by Administrative Agent to take any steps to perfect and maintain its security interest in, or to preserve its rights and maintain its security or collateral for the Obligations of the other Borrowers and the other Loan Parties, (d) the election of Administrative Agent or any other Secured Party in any proceeding instituted under any bankruptcy, insolvency or other Debtor Relief Law or of the application of Section 1111(b)(2) of the Bankruptcy Code of the United States or any similar provision of any other Debtor Relief Law, (e) the disallowance of all or any portion of the claim(s) of the Secured Parties for the repayment of the Obligations of the other Borrowers and other Loan Parties under Section 502 of the Bankruptcy Code of the United States or any similar provision of any other Debtor Relief Law, or (f) any other circumstances which might constitute a legal or equitable discharge or defense of any obligor. With respect to the Obligations arising as a result of the joint and several liability of a Borrower hereunder with respect to the Loans, Letters of Credit or other extensions of credit made to the other Borrowers hereunder, each Borrower waives, until the Obligations shall have been paid in full in immediately available funds and this Agreement shall have been terminated, any right to enforce any right of subrogation or any remedy which the Secured Parties now have or may hereafter have against the Borrowers and the other Loan Parties, any endorser or any guarantor of all or any part of the Obligations, and any benefit of, and any right to participate in, any security or collateral given to the Secured Parties. Upon any Event of Default and for so long as the same is continuing, Administrative Agent may proceed directly and at once, without notice, against any Borrower or any Guarantor to collect and recover the full amount, or any portion of the Obligations, without first proceeding against the other Borrowers or any other Person, or against any security or collateral for the Obligations. Each Borrower consents and agrees that Administrative Agent shall be under no obligation to marshal any assets in favor of any Borrower or any other Loan Party against or in payment of any or all of the Obligations.

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Article 3.

TAXES, YIELD PROTECTION AND INDEMNITY

Section 3.1Increased Costs.

(a)Increased Costs Generally. If any Change in Law shall:

(i)impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in the Adjusted Eurodollar Rate);

(ii)subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii)impose on any Lender or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, converting to, continuing or maintaining any Loan or of maintaining its obligation to make any such Loan, or to increase the cost to such Lender or such other Recipient of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit) or to reduce the amount of any sum received or receivable by such Lender or other Recipient hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or other Recipient, Borrowers will pay to such Lender or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.

(b)Capital or Liquidity Requirements. If any Lender determines that any Change in Law affecting such Lender or any Lending Office of such Lender or such Lender’s holding company, if any, regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit or Swing Line Loans held by such Lender or the Letters of Credit issued by L/C Issuer, to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy and liquidity), then from time to time Borrowers will pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

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(c)Certificates for Reimbursement. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in Sections 3.1(a) or (b) and delivered to the Borrower Representative, shall be conclusive absent manifest error. Borrowers shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.

(d)Delay in Requests. Failure or delay on the part of any Lender to demand compensation pursuant to this Section 3.1 shall not constitute a waiver of such Lender’s right to demand such compensation; provided that no Borrower shall be required to compensate a Lender pursuant to this Section 3.1 for any increased costs incurred or reductions suffered more than six (6) months prior to the date that such Lender notifies the Borrower Representative of the Change in Law giving rise to such increased costs or reductions, and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine (9) -month period referred to above shall be extended to include the period of retroactive effect thereof).

Section 3.2Illegality. If any Lender determines that any Law or regulation has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its Lending Office to make, maintain or fund Loans whose interest is determined by reference to the Eurodollar Rate, or to determine or charge interest rates based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to the Borrower Representative through Administrative Agent, (i) any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans shall be suspended, and (ii) if such notice asserts the illegality of such Lender making or maintaining Base Rate Loans the interest rate on which is determined by reference to the Eurodollar Rate component of the Base Rate, the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by Administrative Agent without reference to the Eurodollar Rate component of the Base Rate, in each case until such Lender notifies Administrative Agent and the Borrower Representative that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, (x) Borrowers shall, upon demand from such Lender (with a copy to Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans (the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by Administrative Agent without reference to the Eurodollar Rate component of the Base Rate), either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar Rate Loans and (y) if such notice asserts the illegality of such Lender determining or charging interest rates based upon the Eurodollar Rate, Administrative Agent shall during the period of such suspension compute the Base Rate applicable to such Lender without reference to the Eurodollar Rate component thereof until Administrative Agent is advised in writing by such Lender that it is no longer illegal for such Lender to determine or charge interest rates based upon the Eurodollar Rate. Upon any such prepayment or conversion, Borrowers shall also pay accrued interest on the amount so prepaid or converted.

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Section 3.3Alternate Rate of Interest.

(a)Inability to Determine Rates. Subject to clauses (b), (c), (d), (e) and (f) of this Section 3.3 and Section 3.2, if prior to the commencement of any Interest Period for a Eurodollar Rate Loan:

(i)the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for determining the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan or in connection with an existing or proposed Base Rate Borrowing (provided that no Benchmark Transition Event shall have occurred at such time); or

(ii)the Administrative Agent is advised by the Required Lenders that the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan will not adequately and fairly reflect the cost to such Lenders of funding such Eurodollar Rate Loans for such Interest Period,

then Administrative Agent will promptly so notify Borrowers and each Lender. Thereafter, (A) the obligation of Lenders to make or maintain Eurodollar Rate Loans shall be suspended, and (B) in the event of a determination described in the preceding sentence with respect to the Eurodollar Rate component of the Base Rate, the utilization of the Eurodollar Rate component in determining the Base Rate shall be suspended, in each case until Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, the Borrower Representative may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans or, failing that, will be deemed to have converted such request into a request for a Base Rate Borrowing in the amount specified therein.

(b)Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Loan Document, if a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then (i) if a Benchmark Replacement is determined in accordance with clauses (a) or (b) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document and (ii) if a Benchmark Replacement is determined in accordance with clause (c) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of objection to such Benchmark Replacement from Lenders comprising the Required Lenders.

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(c)Benchmark Replacement Conforming Changes. In connection with the implementation of a Benchmark Replacement, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.

(d)Notices; Standards for Decisions and Determinations. The Administrative Agent will promptly notify the Borrower Representative and the Lenders of (i) any occurrence of a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date, (ii) the implementation of any Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement Conforming Changes, (iv) the removal or reinstatement of any tenor of a Benchmark pursuant to clause (e) below and (v) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section 3.3, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section 3.3.

(e)Unavailability of Tenor of Benchmark. Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (A) if the then-current Benchmark is a term rate (including BSBY, Term SOFR or USD LIBOR) and either (1) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by Administrative Agent in its reasonable discretion or (2) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is or will be no longer representative, then Administrative Agent may modify the definition of “Interest Period” for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (B) if a tenor that was removed pursuant to clause (i) above either (1) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (2) is not, or is no longer, subject to an announcement that it is or will no longer be representative for a Benchmark (including a Benchmark Replacement), then Administrative Agent may modify the definition of “Interest Period” for all Benchmark settings at or after such time to reinstate such previously removed tenor.

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(f)Benchmark Unavailability Period. Upon the Borrower Representative’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Borrower Representative may revoke any request for a Eurodollar Rate Borrowing of, conversion to or continuation of Eurodollar Rate Loans to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Borrower Representative will be deemed to have converted any such request into a request for a Borrowing of or conversion to Base Rate Loans. During any Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of Base Rate based upon the then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of Base Rate.

(g)London Interbank Offered Rate Benchmark Transition Event. On March 5, 2021, the IBA, the administrator of the London interbank offered rate, and the FCA, the regulatory supervisor of the IBA, made the Announcements that the final publication or representativeness date for dollars for (i) 1-week and 2-month London interbank offered rate tenor settings will be December 31, 2021 and (ii) overnight, 1-month, 3-month, 6-month and 12-month London interbank offered rate tenor settings will be June 30, 2023. No successor administrator for the IBA was identified in such Announcements. The parties hereto agree and acknowledge that the Announcements resulted in the occurrence of a Benchmark Transition Event with respect to the London interbank offered rate pursuant to the terms of this Agreement and that any obligation of the Administrative Agent to notify any parties of such Benchmark Transition Event pursuant to Section 3.3(d) shall be deemed satisfied; provided, however, (x) the Benchmark shall remain USD LIBOR until the occurrence of the Benchmark Replacement Date with respect thereto and (y) such Benchmark Replacement Date shall not be deemed to have occurred solely as a result of the Announcements and shall only occur in accordance with the definition thereof.

(h)BSBY Replacement. Notwithstanding anything to the contrary in this Agreement or any other Loan Documents, at any time that BSBY is the then current Benchmark, if the Administrative Agent determines (which determination shall be conclusive absent manifest error), or the Borrower Representative or Required Lenders notify the Administrative Agent (with, in the case of the Required Lenders, a copy to the Borrower Representative) that the Borrower Representative or Required Lenders (as applicable) have determined, that:

(i)adequate and reasonable means do not exist for ascertaining one month, three month and six month interest periods of BSBY, including, without limitation, because the BSBY Screen Rate is not available or published on a current basis and such circumstances are unlikely to be temporary; or

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(ii) Bloomberg or any successor administrator of the BSBY Screen Rate or a Governmental Authority having jurisdiction over the Administrative Agent or Bloomberg or such administrator has made a public statement identifying a specific date after which one month, three month and six month interest periods of BSBY or the BSBY Screen Rate shall or will no longer be representative or made available, or used for determining the interest rate of loans, or shall or will otherwise cease, provided that, at the time of such statement, there is no successor administrator that is satisfactory to the Administrative Agent, that will continue to provide such representative interest periods of BSBY after such specific date (the latest date on which one month, three month and six month interest periods of BSBY or the BSBY Screen Rate are no longer representative or available permanently or indefinitely, the “Scheduled Unavailability Date”);

then, on a date and time determined by the Administrative Agent (any such date, the “BSBY Replacement Date”), which date shall be at the end of an Interest Period or on the relevant interest payment date, as applicable, for interest calculated and, solely with respect to clause (B) above, no later than the Scheduled Unavailability Date, BSBY will be replaced hereunder and under any Loan Document with a Benchmark Replacement determined in accordance with the definition thereof.

Section 3.4Taxes.

(a)Defined Terms. For purposes of this Section, the term “applicable Law” includes FATCA.

(b)Payment Free of Taxes. Any and all payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable Law. If any applicable Law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 3.4) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

(c)Payment of Other Taxes by the Loan Parties. The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with applicable Law, or at the option of Administrative Agent timely reimburse it for the payment of, any Other Taxes.

(d)Indemnification by the Loan Parties. The Loan Parties shall jointly and severally indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 3.4) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower Representative by a Lender (with a copy to Administrative Agent), or by Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

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(e)Indemnification by Lenders. Each Lender shall severally indemnify Administrative Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.8 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by Administrative Agent to such Lender from any other source against any amount due to Administrative Agent under this Section 3.4(e).

(f)Evidence of Payments. As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 3.4, such Loan Party shall deliver to Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Administrative Agent.

(g)Status of Lenders.

(i)Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower Representative and Administrative Agent, at the time or times reasonably requested by the Borrower Representative or Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower Representative or Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower Representative or Administrative Agent, shall deliver such other documentation prescribed by applicable Law or reasonably requested by the Borrower Representative or Administrative Agent as will enable the Borrower Representative or Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two (2) sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.4(g)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in such Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

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(ii)Without limiting the generality of the foregoing,

(A)any Lender that is a U.S. Person shall deliver to the Borrower Representative and Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower Representative or Administrative Agent), executed copies of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

(B)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower Representative and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower Representative or Administrative Agent), whichever of the following is applicable:

(1)in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of IRS Form W-8BEN (or IRS Form W-8BEN-E, if applicable) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN (or IRS Form W-8BEN-E, if applicable) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2)executed copies of IRS Form W-8ECI;

(3)in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit G-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of any Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed copies of IRS Form W-8BEN (or IRS Form W-8BEN-E, if applicable); or

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(4)to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN (or IRS Form W-8BEN-E, if applicable), a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or Exhibit G-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-4 on behalf of each such direct and indirect partner;

(C)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower Representative and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower Representative or Administrative Agent), executed copies of any other form prescribed by applicable Law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable Law to permit the Borrower Representative or Administrative Agent to determine the withholding or deduction required to be made; and

(D)if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower Representative and Administrative Agent at the time or times prescribed by Law and at such time or times reasonably requested by the Borrower Representative or Administrative Agent such documentation prescribed by applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower Representative or Administrative Agent as may be necessary for the Borrower Representative and Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower Representative and Administrative Agent in writing of its legal inability to do so.

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(h)Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.4 (including by the payment of additional amounts pursuant to this Section 3.4), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 3.4 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this Section 3.4(h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 3.4(h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this Section 3.4(h) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This Section 3.4(h) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

(i)Survival. Each party’s obligations under this Section 3.4 shall survive the resignation or replacement of Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

Section 3.5Compensation for Losses. Upon demand of any Lender (with a copy to Administrative Agent) from time to time, Borrowers shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:

(a)any continuation, conversion, payment or prepayment of any Eurodollar Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise); or

(b)any failure by Borrowers (for a reason other than the failure of such Lender to lend a Eurodollar Rate Loan) to prepay, borrow, continue or convert any Eurodollar Rate Loan on the date or in the amount notified by the Borrower Representative; or

(c)any assignment of a Eurodollar Rate Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower Representative pursuant to Section 3.6(b);

including any loss of anticipated profits and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained. Borrowers shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

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For purposes of calculating amounts payable by Borrowers to the Lenders under this Section 3.5, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at Adjusted Eurodollar Rate by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Loan was in fact so funded. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower Representative and shall be conclusive absent demonstrable error. Borrowers shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

Section 3.6Mitigation of Obligations; Replacement of Lenders.

(a)Designation of a Different Lending Office. If any Lender requests compensation under Section 3.1, or requires Borrowers to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.4, then such Lender shall (at the request of the Borrower Representative) use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or Affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.1 or Section 3.4, as the case may be, in the future, and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. Borrowers hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b)Replacement of Lenders. If any Lender requests compensation under Section 3.1, or if Borrowers are required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.4 and, in each case, such Lender has declined or is unable to designate a different Lending Office in accordance with Section 3.6(a), or if any Lender is a Defaulting Lender or a Non-Consenting Lender, then Borrowers may, at their sole expense and effort, upon notice to such Lender and Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 11.8), all of its interests, rights (other than its existing rights to payments pursuant to Section 3.1 or Section 3.4) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:

(i)Borrowers shall have paid to Administrative Agent the assignment fee (if any) specified in Section 11.8;

(ii) such Lender shall have received payment of an amount equal to the Outstanding Amount of its Loans and L/C Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.5) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Borrowers (in the case of all other amounts);

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(iii)in the case of any such assignment resulting from a claim for compensation under Section 3.1 or payments required to be made pursuant to Section 3.4, such assignment will result in a reduction in such compensation or payments thereafter;

(iv)such assignment does not conflict with applicable Law; and

(v)in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent.

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling Borrowers to require such assignment and delegation cease to apply.

Section 3.7Survival. All of the obligations under this Article 3 shall survive termination of the Commitments, repayment of all other Obligations hereunder, and resignation of Administrative Agent.

Article 4.

CONDITIONS PRECEDENT

Section 4.1Initial Extension of Credit. The obligation of Lenders to make the initial Credit Extension hereunder is subject to the condition precedent that Administrative Agent shall have received all of the following, each dated (unless otherwise indicated or otherwise specified by Administrative Agent) the Closing Date, in form and substance satisfactory to Administrative Agent:

(a)Credit Agreement. Counterparts of this Agreement executed by Administrative Agent, the Lenders, Swing Line Lender, L/C Issuer and each Loan Party;

(b)Resolutions. Resolutions of the board of directors (or other governing body) of Parent and each Loan Party that is not a natural Person certified by the secretary or an assistant secretary (or a Responsible Officer or other custodian of records) of such Person which authorize the execution, delivery, and performance by such Person of this Agreement and the other Loan Documents to which such Person is or is to be a party;

(c)Incumbency Certificate. A certificate of incumbency certified by a Responsible Officer of Parent and each Loan Party that is not a natural Person certifying the names of the individuals or other Persons authorized to sign this Agreement and each of the other Loan Documents to which each Loan Party is or is to be a party (including the certificates contemplated herein) on behalf of such Person together with specimen signatures of such individual Persons;

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(d)Certificate Regarding Consents and Approvals. A certificate of a Responsible Officer of each Loan Party either (i) attaching copies of all consents, licenses and approvals required in connection with the execution, delivery and performance by such Loan Party and the validity against such Loan Party of the Loan Documents to which it is a party, and such consents, licenses and approvals shall be in full force and effect, or (ii) stating that no such consents, licenses or approvals are so required;

(e)Closing Certificate. A certificate signed by a Responsible Officer of the Borrower Representative certifying (i) that the conditions specified in Sections 4.2(b), (c) and (d) have been satisfied and (ii) that attached to such certificate are true, accurate and complete copies of the Parent Loan Documents, including any amendments and supplements thereto;

(f)Solvency Certificate. A solvency certificate signed by the chief financial officer or vice president of finance of Company;

(g)Perfection Certificate. The Perfection Certificate signed by a Responsible Officer of each Loan Party;

(h)Constituent Documents. The Constituent Documents and all amendments thereto for Parent and each Loan Party that is not a natural Person, with the formation documents included in the Constituent Documents being certified as of a date acceptable to Administrative Agent by the appropriate government officials of the state of incorporation or organization of Parent and each Loan Party, and all such Constituent Documents being accompanied by certificates that such copies are complete and correct, given by an authorized representative acceptable to Administrative Agent;

(i)Governmental Certificates. Certificates of the appropriate government officials of the state of incorporation or organization of Parent and each Loan Party that is not a natural Person as to the existence and good standing of Parent and each Loan Party that is not a natural Person, each dated as of a recent date hereof;

(j)Notes. The Notes executed by Borrowers in favor of each Lender requesting Notes;

(k)Security Documents; Intercreditor Agreement. The Security Documents (including the Intercreditor Agreement) executed by Parent, Borrowers, the other Loan Parties, the Subordinated Lenders and Administrative Agent, in each case, as the case may be;

(l)Pledged Equity Interests; Stock Powers; Pledged Notes. Subject to Section 6.17, Administrative Agent shall have received (i) the certificates (if any) representing any Equity Interests pledged pursuant to the Security Documents, together with an undated stock power for each such certificate executed in blank by a duly authorized officer of the pledgor thereof and (ii) each promissory note (if any) pledged to Administrative Agent pursuant to the Security Documents endorsed (without recourse) in blank (or accompanied by an executed transfer form in blank) by the pledgor thereof;

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(m)Financing Statements. UCC financing statements reflecting Parent (solely with respect to its pledge of the Equity Interests in Company) and the Loan Parties, as debtors, and Administrative Agent, as secured party, which are required to grant a Lien which secures the Obligations and covering such Collateral as Administrative Agent may request;

(n)Borrowing Base Report. Borrowing Base Report which calculates the Borrowing Base as of a date specified by Administrative Agent prior to or on the Closing Date with customary supporting schedules and documentation;

(o)Field Examination. Such third-party field examinations and audits of the Borrowers’ Accounts, Inventory (including, without limitation, the Generator Units), related working capital matters and of the Borrowers’ related data processing and other systems and such other information or materials as Administrative Agent shall include within the scope of such third-party field examinations and audits, the results of which shall be satisfactory to Administrative Agent in its sole discretion;

(p)Appraisals. Such third-party asset appraisals of each Borrowers’ Inventory (including, without limitation, the Generator Units), which third-party appraisal shall be in form and substance satisfactory to Administrative Agent in its sole discretion;

(q)Corporate Structure. The corporate structure, capital structure and other material debt instruments, material accounts and governing documents of Parent, the Company and its Subsidiaries shall be acceptable to Administrative Agent in its reasonable discretion;

(r)Insurance Matters. Subject to Section 6.17, copies of insurance certificates describing all insurance policies required by Section 6.5, together with lender loss payable and additional insured endorsements in favor of Administrative Agent with respect to all insurance policies covering Collateral;

(s)Lien Searches. The results of UCC, tax lien and judgment lien searches showing all financing statements and other documents or instruments on file against each Loan Party in the appropriate filing offices, such search to be as of a date no more than thirty (30) days prior to the date hereof, and reflecting no Liens against any of the intended Collateral other than Liens being released or assigned to Administrative Agent concurrently with the initial Credit Extension and Permitted Liens;

(t)Opinion of Counsel. A favorable opinion of Fennemore Craig, P.C., legal counsel to each Loan Party, as to such matters as Administrative Agent may reasonably request;

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(u) Attorneys’ Fees and Expenses. Evidence that the costs and expenses (including reasonable attorneys’ fees) referred to in Section 11.1, to the extent invoiced, shall have been paid in full by Borrowers;

(v)Financial Statements. The financial statements set forth in Section 5.2;

(w)Financial Projections. Pro forma consolidated financial statements for Company and its Subsidiaries, and projections prepared by management of Company, of balance sheets, income statements and cash flow statements on a quarterly basis for the first year following the Closing Date and on an annual basis for each year thereafter during the term of this Agreement, which shall not be inconsistent with any financial information or projections previously delivered to Administrative Agent;

(x)KYC Information; Beneficial Ownership. Each Loan Party shall have provided to Administrative Agent and the Lenders (i) the documentation and other information requested by Administrative Agent as it deems necessary in order to comply with requirements of any anti-money laundering Laws, including, without limitation, the Patriot Act and any applicable “know your customer” rules and regulations and (ii) at least three (3) Business Days prior to the Closing Date, any Borrower that qualified as a “legal entity customer” under the Beneficial Ownership Regulation shall deliver a Beneficial Ownership Certification in relation to such Borrower;

(y)Minimum Availability. Evidence that, immediately after giving effect to the initial Credit Extension hereunder, Availability shall be at least $5,000,000;

(z)Legal Due Diligence. Administrative Agent and its counsel shall have completed all legal due diligence (including review of any material agreements disclosed on Schedule 5.26), the results of which shall be satisfactory to Administrative Agent in its sole discretion;

(aa)Closing Fees. Evidence that (i) all fees required to be paid to Administrative Agent and Arranger on or before the Closing Date have been paid, and (ii) all fees required to be paid to the Lenders on or before the Closing Date have been paid; and

(bb)Additional Documentation. Such additional approvals, opinions, or documents as Administrative Agent or its legal counsel may reasonably request.

For purposes of determining compliance with the conditions set forth in this Section 4.1, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or be satisfied with, each document or other matter required thereunder to be consented to or approved by or be acceptable or satisfactory to a Lender unless Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

Section 4.2All Extensions of Credit. The obligation of Lenders to make any Credit Extension hereunder (including the initial Credit Extension) is subject to the following additional conditions precedent:

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(a) Request for Credit Extension. Administrative Agent shall have received in accordance with this Agreement, as the case may be, a Borrowing Request, Letter of Credit Application, or Swing Line Loan Request, as applicable, pursuant to Administrative Agent’s requirements and executed by a Responsible Officer of the Borrower Representative;

(b)No Default. No Default or Event of Default shall have occurred and be continuing, or would result from or after giving effect to such Credit Extension;

(c)No Material Adverse Effect. No Material Adverse Effect shall have occurred and no circumstance shall exist that could reasonably be expected to have a Material Adverse Effect;

(d)Representations and Warranties. All of the representations and warranties of each Borrower and each other Loan Party contained in Article 5 and in the other Loan Documents shall (i) with respect to representations and warranties that contain a materiality qualification, be true and correct on and as of the date of such Borrowing, and (ii) with respect to representations and warranties that do not contain a materiality qualification, be true and correct in all material respects on and as of the date of such Borrowing, in each case with the same force and effect as if such representations and warranties had been made on and as of such date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects (or in the case of such representations and warranties that contain a materiality qualification, in all respects) as of such earlier date, and except that for purposes of this Section 4.2, the representations and warranties contained in Section 5.2 shall be deemed to refer to the most recent statements furnished pursuant to Section 6.1(a) and (b), respectively; and

(e)Availability Under Revolving Credit Facility. With respect to any request for a Credit Extension under the Commitments, immediately after giving effect to the Credit Extension so requested, the total Revolving Credit Exposure of the Lenders shall not exceed the lesser of (i) the Borrowing Base in effect as of the date of such Credit Extension and (ii) the aggregate Commitments of the Lenders in effect as of the date of such Credit Extension.

Each Credit Extension hereunder shall be deemed to be a representation and warranty by each Borrower that the conditions specified in this Section 4.2 have been satisfied on and as of the date of the applicable Credit Extension.

Article 5.

REPRESENTATIONS AND WARRANTIES

To induce Administrative Agent and Lenders to enter into this Agreement, and to make Credit Extensions hereunder, each Loan Party represents and warrants to Administrative Agent and Lenders that:

Section 5.1Entity Existence. Each Loan Party and each Subsidiary thereof (a) is duly incorporated or organized, as the case may be, validly existing, and in good standing under the Laws of the jurisdiction of its incorporation or organization; (b) has all requisite power and authority to own its assets and carry on its business as now being or as proposed to be conducted; and (c) is qualified to do business in all jurisdictions in which the nature of its business makes such qualification necessary and where failure to so qualify could reasonably be expected to have a Material Adverse Effect. Each of the Loan Parties has the power and authority to execute, deliver, and perform its obligations under this Agreement and the other Loan Documents to which it is or may become a party.

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Section 5.2Financial Statements; Etc. Company has delivered to Administrative Agent (a) audited financial statements of Company and its Subsidiaries as of and for the fiscal year ended December 31, 2017 and (b) unaudited consolidated and consolidating financial statements of Company and its Subsidiaries as of and for the calendar month and the portion of the fiscal year ended November 30, 2018. Such financial statements are true and correct, have been prepared in accordance with GAAP, and fairly and accurately present, on a consolidated basis, the financial condition of Company and its Subsidiaries as of the respective dates indicated therein and the results of operations for the respective periods indicated therein. Neither Company nor any of its Subsidiaries has any material contingent liabilities, liabilities for taxes, unusual forward or long-term commitments, unrealized or anticipated losses from any unfavorable commitments except as referred to or reflected in such financial statements. No Material Adverse Effect and no circumstance which could reasonably be expected to result in a Material Adverse Effect has occurred since the effective date of the financial statements referred to in this Section 5.2. All projections delivered by the Borrower Representative to Administrative Agent and Lenders have been prepared in good faith, with care and diligence and using assumptions that are reasonable under the circumstances at the time such projections were prepared and delivered to Administrative Agent and Lenders and all such assumptions are disclosed in the projections. Other than the Debt listed on Schedule 7.1 and Debt otherwise permitted by Section 7.1, Company and each Subsidiary have no Debt.

Section 5.3Action; No Breach. The execution, delivery, and performance by each Loan Party of this Agreement and the other Loan Documents to which such Person is or may become a party and compliance with the terms and provisions hereof and thereof have been duly authorized by all requisite action on the part of such Person and do not and will not (a) violate or conflict with, or result in a breach of, or require any consent under (i) the Constituent Documents of such Person (if such Person is not a natural person), (ii) any applicable Law, rule, or regulation or any order, writ, injunction, or decree of any Governmental Authority or arbitrator, or (iii) any agreement or instrument to which such Person is a party or by which it or any of its Properties is bound or subject which could reasonably be expected to have a Material Adverse Effect, or (b) constitute a default under any such agreement or instrument which could reasonably be expected to have a Material Adverse Effect, or result in the creation or imposition of any Lien upon any of the revenues or assets of such Person.

Section 5.4Operation of Business. Each Loan Party and its Subsidiaries possesses all licenses, permits, consents, authorizations, franchises, patents, copyrights, trademarks, and trade names, or rights thereto, necessary to conduct its respective businesses substantially as now conducted and as presently proposed to be conducted, and no Loan Party or any of its Subsidiaries is in violation of any valid rights of others with respect to any of the foregoing which could reasonably be expected to have a Material Adverse Effect.

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Section 5.5Litigation and Judgments. Except as specifically disclosed in Schedule 5.5 as of the date hereof, there is no action, suit, investigation, or proceeding before or by any Governmental Authority or arbitrator pending, or to the knowledge of any Loan Party after a reasonable investigation, threatened against or affecting any Loan Party or any of its Subsidiaries or against any of their Properties that could, if adversely determined, reasonably be expected to have a Material Adverse Effect. As of the Closing Date, there are no outstanding judgments against any Loan Party or any of its Subsidiaries. Since the date hereof, there has been no adverse change in the status of any matter set forth on Schedule 5.5 that, taking into account the availability of any appeals, could reasonably be expected to increase materially the likelihood of a Material Adverse Effect resulting therefrom.

Section 5.6Rights in Properties; Liens.

(a)Each Loan Party and its Subsidiaries has good and indefeasible title to or valid leasehold interests in its respective Properties, including the Properties reflected in the financial statements described in Section 5.2, and none of the Properties of any Loan Party or any of its Subsidiaries is subject to any Lien, except Permitted Liens.

(b)Schedule 5.6(b) sets forth a complete and accurate list of all real Property owned by each Loan Party and each of its Subsidiaries on the Closing Date, showing as of the date hereof the street address, county or other relevant jurisdiction, state and record owner thereof. Each Loan Party and each of its Subsidiaries has good, indefeasible and insurable fee simple title to the real Property owned by such Loan Party or such Subsidiary.

(c)Schedule 5.6(c) sets forth a complete and accurate list of all Leases under which any Loan Party or any of its Subsidiaries is the lessee on the Closing Date, showing as of the date hereof the street address, county or other relevant jurisdiction, state, lessor, lessee, expiration date and annual rental cost thereof. Each such Lease is a legal, valid and binding obligation of the lessor thereof, enforceable in accordance with its terms, except as enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other applicable Laws relating to or affecting generally the enforcement of creditors’ rights and except to the extent that availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor may be brought.

Section 5.7Enforceability. This Agreement constitutes, and the other Loan Documents to which any Loan Party is a party, when delivered, shall constitute legal, valid, and binding obligations of such Person, enforceable against such Person in accordance with their respective terms, except as limited by Debtor Relief Laws.

Section 5.8Approvals. No authorization, approval, or consent of, and no filing or registration with, any Governmental Authority or third party (other than filings and registrations to perfect Liens) is or will be necessary for the execution, delivery, or performance by any Loan Party of this Agreement and the other Loan Documents to which such Person is or may become a party or the validity or enforceability thereof.

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Section 5.9Taxes. Each Loan Party and its Subsidiaries has filed on a timely basis all Tax Returns required to be filed, including all income, franchise, employment, Property, and sales Tax Returns. Each such Tax Return is true, correct and complete in all respects. Each Loan Party and its Subsidiaries has paid all of its respective liabilities for Taxes, assessments, governmental charges, and other levies that are due and payable (whether or not shown on any Tax Return), other than Taxes, if any, set forth on Schedule 5.9, the payment of which is being contested in good faith and by appropriate proceedings and reserves for the payment of which are being maintained in accordance with GAAP. Each Loan Party knows of no pending investigation of any Loan Party or any of its Subsidiaries by any taxing authority or of any pending but unassessed tax liability of any Loan Party or any of its Subsidiaries. No claim has ever been made or is expected to be made by any Governmental Authority in a jurisdiction where any Loan Party or its Subsidiaries does not file Tax Returns that it is or may be subject to taxation by that jurisdiction. Each Loan Party and its Subsidiaries has not given or been requested to give waivers or extensions (or is or would be subject to a waiver or extension given by any other Person) of any statute of limitations relating to the payment of Taxes of each Loan Party or its Subsidiaries or for which each Loan Party or its Subsidiaries may be liable. No Loan Party or any Subsidiary thereof is, or has been party to any Tax sharing agreement, Tax allocation agreement, Tax indemnity obligation or similar written or unwritten agreement, arrangement, understanding or practice with respect to Taxes.

Section 5.10Use of Proceeds; Margin Securities. The proceeds of the Revolving Credit Borrowings shall be used by Borrowers for working capital in the ordinary course of business, capital expenditures and other general corporate purposes. No Loan Party nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulations T, U, or X of the Board of Governors of the Federal Reserve System), and no part of the proceeds of any Loan will be used to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying margin stock. No part of the proceeds of any Loan will be used directly or indirectly to fund any operations in, finance any investments or activities in or make any payments to, a Sanctioned Person, or in any other manner that will result in any violation by any Person (including any Lender, any Arranger or Administrative Agent) of any Anti-Terrorism Laws, Anti-Corruption Laws or any Sanctions.

Section 5.11ERISA; Canadian Defined Benefit Plans.

(a)Each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application for such a letter is currently being processed by the IRS with respect thereto and, to the knowledge of each Loan Party, nothing has occurred which would prevent, or cause the loss of, such qualification. No application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan. There are no pending or, to the knowledge of any Loan Party, threatened claims, actions or lawsuits, or action by any Governmental Authority with respect to any Plan or Multiemployer Plan. There has been no Prohibited Transaction or violation of the fiduciary responsibility rules with respect to any Plan or Multiemployer Plan. No ERISA Event has occurred or is reasonably expected to occur. No Plan has any Unfunded Pension Liability. No Multiemployer Plan is insolvent within the meaning of Section 4245 of ERISA. No Loan Party or ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Plan (other than premiums due and not delinquent under Section 4007 of ERISA). No Loan Party or ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Section 4201 of ERISA with respect to a Multiemployer Plan. No Loan Party or ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA.

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(b)No Loan Party sponsors, maintains, participates in, contributes to, or has otherwise incurred liability under, a Canadian Defined Benefit Plan.

Section 5.12Disclosure.

(a)No statement, information, report, representation, or warranty made by any Loan Party in this Agreement or in any other Loan Document or furnished to Administrative Agent or any Lender in connection with this Agreement or any of the transactions contemplated hereby contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements herein or therein not misleading. There is no fact known to any Loan Party which could reasonably be expected to have a Material Adverse Effect, or which might in the future could reasonably be expected to have a Material Adverse Effect that has not been disclosed in writing to Administrative Agent and each Lender.

(b)As of the Closing Date, the information included in the Beneficial Ownership Certification is true and correct in all respects.

Section 5.13Subsidiaries. No Loan Party has any Subsidiaries other than those listed on Schedule 5.13 (and, if subsequent to the Closing Date, such additional Subsidiaries have been formed or acquired in compliance with Section 6.13(a)) and Schedule 5.13 sets forth the jurisdiction of incorporation or organization of each Subsidiary and the percentage of each Loan Party’s ownership interest in such Subsidiary. Schedule 5.13 also sets forth the name and jurisdiction of incorporation or organization of Parent and the percentage of Parent’s ownership interest in Company. All of the outstanding capital stock or other Equity Interests of Parent and each Subsidiary described on Schedule 5.13 have been validly issued, are fully paid, and are nonassessable. There are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments of any nature relating to any Equity Interests of any Loan Party or any Subsidiary.

Section 5.14Agreements. No Loan Party nor any of its Subsidiaries is a party to any indenture, loan, or credit agreement, or to any lease or other agreement or instrument, or subject to any charter or corporate or other organizational restriction, in each case which could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Loan Party nor any of its Subsidiaries is in default in any respect in the performance, observance, or fulfillment of any of the obligations, covenants, or conditions contained in any agreement or instrument material to its business to which it is a party which could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

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Section 5.15Compliance with Laws. No Loan Party nor any of its Subsidiaries is in violation in any material respect of any Law, rule, regulation, order, or decree of any Governmental Authority or arbitrator.

Section 5.16Inventory. All Inventory of each Loan Party and its Subsidiaries has been and will hereafter be produced or maintained in compliance with all applicable Laws, rules, regulations, and governmental standards, including, without limitation, the minimum wage and overtime provisions of the Fair Labor Standards Act (29 U.S.C. §§ 201-219).

Section 5.17Regulated Entities. No Loan Party nor any of its Subsidiaries is (a) an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940 or (b) subject to regulation under any other federal or state statute, rule or regulation limiting its ability to incur Debt, pledge its assets or perform its obligations under the Loan Documents. No Loan Party is an Affected Financial Institution.

Section 5.18Environmental Matters.

(a)Each Loan Party and its Subsidiaries, and all of their respective Properties, assets, and operations, are in compliance with all Environmental Laws. No Loan Party is aware of, nor has any Loan Party received notice of, any past, present, or future conditions, events, activities, practices, or incidents which may interfere with or prevent the compliance or continued compliance of each Loan Party and its Subsidiaries with all Environmental Laws;

(b)Each Loan Party and its Subsidiaries has obtained all permits, licenses, and authorizations that are required under applicable Environmental Laws, and all such permits are in good standing and each Loan Party and its Subsidiaries are in compliance with all of the terms and conditions of such permits;

(c)No Hazardous Materials exist on, about, or within, or have been used, generated, stored, transported, disposed of on, or Released from, any of the Properties or assets of any Loan Party or any of its Subsidiaries in violation of, or in a manner or to a location that could give rise to liability under, any applicable Environmental Laws. The use which each Loan Party and its Subsidiaries make and intend to make of their respective Properties and assets will not result in the use, generation, storage, transportation, accumulation, disposal, or Release of any Hazardous Material on, in, or from any of their Properties or assets in violation of, or in a manner that could give rise to liability under, any applicable Environmental Laws;

(d)No Loan Party or any of its Subsidiaries nor any of their respective currently or previously owned or leased Properties or operations is subject to any outstanding or threatened order from or agreement with any Governmental Authority or other Person or subject to any judicial or docketed administrative proceeding with respect to (i) any failure to comply with Environmental Laws, (ii) any Remedial Action, or (iii) any Environmental Liabilities arising from a Release or threatened Release;

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(e) There are no conditions or circumstances associated with the currently or previously owned or leased Properties or operations of any Loan Party or any of its Subsidiaries that could reasonably be expected to give rise to any Environmental Liabilities;

(f)No Loan Party nor any of its Subsidiaries is a treatment, storage, or disposal facility requiring a permit under the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq., regulations thereunder or any comparable provision of state Law. Each Loan Party and its Subsidiaries are in compliance with all applicable financial responsibility requirements of all Environmental Laws;

(g)No Loan Party nor any of its Subsidiaries has filed or failed to file any notice required under applicable Environmental Law reporting a Release; and

(h)No Lien arising under any Environmental Law has attached to any Property or revenues of any Loan Party or any of its Subsidiaries.

Section 5.19Intellectual Property. Each Loan Party and each of its Subsidiaries owns, or is licensed to use, all Intellectual Property necessary to conduct its business as currently conducted except for such Intellectual Property the failure of which to own or license could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 5.20Anti-Corruption Laws; Sanctions; Etc.

(a)No Loan Party, Subsidiary, Affiliate of any Loan Party or, to the knowledge of any Loan Party, any director, officer, employee, agent, or Affiliate of a Loan Party or any of its Subsidiaries is an individual or entity (“person”) that is, or is owned or Controlled by persons that are: (i) the subject of any Sanctions, or (ii) located, organized or resident in a country or territory that is, or whose government is, the subject of Sanctions (including, Crimea, Cuba, Iran, North Korea, Sudan and Syria).

(b)The Loan Parties, their Subsidiaries and their respective directors, officers and employees and, to the knowledge of the Loan Parties, the agents of the Loan Parties and their Subsidiaries, are in compliance with all applicable Sanctions and with the FCPA and any other applicable Anti-Corruption Law, in all material respects. Each Loan Party and its Subsidiaries have instituted and maintain policies and procedures designed to promote and achieve continued compliance with applicable Sanctions, the FCPA and any other applicable Anti-Corruption Laws.

Section 5.21Patriot Act; Canadian AML Legislation. The Loan Parties, each of their Subsidiaries, and each of their Affiliates are in compliance with (a) the Trading with the Enemy Act, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B Chapter V, as amended), and all other enabling legislation or executive order relating thereto, (b) the Patriot Act, (c) Canadian AML Legislation and (d) all other federal or state Laws relating to “know your customer” (collectively, the “Anti-Terrorism Laws”).

Section 5.22Insurance. The Properties of each Loan Party and its Subsidiaries are insured with financially sound and reputable insurance companies not Affiliates of any Loan Party, in such amounts (after giving effect to any self-insurance compatible with the following standards), with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar Properties in localities where such Loan Party or the applicable Subsidiary operates.

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Section 5.23Solvency. After giving effect to the transactions contemplated hereby (including each Credit Extension hereunder), (a) the aggregate assets (after giving effect to amounts that could reasonably be received by reason of indemnity, offset, insurance or any similar arrangement), at a fair valuation, of the Loan Parties, taken as a whole, will exceed the aggregate liabilities of the Loan Parties on a consolidated basis, as their liabilities become absolute and mature, (b) each of the Loan Parties will not have incurred or intended to incur, and will not believe that it will incur, liabilities beyond its ability to pay such liabilities (after taking into account the timing and amounts of cash to be received by each of the Loan Parties and the amounts to be payable on or in respect of its liabilities, and giving effect to amounts that could reasonably be received by reason of indemnity, offset, insurance or any similar arrangement) as such liabilities become absolute and mature, and (c) each of the Loan Parties will not have (and will have no reason to believe that it will have thereafter) unreasonably small capital for the conduct of its business.

Section 5.24Security Documents. The provisions of the Security Documents are effective to create in favor of Administrative Agent for the benefit of the Secured Parties a legal, valid and enforceable Lien (subject to Permitted Liens) on all right, title and interest of the respective Loan Parties party thereto in the Collateral. Except for filings completed prior to the Closing Date and as contemplated hereby and by the Security Documents, no filing or other action will be necessary to perfect such Liens in Collateral.

Section 5.25Labor Matters. There are no labor controversies pending, or to the best knowledge of any Loan Party, threatened against any Loan Party or any of its Subsidiaries which could reasonably be expected to have a Material Adverse Effect.

Section 5.26Material Agreements. Schedule 5.26 sets forth a complete and correct list of all agreements in effect or to be in effect on the Closing Date and on the date of each update thereof required hereunder, to the extent that a default, breach, termination or other impairment thereof could reasonably be expected to have a Material Adverse Effect.

Section 5.27Additional Representations of Guarantors. Each Guarantor (a) has received, or will receive, direct or indirect benefit from the making of the Guaranty and the Obligations, and (b) is familiar with, and has independently reviewed the books and records regarding, the financial condition of Borrowers and is familiar with the value of any and all Collateral intended to be created as security for the payment of the Obligations, but such Guarantor is not relying on such financial condition, such Collateral, or the agreement of any other party as an inducement to enter into this Agreement and provide the Guaranty. Each Guarantor confirms that neither Administrative Agent, any Lender, any other Guarantor, nor any other party has made any representation, warranty or statement to such Guarantor in order to induce such Guarantor to execute this Agreement and provide the Guaranty.

Section 5.28Qualified ECP Guarantor. Each Borrower is a Qualified ECP Guarantor.

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Article 6.

AFFIRMATIVE COVENANTS

Each Loan Party covenants and agrees that, as long as the Obligations or any part thereof are outstanding or any Letter of Credit shall remain outstanding or any Lender has any Commitment hereunder:

Section 6.1Reporting Requirements. Borrowers will furnish, or cause to be furnished, to Administrative Agent (with copies for each Lender upon Administrative Agent’s request):

(a)Annual Financial Statements. As soon as available, and in any event within one hundred twenty (120) days after the last day of each fiscal year of Company, a copy of the annual audit report of Company and its Subsidiaries for such fiscal year containing, on a consolidated basis, balance sheets and statements of income, retained earnings, and cash flow as of the end of such fiscal year and for the twelve (12)-month period then ended, in each case (other than for the fiscal year ending December 31, 2020) setting forth in comparative form the figures for the preceding fiscal year, all in reasonable detail and audited and certified by independent certified public accountants of recognized standing acceptable to Administrative Agent, to the effect that such report has been prepared in accordance with GAAP and containing no material qualifications or limitations on scope;

(b)Interim Financial Statements. (i) At any time prior to and after the consummation of a Qualified IPO, as soon as available, and in any event within thirty (30) days after the last day of each fiscal month, and (ii) at any time on or after the consummation of a Qualified IPO, as soon as available, and in any event within fifty (50) days after the last day of each fiscal quarter (or, if earlier, on the date on which FGS’s quarterly financial statements are required to be filed with the SEC after giving effect to any permitted extensions pursuant to Rule 12b-25 under the Exchange Act)), in either case, a copy of an unaudited financial report of Company and its Subsidiaries as of the end of such month or fiscal quarter, as applicable, and for the portion of the fiscal year then ended, containing, on a consolidated basis, respectively, balance sheets and statements of income, retained earnings, and cash flow, in each case setting forth in comparative form and figures for the corresponding period of the preceding fiscal year, all in reasonable detail certified by a Responsible Officer of Company to have been prepared in accordance with GAAP and to fairly and accurately present (subject to year-end audit adjustments) the financial condition and results of operations of Company and its Subsidiaries, on a consolidated basis, as of the dates and for the periods indicated therein;

(c)Borrowing Base Report. As soon as available (or contemporaneously with a Disposition of Generator Packages, Generator Units or Field Units pursuant to Section 7.8(f)), and in any event within twenty (20) days after the last day of each fiscal month, a Borrowing Base Report, calculating the Borrowing Base and reflecting the components of the Borrowing Base, including (i) Eligible Accounts of each of the Borrowers as of the end of the preceding month and calculating the advance amounts based thereon, together with the Account Agings, (ii) Eligible Inventory, Eligible Generator Units, Eligible New Generator Units, and Eligible Field Units of each of the Borrowers as of the end of the preceding month and calculating the advance amounts based thereon and (iii) such worksheets detailing the Accounts excluded from Eligible Accounts and Inventory (including Generator Units and Field Units) excluded from Eligible Inventory, Eligible Generator Units, Eligible New Generator Units and Eligible Field Units, as the case may be, and the reason for such exclusion; provided that if a Trigger Period is in effect, a Borrowing Base Report and related documentation shall be due on or before the third (3rd) Business Day of each week (or contemporaneously with a Disposition of Generator Packages, Generator Units or Field Units pursuant to Section 7.8(f) during a Trigger Period) calculating the Borrowing Base and reflecting the Eligible Accounts, the Eligible Inventory, Eligible Generator Units, Eligible New Generator Units and Eligible Field Units of each of the Borrowers as of the end of the preceding week and calculating the advance amounts based thereon. Such report shall also reflect the amount of sales and receipts of Borrowers during the preceding period and such other information as Administrative Agent may reasonably request;

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(d)Compliance Certificate. Concurrently with the delivery of each of the financial statements referred to in Section 6.1(a) and each of the financial statements delivered for each fiscal quarter or the last month of each fiscal quarter pursuant to Section 6.1(b), as applicable, a Compliance Certificate (i) certifying, in the case of the financial statements delivered under Sections 6.1(a) and 6.1(b), as applicable, that such statements present fairly in all material respects the financial condition and results of operations of Company and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes, (ii) stating that to the best of the knowledge of the Responsible Officer executing same, no Default has occurred and is continuing, or if a Default has occurred and is continuing, a statement as to the nature thereof and the action which is proposed to be taken with respect thereto, (iii) showing in reasonable detail the calculations demonstrating compliance with the covenants set forth in Article 8 and calculation of the Leverage Ratio for purposes of calculating the Applicable Margin, (iv) stating whether any change in GAAP or in the application thereof has occurred since the date of the audited financial statements most recently delivered pursuant to Section 6.1(a) above and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such certificate and (v) containing such other certifications set forth therein. For any financial statements delivered electronically by a Responsible Officer in satisfaction of the reporting requirements set forth in clause (a) or (b) preceding that are not accompanied by the required Compliance Certificate, that Responsible Officer shall nevertheless be deemed to have certified the factual matters described in this clause (d) with respect to such financial statements; however, such deemed certificate shall not excuse or be construed as a waiver of Company’s obligation to deliver the required Compliance Certificate;

(e)Projections. Commencing with respect to the fiscal year ending December 31, 2019, as soon as available, but in any event not earlier than thirty (30) days before and not later than thirty (30) days after the end of each fiscal year of Company, forecasts prepared by management of Company, in form and substance satisfactory to Administrative Agent, of consolidated balance sheets of income or operations and cash flows of Company and its Subsidiaries on a monthly basis for the immediately following fiscal year;

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(f)Notice of Litigation. Promptly after the commencement thereof, notice of all actions, suits, and proceedings before any Governmental Authority or arbitrator affecting any Loan Party or any of its Subsidiaries which, if determined adversely to such Loan Party or such Subsidiary, could reasonably be expected to have a Material Adverse Effect;

(g)Notice of Default. As soon as possible and in any event within five (5) days after the occurrence of any Default, a written notice setting forth the details of such Default and the action that the applicable Loan Party has taken and proposes to take with respect thereto;

(h)ERISA Reports. Promptly after the filing or receipt thereof, copies of all reports, including annual reports, and notices which any Loan Party or ERISA Affiliate files with or receives from the PBGC, the IRS, or the U.S. Department of Labor under ERISA; as soon as possible and in any event within five (5) days after any Loan Party or any ERISA Affiliate knows or has reason to know that any ERISA Event or Prohibited Transaction has occurred with respect to any Plan or Multiemployer Plan, a certificate of the chief financial officer or other Responsible Officer of the applicable Loan Party setting forth the details as to such ERISA Event or Prohibited Transaction and the action that the applicable Loan Party proposes to take with respect thereto; annually, a copy of the notice described in Section 101(f) of ERISA that any Loan Party or ERISA Affiliate files or receives with respect to a Plan or Multiemployer Plan;

(i)Updates to Security Document Schedules. Upon Administrative Agent’s request, at the time of delivery of the Compliance Certificate delivered in connection with the financial statements pursuant to Sections 6.1(a) and 6.1(b), updates to all Schedules to the Security Documents to the extent that information contained in such Schedules has become inaccurate or incomplete since delivery thereof and such Schedules are required to be updated from time to time pursuant to the terms of the applicable Security Document;

(j)Insurance. Upon Administrative Agent’s request, at the time of delivery of the Compliance Certificate delivered in connection with the annual financial statements pursuant to Section 6.1(a), a report summarizing the insurance coverage (specifying type, amount and carrier) in effect for each Loan Party and its Subsidiaries and containing such additional information as Administrative Agent, or any Lender through Administrative Agent, may reasonably specify;

(k)Notice of Material Adverse Effect. As soon as possible and in any event within five (5) days after the occurrence thereof, written notice of any event or circumstance that could reasonably be expected to have a Material Adverse Effect;

(l) Account Agings. As soon as available and in any event within twenty (20) days (or earlier if a Trigger Period is in effect or if deemed necessary by Administrative Agent in its sole discretion) after the end of each fiscal month, consolidated and consolidating agings of all accounts payable and accounts receivable of the Borrowers (the “Account Agings”) showing each such account which is current and each such account which is thirty (30), sixty (60), ninety (90), and over ninety (90) days past invoice date and, with respect to accounts receivable, reconciling such aging with the Borrowing Base Reports;

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(m)Inventory Report(s). As soon as available and in any event within twenty (20) days after the end of each calendar month (or earlier if a Trigger Period is in effect or if deemed necessary by Administrative Agent in its sole discretion), an Inventory perpetual report for the Borrowers and a schedule that lists Inventory (including Generator Units and Field Units) by item, quantity, cost, location, customer, utilization, leased or rented out or held for lease or rent, appraised or not appraised in most recent appraisal, and eligible or ineligible as Eligible Inventory;

(n)Monthly Customer Statements. If requested by Administrative Agent, as soon as available and in any event within twenty (20) days (or earlier to the extent available and a Trigger Period is then in effect) after the end of each fiscal month, monthly customer statements of the Borrowers;

(o)Notice of Certain Changes. Promptly, (i) notice of any change in the business conducted by any Loan Party or any of its Subsidiaries, (ii) copies of any amendment, restatement, supplement or other modification to any of the Constituent Documents of any Loan Party or any of its Subsidiaries and (iii) notice of any change in the information provided in the Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified in parts (c) or (d) of such certification;

(p)Management Letters. Promptly upon receipt thereof, a copy of any management letter or written report submitted to Company or any of its Subsidiaries by independent certified public accountants with respect to the business, condition (financial or otherwise), operations, prospects, or Properties of Company or any of its Subsidiaries;

(q)General Information. Promptly, such other information concerning any Loan Party, any of its Subsidiaries or any of their respective Properties as Administrative Agent, or any Lender through Administrative Agent, may from time to time request, including, without limitation, any certification or other evidence Administrative Agent requests in order for it to (i) comply with any applicable federal, state, provincial or territorial Laws or regulations (including, but not limited to, information about the ownership and management of any Loan Party), (ii) confirm compliance by any Loan Party with all Anti-Terrorism Laws, and (iii) confirm that no Loan Party (nor any Person owning any interest of any nature whatsoever in any Loan Party) is a Sanctioned Person;

(r)Quarterly Financial Statements. As soon as available, and in any event within sixty (60) days after the last day of each fiscal quarter of FlexEnergy, a copy of an unaudited financial report of FlexEnergy and its Subsidiaries as of the end of such quarter and for the portion of the fiscal year then ended, containing, on a consolidated basis, respectively, balance sheets and statements of income, retained earnings, and cash flow, in each case setting forth in comparative form and figures for the corresponding period of the preceding fiscal year, all in reasonable detail and prepared in accordance with GAAP and to fairly and accurately present (subject to year-end audit adjustments) the financial condition and results of operations of FlexEnergy and its Subsidiaries, on a consolidated basis, as of the dates and for the periods indicated therein; and

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(s)Additional Information. If requested by Administrative Agent, (i) cash receipt journals or copies of checks, invoices for new billings, sales journals and backup for all miscellaneous credits and debits, purchases journals and cost of goods sold reports and inventory reports, which support a Borrowing Base report, (ii) a schedule detailing each Borrower’s Inventory, in form satisfactory to Administrative Agent, (A) by location (showing Inventory in transit and any Inventory located with a third party under any consignment, bailee arrangement or warehouse agreement), by product type (including Generator Units or Field Units), and by volume on hand, which Inventory shall be valued at the lower of cost or market (which approximates cost) and adjusted for Availability Reserves as Administrative Agent has previously indicated to the Borrowers are deemed by Administrative Agent to be appropriate, and (B) including a report of any variances or other results of Inventory counts performed by the Borrowers since the last Inventory schedule (including information regarding sales or other reductions, additions, returns, credits issued by the Borrowers and complaints and claims made against any Borrower) and (iii) a status report regarding each uptime energy, servicing or lease agreement covering any Generator Unit or Field Units, including whether such uptime energy, servicing or lease agreement has been amended, restated, modified or terminated during such period and delivering a copy of any new uptime energy, servicing or lease agreement or any amendment, modification or termination of any uptime energy, servicing or lease agreement.

All representations and warranties set forth in the Loan Documents with respect to any financial information concerning any Loan Party shall apply to all financial information delivered to Administrative Agent by such Loan Party, or any Person purporting to be a Responsible Officer of such Loan Party or other representative of such Loan Party regardless of the method of such transmission to Administrative Agent or whether or not signed by such Loan Party, or such Responsible Officer or other representative, as applicable.

Section 6.2Maintenance of Existence; Conduct of Business. Each Loan Party shall, and shall cause each of its Subsidiaries to, preserve and maintain its existence and all of its leases, privileges, licenses, permits, franchises, qualifications, and rights that are necessary or desirable in the ordinary conduct of its business, except to the extent a failure to so preserve and maintain could not reasonably be expected to have a Material Adverse Effect. Each Loan Party shall, and shall cause each of its Subsidiaries to, conduct its business in an orderly and efficient manner in accordance with good business practices.

Section 6.3Maintenance of Properties. Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain, keep, and preserve all of its Properties (tangible and intangible) necessary or useful in the proper conduct of its business in good working order and condition (reasonable wear and tear excepted).

Section 6.4Taxes and Claims. Each Loan Party shall, and shall cause each of its Subsidiaries to, pay or discharge at or before maturity or before becoming delinquent (a) all Taxes, levies, assessments, and governmental charges imposed on it or its income or profits or any of its Property, and (b) all lawful claims for labor, material, and supplies, which, if unpaid, might become a Lien upon any of its Property; provided, however, that no Loan Party nor any of its Subsidiaries shall be required to pay or discharge any Tax, levy, assessment, or governmental charge which is being contested in good faith by appropriate proceedings diligently pursued, and for which adequate reserves in accordance with GAAP have been established.

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Section 6.5Insurance. Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain insurance with financially sound and reputable insurance companies satisfactory to Administrative Agent in such amounts and covering such risks as is usually carried by companies engaged in similar businesses and owning similar Properties in the same general areas in which such Loan Party and its Subsidiaries operate, provided that in any event each Loan Party will maintain and cause each of its Subsidiaries to maintain workmen’s compensation insurance, property insurance and comprehensive general liability insurance with coverage amounts and deductibles reasonably satisfactory to Administrative Agent. Each insurance policy shall name Administrative Agent as lender loss payee or additional insured, as applicable, and each such insurance policy shall provide that such policy will not be cancelled or reduced without 30 days’ prior written notice to Administrative Agent (or 10 days in the case of nonpayment of premium).

Section 6.6Inspection Rights; Field Examinations; Appraisals.

(a)Each Loan Party shall, and shall cause each of its Subsidiaries to, permit representatives and independent contractors of Administrative Agent and each Lender (i) to examine, inspect, review, evaluate and make physical verifications of the Inventory (including Generator Units and Field Units) and other Collateral in any manner and through any medium that Administrative Agent or such Lender considers advisable, (ii) to visit and inspect its Properties, (iii) to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom and (iv) to discuss its affairs, business, operations, financial condition and accounts with its directors, officers, employees and independent certified public accountants, all at the expense of Borrowers and at such reasonable times during normal business hours and as often as may be reasonably requested; provided that, other than with respect to such visits and inspections during the continuance of an Event of Default, (A) only Administrative Agent on behalf of the Lenders may exercise rights under this clause (a) and (B) subject to Section 6.6(c), Administrative Agent shall not exercise such rights more often than one time during any period of twelve (12) consecutive months; provided, further, that when an Event of Default exists Administrative Agent or any Lender (or any of their respective representatives or independent contractors) may do any of the foregoing under this Section at the expense of Borrowers and at any time during normal business hours and without advance notice.

(b)Each Loan Party shall, and shall cause each of its Subsidiaries to, permit any representatives designated by Administrative Agent (including any consultants, accountants, lawyers and appraisers retained by Administrative Agent) to conduct field exams of the Accounts of the Loan Parties all at the expense of Borrowers and at such reasonable times; provided that Borrowers shall not be required to pay for more than one such field exam in any period of twelve (12) consecutive months unless an Event of Default has occurred and is continuing (in which case any limit of the number of field exams Administrative Agent may conduct shall not apply and any such field exams conducted when an Event of Default has occurred and is continuing shall be at the sole cost and expense of Borrowers).

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(c)Each Loan Party shall, and shall cause each of its Subsidiaries to, permit any representatives designated by Administrative Agent (including any consultants, accountants, lawyers and appraisers retained by Administrative Agent) to conduct third-party appraisals or updates thereof of the Inventory (including Generator Units and Field Units) owned by the Loan Parties, all at the expense of Borrowers and at such reasonable times; provided that Borrowers shall not be required to pay for more than two such third-party appraisals in any period of twelve (12) consecutive months unless an Event of Default has occurred and is continuing (in which case any such third-party appraisal conducted when an Event of Default has occurred and is continuing shall be at the sole cost and expense of Borrowers).

Section 6.7Keeping Books and Records. Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain proper books of record and account in which full, true, and correct entries in conformity with GAAP shall be made of all dealings and transactions in relation to its business and activities.

Section 6.8Compliance with Laws. Each Loan Party shall, and shall cause each of its Subsidiaries to, comply in all material respects with all applicable Laws (including, without limitation, all Anti-Terrorism Laws, Anti-Corruption Laws and applicable Sanctions) and decrees of any Governmental Authority or arbitrator.

Section 6.9Compliance with Agreements. Each Loan Party shall, and shall cause each of its Subsidiaries to, comply in all material respects with all agreements, contracts, and instruments binding on it or affecting its Properties or business, except to the extent a failure to so comply could not reasonably be expected to have a Material Adverse Effect.

Section 6.10Further Assurances. Each Loan Party shall, and shall cause each of its Subsidiaries and each other Loan Party to, execute and deliver such further agreements and instruments and take such further action as may be reasonably requested by Administrative Agent or any Lender to carry out the provisions and purposes of this Agreement and the other Loan Documents and to create, preserve, and perfect the Liens of Administrative Agent in the Collateral.

Section 6.11ERISA. Each Loan Party shall, and shall cause each of its Subsidiaries to, comply with all minimum funding requirements, and all other material requirements, of ERISA and the Code, if applicable, so as not to give rise to any liability thereunder.

Section 6.12Depository Relationship; Control Agreements; Blocked Accounts. Within sixty (60) days after the Closing Date (or such longer period as agreed to by Administrative Agent in its sole discretion), each Loan Party shall, and shall cause each of its Subsidiaries to, (a) use the financial institution serving as Administrative Agent as its principal depository bank, including for the maintenance of business, cash management, operating and administrative deposit accounts, (b) cause all commodity accounts, deposit accounts and securities accounts (in each case, excluding those accounts which are Excluded Accounts) to be subject to a Control Agreement in favor of Administrative Agent, in form and substance reasonably satisfactory to Administrative Agent, which provides that Administrative Agent shall have exclusive “Control” (as defined in the UCC) of such account and (c) will cause all collection and other Receipts to be directed to Blocked Accounts in accordance with Section 2.11. Loan Parties will at all times maintain Blocked Accounts required by Section 2.11.

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Section 6.13Additional Loan Parties; Additional Collateral.

(a)Each Loan Party shall notify Administrative Agent at the time that any Person becomes a Subsidiary of such Loan Party, and promptly thereafter (and in any event within thirty (30) days (or such longer period as agreed to by Administrative Agent in its sole discretion)) (i) execute and deliver or cause to be delivered to Administrative Agent all Security Documents, stock certificates, stock powers and other agreements and instruments as may be requested by Administrative Agent to ensure that Administrative Agent has a perfected Lien on all ownership interests (other than Excluded Assets) held by such Loan Party in such Subsidiary, and (ii) cause such new Subsidiary to (A) become a Guarantor and/or a Borrower by executing and delivering to Administrative Agent a Guaranty (or a joinder to Guaranty) and/or a Joinder Agreement, (B) execute and deliver all Security Documents (or joinders or assumptions thereto) requested by Administrative Agent pledging to Administrative Agent for the benefit of the Secured Parties all of its Property (other than Excluded Assets or such other exceptions as Administrative Agent may permit) and take all actions required by Administrative Agent to grant to Administrative Agent for the benefit of Secured Parties a perfected first priority (subject to Permitted Liens) security interest in such Property, including the filing of UCC and/or PPSA financing statements in such jurisdictions as may be requested by Administrative Agent, and (C) deliver to Administrative Agent such other documents and instruments as Administrative Agent may require, including appropriate favorable opinions of counsel to such Person in form, content and scope reasonably satisfactory to Administrative Agent.

(b)Company will at all times cause Parent or any other holder of the direct Equity Interests in Company to be a party to the Parent Pledge Agreement and pledge 100% of the Equity Interests in Company that such Person owns (including, to the extent such Equity Interests are certificated, delivery of original stock certificates evidencing such Equity Interests, together with an appropriate undated membership power for each certificate duly executed in blank by the registered owner thereof).

(c)Each Loan Party will cause 100% of the issued and outstanding Equity Interests of each of its Subsidiaries to be subject at all times to a first priority, perfected Lien in favor of the Administrative Agent, for the benefit of the Administrative Agent and the other Secured Parties, pursuant to the terms and conditions of the Loan Documents or other Security Documents as Administrative Agent shall reasonably request.

(d)Company will at all times cause Canadian Borrower to be a party to the Canadian Security Agreement.

Section 6.14Inventory; Collateral Access Agreements. If any Loan Party’s Inventory is located at a location leased by such Loan Party or in the possession or control of any Person (other than a customer of such Loan Party), the Borrower Representative shall notify the landlord or such Person, as applicable, of Administrative Agent’s security interest therein and, upon request by Administrative Agent, instruct such Person to execute a Collateral Access Agreement or otherwise acknowledge in writing its agreement to hold all such Inventory for the benefit of Administrative Agent and subject to Administrative Agent’s instructions; provided that if the Borrower Representative is unable to have such Person execute a Collateral Access Agreement, then such failure shall not constitute a Default or Event of Default under this Agreement, but Administrative Agent may establish a Rent Reserve. If so requested by Administrative Agent, the Borrower Representative and such other Loan Parties (as promptly as possible after requested by Administrative Agent but in any event within five (5) Business Days after any such request is made) will deliver (i) to Administrative Agent warehouse receipts covering any Loan Party’s Inventory located in warehouses showing Administrative Agent as the beneficiary thereof and (ii) to the warehouseman such agreements relating to the release of warehouse Inventory as Administrative Agent may reasonably request.

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Section 6.15Certificates of Title. The Loan Parties shall (a) cause Administrative Agent to be named as lienholder on all of their (i) Generator Units that are evidenced by a certificate of title, (ii) New Generator Units acquired after the Closing Date that are evidenced by a certificate of title and (iii) Field Units that are evidenced by a certificate of title, in each case, in accordance with Section 4.3(d) of the U.S. Security Agreement and (b) identify the location and serial numbers or vehicle identification numbers of any Generator Units, New Generator Units and Field Units that are serial number goods on and after the Third Amendment Effective Date, in each case in accordance with Section 3.4 of the Canadian Security Agreement.

Section 6.16Sanctions; Anti-Corruption Laws. Each Loan Party will maintain in effect policies and procedures designed to promote compliance by such Loan Party, its Subsidiaries, and their respective directors, officers, employees, and agents with applicable Sanctions and with the FCPA and any other applicable Anti-Corruption Laws.

Section 6.17Post-Closing Obligations.

(a)Within thirty (30) days following the Closing Date (or such longer period as agreed to by the Administrative Agent in its sole discretion), the Loan Parties shall deliver (or cause to be delivered) to the Administrative Agent copies of all lender loss payable and additional insured endorsements with respect to the insurance policies required pursuant to Section 6.5.

(b)Within thirty (30) days following the Closing Date (or such longer period as agreed to by the Administrative Agent in its sole discretion), the Loan Parties shall deliver (or cause to be delivered) to the Administrative Agent (i) Certificate No. 1 issued to Company evidencing 3,000 shares of Common Shares of Flex Power Co., (ii) an undated stock power executed in blank by a Responsible Officer of Company with respect to such stock certificate, (iii) Certificate No. 2AC issued to Flex Power Co. evidencing 65 shares of Class A Common Shares of Canadian Borrower and (iv) an undated stock power executed in blank by a Responsible Officer of Flex Power Co. with respect to such stock certificate.

For the avoidance of doubt, the Loan Parties’ failure to comply with any requirement of this Section 6.17 on or before the dates specified in this Section 6.17 shall constitute an immediate Event of Default.

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Article 7.

NEGATIVE COVENANTS

Each Loan Party covenants and agrees that, as long as the Obligations or any part thereof are outstanding or any Letter of Credit is outstanding or any Lender has any Commitment hereunder:

Section 7.1Debt. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, incur, create, assume, or permit to exist any Debt, except:

(a)the Obligations (other than Hedge Obligations);

(b)existing Debt described on Schedule 7.1;

(c)purchase money Debt and Capitalized Lease Obligations not to exceed $2,500,000 in the aggregate at any time outstanding;

(d)(i) Debt of any Loan Party owing to any other Loan Party, (ii) Debt of any Subsidiary that is not a Guarantor owing to any other Subsidiary that is not a Guarantor, and (iii) Debt of any Subsidiary that is not a Guarantor owing to any Loan Party that is permitted under Section 7.5;

(e)Debt owed to any Person providing workers’ compensation, health, disability or other employee benefits or property, casualty or liability insurance, performance, bid, surety or appeal bonds, performance and completion guarantees and similar obligations, pursuant to reimbursement or indemnification obligations to such Person, in each case incurred in the ordinary course of business;

(f)endorsements of negotiable or similar instruments for collection or deposit in the ordinary course of business;

(g)with respect to any Debt permitted to be incurred pursuant to this Section 7.1, guaranties of such Debt or guaranties by any Loan Party or any of its Subsidiaries of such Debt;

(h)Debt incurred in the ordinary course of business owed to any Person providing property, casualty, liability, or other insurance to the Loan Parties, including to finance insurance premiums, so long as the amount of such Debt is not in excess of the amount of the unpaid cost of, and shall be incurred only to defer the cost of, such;

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(i) Hedge Obligations existing or arising under Hedge Agreements permitted by Section 7.17; and

(j)other Debt not to exceed $2,500,000 in the aggregate at any time outstanding.

Section 7.2Limitation on Liens. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, incur, create, assume, or permit to exist any Lien upon any of its Property, assets, or revenues, whether now owned or hereafter acquired, except:

(a)existing Liens disclosed on Schedule 7.2;

(b)Liens in favor of the Secured Parties or Administrative Agent for the benefit of Secured Parties;

(c)encumbrances consisting of minor easements, zoning restrictions, or other restrictions on the use of real Property that do not (individually or in the aggregate) materially affect the value of the assets encumbered thereby or materially impair the ability of any Loan Party or its Subsidiaries to use such assets in their respective businesses, and none of which is violated in any material respect by existing or proposed structures or land use;

(d)Liens for taxes, assessments, or other governmental charges which are not delinquent or which are being contested in good faith and for which adequate reserves in accordance with GAAP have been established and for which such contest operates to suspend the enforcement of any foreclosure or levy on any Property of each Loan Party or any of its Subsidiary;

(e)Liens of landlords, vendors, mechanics, materialmen, warehousemen, carriers, or other similar statutory Liens securing obligations incurred in the ordinary course of business that are not yet due or which are being contested in good faith and for which adequate reserves in accordance with GAAP have been established and for which such contest operates to suspend the enforcement of any foreclosure or levy on any Property of each Loan Party or any of its Subsidiaries;

(f)Liens resulting from good faith deposits to secure payments of workmen’s compensation, unemployment insurance or other social security programs (other than Liens imposed by ERISA) or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, contracts (other than for payment of Debt), or leases made in the ordinary course of business;

(g)normal and customary rights of setoff upon deposits in favor of depository institutions, and Liens of a collecting bank on payment items in the course of collection;

(h)purported Liens evidenced by the filing of precautionary UCC or PPSA financing statements relating solely to operating leases or consignments of personal property entered into in the ordinary course of business;

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(i) Liens granted in the ordinary course of business on the unearned portion of insurance premiums securing the financing of insurance premiums to the extent the financing is permitted under Section 7.1(h);

(j)purchase money Liens on specific Property to secure Debt used to acquire such Property and Liens securing Capitalized Lease Obligations with respect to specific leased Property, in each case to the extent permitted in Section 7.1(c);

(k)Liens granted by the Loan Parties on certain Property specified in each of the Parent Loan Notes to secure the Parent Loan, provided that such Liens (i) are subordinate to the Liens in favor of Administrative Agent securing the Obligations and (ii) are at all time subject to the Intercreditor Agreement; and

(l)other Liens securing Debt not to exceed $500,000 in the aggregate at any time outstanding.

Nothing in this Section 7.2 shall in and of itself cause the obligations of the Loan Parties to the Secured Parties under or pursuant to the Loan Documents to be subordinated to any Lien permitted by this Section 7.2 or cause any Liens in favor of the Secured Parties to rank subordinate to any such permitted Liens.

Section 7.3Mergers, Etc. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, become a party to a division, merger, amalgamation or consolidation, or purchase or otherwise acquire all or substantially all of the assets of any Person or any shares or other evidence of beneficial ownership of any Person, or wind-up, dissolve, or liquidate, except that (a) any Subsidiary of Company may merge, amalgamate or consolidate with any Borrower so long as such Borrower is the surviving entity, (b) any Subsidiary of Company may merge, amalgamate or consolidate with another Subsidiary so long as if such Subsidiary that is a Guarantor is involved in such merger, amalgamation or consolidation, such Guarantor is the surviving entity and (c) any Person may merge, amalgamate or consolidate with or into any Loan Party provided such Loan Party shall be the surviving entity.

Section 7.4Restricted Payments. Each Loan Party shall not, nor shall it permit any of its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment, except:

(a)each Loan Party may make Restricted Payments with respect to its Equity Interests payable solely in additional shares of its Equity Interests (other than Disqualified Equity Interests);

(b)Subsidiaries may declare and pay dividends and other Restricted Payments, directly or indirectly, to Company and any other Subsidiary of Company that is a Loan Party;

(c)so long as no Default or Event of Default exists or would result therefrom, the Company may make Permitted Tax Distributions to the Parent;

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(d) so long as no Default or Event of Default exists or would result therefrom, the Company may make Restricted Payments to allow the Parent or FGS, as applicable, to pay Qualified IPO Expenses in an aggregate amount not to exceed (i) $1,672,603.11 during the period commencing on July 9, 2020 through (but not including) the Fifth Amendment Effective Date and (ii) $400,000 during the period commencing on the Fifth Amendment Effective Date through and including February 28, 2022; and

(e)commencing January 1, 2020, the Loan Parties and their Subsidiaries may make other Restricted Payments so long as the Payment Conditions have been satisfied at the time such Restricted Payment is made.

Section 7.5Loans and Investments. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, make, hold or maintain, any advance, loan, extension of credit, or capital contribution to or investment in, or purchase any stock, bonds, notes, debentures, or other securities of, any Person, except:

(a)existing investments described on Schedule 7.5;

(b)readily marketable direct obligations of the U.S. or any agency thereof with maturities of one (1) year or less from the date of acquisition;

(c)fully insured certificates of deposit with maturities of one (1) year or less from the date of acquisition issued by either (i) any commercial bank operating in the U.S. having capital and surplus in excess of $50,000,000 or (ii) any Lender;

(d)commercial paper of a domestic issuer if at the time of purchase such paper is rated in one (1) of the two (2) highest rating categories of Standard and Poor’s Corporation or Moody’s Investors Service;

(e)investments by a Borrower or a Guarantor in another Borrower or Guarantor;

(f)investments consisting of Hedge Agreements permitted under Section 7.17;

(g)advances or extensions of credit in the form of accounts receivable incurred and trade credit extended in the ordinary course of business;

(h)investments in securities of account debtors received pursuant to any settlement, restructuring, plan of reorganization or similar arrangement in connection with a foreclosure, bankruptcy workout or otherwise with respect to such account debtors, or upon the foreclosure or enforcement of any Lien on such securities arising in the ordinary course of business in favor of a Loan Party or its Subsidiaries;

(i)loans or advances made by a Loan Party to its employees for travel and entertainment expenses, relocation costs and similar purposes up to a maximum of $250,000 in the aggregate at any one time outstanding or, on a non-cash basis, for the purchase of Equity Interests in any Loan Party or any direct or indirect parent thereof; and

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(j) other investments so long as (i) no Event of Default shall have occurred and be continuing at the time of making such investment and immediately after giving effect thereto and (ii) the aggregate amount of all such investments under this clause (j) shall not exceed $2,000,000 at any time.

Section 7.6Limitation on Issuance of Equity. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, issue, sell, assign, or otherwise Dispose of (a) any of its stock or other Equity Interests, (b) any securities exchangeable for or convertible into or carrying any rights to acquire any of its stock or other Equity Interests, (c) any option, warrant, or other right to acquire any of its stock or other Equity Interests or (d) any Disqualified Equity Interests, in each case, other than (x) to any Loan Party or another Subsidiary or (y) the issuance of any Equity Interests in the Company (other than Disqualified Equity Interests) to the Parent.

Section 7.7Transactions With Affiliates. Except with respect to the making of Restricted Payments permitted by Section 7.4, Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, enter into any transaction, including, without limitation, the purchase, sale, or exchange of Property, the rendering of any service or the payment of any management, advisory or similar fees, with any Affiliate of Company or such Subsidiary, except in the ordinary course of and pursuant to the reasonable requirements of Company’s or such Subsidiary’s business, pursuant to a transaction which is otherwise expressly permitted under this Agreement, and upon fair and reasonable terms no less favorable to Company or such Subsidiary than would be obtained in a comparable arm’s-length transaction with a Person not an Affiliate of Company or such Subsidiary; provided that on and after the Fifth Amendment Effective Date, (a) the aggregate amount of intercompany receivables owing by Affiliates of the Company to the Company or its Subsidiaries to the extent such receivables are for transactions permitted by Section 7.5 and do not otherwise constitute a sale of goods or the rendering of services that is similar to other arm’s-length transactions with a Person that is not an Affiliate of the Company or such Subsidiary shall not exceed (i) $17,700,000 at any time outstanding prior to the consummation of a Qualified IPO and (ii) $12,700,000 at any time outstanding on or after the consummation of a Qualified IPO, and (b) to the extent unreimbursed, the aggregate amount of prepaid expenses made by the Company or any of its Subsidiaries to or on behalf of any of its Affiliates shall not exceed $11,000,000 at any time outstanding. Commencing on the Fifth Amendment Effective Date, the restrictions set forth in this Section 7.7 shall not apply to any payment of any management, development and engineering service fees and any expense reimbursement payments for general and administrative services made by the Company pursuant to the Management Services Agreement (collectively, the “Management Fees”) so long as (A) the aggregate amount of such fees and expenses do not exceed an amount of $200,000 in any calendar month and (B) such fees and expenses are not at any time paid in cash and in lieu thereof are accounted for by offsetting the amount of accounts receivable owed to the Company by one or more of its Affiliates, if any. 

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Section 7.8Disposition of Assets. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly make any Disposition, except (a) Dispositions of Inventory in the ordinary course of business, (b) Dispositions, for fair value, of worn-out, surplus and obsolete equipment not necessary or useful to the conduct of business, (c) Dispositions of Equity Interests permitted by Section 7.6, (d) Dispositions of Property to any Loan Party or any Subsidiary, provided that any such Disposition involving a Subsidiary that is not a Loan Party shall be made in compliance with Sections 7.5 or 7.6, (e) the unwinding of any Hedge Agreement, (f) Dispositions of Generator Packages, Generator Units or Field Units not to exceed $8,000,000 in the aggregate in any fiscal year; provided that (i) no Default or Event of Default shall have occurred and be continuing both before and after giving effect to such Disposition, (ii) Borrowers shall concurrently with such Disposition deliver a pro forma Borrowing Base Report to Administrative Agent giving effect to such Disposition (with such Disposition, for the avoidance of doubt, calculated based on the Net Orderly Liquidation Value of such Generator Packages, Generator Units and/or Field Units at such time) and the Borrowing Base shall be adjusted immediately upon receipt of such Borrowing Base Report to reflect such Disposition, (iii) after giving effect to such Disposition, including the reduction of the Borrowing Base in accordance with the foregoing clause (ii), Availability shall be equal to or greater than $0 or the Borrowers shall make any mandatory prepayment pursuant to Section 2.9(c)(i) concurrently with such Disposition, and (iv) such Disposition shall be made for fair value and for at least 80% cash consideration or (g) other Dispositions (other than with respect to any Accounts or other Property included in the Borrowing Base at any time) not to exceed $2,000,000 in the aggregate in any fiscal year.

Section 7.9Sale and Leaseback. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, enter into any arrangement with any Person pursuant to which it leases from such Person real or personal Property that has been or is to be sold or transferred, directly or indirectly, by it to such Person.

Section 7.10Prepayment of Debt. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, make any optional or voluntary payment, prepayment, repurchase or redemption of any Debt, except the Obligations under the Loan Documents.

Section 7.11Nature of Business. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, engage in any business other than the businesses in which they are engaged as of the date hereof or businesses directly related thereto. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, make any material change in its credit collection policies if such change would materially impair the collectability of any Account, nor will it rescind, cancel or modify any Account except in the ordinary course of business.

Section 7.12Environmental Protection. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly (a) use (or permit any tenant to use) any of their respective Properties or assets for the handling, processing, storage, transportation, or disposal of any Hazardous Material in violation of, or in a manner or to a location that could give rise to liability under, any applicable Environmental Laws, (b) generate any Hazardous Material in violation of any applicable Environmental Laws, (c) conduct any activity that is likely to cause a Release or threatened Release of any Hazardous Material in violation of any applicable Environmental Laws, or (d) otherwise conduct any activity or use any of their respective Properties or assets in any manner that is likely to violate any Environmental Law or create any Environmental Liabilities for which any Loan Party or any of its Subsidiaries would be responsible.

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Section 7.13Accounting. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, change its fiscal year or make any change (a) in accounting treatment or reporting practices, except as required by GAAP and disclosed to Administrative Agent and Lenders, or (b) in tax reporting treatment, except as required by Law and disclosed to Administrative Agent and Lenders.

Section 7.14Burdensome Agreements. Each Loan Party shall not, and shall not permit any of its Subsidiaries or any other Loan Party to, enter into or permit to exist any arrangement or agreement, other than pursuant to this Agreement or any other Loan Document, which (a) directly or indirectly prohibits Company, any of its Subsidiaries or any other Loan Party from creating or incurring a Lien on any of its Property, revenues, or assets, whether now owned or hereafter acquired, (b) directly or indirectly prohibits any of its Subsidiaries or any other Loan Party to make any payments, directly or indirectly, to any other Loan Party by way of dividends, distributions, advances, repayments of loans, repayments of expenses, accruals, or otherwise or (c) in any way would be contravened by such Person’s performance of its obligations hereunder or under the other Loan Documents; provided that clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Debt permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Debt.

Section 7.15Subsidiaries. Each Loan Party shall not, directly or indirectly, form or acquire any Domestic Subsidiary unless such Loan Party complies with the requirements of Section 6.13(a), 6.13(c) and 6.13(d), as applicable. Except with respect to the existence of Canadian Borrower, no Loan Party shall form or acquire any Foreign Subsidiaries.

Section 7.16Amendments of Certain Documents. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, amend, restate, supplement or otherwise modify (a) any of their respective Constituent Documents, (b) the Management Services Agreement, in each case, in a manner adverse to the interest of the Lenders (it being understood that any expansion in the scope of expenses or increase in any fees payable to any Affiliate of the Company pursuant to the Management Services Agreement shall be deemed to be adverse to the interests of the Lenders) or (c) the Parent Loan Documents in contravention of the Intercreditor Agreement.

Section 7.17Hedge Agreements. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, enter into any Hedge Agreement, except those that are entered into for non-speculative purposes and that are (a) Hedge Agreements entered into to hedge or mitigate risks to which such Loan Party or any Subsidiary thereof has actual exposure which have terms and conditions reasonably acceptable to Administrative Agent, and (b) other Hedge Agreements entered into in order to effectively cap, collar or exchange interest rates (from fixed to floating rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment, Debt of such Loan Party or any of its Subsidiaries limited to the principal amount of such interest-bearing liability or investment or Debt which have terms and conditions reasonably acceptable to Administrative Agent.

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Section 7.18Anti-Corruption Laws; Sanctions; Anti-Terrorism Law. Each Loan Party will not, directly or indirectly, use the proceeds of the Loans or Letters of Credit, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person, (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of the FCPA or any other applicable Anti-Corruption Law, or (b) (i) to fund any activities or business of or with any Person, or in any country or territory, that, at the time of such funding, is, or whose government is, the subject of Sanctions, or (ii) in any other manner that would result in a violation of Sanctions by any Person (including any Person participating in the Loans or Letters of Credit, whether as Administrative Agent, Arranger, Lender, underwriter, advisor, investor, or otherwise).

Section 7.19Negative Pledge. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that limits the ability of such Loan Party or Subsidiary to create, incur, assume or suffer to exist Liens on any real estate owned by such Loan Party or Subsidiary to secure the Obligations.

Section 7.20Canadian Defined Benefit Plan. No Loan Party shall sponsor, maintain, participate in, contribute to, or have or otherwise incur liability under, a Canadian Defined Benefit Plan.

Article 8.

FINANCIAL COVENANTS

Each Loan Party covenants and agrees that, as long as the Obligations or any part thereof are outstanding or any Letter of Credit is outstanding or any Lender has any Commitment hereunder:

Section 8.1Leverage Ratio. Company shall not permit the Leverage Ratio to be greater than (a) 4.00 to 1.00 as of the last day of any fiscal quarter ending March 31, 2019 through September 30, 2019 and (b) 3.50 to 1.00 as of the last day of any fiscal quarter ending on and after December 31, 2019.

Section 8.2Fixed Charge Coverage Ratio. Company shall not permit the Fixed Charge Coverage Ratio to be less than (a) 1.10 to 1.00 as of the last day of any fiscal quarter ending March 31, 2019 through September 30, 2019 and (b) 1.25 to 1.00 as of the last day of any fiscal quarter ending on and after December 31, 2019.

Article 9.

DEFAULT

Section 9.1Events of Default. Each of the following shall be deemed an “Event of Default”:

(a)Any Loan Parties shall fail to pay the Obligations under the Loan Documents or any part thereof shall not be paid when due or declared due and, other than with respect to payments of principal, such failure shall continue unremedied for three (3) Business Days after such payment became due;

(b)Any Loan Party shall breach any provision of Sections 6.1, 6.2 (with respect to a Loan Party’s existence), 6.5, 6.12, 6.13, 6.16 or 6.17 or Article 7 or Article 8 of this Agreement;

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(c) Any representation or warranty made or deemed made by Parent or any Loan Party (or any of their respective officers) in any Loan Document or in any certificate, report, notice, or financial statement furnished at any time in connection with this Agreement or any other Loan Document shall be false, misleading, or erroneous in any material respect (without duplication of any materiality qualifier contained therein) when made or deemed to have been made;

(d)Parent, Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party shall fail to perform, observe, or comply with any covenant, agreement, or term contained in this Agreement or any other Loan Document (other than as covered by Sections 9.1(a) and (b)), and such failure continues for more than thirty (30) days following the date such failure first began;

(e)Parent, Company or any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party shall commence a voluntary proceeding seeking liquidation, reorganization, or other relief with respect to itself or its debts under any bankruptcy, insolvency, or other Debtor Relief Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian, monitor or other similar official of it or a substantial part of its Property or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it or shall make a general assignment for the benefit of creditors or shall generally fail to pay its debts as they become due or shall take any corporate action to authorize any of the foregoing;

(f)An involuntary proceeding shall be commenced against Parent, Company or any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party seeking liquidation, reorganization, or other relief with respect to it or its debts under any bankruptcy, insolvency, or other Debtor Relief Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian, monitor or other similar official for it or a substantial part of its Property, and such involuntary proceeding shall remain undismissed and unstayed for a period of thirty (30) consecutive days;

(g)Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party shall fail to pay when due any principal of or interest on any Debt (other than the Obligations under the Loan Documents) with an outstanding principal amount of $1,000,000 or more, or the maturity of any such Debt shall have been accelerated, or any such Debt shall have been required to be prepaid, repurchased, defeased or redeemed prior to the stated maturity thereof or any cash collateral in respect thereof to be demanded, or any event shall have occurred that permits (or, with the giving of notice or lapse of time or both, after any applicable cure periods, would permit) any holder or holders of such Debt, or the counterparty under any Hedge Agreement constituting such Debt, or any Person acting on behalf of such holder or holders or such counterparty to accelerate the maturity thereof or require any such prepayment, repurchase, defeasance or redemption or any cash collateral in respect thereof to be demanded;

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(h)This Agreement, the Guaranty or any other Loan Document shall cease to be in full force and effect or shall be declared null and void or the validity or enforceability thereof shall be contested or challenged by the Parent, Company, any of its Subsidiaries, any other Loan Party or any Subsidiary of any Loan Party or any of their respective equity holders, or Parent or any Loan Party shall deny that it has any further liability or obligation under any of the Loan Documents, or any Lien created by the Loan Documents shall for any reason cease to be a valid, first priority perfected Lien (subject to Permitted Liens) upon any of the Collateral purported to be covered thereby;

(i)Any of the following events shall occur or exist with respect to any Loan Party or any ERISA Affiliate: (i) any ERISA Event occurs with respect to a Plan or Multiemployer Plan, or (ii) any Prohibited Transaction involving any Plan or Multiemployer Plan; and in each case above, such event or condition, together with all other events or conditions, if any, have subjected or could in the reasonable opinion of Administrative Agent subject any Loan Party or any ERISA Affiliate to any tax, penalty, or other liability to a Plan, a Multiemployer Plan, the PBGC, the IRS, the U. S. Department of Labor, or otherwise (or any combination thereof) which in the aggregate exceed or could reasonably be expected to exceed $1,000,000;

(j)A Change of Control shall occur;

(k)Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party, or any of their Properties, revenues, or assets, shall become subject to an order of forfeiture, seizure, or divestiture (whether under RICO or otherwise) and the same shall not have been discharged within thirty (30) days from the date of entry thereof;

(l)Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party shall fail to discharge within a period of thirty (30) consecutive days after the commencement thereof any attachment, sequestration, or similar proceeding or proceedings involving an aggregate amount in excess of $500,000 against any of its assets or Properties;

(m)A final judgment or judgments for the payment of money in excess of $500,000 not covered by insurance in the aggregate (and to which the applicable insurer has not denied coverage) shall be rendered by a court or courts against Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party and the same shall not be discharged (or provision shall not be made for such discharge), or a stay of execution thereof shall not be procured, within thirty (30) consecutive days from the date of entry thereof and Company, such Subsidiary, or such Loan Party or such Subsidiary of such Loan Party shall not, within such period of thirty (30) consecutive days, or such longer period during which execution of the same shall have been stayed, appeal therefrom and cause the execution thereof to be stayed during such appeal; or

(n)Any event of default shall occur under any of the Parent Loan Documents.

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Section 9.2Remedies Upon Default. If any Event of Default shall occur and be continuing, then Administrative Agent may, with the consent of Required Lenders, or shall, at the direction of Required Lenders, without notice do any or all of the following: (a) terminate the Commitments of Lenders (except for funding obligations of outstanding Letters of Credit), (b) terminate the obligations of L/C Issuer to make L/C Credit Extensions, (c) terminate the commitment of Swing Line Lender to make Swing Line Loans, (d) require that Borrowers Cash Collateralize the L/C Obligations (in an amount equal to the Minimum Collateral Amount with respect thereto), or (e) declare the Obligations (other than the Obligations arising out of Bank Product Agreements) or any part thereof to be immediately due and payable, and the same shall thereupon become immediately due and payable, without notice, demand, presentment, notice of dishonor, notice of acceleration, notice of intent to accelerate, notice of intent to demand, protest, or other formalities of any kind, all of which are hereby expressly waived by each Borrower and each other Loan Party; provided, however, that upon the occurrence of an Event of Default under Section 9.1(e) or (f), the Commitments of Lenders shall automatically terminate (except for funding obligations of outstanding Letters of Credit), the obligations of L/C Issuer to make L/C Credit Extensions shall automatically terminate, the commitment of Swing Line Lender to make Swing Line Loans shall automatically terminate, the obligation of each Borrower to Cash Collateralize the L/C Obligations as aforesaid shall automatically become effective, and the Obligations (other than the Obligations arising out of Bank Product Agreements) shall become immediately due and payable, in each case without notice, demand, presentment, notice of dishonor, notice of acceleration, notice of intent to accelerate, notice of intent to demand, protest, or other formalities of any kind, all of which are hereby expressly waived by each Borrower and each other Loan Party. In addition to the foregoing, if any Event of Default shall occur and be continuing, Administrative Agent may, with the consent of Required Lenders, or shall, at the direction of Required Lenders, exercise all rights and remedies available to it, Lenders and L/C Issuer in law or in equity, under the Loan Documents, or otherwise.

Section 9.3Right to Cure Financial Covenant Non-Compliance. Notwithstanding anything to the contrary contained in Section 9.1 or 9.2, in the event Company fails to comply with the financial covenants set forth in Section 8.1 or Section 8.2 as of the last day of such fiscal quarter, subject to the terms and conditions hereof, Company shall have the right (the “Cure Right”) from the last day of the applicable fiscal quarter until the expiration of the 10th Business Day subsequent to the date by which the financial statements for the last month of such fiscal quarter are required to be delivered to Administrative Agent pursuant to Section 6.1(b), to receive a Specified EBITDA Equity Contribution in an aggregate amount equal to, but not greater than, the amount necessary to cause Company to be in compliance with Section 8.1 and Section 8.2 for such period (hereinafter, the “Cure Amount”), and upon the receipt by Company of the cash proceeds thereof, the financial covenants shall then be recalculated giving effect to the following pro forma adjustments: Annualized EBITDA and/or EBITDA shall be calculated for the applicable fiscal quarter and any four fiscal quarter period that contains such fiscal quarter, solely for the purpose of measuring compliance with the financial covenants and not for any other purpose under this Agreement, by an amount equal to the Cure Amount (it being understood that, with respect to the calculation of Annualized EBITDA, the Cure Amount will be added after the amount of EBITDA set forth in clause (a) of the definition of Annualized EBITDA has been calculated for the applicable fiscal month for which Company has failed to comply with the financial covenants set forth in Section 8.2);

(b) if, after giving effect to the foregoing recalculations, Company shall then be in compliance with the requirements of all financial covenants, Company shall be deemed to have been in compliance with such financial covenants as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach, Default or Event of Default of such financial covenants that had occurred shall be deemed not to have occurred for this purpose of the Agreement;

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(c)notwithstanding anything herein to the contrary, (i) in each four consecutive fiscal quarter period of Company there shall be at least two fiscal quarters in which the Cure Right is not exercised, (ii) during the term of this Agreement, the Cure Right shall not be exercised more than five (5) times, (iii) the Cure Amount shall be no greater than the amount required for purposes of complying with the financial covenants and any amounts in excess thereof shall not be deemed to be a Cure Amount and (iv) there shall be no pro forma reduction in Debt with the proceeds of any Cure Amount. Notwithstanding any other provision in this Agreement to the contrary, the Cure Amount received pursuant to any exercise of the Cure Right shall be disregarded for purposes of determining the satisfaction of any Default or Event of Default condition, any financial ratio-based conditions or tests, the Applicable Margin or other pricing or any available basket under Article 7 of this Agreement; and

(d)the mandatory prepayment of the Loans made pursuant to Section 2.9(c) with respect to any cash proceeds of Specified EBITDA Equity Contribution shall not serve as a reduction to Debt for purposes of calculating the Leverage Ratio for the four fiscal quarter period then ending (even if the proceeds of any Specified EBITDA Equity Contribution are actually used to repay Debt, regardless of whether the proceeds of any Specified EBITDA Equity Contribution are received before or after the last day of such period).

Section 9.4Application of Funds. After the exercise of remedies provided for in Section 9.2 (or if an Event of Default exists and the written notice thereof, if any, to any Borrower from Administrative Agent expressly provides that this Section 9.4 shall thereafter apply to any amounts received on account of the Obligations or after the Loans have automatically become immediately due and payable), any amounts received on account of the Obligations shall be applied by Administrative Agent in the following order:

First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to Administrative Agent) payable to Administrative Agent in its capacity as such;

Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal, interest, and Letter of Credit Fees) payable to Lenders and L/C Issuer (including fees, charges and disbursements of counsel to the respective Lenders and L/C Issuer) arising under the Loan Documents, ratably among them in proportion to the respective amounts described in this clause Second payable to them;

Third, to payment of that portion of the Obligations constituting accrued and unpaid Letter of Credit Fees and interest on the Loans, L/C Borrowings and other Obligations arising under the Loan Documents, ratably among Lenders and L/C Issuer in proportion to the respective amounts described in this clause Third payable to them;

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Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans and L/C Borrowings and constituting unpaid Bank Product Obligations, ratably among Lenders and Bank Product Providers in proportion to the respective amounts described in this clause Fourth held by them;

Fifth, to Administrative Agent for the account of the L/C Issuer, to Cash Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of Letters of Credit to the extent not otherwise Cash Collateralized by any Borrower pursuant to Sections 2.2 and 2.7;

Sixth, to payment of that remaining portion of the Obligations, ratably among the Lenders and Bank Product Providers in proportion to the respective amounts described in this clause Sixth held by them; and

Last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to Borrowers or as otherwise required by Law.

Notwithstanding anything to the contrary herein or in any other Loan Document, no amount received from any Loan Party shall be applied to any Excluded Swap Obligation of such Loan Party, but appropriate adjustments shall be made with respect to payments from other Loan Parties to preserve allocation to Obligations otherwise set forth in this Section.

Further notwithstanding, Bank Product Obligations shall be excluded from the application described above if Administrative Agent has not received written notice thereof, together with supporting documentation as Administrative Agent may request from the applicable Bank Product Provider, provided that no such notice shall be required for any Bank Product Agreement for which Administrative Agent or any Affiliate of Administrative Agent is the applicable Bank Product Provider. Each Bank Product Provider that is not a party to this Agreement that has given notice contemplated by the preceding sentence shall, by such notice, be deemed to have acknowledged and accepted the appointment of Administrative Agent pursuant to the terms of Article 10 hereof for itself and its Affiliates as if a “Lender” party hereto.

Section 9.5Performance by Administrative Agent. If any Loan Party shall fail to perform any covenant or agreement contained in any of the Loan Documents, then Administrative Agent may perform or attempt to perform such covenant or agreement on behalf of such Loan Party. In such event, Borrowers shall, at the request of Administrative Agent, promptly pay to Administrative Agent any amount expended by Administrative Agent in connection with such performance or attempted performance, together with interest thereon at the Default Interest Rate from and including the date of such expenditure to but excluding the date such expenditure is paid in full. Notwithstanding the foregoing, it is expressly agreed that Administrative Agent shall not have any liability or responsibility for the performance of any covenant, agreement, or other obligation of any Borrower or any other Loan Party under this Agreement or any other Loan Document.

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Article 10.

AGENCY

Section 10.1Appointment and Authority.

(a) Each of the Lenders, L/C Issuer, and Swing Line Lender hereby irrevocably appoints Texas Capital Bank to act on its behalf as Administrative Agent hereunder and under the other Loan Documents and authorizes Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article 10 are solely for the benefit of Administrative Agent, Lenders, L/C Issuer, and Swing Line Lender, and no Loan Party shall have rights as a third-party beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” herein or in any other Loan Documents (or any other similar term) with reference to Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

(b)Administrative Agent shall also act as the “collateral agent” under the Loan Documents, and each of the Lenders (including for itself and its Affiliates in their capacities as potential Bank Product Providers) and L/C Issuer hereby irrevocably appoints and authorizes Administrative Agent to act as the agent of such Lender and L/C Issuer for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Loan Parties to secure any of the Obligations, together with such powers and discretion as are reasonably incidental thereto. In this connection, Administrative Agent, as “collateral agent” and any co-agents, sub-agents and attorneys-in-fact appointed by Administrative Agent pursuant to Section 10.5 for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted under the Security Documents, or for exercising any rights and remedies thereunder at the direction of Administrative Agent, shall be entitled to the benefits of all provisions of this Article 10 and Article 11 (including Section 11.1(b), as though such co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under the Loan Documents) as if set forth in full herein with respect thereto.

Section 10.2Rights as a Lender. The Person serving as Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not Administrative Agent, and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for, and generally engage in any kind of business with, any Loan Party or any Subsidiary or other Affiliate thereof as if such Person were not Administrative Agent hereunder and without any duty to account therefor to Lenders.

Section 10.3Exculpatory Provisions.

(a)Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents, and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, Administrative Agent:

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(i) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(ii)shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that Administrative Agent is required to exercise as directed in writing by Required Lenders (or such other number or percentage of Lenders as shall be expressly provided for herein or in the other Loan Documents); provided that Administrative Agent shall not be required to take any action that, in its opinion or upon the advice of its counsel, may expose Administrative Agent to liability or that is contrary to any Loan Document or applicable Law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of Property of a Defaulting Lender in violation of any Debtor Relief Law;

(iii)shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any Loan Party or any of their respective Affiliates that is communicated to or obtained by the Person serving as Administrative Agent or any of its Affiliates in any capacity; and

(iv)shall be fully justified in failing or refusing to take any action hereunder or under any other Loan Document unless it shall first be indemnified to its satisfaction by Lenders pro rata against any and all liability, cost and expense that it may incur by reason of taking or continuing to take any such action.

(b)Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of Required Lenders (or such other number or percentage of Lenders as shall be necessary, or as Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 9.2 and 10.9), or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. SUCH LIMITATION OF LIABILITY SHALL APPLY REGARDLESS OF WHETHER THE LIABILITY ARISES FROM THE SOLE, CONCURRENT, CONTRIBUTORY OR COMPARATIVE NEGLIGENCE OF ADMINISTRATIVE AGENT. Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given to Administrative Agent in writing by any Loan Party, a Lender, L/C Issuer, or Swing Line Lender.

(c)Neither Administrative Agent nor any Related Party thereof shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article 4 or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to Administrative Agent.

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Section 10.4Reliance by Administrative Agent. Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Credit Extension, that by its terms must be fulfilled to the satisfaction of a Lender, L/C Issuer, or Swing Line Lender, Administrative Agent may presume that such condition is satisfactory to such Lender, L/C Issuer, or Swing Line Lender unless Administrative Agent shall have received notice to the contrary from such Lender prior to the making of such Credit Extension. Administrative Agent may consult with legal counsel (who may be counsel for any Loan Party), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

Section 10.5Delegation of Duties. Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub agents appointed by Administrative Agent. Administrative Agent and any such sub agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article 10 shall apply to any such sub agent and to the Related Parties of Administrative Agent and any such sub agent, and shall apply to their respective activities in connection with the syndication of the Revolving Credit Facility as well as activities as Administrative Agent. Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub agents.

Section 10.6Resignation or Removal of Administrative Agent.

(a)Administrative Agent may at any time give notice of its resignation to Lenders, L/C Issuer, Swing Line Lender and Borrowers. Upon receipt of any such notice of resignation, Required Lenders shall have the right, in consultation with Borrowers (so long as no Event of Default has occurred and is continuing), to appoint a successor, which shall be a bank with an office in Dallas, Texas, or an Affiliate of any such bank with an office in Dallas, Texas. If no such successor shall have been so appointed by Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent gives notice of its resignation (or such earlier day as shall be agreed by Required Lenders) (the “Resignation Effective Date”), then the retiring Administrative Agent may (but shall not be obligated to), on behalf of Lenders, L/C Issuer, and Swing Line Lender, appoint a successor Administrative Agent meeting the qualifications set forth above; provided that in no event shall any successor Administrative Agent be a Defaulting Lender. Whether or not a successor has been appointed, such resignation shall become effective in accordance with such notice on the Resignation Effective Date. After the Resignation Effective Date, the provisions of this Article 10 relating to or indemnifying or releasing Administrative Agent shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement and the other Loan Documents.

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(b)If the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, Required Lenders may, to the extent permitted by applicable Law, by notice in writing to the Borrower Representative and such Person remove such Person as Administrative Agent and, in consultation with the Borrower Representative, appoint a successor. If no such successor shall have been so appointed by Required Lenders and shall have accepted such appointment within thirty (30) days (or such earlier day as shall be agreed by Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date.

(c)With effect from the Resignation Effective Date or the Removal Effective Date (as applicable) (i) the retiring or removed Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any Collateral held by Administrative Agent on behalf of Secured Parties under any of the Loan Documents, the retiring or removed Administrative Agent shall continue to hold such Collateral until such time as a successor Administrative Agent is appointed) and (ii) except for any indemnity, fee or expense payments owed to the retiring or removed Administrative Agent, all payments, communications and determinations provided to be made by, to or through Administrative Agent shall instead be made by or to each Lender, L/C Issuer, or Swing Line Lender, as applicable, directly, until such time, if any, as Required Lenders appoint a successor Administrative Agent as provided for above. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring or removed Administrative Agent (other than any rights to indemnity payments owed to the retiring or removed Administrative Agent), and the retiring or removed Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents. The fees payable by Borrowers to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between Borrowers and such successor. After the retiring or removed Administrative Agent’s resignation or removal hereunder and under the other Loan Documents, the provisions of this Article 10, Section 11.1, and Section 11.2 shall continue in effect for the benefit of such retiring or removed Administrative Agent, its sub agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring or removed Administrative Agent was acting as Administrative Agent.

(d)Any resignation by Texas Capital Bank as Administrative Agent pursuant to this Section shall also constitute its resignation as L/C Issuer and Swing Line Lender unless the notice thereof otherwise provides. If Texas Capital Bank resigns as an L/C Issuer, it shall retain all the rights, powers, privileges and duties of L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto, including the right to require Lenders to make Revolving Credit Loans or fund risk participations in Unreimbursed Amounts pursuant to Section 2.2(c). If Texas Capital Bank resigns as Swing Line Lender, it shall retain all the rights of Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such resignation, including the right to require Lenders to make Revolving Credit Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section 2.3(c). Upon the appointment by Borrowers of a successor L/C Issuer or Swing Line Lender hereunder (which successor shall in all cases be a Lender other than a Defaulting Lender), (i) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender, as applicable, (ii) the retiring L/C Issuer and Swing Line Lender shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (iii) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to Texas Capital Bank to effectively assume the obligations of Texas Capital Bank with respect to such Letters of Credit.

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Section 10.7Non-Reliance on Administrative Agent and Other Lenders. Each Lender, L/C Issuer, and Swing Line Lender expressly acknowledges that neither Administrative Agent nor any other Lender nor any Related Party thereto has made any representation or warranty to such Person and that no act by Administrative Agent or any other Lender hereafter taken, including any review of the affairs of any Loan Party, shall be deemed to constitute any representation or warranty by Administrative Agent or any Lender to any other Lender. Each Lender, Swing Line Lender and L/C Issuer acknowledges that it has, independently and without reliance upon Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender, L/C Issuer, and Swing Line Lender also acknowledges that it will, independently and without reliance upon Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder. Except for notices, reports and other documents expressly required to be furnished to the Lenders or Swing Line Lender by Administrative Agent hereunder, Administrative Agent shall not have any duty or responsibility to provide any Lender or Swing Line Lender with any credit or other information concerning the business, operations, Property, condition (financial or otherwise), or creditworthiness of any Loan Party or the value of the Collateral or other Properties of any Loan Party or any other Person which may come into the possession of Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates.

Section 10.8Administrative Agent May File Proofs of Claim. In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Loan Party, Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether Administrative Agent shall have made any demand on any Loan Party) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:

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(a)to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations and all other Obligations under the Loan Documents that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of Lenders, L/C Issuer, Swing Line Lender, and Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of Lenders, L/C Issuer, Swing Line Lender, and Administrative Agent and their respective agents and counsel and all other amounts due Lenders, L/C Issuer, Swing Line Lender, and Administrative Agent under Section 11.1 or Section 11.2) allowed in such judicial proceeding; and

(b)to collect and receive any monies or other Property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender, L/C Issuer and Swing Line Lender to make such payments to Administrative Agent and, in the event that Administrative Agent shall consent to the making of such payments directly to Lenders, L/C Issuer, and Swing Line Lender, as applicable, to pay to Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of Administrative Agent and its agents and counsel, and any other amounts due Administrative Agent under Section 11.1 or Section 11.2.

Section 10.9Collateral and Guaranty Matters.

(a)The Secured Parties irrevocably authorize Administrative Agent, at its option and in its discretion:

(i)to release any Lien on any Property granted to or held by Administrative Agent under any Loan Document (x) upon termination of all Commitments and payment in full of all Obligations (other than (A) contingent indemnification obligations and (B) obligations and liabilities under Bank Product Agreements as to which arrangements satisfactory to the applicable Bank Product Provider shall have been made) and the expiration or termination of all Letters of Credit (other than Letters of Credit as to which other arrangements satisfactory to Administrative Agent and L/C Issuer shall have been made), (y) that is sold or otherwise disposed of or to be sold or otherwise disposed of as part of or in connection with any sale or other disposition permitted under the Loan Documents, or (z) if approved, authorized or ratified in writing by Required Lenders or all Lenders, as applicable, under Section 11.10;

(ii)to subordinate any Lien on any Property granted to or held by Administrative Agent under any Loan Document to the holder of any Lien on such Property that is permitted by Section 7.2; and

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(iii) to release any Guarantor from its obligations under the Guaranty if such Person ceases to be a Subsidiary as a result of a transaction permitted under the Loan Documents.

Upon request by Administrative Agent at any time, Required Lenders will confirm in writing Administrative Agent’s authority to release or subordinate its interest in particular types or items of Property, or to release any Guarantor from its obligations under the Guaranty pursuant to this Section 10.9. Upon the occurrence of any of the events specified in Section 10.9(a)(i)(x), (y) or (z) or Section 10.9(a)(iii), at Borrowers’ expense, Administrative Agent shall execute and deliver to Borrowers such documentation as Borrowers shall reasonably request to release the applicable Collateral from the Liens created by the Loan Documents and/or release the applicable Guarantor from its obligations under its Guaranty, as the case may be.

(b)Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of Administrative Agent’s Lien thereon, or any certificate prepared by any Loan Party in connection therewith, nor shall Administrative Agent be responsible or liable to Lenders for any failure to monitor or maintain any portion of the Collateral.

Section 10.10Bank Product Agreements. No Bank Product Provider who obtains the benefits of Section 9.4, any Guaranty or any Collateral by virtue of the provisions hereof or of any Guaranty or any Security Document shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) (or to notice of or to consent to any amendment, waiver or modification of the provisions hereof or of the Guaranty or any Security Document) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents. Notwithstanding any other provision of this Article 10 to the contrary, Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, Bank Product Obligations unless Administrative Agent has received written notice of such Bank Product Obligations, together with such supporting documentation as Administrative Agent may request, from the applicable Bank Product Provider. Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, Bank Product Obligations arising under Bank Product Agreements upon termination of all Commitments and payment in full of all Obligations under the Loan Documents (other than contingent indemnification obligations) and the expiration or termination of all Letters of Credit (other than Letters of Credit as to which other arrangements satisfactory to Administrative Agent and L/C Issuer shall have been made).

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Section 10.11Erroneous Payments.

(a)If the Administrative Agent notifies a Lender, L/C Issuer or Secured Party, or any Person who has received funds on behalf of a Lender, L/C Issuer or Secured Party (any such Lender, L/C Issuer, Secured Party or other recipient, a “Payment Recipient”) that the Administrative Agent has determined in its sole discretion (whether or not after receipt of any notice under immediately succeeding clause (b)) that any funds received by such Payment Recipient from the Administrative Agent or any of its Affiliates were erroneously transmitted to, or otherwise erroneously or mistakenly received by, such Payment Recipient (whether or not known to such Lender, L/C Issuer, Secured Party or other Payment Recipient on its behalf) (any such funds, whether received as a payment, prepayment or repayment of principal, interest, fees, distribution or otherwise, individually and collectively, an “Erroneous Payment”) and demands the return of such Erroneous Payment (or a portion thereof) (provided, that, without limiting any other rights or remedies (whether at law or in equity), the Administrative Agent may not make any such demand under this clause (a)(i) with respect to an Erroneous Payment unless such demand is made within 10 Business Days of the date of receipt of such Erroneous Payment by the applicable Payment Recipient), such Erroneous Payment shall at all times remain the property of the Administrative Agent and shall be segregated by the Payment Recipient and held in trust for the benefit of the Administrative Agent, and such Lender, L/C Issuer or Secured Party shall (or, with respect to any Payment Recipient who received such funds on its behalf, shall cause such Payment Recipient to) promptly, but in no event later than two Business Days thereafter, return to the Administrative Agent the amount of any such Erroneous Payment (or portion thereof) as to which such a demand was made, in same day funds (in the currency so received), together with interest thereon in respect of each day from and including the date such Erroneous Payment (or portion thereof) was received by such Payment Recipient to the date such amount is repaid to the Administrative Agent in same day funds at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect. A notice of the Administrative Agent to any Payment Recipient under this clause (a) shall be conclusive, absent manifest error.

(b)Without limiting immediately preceding clause (a), each Lender, L/C Issuer or Secured Party, or any Person who has received funds on behalf of a Lender, L/C Issuer or Secured Party, hereby further agrees that if it receives a payment, prepayment or repayment (whether received as a payment, prepayment or repayment of principal, interest, fees, distribution or otherwise) from the Administrative Agent (or any of its Affiliates) (x) that is in a different amount than, or on a different date from, that specified in a notice of payment, prepayment or repayment sent by the Administrative Agent (or any of its Affiliates) with respect to such payment, prepayment or repayment, (y) that was not preceded or accompanied by a notice of payment, prepayment or repayment sent by the Administrative Agent (or any of its Affiliates), or (z) that such Lender, L/C Issuer or Secured Party, or other such recipient, otherwise becomes aware was transmitted, or received, in error or by mistake (in whole or in part) in each case.

(i)(A) in the case of immediately preceding clauses (x) or (y), an error shall be presumed to have been made (absent written confirmation from the Administrative Agent to the contrary) or (B) an error has been made (in the case of immediately preceding clause (z)), in each case, with respect to such payment, prepayment or repayment; and

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(ii)such Lender, L/C Issuer or Secured Party shall (and shall cause any other recipient that receives funds on its respective behalf to) promptly (and, in all events, within one Business Day of its knowledge of such error) notify the Administrative Agent of its receipt of such payment, prepayment or repayment, the details thereof (in reasonable detail) and that it is so notifying the Administrative Agent pursuant to this Section 10.11(b).

(c)Each Lender, L/C Issuer or Secured Party hereby authorizes the Administrative Agent to set off, net and apply any and all amounts at any time owing to such Lender, L/C Issuer or Secured Party under any Loan Document, or otherwise payable or distributable by the Administrative Agent to such Lender, L/C Issuer or Secured Party from any source, against any amount due to the Administrative Agent under immediately preceding clause (a) or under the indemnification provisions of this Agreement.

(d)In the event that an Erroneous Payment (or portion thereof) is not recovered by the Administrative Agent for any reason, after demand therefor by the Administrative Agent in accordance with immediately preceding clause (a), from any Lender or L/C Issuer that has received such Erroneous Payment (or portion thereof) (and/or from any Payment Recipient who received such Erroneous Payment (or portion thereof) on its respective behalf) (such unrecovered amount, an “Erroneous Payment Return Deficiency”), upon the Administrative Agent’s notice to such Lender or L/C Issuer at any time, (i) such Lender or L/C Issuer shall be deemed to have assigned its relevant Loans (but not its Commitments) with respect to which such Erroneous Payment was made (the “Erroneous Payment Impacted Class”) in an amount equal to the Erroneous Payment Return Deficiency (or such lesser amount as the Administrative Agent may specify) (such assignment of the Loans (but not Commitments) of the Erroneous Payment Impacted Class, the “Erroneous Payment Deficiency Assignment”) at par plus any accrued and unpaid interest (with the assignment fee to be waived by the Administrative Agent in such instance), and is hereby (together with the Borrowers) deemed to execute and deliver an Assignment and Assumption with respect to such Erroneous Payment Deficiency Assignment, and such Lender or L/C Issuer shall deliver any Notes evidencing such Loans to the Borrowers or the Administrative Agent, (ii) the Administrative Agent as the assignee Lender shall be deemed to acquire the Erroneous Payment Deficiency Assignment, (iii) upon such deemed acquisition, the Administrative Agent as the assignee Lender shall become a Lender or L/C Issuer, as applicable, hereunder with respect to such Erroneous Payment Deficiency Assignment and the assigning Lender or assigning L/C Issuer shall cease to be a Lender or L/C Issuer, as applicable, hereunder with respect to such Erroneous Payment Deficiency Assignment, excluding, for the avoidance of doubt, its obligations under the indemnification provisions of this Agreement and its applicable Commitments which shall survive as to such assigning Lender or assigning L/C Issuer and (iv) the Administrative Agent may reflect in the Register its ownership interest in the Loans subject to the Erroneous Payment Deficiency Assignment. The Administrative Agent may, in its discretion, sell any Loans acquired pursuant to an Erroneous Payment Deficiency Assignment and upon receipt of the proceeds of such sale, the Erroneous Payment Return Deficiency owing by the applicable Lender or L/C Issuer shall be reduced by the net proceeds of the sale of such Loan (or portion thereof), and the Administrative Agent shall retain all other rights, remedies and claims against such Lender or L/C Issuer (and/or against any recipient that receives funds on its respective behalf). For the avoidance of doubt, no Erroneous Payment Deficiency Assignment will reduce the Commitments of any Lender or L/C Issuer and such Commitments shall remain available in accordance with the terms of this Agreement. In addition, each party hereto agrees that, except to the extent that the Administrative Agent has sold a Loan (or portion thereof) acquired pursuant to an Erroneous Payment Deficiency Assignment, and irrespective of whether the Administrative Agent may be equitably subrogated, the Administrative Agent shall be contractually subrogated to all the rights and interests of the applicable Lender, L/C Issuer or Secured Party under the Loan Documents with respect to each Erroneous Payment Return Deficiency (the “Erroneous Payment Subrogation Rights”).

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(e)The parties hereto agree that an Erroneous Payment shall not pay, prepay, repay, discharge or otherwise satisfy any Obligations owed by any Borrower or any other Loan Party, except, in each case, to the extent such Erroneous Payment is, and solely with respect to the amount of such Erroneous Payment that is, comprised of funds received by the Administrative Agent from any Borrower or any other Loan Party for the purpose of making such Erroneous Payment.

(f)To the extent permitted by applicable law, no Payment Recipient shall assert any right or claim to an Erroneous Payment, and hereby waives, and is deemed to waive, any claim, counterclaim, defense or right of set-off or recoupment with respect to any demand, claim or counterclaim by the Administrative Agent for the return of any Erroneous Payment received, including without limitation waiver of any defense based on “discharge for value” or any similar doctrine.

(g)Each party’s obligations, agreements and waivers under this Section 10.11 shall survive the resignation or replacement of the Administrative Agent, any transfer of rights or obligations by, or the replacement of, a Lender or L/C Issuer, the termination of the Commitments and/or the repayment, satisfaction or discharge of all Obligations (or any portion thereof) under any Loan Document.

Article 11.

MISCELLANEOUS

Section 11.1Expenses.

(a)Each Borrower hereby agrees to pay on demand: (i) all costs and expenses of Arranger, Administrative Agent, L/C Issuer, Swing Line Lender and their Related Parties in connection with the syndication and distribution of the Revolving Credit Facility and the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents and any and all amendments, modifications, renewals, extensions, supplements, waivers, consents and ratifications thereof and thereto, including, without limitation, the reasonable fees and expenses of legal counsel, advisors, consultants, and auditors for Administrative Agent, L/C Issuer, Swing Line Lender and their Related Parties; (ii) all costs and expenses of Administrative Agent, L/C Issuer, Swing Line Lender and each Lender in connection with any Default and the enforcement of this Agreement or any other Loan Document, including, without limitation, court costs and fees and expenses of legal counsel, advisors, consultants, and auditors for Administrative Agent, L/C Issuer, Swing Line Lender and each Lender; (iii) all costs and expenses incurred by L/C Issuer in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder; (iv) all transfer, stamp, documentary, or other similar taxes, assessments, or charges levied by any Governmental Authority in respect of this Agreement or any of the other Loan Documents; (v) all costs, expenses, assessments, and other charges incurred in connection with any filing, registration, recording, or perfection of any Lien contemplated by this Agreement or any other Loan Document; and (vi) all other costs and expenses incurred by Administrative Agent, L/C Issuer, Swing Line Lender and any Lender in connection with the enforcement or protection of its rights under this Agreement or any other Loan Document, any workout or restructuring (including the negotiations thereof), any litigation, dispute, suit, proceeding or action, the enforcement of its rights and remedies, and the protection of its interests in bankruptcy, insolvency or other legal proceedings, including, without limitation, all costs, expenses, and other charges (including Administrative Agent’s and such Lender’s, L/C Issuer’s, and Swing Line Lender’s internal charges) incurred in connection with evaluating, observing, collecting, examining, auditing, appraising, selling, liquidating, or otherwise disposing of the Collateral or other assets of the Loan Parties. Borrowers shall be responsible for all expenses described in this clause (a) whether or not any Credit Extension is ever made. Any amount to be paid under this Section 11.1 shall be a demand obligation owing by Borrowers and if not paid within ten (10) days of demand shall bear interest, to the extent not prohibited by and not in violation of applicable Law, from the date of expenditure until paid at a rate per annum equal to the Default Interest Rate. The obligations of Borrowers under this Section 11.1 shall survive payment of the Notes and other obligations hereunder and the assignment of any right hereunder.

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(b)To the extent that Borrowers for any reason fail to indefeasibly pay any amount required under Section 11.1(a) or Section 11.2 to be paid by it to Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any sub-agent thereof) or any Related Party of Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any sub-agent thereof), each Lender severally agrees to pay to Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any such sub-agent) or such Related Party, as the case may be, such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought based on each Lender’s share of the Revolving Credit Exposure at such time) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender); provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any such sub-agent) or against any Related Party of Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any sub-agent thereof) acting for Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any such sub-agent) in connection with such capacity. EACH LENDER ACKNOWLEDGES THAT SUCH PAYMENTS MAY BE IN RESPECT OF LOSSES, CLAIMS, DAMAGES, LIABILITIES OR RELATED EXPENSES ARISING OUT OF OR RESULTING FROM THE SOLE, CONTRIBUTORY, COMPARATIVE, CONCURRENT OR ORDINARY NEGLIGENCE OF THE PERSON (OR THE REPRESENTATIVES OF THE PERSON) TO WHOM SUCH PAYMENTS ARE TO BE MADE.

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Section 11.2INDEMNIFICATION.

(a)EACH BORROWER SHALL INDEMNIFY ARRANGER, ADMINISTRATIVE AGENT, L/C ISSUER, SWING LINE LENDER, EACH LENDER AND EACH RELATED PARTY THEREOF (EACH, AN “INDEMNITEE”) FROM, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’ FEES) TO WHICH ANY OF THEM MAY BECOME SUBJECT WHICH DIRECTLY OR INDIRECTLY ARISE FROM OR RELATE TO (A) THE NEGOTIATION, EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION, OR ENFORCEMENT OF ANY OF THE LOAN DOCUMENTS, (B) ANY OF THE TRANSACTIONS CONTEMPLATED BY THE LOAN DOCUMENTS, (C) ANY BREACH BY ANY BORROWER OF ANY REPRESENTATION, WARRANTY, COVENANT, OR OTHER AGREEMENT CONTAINED IN ANY OF THE LOAN DOCUMENTS, (D) THE PRESENCE, RELEASE, THREATENED RELEASE, DISPOSAL, REMOVAL, OR CLEANUP OF ANY HAZARDOUS MATERIAL LOCATED ON, ABOUT, WITHIN, OR AFFECTING ANY OF THE PROPERTIES OR ASSETS OF COMPANY OR ANY OF ITS SUBSIDIARIES OR ANY OTHER LOAN PARTY, (E) ANY LOAN OR LETTER OF CREDIT OR USE OR PROPOSED USE OF THE PROCEEDS THEREFROM (INCLUDING ANY REFUSAL BY THE L/C ISSUER TO HONOR A DEMAND FOR PAYMENT UNDER A LETTER OF CREDIT IF THE DOCUMENTS PRESENTED IN CONNECTION WITH SUCH DEMAND DO NOT STRICTLY COMPLY WITH THE TERMS OF SUCH LETTER OF CREDIT) OR (F) ANY INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY THREATENED OR PROSPECTIVE INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, RELATING TO ANY OF THE FOREGOING, WHETHER BROUGHT BY A THIRD PARTY OR BY ANY LOAN PARTY. WITHOUT LIMITING ANY PROVISION OF THIS AGREEMENT OR OF ANY OTHER LOAN DOCUMENT, IT IS THE EXPRESS INTENTION OF THE PARTIES HERETO THAT EACH INDEMNITEE SHALL BE INDEMNIFIED FROM AND HELD HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’ FEES) ARISING OUT OF OR RESULTING FROM THE SOLE, CONTRIBUTORY, COMPARATIVE, CONCURRENT OR ORDINARY NEGLIGENCE OF SUCH INDEMNITEE (OR THE REPRESENTATIVES OF SUCH PERSON); provided that such indemnity shall not, as to any Indemnitee, be available to the extent such losses, liabilities, claims, damages, penalties, judgments, disbursements, costs and expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or (y) result from a claim not involving an act or omission of any Loan Party and that is brought by an Indemnitee against another Indemnitee (other than against the Arranger or Administrative Agent in their capacities as such).

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(b)If, for the purposes of obtaining judgment in any court in any jurisdiction with respect to this Agreement or any other Loan Document, it becomes necessary to convert into a particular currency (the “Judgment Currency”) any amount due under this Agreement or under any other Loan Document in any currency other than the Judgment Currency (the “Currency Due”), then conversion shall be made at the rate of exchange prevailing on the Business Day before the day on which judgment is given. For this purpose “rate of exchange” means the rate at which the Administrative Agent is able, on the relevant date, to purchase the Currency Due with the Judgment Currency in accordance with its normal practice. In the event that there is a change in the rate of exchange prevailing between the Business Day immediately preceding the day on which the judgment is given and the date of receipt by the Administrative Agent of the amount due, the Borrowers shall, on the date of receipt by the Administrative Agent, pay such additional amounts, if any, or be entitled to receive reimbursement of such amount, if any, as may be necessary to ensure that the amount received by the Administrative Agent on such date is the amount in the Judgment Currency which when converted at the rate of exchange prevailing on the date of receipt by the Administrative Agent is the amount then due under this Agreement or such other Loan Document in the Currency Due. If the amount of the Currency Due which the Administrative Agent is so able to purchase is less than the amount of the Currency Due originally due to it, the Borrowers shall indemnify and save the Administrative Agent and the Lenders harmless from and against all loss or damage arising as a result of such deficiency. This indemnity shall constitute an obligation separate and independent from the other obligations contained in this Agreement and the other Loan Documents, shall give rise to a separate and independent cause of action, shall apply irrespective of any indulgence granted by the Administrative Agent from time to time and shall continue in full force and effect notwithstanding any judgment or order for a liquidated sum in respect of an amount due under this Agreement or any other Loan Document or under any judgment or order.

(c)Any amount to be paid under this Section 11.2 shall be a demand obligation owing by Borrowers and if not paid within ten (10) days of demand shall bear interest, to the extent not prohibited by and not in violation of applicable Law, from the date of expenditure until paid at a rate per annum equal to the Default Interest Rate. The obligations of Borrowers under this Section 11.2 shall survive payment of the Notes and other obligations hereunder and the assignment of any right hereunder.

Section 11.3Limitation of Liability. None of Arranger, Administrative Agent, L/C Issuer, Swing Line Lender, or any Lender, or any of their Related Parties, shall have any liability with respect to, and each Loan Party hereby waives, releases, and agrees not to sue any of them upon, any claim for any special, indirect, incidental, or consequential damages (whether in contract, tort or otherwise) suffered or incurred by any Loan Party in connection with, arising out of, or in any way related to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by this Agreement or any of the other Loan Documents. Each Loan Party hereby waives, releases, and agrees not to sue Arranger, Administrative Agent, L/C Issuer, Swing Line Lender, or any Lender, or any of their Related Parties, for punitive damages in respect of any claim in connection with, arising out of, or in any way related to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by this Agreement or any of the other Loan Documents.

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Section 11.4No Duty. All attorneys, accountants, appraisers, and other professional Persons and consultants retained by Arranger, Administrative Agent, any Lender, L/C Issuer, or Swing Line Lender shall have the right to act exclusively in the interest of Arranger, Administrative Agent or such Lender, L/C Issuer, or Swing Line Lender and shall have no duty of disclosure, duty of loyalty, duty of care, or other duty or obligation of any type or nature whatsoever to any Loan Party or any of such Loan Party’s equity holders, Affiliates, officers, employees, attorneys, agents, or any other Person.

Section 11.5Lenders Not Fiduciary. The relationship between Borrowers and each other Loan Party on the one hand, and Administrative Agent, Arranger and each Lender, L/C Issuer, and Swing Line Lender is solely that of debtor and creditor, and none of Administrative Agent, Arranger, any Lender, L/C Issuer, or Swing Line Lender, on the other hand, has any fiduciary or other special relationship with Borrowers or any other Loan Party, and no term or condition of any of the Loan Documents shall be construed so as to deem the relationship between Borrowers and each other Loan Party on the one hand, and Administrative Agent, Arranger and each Lender, L/C Issuer, and Swing Line Lender, on the other hand, to be other than that of debtor and creditor.

Section 11.6Equitable Relief. Each Loan Party recognizes that in the event any Borrower or any other Loan Party fails to pay, perform, observe, or discharge any or all of the Obligations, any remedy at law may prove to be inadequate relief to Administrative Agent or Lenders, L/C Issuer, or Swing Line Lender. Each Loan Party therefore agrees that Administrative Agent, any Lender, L/C Issuer, or Swing Line Lender, if Administrative Agent or such Lender, L/C Issuer, or Swing Line Lender so requests, shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages.

Section 11.7No Waiver; Cumulative Remedies. No failure on the part of Administrative Agent, any Lender, L/C Issuer, or Swing Line Lender to exercise and no delay in exercising, and no course of dealing with respect to, any right, remedy, power, or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege. The rights and remedies provided for in this Agreement and the other Loan Documents are cumulative and not exclusive of any rights and remedies provided by Law.

Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, Administrative Agent in accordance with Section 9.2 for the benefit of all the Lenders; provided, however, that the foregoing shall not prohibit (a) Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) Swing Line Lender from exercising the rights and remedies that inure to its benefit (solely in its capacity as Swing Line Lender) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in accordance with Section 4.2 (subject to the terms of Section 11.23), or (d) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party under any Debtor Relief Law; and provided, further, that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwise ascribed to Administrative Agent pursuant to Section 9.2 and (ii) in addition to the matters set forth in clauses (b), (c) and (d) of the preceding proviso and subject to Section 11.23, any Lender may, with the consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.

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Section 11.8Successors and Assigns.

(a)Successors and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that no Loan Party may assign or otherwise transfer any of its rights, duties, or obligations under this Agreement or the other Loan Documents without the prior written consent of Administrative Agent and each Lender, and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of Section 11.8(b), (ii) by way of participation in accordance with the provisions of Section 11.8(d), or (iii) by way of pledge or assignment of a security interest subject to the restrictions of Section 11.8(e) (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in Section 11.8(d) and, to the extent expressly contemplated hereby, the Related Parties of each of Administrative Agent and Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment(s) and the Loans at the time owing to it); provided that any such assignment shall be subject to the following conditions:

(i)Minimum Amounts. (A) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment(s) and/or the Loans at the time owing to it or contemporaneous assignments to related Approved Funds (determined after giving effect to such assignments) that equal at least the amount specified in Section 11.8(b)(i)(B) in the aggregate or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and (B) in any case not described in Section 11.8(b)(i)(A), the aggregate amount of the Commitment(s) (which for this purpose includes Loans outstanding hereunder) or, if the applicable Commitment is not then in effect, the Outstanding Amount of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000, unless each of Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower Representative otherwise consents (each such consent not to be unreasonably withheld or delayed).

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(ii)Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loan or the Commitment(s) assigned.

(iii)Required Consents. No consent shall be required for any assignment except to the extent required by Section 11.8(b)(i)(B) and, in addition: (A) the consent of the Borrower Representative (such consent not to be unreasonably withheld or delayed) shall be required unless (x) an Event of Default has occurred and is continuing at the time of such assignment, or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided that the Borrower Representative shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to Administrative Agent within five (5) Business Days after having received notice thereof; (B) the consent of Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of any Commitment or Revolving Credit Loans if such assignment is to a Person that is not a Lender with a Commitment, an Affiliate of such Lender or an Approved Fund with respect to such Lender; and (C) the consent of L/C Issuer and Swing Line Lender shall be required for any assignment in respect of the Revolving Credit Facility.

(iv)Assignment and Assumption. The parties to each assignment shall execute and deliver to Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500; provided that Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment; and provided further that Borrowers shall not be obligated to pay for such processing and recording fee except in the case of any assignment made pursuant to Section 3.6(b). The assignee, if it is not a Lender, shall deliver to Administrative Agent an Administrative Questionnaire.

(v)No Assignment to Certain Persons. No such assignment shall be made to (A)  Parent, any Loan Party, or any their respective Affiliates or Subsidiaries or (B) any Defaulting Lender or any of its Affiliates, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (b).

(vi)No Assignment to Natural Persons. No such assignment shall be made to a natural Person (or a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural Person).

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(vii)Certain Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to such assignment shall make such additional payments to Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower Representative and Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by such Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to: (A) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to Administrative Agent or any Lender hereunder (and interest accrued thereon) and (B) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit and Swing Line Loans in accordance with its Applicable Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

Subject to acceptance and recording thereof by Administrative Agent pursuant to Section 11.8(c), from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Section 3.1, Section 3.2, Section 11.1 and Section 11.2 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided that, except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 11.8(d). Upon the consummation of any assignment pursuant to this Section 11.8(b), if requested by the transferor or transferee Lender, the transferor Lender, Administrative Agent and Borrowers shall make appropriate arrangements so that replacement Notes are issued to such transferor Lender (if applicable) and new Notes or, as appropriate, replacement Notes, are issued to the assignee.

(c)Register. Administrative Agent, acting solely for this purpose as a non-fiduciary agent of Borrowers, shall maintain at one of its offices in Dallas, Texas a copy of each Assignment and Assumption delivered to it and a Register. The entries in the Register shall be conclusive absent manifest error, and Borrowers, Administrative Agent and Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by Borrowers and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

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(d)Participations. Any Lender may at any time, without the consent of, or notice to, any Loan Party or Administrative Agent, sell participations to a Participant in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment(s) and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, and (iii) each Loan Party, Administrative Agent, and Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. For the avoidance of doubt, each Lender shall be responsible for the indemnity under Section 11.1(b) without regard to the existence of any participation.

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in Section 11.10 which requires the consent of all Lenders and affects such Participant. Each Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.1, 3.4 and 3.5 (subject to the requirements and limitations therein, including the requirements under Section 3.4(g) (it being understood that the documentation required under Section 3.4(g) shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant (A) agrees to be subject to the provisions of Section 3.6 as if it were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment under Sections 3.1 or 3.4, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that sells a participation agrees, at Borrowers’ request and expense, to use reasonable efforts to cooperate with Borrowers to effectuate the provisions of Section 3.6 with respect to any Participant. To the extent permitted by Law, each Participant also shall be entitled to the benefits of Section 11.25 as though it were a Lender; provided that such Participant agrees to pay to Administrative Agent any amount set-off for application to the Obligations under the Loan Documents as required pursuant to Section 11.25; provided further that such Participant agrees to be subject to Section 11.23 as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of Borrowers, maintain a Participant Register; provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

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(e)Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

(f)Dissemination of Information. Each Loan Party authorizes Administrative Agent and each Lender to disclose to any actual or prospective purchaser, assignee or other recipient of a Lender’s Commitment, any and all information in Administrative Agent’s or such Lender’s possession concerning Borrowers, the other Loan Parties and their respective Affiliates.

Section 11.9Survival. All representations and warranties made in this Agreement or any other Loan Document or in any document, statement, or certificate furnished in connection with this Agreement shall survive the execution and delivery of this Agreement and the other Loan Documents, and no investigation by Administrative Agent or any Lender or any closing shall affect the representations and warranties or the right of Administrative Agent or any Lender to rely upon them. Without prejudice to the survival of any other obligation of any Loan Party hereunder, the obligations of Borrowers under Sections 11.1 and 11.2 shall survive repayment of the Obligations and termination of the Commitments.

Section 11.10Amendment. Subject to Section 3.3(b), the provisions of this Agreement and the other Loan Documents to which Borrowers or any other Loan Party is a party (other than the Issuer Documents) may be amended or waived only by an instrument in writing signed by Required Lenders (or by Administrative Agent with the consent of Required Lenders) and each Loan Party party thereto and acknowledged by Administrative Agent; provided, however, that no such amendment or waiver shall:

(a)waive any condition set forth in Section 4.1, without the written consent of each Lender;

(b)extend or increase any Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 9.2) without the written consent of such Lender;

(c)postpone any date fixed by this Agreement or any other Loan Document for any payment (excluding mandatory prepayment) of principal, interest, fees or other amounts due to Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

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(d) reduce the principal of, or the rate of interest specified herein on, any Loan, or any fees or other amounts payable hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby; provided, however, that (i) any amendment or modification of the financial covenants in this Agreement (or any defined term used therein) shall not constitute a reduction in the rate of interest or fees for purposes of this clause (d) and (ii) only the consent of Required Lenders shall be necessary to adjust the Default Interest Rate or to waive any obligation of Borrowers to pay interest at such rate;

(e)change any provision of this Section 11.10 or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender;

(f)(i) change Section 9.4 in a manner that would alter the pro rata sharing of payments required thereby or otherwise adversely affect the priority of payment of any such Obligations, (ii) subordinate any of the Obligations owed to the Lenders in right of payment or otherwise adversely affect the priority of payment of any such Obligations or (iii) subordinate any of the Liens securing the Obligations owed to the Lenders (except as otherwise set forth in Section 10.9), in each case, without the written consent of each Lender; or

(g)release any Guaranty or all or substantially all of the Collateral (in each case, except as provided herein) without the written consent of each Lender;

and, provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the L/C Issuer in addition to the Lenders required above, affect the rights or duties of the L/C Issuer under this Agreement or any Issuer Document relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swing Line Lender in addition to the Lenders required above, affect the rights or duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by Administrative Agent in addition to Lenders required above, affect the rights or duties of Administrative Agent under this Agreement or any other Loan Document; (iv) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto; and (v) Borrowers and Administrative Agent may amend this Agreement or any other Loan Document without the consent of Lenders (unless the Required Lenders object in writing within five (5) Business Days of notice by Administrative Agent of such amendment) in order to (A) correct, amend or cure any ambiguity, inconsistency or defect or correct any typographical error or other manifest error in any Loan Document or (B) comply with local Law or advice of local counsel in any jurisdiction the Laws of which govern any Security Document or that are relevant to the creation, perfection, protection and/or priority of any Lien in favor of Administrative Agent, (C) effect the granting, perfection, protection, expansion or enhancement of any security interest in any Collateral or additional property to become Collateral for the benefit of the Secured Parties, (D) make administrative or operational changes not adverse to any Lender or (E) add a Guarantor or Collateral or otherwise enhance the rights and benefits of the Lenders.

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Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment(s) of any Defaulting Lender may not be increased or extended without the consent of such Lender; and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.

Section 11.11Notices.

(a)Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in Section 11.11(b)), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile as set forth on Schedule 11.11. Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received. Notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications, to the extent provided in Section 11.11(b) shall be effective as provided in Section 11.11(b).

(b)Electronic Communications. Notices and other communications to Lenders and hereunder may be delivered or furnished by electronic communication (including e-mail and internet or intranet websites) pursuant to procedures approved by Administrative Agent, provided that the foregoing shall not apply to notices to any Lender pursuant to Article 2 if such Lender has notified Administrative Agent that it is incapable of receiving notices under Article 2 by electronic communication. Administrative Agent or any Loan Party may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

Unless Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such facsimile, email or other electronic communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.

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(c)Change of Address, etc. Any party hereto may change its address or facsimile number for notices and other communications hereunder by notice to the other parties hereto, Schedule 11.11 shall be deemed to be amended by each such change, and Administrative Agent is authorized, in its discretion, from time to time to reflect each such change in an amended Schedule 11.11 provided by Administrative Agent to each party hereto.

(d)Platform.

(i)Each Loan Party agrees that Administrative Agent may, but shall not be obligated to, make the Communications (as defined below) available to the Lenders, L/C Issuer or Swing Line Lender by posting the Communications on the Platform.

(ii)The Platform is provided “as is” and “as available.” The Agent Parties do not warrant the adequacy of the Platform and expressly disclaim liability for errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Communications or the Platform. In no event shall the Agent Parties have any liability to any Loan Party, any Lender or any other Person or entity for damages of any kind, including, without limitation, direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of any Loan Party’s or Administrative Agent’s transmission of Communications through the Platform.

(iii)Each Loan Party (by its, his or her execution of a Loan Document) hereby authorizes Administrative Agent, each Lender, Swing Line Lender and their respective counsel and agents and Related Parties (each an “Authorized Party”) to communicate and transfer documents and other information (including confidential information) concerning this transaction or any Loan Party and the business affairs of such Loan Parties via the Internet or other electronic communication method. In no event shall any Authorized Party have any liability to any Loan Party, any Lender or any other Person or entity for damages of any kind (whether in tort, contract or otherwise) arising out of any such communications or transmissions, except to the extent that such damages are determined by a court of competent jurisdiction in a final and nonappealable judgment to have directly resulted from the gross negligence or willful misconduct of such Authorized Party; provided, however, that in no event shall any Authorized Party have any liability for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

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Section 11.12Governing Law; Venue; Service of Process.

(a)Governing Law. This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be governed by, and construed in accordance with, the Laws of the State of Texas (without reference to applicable rules of conflicts of Laws), except to the extent the Laws of any jurisdiction where Collateral is located require application of such Laws with respect to such Collateral.

(b)Jurisdiction. Each Loan Party irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding of any kind or description, whether in law or equity, whether in contract or in tort or otherwise, against Administrative Agent, any Lender, L/C Issuer, Swing Line Lender or any Related Party of the foregoing in any way relating to this Agreement or any other Loan Document or the transactions relating hereto or thereto, in any forum other than the courts of the State of Texas sitting in Dallas County, Texas, and of the United States District Court of the Northern District of Texas, and any appellate court from any thereof, and each of the parties hereto irrevocably and unconditionally submits to the jurisdiction of such courts and agrees that all claims in respect of any such action, litigation or proceeding may be heard and determined in such Texas state court or, to the fullest extent permitted by applicable Law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action, litigation or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Nothing in this Agreement or in any other Loan Document shall affect any right that Administrative Agent, any Lender, L/C Issuer or Swing Line Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Borrower or any of the other Loan Parties or their Properties in the courts of any jurisdiction.

(c)Waiver of Venue. Each Loan Party irrevocably and unconditionally waives, to the fullest extent permitted by applicable Law, any objection that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable Law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(d)Service of Process. Each party hereto irrevocably consents to service of process by the mailing thereof, in the manner provided for the mailing of notices in Section 11.11. Nothing in this Agreement will affect the right of any party hereto to serve process in any other manner permitted by applicable Law.

Section 11.13Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Except as provided in Section 4.1, this Agreement shall become effective when it shall have been executed by Administrative Agent and when Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic imaging means (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Agreement.

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Section 11.14Severability. Any provision of this Agreement or any other Loan Document held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Agreement and the effect thereof shall be confined to the provision held to be invalid or illegal. Furthermore, in lieu of such invalid or unenforceable provision there shall be added as a part of this Agreement or the other Loan Documents a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.

Section 11.15Headings. The headings, captions, and arrangements used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.

Section 11.16Construction. Each Loan Party, Administrative Agent and each Lender acknowledge that each of them has had the benefit of legal counsel of its own choice and has been afforded an opportunity to review this Agreement and the other Loan Documents with its legal counsel and that this Agreement and the other Loan Documents shall be construed as if jointly drafted by each Loan Party, Administrative Agent and each Lender.

Section 11.17Independence of Covenants. All covenants hereunder shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitations of, another covenant shall not avoid the occurrence of a Default if such action is taken or such condition exists.

Section 11.18WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.18.

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Section 11.19Additional Interest Provision. It is expressly stipulated and agreed to be the intent of each Loan Party, Administrative Agent and each Lender at all times to comply strictly with the applicable Law governing the maximum rate or amount of interest payable on the indebtedness evidenced by any Note, any other Loan Document, and the Related Indebtedness (or applicable United States federal Law to the extent that it permits any Lender to contract for, charge, take, reserve or receive a greater amount of interest than under applicable Law). If the applicable Law is ever judicially interpreted so as to render usurious any amount (a) contracted for, charged, taken, reserved or received pursuant to any Note, any of the other Loan Documents or any other communication or writing by or between any Borrower or any other Loan Party and any Lender related to the transaction or transactions that are the subject matter of the Loan Documents, (b) contracted for, charged, taken, reserved or received by reason of Administrative Agent’s or any Lender’s exercise of the option to accelerate the maturity of any Note and/or the Related Indebtedness, or (c) any Loan Party will have paid or Administrative Agent or any Lender will have received by reason of any voluntary prepayment by Borrowers or any other Loan Party of any Note and/or the Related Indebtedness, then it is Borrowers’ and each other Loan Party’s, Administrative Agent’s and Lenders’ express intent that all amounts charged in excess of the Maximum Rate shall be automatically canceled, ab initio, and all amounts in excess of the Maximum Rate theretofore collected by Administrative Agent or any Lender shall be credited on the principal balance of any Note and/or the Related Indebtedness (or, if any Note and all Related Indebtedness have been or would thereby be paid in full, refunded to Borrowers or such other Loan Party, as applicable), and the provisions of any Note and the other Loan Documents shall immediately be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced, without the necessity of the execution of any new document, so as to comply with the applicable Law, but so as to permit the recovery of the fullest amount otherwise called for hereunder and thereunder; provided, however, if any Note or Related Indebtedness has been paid in full before the end of the stated term thereof, then Borrowers, each other Loan Party, Administrative Agent and each Lender agree that Administrative Agent or any Lender, as applicable, shall, with reasonable promptness after Administrative Agent or such Lender discovers or is advised by any Loan Party that interest was received in an amount in excess of the Maximum Rate, either refund such excess interest to such Loan Party, as applicable, and/or credit such excess interest against such Note and/or any Related Indebtedness then owing by Borrowers and the other Loan Parties to Administrative Agent or such Lender. Each Loan Party hereby agrees that as a condition precedent to any claim seeking usury penalties against Administrative Agent or such Lender, such Loan Party will provide written notice to Administrative Agent or any Lender, advising Administrative Agent or such Lender in reasonable detail of the nature and amount of the violation, and Administrative Agent or such Lender shall have sixty (60) days after receipt of such notice in which to correct such usury violation, if any, by either refunding such excess interest to such Loan Parties, as applicable, or crediting such excess interest against the Note to which the alleged violation relates and/or the Related Indebtedness then owing by the Loan Parties to Administrative Agent or such Lender. All sums contracted for, charged, taken, reserved or received by Administrative Agent or any Lender for the use, forbearance or detention of any debt evidenced by any Note and/or the Related Indebtedness shall, to the extent permitted by applicable Law, be amortized or spread, using the actuarial method, throughout the stated term of such Note and/or the Related Indebtedness (including any and all renewal and extension periods) until payment in full so that the rate or amount of interest on account of any Note and/or the Related Indebtedness does not exceed the Maximum Rate from time to time in effect and applicable to such Note and/or the Related Indebtedness for so long as debt is outstanding. In no event shall the provisions of Chapter 346 of the Texas Finance Code (which regulates certain revolving credit loan accounts and revolving triparty accounts) apply to the Notes and/or any of the Related Indebtedness. Notwithstanding anything to the contrary contained herein or in any of the other Loan Documents, it is not the intention of Administrative Agent or any Lender to accelerate the maturity of any interest that has not accrued at the time of such acceleration or to collect unearned interest at the time of such acceleration.

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Section 11.20Ceiling Election. To the extent that any Lender is relying on Chapter 303 of the Texas Finance Code to determine the Maximum Rate payable on any Note and/or any other portion of the Obligations under the Loan Documents, such Lender will utilize the weekly ceiling from time to time in effect as provided in such Chapter 303. To the extent United States federal Law permits any Lender to contract for, charge, take, receive or reserve a greater amount of interest than under Texas Law, such Lender will rely on United States federal Law instead of such Chapter 303 for the purpose of determining the Maximum Rate. Additionally, to the extent permitted by applicable Law now or hereafter in effect, any Lender may, at its option and from time to time, utilize any other method of establishing the Maximum Rate under such Chapter 303 or under other applicable Law by giving notice, if required, to Borrowers as provided by applicable Law now or hereafter in effect.

Section 11.21USA Patriot Act and Canadian AML Legislation Notice. Administrative Agent and each Lender hereby notifies each Loan Party that pursuant to the requirements of the Patriot Act and applicable Canadian AML Legislation, it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of each Loan Party and other information that will allow Administrative Agent and such Lender to identify each Loan Party in accordance with the Patriot Act and applicable Canadian AML Legislation. In addition, each Loan Party agrees to (a) ensure that no Person who owns a Controlling interest in or otherwise controls any Loan Party or any Subsidiary of Company or any other Loan Party is or shall be a Sanctioned Person, (b) not to use or permit the use of proceeds of the Obligations to violate any Anti-Corruption Laws, Anti-Terrorism Laws or any applicable Sanctions, and (c) comply, or cause its Subsidiaries to comply, with the applicable Laws.

Section 11.22Defaulting Lenders.

(a)Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:

(i)Waivers and Amendments. Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of “Required Lenders” and in Section 11.10.

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(ii)Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article 9 or otherwise) or received by Administrative Agent from a Defaulting Lender shall be applied at such time or times as may be determined by Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to L/C Issuer or Swing Line Lender hereunder; third, to Cash Collateralize L/C Issuer’s Fronting Exposure, if any, with respect to such Defaulting Lender in accordance with Section 2.7; fourth, as Borrowers may request (so long as no Default or Event of Default exists), to the funding of any Revolving Credit Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by Administrative Agent; fifth, if so determined by Administrative Agent and Borrowers, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Revolving Credit Loans under this Agreement and (y)  Cash Collateralize L/C Issuer’s future Fronting Exposure, if any, with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with Section 2.7; sixth, to the payment of any amounts owing to Lenders, L/C Issuer or Swing Line Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, L/C Issuer or Swing Line Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to Borrowers as a result of any judgment of a court of competent jurisdiction obtained by Borrowers against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that, if (x) such payment is a payment of the principal amount of any Loans or L/C Borrowings in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 4.2 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Obligations owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Obligations owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in L/C Obligations and Swing Line Loans are held by Lenders pro rata in accordance with the Commitments under the Revolving Credit Facility without giving effect to Section 11.22(a)(iv). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 11.22(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii)Certain Fees.

(A)No Defaulting Lender shall be entitled to receive any fee payable under Section 2.4(c) for any period during which that Lender is a Defaulting Lender (and Borrowers shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).

(B)Each Defaulting Lender shall be entitled to receive Letter of Credit Fees for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Applicable Percentage of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.7.

(C)With respect to any fee payable under Section 2.4(c) or to any Letter of Credit Fee not required to be paid to any Defaulting Lender pursuant to clause (A) or (B) above, Borrowers shall (x) pay to each Lender that is a Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in L/C Obligations or Swing Line Loans that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to L/C Issuer and Swing Line Lender, as applicable, the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to such L/C Issuer’s or Swing Line Lender’s Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee.

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(iv)Reallocation of Applicable Percentages to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in L/C Obligations and Swing Line Loans shall be reallocated among the Lenders that are Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that such reallocation does not cause the aggregate Revolving Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Commitment. Subject to Section 11.23, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

(v)Cash Collateral, Repayment of Swing Line Loans. If the reallocation described in clause (a)(iv) above cannot, or can only partially, be effected, Borrowers shall, without prejudice to any right or remedy available to it hereunder or under applicable Law, (x) first, prepay Swing Line Loans in an amount equal to Swing Line Lender’s Fronting Exposure and (y) second, Cash Collateralize L/C Issuers’ Fronting Exposure in accordance with the procedures set forth in Section 2.7.

(b)Defaulting Lender Cure. If Borrowers, Administrative Agent, Swing Line Lender and L/C Issuer agree in writing that a Lender is no longer a Defaulting Lender, Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held on a pro rata basis by Lenders in accordance with their Applicable Percentages (without giving effect to Section 11.22(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of Borrowers while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

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Section 11.23Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of the Loans made by it or other obligations hereunder, resulting in such Lender’s receiving payment of a proportion of the aggregate amount of such Loans and accrued interest thereon greater than its pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall:

(a)notify Administrative Agent of such fact; and

(b)purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other amounts owing them, provided that:

(i)if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

(ii)the provisions of this Section 11.23 shall not be construed to apply to: (A) any payment made by or on behalf of Borrowers pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender); or (B) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or subparticipations in L/C Obligations or Swing Line Loans to any assignee or participant, other than an assignment to any Borrower or any Affiliate thereof (as to which the provisions of this Section 11.23 shall apply).

Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against such Loan Party, as applicable, rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of such participation.

Section 11.24Payments Set Aside. To the extent that any payment by or on behalf of any Loan Party is made to Administrative Agent, L/C Issuer or any Lender, or Administrative Agent, L/C Issuer or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by Administrative Agent, L/C Issuer or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (b) each Lender and L/C Issuer severally agrees to pay to Administrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of Lenders and L/C Issuer under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

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Section 11.25Setoff. If an Event of Default exists, Administrative Agent and each Lender shall have the right to set off against the Obligations under the Loan Documents, at any time and without notice to any Loan Party, any and all deposits (general or special, time or demand, provisional or final) or other sums at any time credited by or owing from Administrative Agent or such Lender to such Loan Party whether or not the Obligations under the Loan Documents are then due; provided that in the event that any Defaulting Lender shall exercise any such right of setoff: (a) all amounts so set off shall be paid over immediately to Administrative Agent for further application in accordance with the provisions of Section 11.22 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of Administrative Agent and Lenders; and (b) such Defaulting Lender shall provide promptly to Administrative Agent a statement describing in reasonable detail the Obligations under the Loan Documents owing to such Defaulting Lender as to which it exercised such right of setoff. Each amount set off shall be paid to Administrative Agent for application to the Obligations under the Loan Documents in the order set forth in Section 9.4. As further security for the Obligations, each Loan Party hereby grants to Administrative Agent and each Lender a security interest in all money, instruments, and other Property of such Loan Party, as applicable, now or hereafter held by Administrative Agent or such Lender, including, without limitation, Property held in safekeeping. In addition to Administrative Agent’s and each Lender’s right of setoff and as further security for the Obligations, each Loan Party hereby grants to Administrative Agent and each Lender a security interest in all deposits (general or special, time or demand, provisional or final) and other accounts of such Loan Party now or hereafter on deposit with or held by Administrative Agent or such Lender and all other sums at any time credited by or owing from Administrative Agent or such Lender to such Loan Party. The rights and remedies of Administrative Agent and each Lender hereunder are in addition to other rights and remedies (including, without limitation, other rights of setoff) which Administrative Agent or such Lender may have.

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Section 11.26Confidentiality. Each of Administrative Agent, L/C Issuer, Swing Line Lender and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its Related Parties (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential or shall otherwise be subject to confidentiality provisions generally), (b) to any regulatory authority purporting to have jurisdiction over it (including any self-regulatory authority, such as the National Association of Insurance Commissioners) or any Governmental Authority, quasi-Governmental Authority or legislative committee, (c) to the extent required by applicable Laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement or any other Loan Document, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to its being under a duty of confidentiality no less restrictive than this Section 11.26, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, (ii) any actual or prospective counterparty (or its Related Parties) to any Bank Product relating to any Loan Party and its obligations, (iii) any actual or prospective purchaser of a Lender or its holding company, (iv) any rating agency or any similar organization in connection with the rating of any Loan Party or the Revolving Credit Facility or (v) the CUSIP Service Bureau or any similar organization in connection with the issuance and monitoring of CUSIP numbers with respect to the Revolving Credit Facility, (g) with the consent of Borrowers or such other applicable Loan Parties, or (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section 11.26 or (ii) becomes available to Administrative Agent, L/C Issuer, Swing Line Lender, any Lender or any of their respective Affiliates on a nonconfidential basis from a source other than Borrowers. In addition, Administrative Agent and the Lenders may disclose the existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry and service providers to Administrative Agent and the Lenders in connection with the administration of this Agreement, the other Loan Documents, and the Commitments. For purposes of this Section 11.26, “Information” means all information received from any Borrower or any other Loan Party or any Subsidiary thereof relating to any Borrower or any other Loan Party or any Subsidiary thereof or any of their respective businesses which is clearly identified as confidential, other than any such information that is available to Administrative Agent, L/C Issuer, Swing Line Lender or any Lender on a nonconfidential basis prior to disclosure by any Borrower or any other Loan Party or any Subsidiary thereof; provided that, in the case of information received from any Borrower or any other Loan Party or any Subsidiary thereof after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section 11.26 shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information. Each Loan Party party hereto agrees and confirms that, as between such Loan Party and Texas Capital Bank, the obligations of Texas Capital Bank under this Section 11.26 supersede and replace in their respective entireties all confidentiality, non-disclosure and similar obligations of Texas Capital Bank, if any, set forth in any previous agreement between such Loan Party and Texas Capital Bank notwithstanding anything to the contrary contained therein.

Each of the Loan Parties hereby authorize Administrative Agent, with the written consent of the Borrower Representative, to publish the name and logo of any Loan Party and the amount of the credit facility provided hereunder in any “tombstone” or comparable advertisement which Administrative Agent desires to publish; provided, however, that Administrative Agent may provide industry trade organizations information necessary for inclusion in league table measurements without the written consent of the Borrower Representative.

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Section 11.27Electronic Execution of Assignments and Certain Other Documents. The words “execute”, “execution”, “signed”, “signature”, and words of like import in or related to this Agreement, any other Loan Document or any Assignment and Assumption or in any amendment or other modification hereof (including waivers and consents) shall be deemed to include Electronic Signatures or execution in the form of an Electronic Record, the electronic matching of assignment terms and contract formations on electronic platforms approved by Administrative Agent, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state Laws based on the Uniform Electronic Transactions Act. Notwithstanding anything contained herein to the contrary, Administrative Agent is under no obligation to accept an Electronic Signature in any form or in any format unless expressly agreed to by Administrative Agent pursuant to procedures approved by it; provided that  without limiting the foregoing, (a) to the extent Administrative Agent has agreed to accept such Electronic Signature from any party hereto, Administrative Agent and the other parties hereto shall be entitled to rely on any such Electronic Signature purportedly given by or on behalf of the executing party without further verification and (b) upon the request of Administrative Agent or any Lender, any Electronic Signature shall be promptly followed by an original manually executed counterpart thereof.

Section 11.28Acknowledgement and Consent to Bail-In of Affected Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender that is an Affected Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a)the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender that is an Affected Financial Institution; and

(b)the effects of any Bail-In Action on any such liability, including, if applicable:

(i)a reduction in full or in part or cancellation of any such liability;

(ii)a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(iii)the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of the applicable Resolution Authority.

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Section 11.29Keepwell. Each Qualified ECP Guarantor party hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of such other Loan Party’s (a) Swap Obligations and (b) obligations under the Guaranty including those with respect to Swap Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section, or otherwise under this Agreement or any other Loan Document, voidable under applicable Law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section shall remain in full force and effect until the Obligations (other than contingent indemnification obligations that survive the termination of this Agreement) have been paid in full and the Commitments have expired or terminated. Each Qualified ECP Guarantor intends that this Section constitute, and this Section shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(ii) of the Commodity Exchange Act.

Section 11.30NOTICE OF FINAL AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

Section 11.31Intercreditor Agreement Section 11.32. Notwithstanding anything to the contrary herein, the Liens granted to the Secured Parties pursuant to this Agreement and the exercise of any right or remedy by Administrative Agent hereunder with respect to the Collateral are subject to the provisions of the Intercreditor Agreement. In the event of any conflict between the terms of the Intercreditor Agreement and this Agreement with respect to such matters, the terms of the Intercreditor Agreement shall govern and control. The Lenders hereby authorize (a) Administrative Agent to enter into the Intercreditor Agreement and to amend such agreement in accordance with the provisions of Section 11.10 and (b) Administrative Agent to take such action and execute and deliver to the Loan Parties, at the Loan Parties’ sole cost and expense, any all instruments, assignments, agreements, releases of Liens, UCC-3 termination, PPSA termination or other documents reasonably requested by the Loan Parties and/or the Subordinated Lenders in connection with the Subordinated Lenders exercising their purchase option in accordance with the Intercreditor Agreement. Each Lender (by receiving the benefits thereunder and of the Collateral pledged pursuant to the Security Documents) agrees that the terms of the Intercreditor Agreement shall be binding on such Lender and its successors and assigns, as if it were a party thereto.

Section 11.32Acknowledgement Regarding Any Supported QFCs. To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Hedge Agreements or any other agreement or instrument that is a QFC (such support, “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of Texas and/or of the United States or any other state of the United States):

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In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regimes if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regimes, Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States.

Article 12.

GUARANTY

Section 12.1Guaranty. In consideration of the Loans, advances and other credit heretofore or hereafter granted by the Secured Parties to Borrowers pursuant to this Agreement and the other Loan Documents and in further consideration of any Bank Product Agreements, Guarantors hereby, jointly and severally, unconditionally, absolutely and irrevocably, guarantee to the Secured Parties, the due and punctual payment at maturity, whether by acceleration or otherwise, and the due fulfillment and performance of the Obligations. Each Guarantor is jointly and severally liable for the full payment and performance of the Obligations as a primary obligor.

Section 12.2Payment. If any of the Obligations is not punctually paid when such indebtedness becomes due and payable, either by its terms or as a result of the exercise of any power to accelerate, Guarantors shall, immediately on demand and without presentment, protest, notice of protest, notice of nonpayment, notice of intent to accelerate, notice of acceleration or any other notice whatsoever (all of which are expressly waived in accordance with Section 12.3 hereof), pay the amount due and payable thereon to Administrative Agent, at its Principal Office. It is not necessary for Administrative Agent, in order to enforce such payment by Guarantors, first to institute suit or exhaust its remedies against Borrowers or others liable on the Obligations, or to enforce its rights against any security given to secure such Obligations. Administrative Agent is not required to mitigate damages or take any other action to reduce, collect or enforce the Obligations. No setoff, counterclaim, reduction or diminution of any obligation, or any defense of any kind which any Guarantor has or may have against any Borrower or any Secured Party shall be available hereunder to Guarantors. No payment by any Guarantor shall discharge the liability of Guarantors hereunder until the Obligations have been fully satisfied and the Release Date shall have occurred. If Administrative Agent must rescind or restore any payment, or any part thereof, received by Administrative Agent on any part of the Obligations, any prior release or discharge from the terms of this Guaranty given Guarantors by Administrative Agent or any reduction of any Guarantor’s liability hereunder shall be without effect, and this Guaranty shall remain in full force and effect.

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Section 12.3Agreements and Waivers. Each Guarantor

(a)agrees to all terms and agreements heretofore or hereafter made by Borrowers with Administrative Agent and/or any other Secured Party;

(b)agrees that Administrative Agent may without impairing its rights or the obligations of such Guarantor hereunder (i) waive or delay the exercise of any of its rights or remedies against or release Borrowers or any other Person, including, without limitation, any other party who is or whose Property is liable with respect to the Obligations or any part thereof (Guarantors and any such other Person or Persons are hereafter collectively called the “Sureties” and individually called a “Surety”); (ii) take or accept any other security, collateral or guaranty, or other assurance of the payment of all or any part of the Obligations; (iii) release, surrender, exchange, subordinate or permit or suffer to exist any deterioration, waste, loss or impairment (including without limitation negligent, willful, unreasonable or unjustified impairment) of any collateral, Property or security, at any time existing in connection with, or assuring or securing payment of, all or any part of the Obligations or the liability of such Guarantor or any other Surety; (iv) increase, renew, extend, or modify the terms of any of the Obligations or any instrument or agreement evidencing the same; (v) apply payments by Borrowers, any Surety, or any other Person, to any of the Obligations; (vi) bring suit against any one or more Sureties without joining any other Surety or Borrowers in such proceeding; (vii) compromise or settle with any one or more Sureties in whole or in part for such consideration or no consideration as Administrative Agent may deem appropriate; or (viii) partially or fully release any Guarantor or any other Surety from liability hereunder;

(c)agrees that the obligations of such Guarantor under this Guaranty shall not be released, diminished, or adversely affected by any of the following: (i) the insolvency, bankruptcy, rearrangement, adjustment, composition, liquidation, disability, dissolution or lack of power of Borrowers or any Surety; (ii) the invalidity, illegality or unenforceability of all or any part of the Obligations or any document or agreement executed in connection with the Obligations, for any reason, or the fact that any debt included in the Obligations exceeds the amount permitted by Law; (iii) the failure of Administrative Agent or any other party to exercise diligence or reasonable care or to act in a commercially reasonable manner in the preservation, protection, enforcement, sale or other handling or treatment of all or any part of such collateral, Property or security; (iv) the fact that any collateral, security or Lien contemplated or intended to be given, created or granted as security for the repayment of the Obligations is not properly perfected or created, or proves to be unenforceable or subordinate to any other Lien; (v) the fact that any Borrower has any defense to the payment of all or any part of the Obligations; (vi) any payment by Borrowers or any Surety to Administrative Agent and/or any other Secured Party is a preference under applicable Debtor Relief Laws, or for any reason Administrative Agent and/or any other Secured Party is required to refund such payment or pay such amounts to Borrowers, any such Surety, or someone else; (vii) any defenses which Borrowers could assert on the Obligations, including but not limited to failure of consideration, breach of warranty, fraud, payment, accord and satisfaction, strict foreclosure, statute of frauds, bankruptcy, statute of limitations, lender liability and usury; or (viii) any other action taken or omitted to be taken with respect to this Agreement, the Loan Documents, the Obligations, the security and collateral therefor whether or not such action or omission prejudices such Guarantor or any Surety, or increases the likelihood that such Guarantor will be required to pay the Obligations pursuant to the terms hereof;

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(d)agrees that such Guarantor is obligated to pay the Obligations when due, notwithstanding any occurrence, circumstance, event, action or omission whatsoever, whether or not particularly described herein, except for the full and final payment and satisfaction of the Obligations;

(e)to the extent allowed by applicable Law, waives all rights and remedies now or hereafter accorded by applicable Law to guarantors or sureties, including without limitation any defense, right of offset or other claim which such Guarantor may have against Borrowers or which Borrowers may have against Administrative Agent and/or the Lenders;

(f)waives all notices whatsoever with respect to this Guaranty or with respect to the Obligations, including, but without limitation, notice of (i) Administrative Agent’s and/or any other Secured Party’s acceptance hereof or its intention to act, or its action, in reliance hereon; (ii) the present existence, future incurring, or any amendment of the provisions of any of the Obligations or any terms or amounts thereof or any change therein in the rate of interest thereon; (iii) any default by Borrowers or any Surety; or (iv) the obtaining, enforcing, or releasing of any guaranty or surety agreement (in addition hereto), pledge, assignment or other security for any of the Obligations;

(g)waives notice of presentment for payment, notice of protest, protest, demand, notice of intent to accelerate, notice of acceleration and notice of nonpayment, protest in relation to any instrument evidencing any of the Obligations, and any demands and notices required by Law, except as such waiver may be expressly prohibited by Law, and diligence in bringing suits against any Surety; and

(h)waives each right to which it may be entitled by virtue of the Laws of the State of Texas governing or relating to suretyship and guaranties, including, without limitation, any rights under Rule 31, Texas Rules of Civil Procedure, Chapter 51 of the Texas Property Code, Section 17.001 of the Texas Civil Practice and Remedies Code, Section 3.605 of the Uniform Commercial Code, and Chapter 43 of the Texas Civil Practice and Remedies Code, as any or all of the same may be amended or construed from time to time, or the common law of the State of Texas at all relevant times.

Section 12.4Liability. The liability of each Guarantor under this Guaranty is irrevocable, absolute and unconditional, without regard to the liability of any other Person, and shall not in any manner be affected by reason of any action taken or not taken by Administrative Agent and/or any other Secured Party, which action or inaction is herein consented and agreed to, nor by the partial or complete unenforceability or invalidity of any other guaranty or surety agreement, pledge, assignment or other security for any of the Obligations. No delay in making demand on Sureties or any of them for satisfaction of the liability hereunder shall prejudice Administrative Agent’s right to enforce such satisfaction. All of Administrative Agent’s rights and remedies shall be cumulative and any failure of Administrative Agent to exercise any right hereunder shall not be construed as a waiver of the right to exercise the same or any other right at any time, and from time to time, thereafter. This is a continuing guaranty of payment, not a guaranty of collection, and this Guaranty shall be binding upon Guarantors regardless of how long before or after the date hereof any of the Obligations were or are incurred.

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Section 12.5Subordination. If a Borrower or any other Loan Party is now or hereafter becomes indebted to one or more Guarantors (such indebtedness and all interest thereon is referred to as the “Affiliated Debt”), such Affiliated Debt shall be subordinate in all respects to the full payment and performance of the Obligations, and no Guarantor shall be entitled to enforce or receive payment with respect to any Affiliated Debt until the Release Date. Each Guarantor agrees that any Liens, mortgages, deeds of trust, security interests, judgment liens, charges or other encumbrances upon any Loan Party’s assets securing the payment of the Affiliated Debt shall be and remain subordinate and inferior to any Liens, mortgages, deeds of trust, security interests, judgment liens, charges or other encumbrances upon any Loan Party’s assets securing the payment of the Obligations, and without the prior written consent of Administrative Agent, no Guarantor shall exercise or enforce any creditor’s rights of any nature against any Loan Party to collect the Affiliated Debt (other than demand payment therefor). In the event of the receivership, bankruptcy, reorganization, arrangement, debtor’s relief or other insolvency proceedings involving any Borrower or any applicable Loan Party as a debtor, Administrative Agent has the right and authority, either in its own name or as attorney-in-fact for any applicable Guarantor, to file such proof of debt, claim, petition or other documents and to take such other steps as are necessary to prove its rights hereunder and receive directly from the receiver, trustee or other court custodian, payments, distributions or other dividends which would otherwise be payable upon the Affiliated Debt. Each Guarantor hereby assigns such payments, distributions and dividends to Administrative Agent, and irrevocably appoints Administrative Agent as its true and lawful attorney-in-fact with authority to make and file in the name of such Guarantor any proof of debt, amendment of proof of debt, claim, petition or other document in such proceedings and to receive payment of any sums becoming distributable on account of the Affiliated Debt, and to execute such other documents and to give acquittances therefor and to do and perform all such other acts and things for and on behalf of such Guarantor as may be necessary in the opinion of Administrative Agent in order to have the Affiliated Debt allowed in any such proceeding and to receive payments, distributions or dividends of or on account of the Affiliated Debt.

Section 12.6Subrogation. No Guarantor waives or releases any rights of subrogation, reimbursement or contribution which such Guarantor may have, after full and final payment of the Obligations, against others liable on the Obligations. Each Guarantor’s rights of subrogation and reimbursement are subordinate in all respects to the rights and claims of Administrative Agent and the other Secured Parties, and no Guarantor may exercise any rights it may acquire by way of subrogation under this Guaranty, by payment made hereunder or otherwise, until the Release Date. If any amount is paid to any Guarantor on account of such subrogation rights prior to the Release Date, such amount shall be held in trust for the benefit of Administrative Agent and/or the other Secured Parties to be credited and applied on the Obligations, whether matured or unmatured.

Section 12.7Other Indebtedness or Obligations of Guarantors. If any Guarantor is or becomes liable for any indebtedness owed by any Loan Party to the Lenders by endorsement or otherwise than under this Guaranty, such liability shall not be affected by this Guaranty, and the rights of Administrative Agent and the Lenders hereunder shall be cumulative of all other rights that Administrative Agent and the Lenders may have against such Guarantor. The exercise by Administrative Agent of any right or remedy hereunder or under any other instrument or at law or in equity shall not preclude the concurrent or subsequent exercise of any other instrument or remedy at law or in equity and shall not preclude the concurrent or subsequent exercise of any other right or remedy. Further, without limiting the generality of the foregoing, this Guaranty is given by Guarantors as an additional guaranty to all guaranties heretofore or hereafter executed and delivered to Administrative Agent and/or the Lenders by Guarantors in favor of Administrative Agent and/or the Lenders relating to the indebtedness of the Loan Parties to the Secured Parties, and nothing herein shall be deemed to replace or be in lieu of any other of such previous or subsequent guarantees.

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Section 12.8Costs and Expenses. Guarantors jointly and severally agree to pay to Administrative Agent and the Lenders, upon demand, all losses and costs and expenses, including attorneys’ fees, that may be incurred by Administrative Agent and the Lenders in attempting to cause the Obligations to be satisfied or in attempting to cause satisfaction of Guarantors’ liability under this Guaranty.

Section 12.9Exercising Rights, Etc. No notice to or demand upon any Guarantor in any case shall, of itself, entitle such Guarantor or any other Guarantor to any other or further notice or demand in similar or other circumstances. No delay or omission by Administrative Agent in exercising any power or right hereunder shall impair such right or power or be construed as a waiver thereof or any acquiescence therein, nor shall any single or partial exercise of any such power preclude other or further exercise thereof, or the exercise of any other right or power hereunder.

Section 12.10Benefit; Binding Effect. This Guaranty shall inure to the benefit of Administrative Agent and each other Secured Party and their respective successors and assigns, and to any interest in any of the Obligations. All of the obligations of Guarantors arising hereunder shall be jointly and severally binding on each of the Persons signing this Guaranty, and their respective successors and assigns (provided, however, that no Guarantor may, without the prior written consent of Administrative Agent in each instance, assign or delegate any of its rights, powers, duties or obligations hereunder, and any attempted assignment or delegation made without Administrative Agent’s prior written consent shall be void ab initio and of no force or effect).

Section 12.11Multiple Guarantors. It is specifically agreed that Administrative Agent may enforce the provisions hereof with respect to one or more Guarantors without seeking to enforce the same as to all or any Guarantors. If one or more additional guaranty agreements (“Other Guaranties”) are executed by one or more additional guarantors (“Other Guarantors”), which guarantee, in whole or in part, any of the Obligations, it is specifically agreed that Administrative Agent may enforce the provisions of this Guaranty or of Other Guaranties with respect to one or more of Guarantors or any one or more of Other Guarantors under Other Guaranties without seeking to enforce the provisions of this Guaranty or Other Guaranties as to all or any of Guarantors or Other Guarantors. Each Guarantor hereby waives any requirement of joinder of all or any other Guarantor or all or any of Other Guarantors in any suit or proceeding to enforce the provisions of this Guaranty or of Other Guaranties. The liability hereunder of all Guarantors hereunder shall be joint and several.

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Section 12.12Additional Guarantors. From time to time subsequent to the date hereof, additional Persons may become parties hereto as additional Guarantors (each, an “Additional Guarantor”), by executing a Joinder Agreement. Upon delivery of any such Joinder Agreement to Administrative Agent, notice of which is hereby waived by Guarantors, each Additional Guarantor shall be a Guarantor and shall be as fully a party hereto as if Additional Guarantor were an original signatory hereto. Each Guarantor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the addition or release of any other Guarantor hereunder, nor by any election of Administrative Agent not to cause any Subsidiary or Affiliate of Company to become an Additional Guarantor hereunder. This Guaranty shall be fully effective as to any Guarantor that is or becomes a party hereto regardless of whether any other Person becomes or fails to become or ceases to be a Guarantor hereunder.

Section 12.13Reinstatement. Notwithstanding anything contained in this Agreement or the other Loan Documents, the obligations of each Guarantor under this Article 12 shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of any Person in respect of the Obligations is rescinded or must be otherwise restored by any holder of any of the Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise, and each Guarantor agrees that it will indemnify each Secured Party on demand for all reasonable costs and expenses (including, without limitation, reasonable fees of counsel) incurred by such Person in connection with such rescission or restoration, including any such costs and expenses incurred in defending against any claim alleging that such payment constituted a preference, fraudulent transfer or similar payment under any Debtor Relief Law.

Section 12.14Maximum Liability. Anything in this Guaranty to the contrary notwithstanding, the obligations of each Guarantor hereunder shall be limited to a maximum aggregate amount equal to the largest amount that would not render its obligations hereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11 of the United States Code or any applicable provisions of comparable Law (collectively, the “Fraudulent Transfer Laws”), in each case after giving effect to all other liabilities of such Guarantor, contingent or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically excluding, however, any liabilities of such Guarantor in respect of intercompany indebtedness to other Loan Parties or Affiliates of other Loan Parties to the extent that such indebtedness would be discharged in an amount equal to the amount paid or Property conveyed by such Guarantor under the Loan Documents) and after giving effect as assets, subject to Section 12.6, to the value (as determined under the applicable provisions of the Fraudulent Transfer Laws) of any rights to subrogation or contribution of such Guarantor pursuant to (a) applicable Law or (b) any agreement providing for an equitable allocation among such Guarantor and other Loan Parties of obligations arising under the Loan Documents and Bank Product Agreements.

[Remainder of Page Intentionally Left Blank; Signature Page Follows]

CREDIT AGREEMENT – Page 159

ANNEX B

Conformed Credit Agreement (Specified Contribution Effective Date)

[See Attached]

ANNEX B

Annex B to Fifth Amendment to Credit Agreement

CREDIT AGREEMENT

among

FLEX LEASING POWER & SERVICE LLC

and

FLEX LEASING POWER AND SERVICE ULC,
as Borrowers,

and

THE OTHER LOAN PARTIES FROM TIME TO TIME PARTY HERETO,


THE LENDERS FROM TIME TO TIME PARTY HERETO

and

TEXAS CAPITAL BANK,
as Administrative Agent, Swing Line Lender and L/C Issuer

TEXAS CAPITAL BANK,
as Sole Lead Arranger and Sole Book Runner

DATED AS OF FEBRUARY 8, 2019

TABLE OF CONTENTS

Page

Article 1. DEFINITIONS		1
Section 1.1	Definitions	1
Section 1.2	Accounting Matters	45
Section 1.3	ERISA Matters	46
Section 1.4	Letter of Credit Amounts	46
Section 1.5	Other Definitional Provisions	46
Section 1.6	Interpretative Provision	47
Section 1.7	Times of Day	47
Section 1.8	Other Loan Documents	47
Section 1.9	Divisions	47
Section 1.10	Rates	48
Section 1.11	Rounding	48
Article 2. THE COMMITMENTS AND CREDIT EXTENSIONS		49
Section 2.1	The Loans	49
Section 2.2	Letters of Credit	51
Section 2.3	Swing Line Loans	59
Section 2.4	Fees	62
Section 2.5	Payments Generally; Administrative Agent’s Clawback	63
Section 2.6	Evidence of Debt	64
Section 2.7	Cash Collateral	65
Section 2.8	Interest; Payment Terms	66
Section 2.9	Voluntary Termination or Reduction of Commitments; Prepayments	68
Section 2.10	Uncommitted Increase in Commitments	70
Section 2.11	Cash Collateral Blocked Accounts	72
Section 2.12	Collection of Accounts	72
Section 2.13	Appointment of Borrower Representative	72
Section 2.14	Joint and Several Liability	74
Article 3. TAXES, YIELD PROTECTION AND INDEMNITY		74
Section 3.1	Increased Costs	74
Section 3.2	Illegality	76
Section 3.3	Alternate Rate of Interest	76
Section 3.4	Taxes	79
Section 3.5	Compensation for Losses	84
Section 3.6	Mitigation of Obligations; Replacement of Lenders	84
Section 3.7	Survival	85
Article 4. CONDITIONS PRECEDENT		86
Section 4.1	Initial Extension of Credit	86

i

Section 4.2	All Extensions of Credit	89
Article 5. REPRESENTATIONS AND WARRANTIES		90
Section 5.1	Entity Existence	90
Section 5.2	Financial Statements; Etc.	90
Section 5.3	Action; No Breach	91
Section 5.4	Operation of Business	91
Section 5.5	Litigation and Judgments	91
Section 5.6	Rights in Properties; Liens	91
Section 5.7	Enforceability	92
Section 5.8	Approvals	92
Section 5.9	Taxes	92
Section 5.10	Use of Proceeds; Margin Securities	92
Section 5.11	ERISA	93
Section 5.12	Disclosure	93
Section 5.13	Subsidiaries	94
Section 5.14	Agreements	94
Section 5.15	Compliance with Laws	94
Section 5.16	Inventory	94
Section 5.17	Regulated Entities	94
Section 5.18	Environmental Matters	94
Section 5.19	Intellectual Property	95
Section 5.20	Anti-Corruption Laws; Sanctions; Etc.	95
Section 5.21	Patriot Act	96
Section 5.22	Insurance	96
Section 5.23	Solvency	96
Section 5.24	Security Documents	96
Section 5.25	Labor Matters	96
Section 5.26	Material Agreements	97
Section 5.27	Additional Representations of Guarantors	97
Section 5.28	Qualified ECP Guarantor. Each Borrower is a Qualified ECP Guarantor	97
Article 6. AFFIRMATIVE COVENANTS		97
Section 6.1	Reporting Requirements	97
Section 6.2	Maintenance of Existence; Conduct of Business	102
Section 6.3	Maintenance of Properties	102
Section 6.4	Taxes and Claims	102
Section 6.5	Insurance	102
Section 6.6	Inspection Rights	102
Section 6.7	Keeping Books and Records	103
Section 6.8	Compliance with Laws	103
Section 6.9	Compliance with Agreements	103
Section 6.10	Further Assurances	103
Section 6.11	ERISA	104

ii

Section 6.12	Depository Relationship; Control Agreements; Blocked Accounts	104
Section 6.13	Additional Loan Parties	104
Section 6.14	Inventory; Collateral Access Agreements	105
Section 6.15	Certificates of Title	105
Section 6.16	Sanctions; Anti-Corruption Laws	105
Section 6.17	Post-Closing Obligations	106
Article 7. NEGATIVE COVENANTS		106
Section 7.1	Debt	106
Section 7.2	Limitation on Liens	107
Section 7.3	Mergers, Etc.	108
Section 7.4	Restricted Payments	109
Section 7.5	Loans and Investments	109
Section 7.6	Limitation on Issuance of Equity	110
Section 7.7	Transactions With Affiliates	110
Section 7.8	Disposition of Assets	111
Section 7.9	Sale and Leaseback	111
Section 7.10	Prepayment of Debt	111
Section 7.11	Nature of Business	111
Section 7.12	Environmental Protection	112
Section 7.13	Accounting	112
Section 7.14	Burdensome Agreements	112
Section 7.15	Subsidiaries	112
Section 7.16	Amendments of Certain Documents	112
Section 7.17	Hedge Agreements	113
Section 7.18	Anti-Corruption Laws; Sanctions; Anti-Terrorism Law	113
Section 7.19	Negative Pledge	113
Section 7.20	Canadian Defined Benefit Plan	113
Article 8. FINANCIAL COVENANTS		113
Section 8.1	Leverage Ratio	113
Section 8.2	Fixed Charge Coverage Ratio	113
Article 9. DEFAULT		114
Section 9.1	Events of Default	114
Section 9.2	Remedies Upon Default	116
Section 9.3	Right to Cure Financial Covenant Non-Compliance	116
Section 9.4	Application of Funds	117
Section 9.5	Performance by Administrative Agent	118
Article 10. AGENCY		119
Section 10.1	Appointment and Authority	119
Section 10.2	Rights as a Lender	119
Section 10.3	Exculpatory Provisions	120

iii

Section 10.4	Reliance by Administrative Agent	121
Section 10.5	Delegation of Duties	121
Section 10.6	Resignation or Removal of Administrative Agent	122
Section 10.7	Non-Reliance on Administrative Agent and Other Lenders	123
Section 10.8	Administrative Agent May File Proofs of Claim	124
Section 10.9	Collateral and Guaranty Matters	124
Section 10.10	Bank Product Agreements	125
Section 10.11	Erroneous Payments	126
Article 11. MISCELLANEOUS		129
Section 11.1	Expenses	129
Section 11.2	INDEMNIFICATION	130
Section 11.3	Limitation of Liability	132
Section 11.4	No Duty	132
Section 11.5	Lenders Not Fiduciary	132
Section 11.6	Equitable Relief	132
Section 11.7	No Waiver; Cumulative Remedies	132
Section 11.8	Successors and Assigns	133
Section 11.9	Survival	137
Section 11.10	Amendment	137
Section 11.11	Notices	139
Section 11.12	Governing Law; Venue; Service of Process	141
Section 11.13	Counterparts	142
Section 11.14	Severability	143
Section 11.15	Headings	143
Section 11.16	Construction	143
Section 11.17	Independence of Covenants	143
Section 11.18	WAIVER OF JURY TRIAL	143
Section 11.19	Additional Interest Provision	144
Section 11.20	Ceiling Election	145
Section 11.21	USA Patriot Act	145
Section 11.22	Defaulting Lenders	145
Section 11.23	Sharing of Payments by Lenders	148
Section 11.24	Payments Set Aside	148
Section 11.25	Setoff	149
Section 11.26	Confidentiality	150
Section 11.27	Electronic Execution of Assignments and Certain Other Documents	151
Section 11.28	Acknowledgement and Consent to Bail-In of Affected Financial Institutions	151
Section 11.29	Keepwell	152
Section 11.30	NOTICE OF FINAL AGREEMENT	152
Section 11.31	Acknowledgement Regarding Any Supported QFCs	152
Article 12. GUARANTY		153
Section 12.1	Guaranty	153

iv

Section 12.2	Payment	153
Section 12.3	Agreements and Waivers	153
Section 12.4	Liability	155
Section 12.5	Subordination	156
Section 12.6	Subrogation	156
Section 12.7	Other Indebtedness or Obligations of Guarantors	156
Section 12.8	Costs and Expenses	156
Section 12.9	Exercising Rights, Etc.	157
Section 12.10	Benefit; Binding Effect	157
Section 12.11	Multiple Guarantors	157
Section 12.12	Additional Guarantors	157
Section 12.13	Reinstatement	158
Section 12.14	Maximum Liability	158

v

INDEX TO SCHEDULES
Schedule	Description of Schedule	Section
2.1	Commitments and Applicable Percentages	2.1
2.11	Blocked Accounts	2.11
5.5	Litigation and Judgments	5.5
5.6(b)	Owned Real Property	5.6
5.6(c)	Leased Real Property (Lessee)	5.6
5.9	Taxes	5.9
5.13	Parent; Subsidiaries	5.13
5.26	Material Agreements	5.26
7.1	Existing Debt	7.1
7.2	Existing Liens	7.2
7.5	Existing Investments	7.5
11.11	Notices	11.11

INDEX TO EXHIBITS
Exhibit	Description of Exhibit	Section
A	Assignment and Assumption	1.1
B	Borrowing Base Report	1.1
C	Compliance Certificate	1.1
D	Borrowing Request	1.1
E	Note	1.1
F	Swing Line Loan Request	1.1
G	Tax Forms	3.4(g)
H	Joinder Agreement	1.1

vi

CREDIT AGREEMENT

This CREDIT AGREEMENT dated as of February 8, 2019 (as the same may be amended, restated, supplemented or otherwise modified from time to time, this “Agreement”), is among FLEX LEASING POWER & SERVICE LLC, a Delaware limited liability company (“Company”), FLEX LEASING POWER AND SERVICE ULC, an Alberta unlimited liability corporation (“Canadian Borrower”; and together with Company and any Subsidiary of Company that becomes party hereto as a “Borrower” pursuant to Section 6.13(a), including their respective successors and assigns to the extent permitted by Section 11.8, individually, a “Borrower”, and collectively, “Borrowers”), each of the other Loan Parties from time to time party hereto, the Lenders from time to time party hereto, and TEXAS CAPITAL BANK, a national banking association, as Administrative Agent, Swing Line Lender and L/C Issuer.

RECITALS

The Borrowers have requested that Lenders extend credit to Borrowers as described in this Agreement. Lenders are willing to make such credit available to Borrowers upon and subject to the provisions, terms and conditions hereinafter set forth.

NOW THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto agree as follows:

Article 1.

DEFINITIONS

Section 1.1Definitions. As used in this Agreement, all exhibits, appendices and schedules hereto and in any note, certificate, report or other Loan Document made or delivered pursuant to this Agreement, the following terms will have the meanings given such terms in this Article 1 or in the provision, section or recital referred to below:

“Account” means an account, as defined in the UCC or the PPSA, as applicable.

“Account Agings” has the meaning set forth in Section 6.1(l).

“Additional Guarantor” has the meaning set forth in Section 12.12.

“Adjusted Eurodollar Rate” means, with respect to any Loan for any Interest Period or day, as applicable, an interest rate per annum equal to the Eurodollar Rate for such Interest Period or day multiplied by the Statutory Reserve Rate; provided, however, if the Eurodollar Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.

“Administrative Agent” means Texas Capital Bank, in its capacity as administrative agent under any of the Loan Documents, until the appointment of a successor administrative agent pursuant to the terms of this Agreement and, thereafter, shall mean such successor administrative agent.

CREDIT AGREEMENT – Page 1

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by or reasonably acceptable to Administrative Agent.

“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.

“Affiliate” means, as to any Person, any other Person that directly or indirectly, through one or more intermediaries, Controls or is Controlled by, or is under common Control with, such Person; provided, however, in no event shall any Lender be deemed an Affiliate of Parent, any Borrower or any of their respective Subsidiaries or Affiliates. Notwithstanding the foregoing, for purposes of clause (e), clause (n), and clause (r) of the definition of “Eligible Accounts”, the term “Affiliate” solely with respect to any Loan Party shall exclude any portfolio company (other than Parent, any Loan Party or any of their respective Subsidiaries) of the Permitted Holders and their Affiliates engaged in the business of producing goods or providing services that, but for this sentence, would otherwise be an Affiliate of any Permitted Holder or of Parent, any Loan Party or any of their respective Subsidiaries.

“Affiliated Debt” has the meaning set forth in Section 12.5.

“Agent Parties” means, collectively, Administrative Agent or any of its Related Parties.

“Agreement” has the meaning set forth in the introductory paragraph hereto, and includes all schedules, exhibits and appendices attached or otherwise identified therewith.

“Annualized Debt Service” means, for any date of determination, the sum of all regularly scheduled principal payments and all Cash Interest Expense that are paid or payable in respect of all Debt of Company and its Subsidiaries on a consolidated basis in accordance with GAAP (other than scheduled payments of principal on Debt which pay such Debt in full, but only to the extent such final payment is greater than the scheduled principal payment immediately preceding such final payment) for the trailing three month period then ending on such date multiplied by four (4).

“Annualized EBITDA” means, for any date of determination, the sum of (a)(i) EBITDA of Company and its Subsidiaries on a consolidated basis in accordance with GAAP for the trailing three month period then ending on such date (without giving effect to the amount of any Specified EBITDA Equity Contribution that is deemed to be EBITDA for any fiscal quarter included in the trailing four fiscal quarter period pursuant to Section 9.3) multiplied by (ii) four (4), plus (b) the amount of any Specified EBITDA Equity Contribution that is deemed to be EBITDA for any fiscal quarter included in the trailing four fiscal quarter period pursuant to Section 9.3.

“Anti-Corruption Laws” means all state, provincial, territorial or federal Laws, rules, and regulations applicable to the Loan Parties or any of their Affiliates from time to time concerning or relating to bribery or corruption, including the FCPA, the Bank Secrecy Act, the Corruption of Foreign Public Officials Act (Canada), and other similar anti-corruption legislation in other jurisdictions.

“Anti-Terrorism Laws” has the meaning set forth in Section 5.21.

CREDIT AGREEMENT – Page 2

“Applicable Margin” means the applicable percentages per annum set forth below, based upon the Leverage Ratio, as set forth in the most recent Compliance Certificate received by Administrative Agent for each fiscal quarter or the last month of each fiscal quarter from time to time pursuant to Section 6.1(d), as applicable:

Pricing Level	Leverage Ratio	Base Rate Loans	Eurodollar Rate Loans and Letter of Credit Fee
1	≤ 2.00:1.00	1.50%	2.50%
2	>2.00:1.00 but ≤ 2.50:1.00	1.75%	2.75%
3	>2.50:1.00	2.00%	3.00%

Any increase or decrease in the Applicable Margin resulting from a change in the Leverage Ratio shall become effective as of the first day immediately following the date a Compliance Certificate is delivered for each fiscal quarter or the last month of each fiscal quarter from time to time pursuant to Section 6.1(d), as applicable; provided that if such Compliance Certificate is not delivered when due in accordance with such Section, then upon the request of the Required Lenders, Pricing Level 3 shall apply as of the first day after the date on which such Compliance Certificate was required to have been delivered and shall remain in effect until the date on which such Compliance Certificate is delivered. The Applicable Margin from the Closing Date through the date such Compliance Certificate is delivered pursuant to Section 6.1(d) in respect of the last month of the second fiscal quarter of Company ending after the Closing Date shall be determined based upon Pricing Level 2.

If, as a result of any restatement of or other adjustment to the financial statements of Company or for any other reason, the Borrower Representative or the Required Lenders determine that (i) the Leverage Ratio as calculated by Company as of any applicable date was inaccurate and (ii) a proper calculation of the Leverage Ratio would have resulted in higher pricing for such period, Borrowers shall immediately and retroactively be obligated to pay to Administrative Agent for the account of the applicable Lenders, L/C Issuer or Swing Line Lender, as the case may be, promptly on demand by Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to any Loan Party under the Bankruptcy Code of the United States, automatically and without further action by Administrative Agent, any Lender, L/C Issuer or Swing Line Lender), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period. This paragraph shall not limit the rights of Administrative Agent, any Lender, L/C Issuer or Swing Line Lender, as the case may be, including the rights available under Article 2 or under Article 9. Each Borrower’s obligations under this paragraph shall survive the termination of the Commitments and the repayment of all other Obligations hereunder.

“Applicable Percentage” means, with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of such Lender’s Commitment at such time divided by the aggregate Commitments of all Lenders; provided that if the Commitments have been terminated pursuant to the terms hereof, then the Applicable Percentage of each Lender shall be determined based upon the Applicable Percentage of such Lender immediately prior to such termination and after giving effect to any subsequent assignments made pursuant to the terms hereof.

CREDIT AGREEMENT – Page 3

“Applicable Rate” means (a) in the case of a Base Rate Loan, the Base Rate plus the Applicable Margin; and (b) in the case of a Eurodollar Rate Loan, the Adjusted Eurodollar Rate plus the Applicable Margin.

“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arranger” means Texas Capital Bank in its capacity as sole lead arranger and sole book runner.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 11.8), and accepted by Administrative Agent, in substantially the form of Exhibit A or any other form approved by Administrative Agent.

“Authorized Party” has the meaning set forth in Section 11.11(d)(iii).

“Availability” means, as of any date, the difference between (a) an amount equal to the lesser of (i) the Borrowing Base in effect on such date and (ii) the aggregate amount of the Commitments of the Lenders on such date less (b) the total Revolving Credit Exposure of the Lenders on such date.

“Availability Reserves” shall mean, as of any date of determination, such amounts as Administrative Agent may from time to time establish and revise in its Permitted Discretion: (a) to reflect events, conditions, contingencies or risks which, as determined by Administrative Agent, do or may affect either (i) the Collateral or any other Property which is security for the Obligations, (ii) the assets, business or prospects of the Loan Parties, (iii) the security interests and other rights of any Secured Party in the Collateral (including the enforceability, perfection and priority thereof), (b) to reflect Administrative Agent’s belief that any collateral report or financial information furnished by or on behalf of the Loan Parties to Administrative Agent is or may have been incomplete, inaccurate or misleading in any material respect, (c) in respect of Rent Reserves, Bank Products and Hedge Agreements and (d) in respect of any state of facts which Administrative Agent determines constitutes a Default or an Event of Default or may, with notice or passage of time or both, constitute a Default or an Event of Default. Without limiting the foregoing, the Administrative Agent, in its Permitted Discretion, may establish and/or increase Availability Reserves (but without duplication) in respect of: (A) any reserve established by the Administrative Agent on account of statutory claims, deemed trusts, or inventory subject to rights of suppliers under Section 81.1 of the BIA or similar rights of reclamation under Section 81.2 of the BIA, or under any other applicable Law, (B) employee or employee benefit related liabilities and any other claims which may have priority over the claims of the Administrative Agent and the Lenders, including Canadian Priority Payables, (C) liabilities arising under or in respect of any Canadian Pension Plan which, if not paid, could result in a Lien on any of the assets of any Credit Party, which Lien could reasonably be expected to have priority over, or rank pari passu with, the Liens of the Administrative Agent, (D) claims by Her Majesty the Queen in Right of Canada made pursuant to Section 224(1.2) or 224(1.3) of the ITA, (E) claims pursuant to any provision of the Canada Pension Plan or the Employment Insurance Act (Canada) that refers to subsection 224(1.2) of the ITA and provides for the collection of a contribution (as defined in the Canada Pension Plan), or employee’s premium or employer’s premium (as defined in the Employment Insurance Act (Canada)), or a premium under Part VII.1 of that Act, and of any related interest, penalties or other amounts, (F) claims pursuant to any provision of provincial legislation that has a similar purpose to subsection 224(1.2) of the ITA, or that refers to that subsection, to the extent that it provides for the collection of a sum, and of any related interest, penalties or other amounts, where the sum has been withheld or deducted by a person from a payment to another person and is in respect of a tax similar in nature to the income tax imposed on individuals under the ITA or is of the same nature as a contribution under the Canada Pension Plan if the province is a “province providing a comprehensive pension plan” as defined in subsection 3(1) of the Canada Pension Plan and the provincial legislation establishes a “provincial pension plan” as defined in that subsection, which claims could reasonably be expected to have priority over, or rank pari passu with, the Liens of the Administrative Agent.

CREDIT AGREEMENT – Page 4

“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, any tenor for such Benchmark or payment period for interest calculated with reference to such Benchmark, as applicable, that is or may be used for determining the length of an Interest Period pursuant to this Agreement as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to Section 3.3(e).

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” means, (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing Law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).

“Bank Product Agreements” means those certain agreements entered into from time to time between any Loan Party and a Bank Product Provider in connection with any of the Bank Products, including without limitation, Hedge Agreements.

“Bank Product Obligations” means all obligations, liabilities, contingent reimbursement obligations, fees, and expenses owing by any Loan Party or any of its Subsidiaries to any Bank Product Provider pursuant to or evidenced by the Bank Product Agreements and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all such amounts that any Loan Party or such Subsidiary is obligated to reimburse to any Bank Product Provider as a result of such Bank Product Provider purchasing participations or executing indemnities or reimbursement obligations with respect to the Bank Products provided to any Loan Party or such Subsidiaries pursuant to the Bank Product Agreements. For the avoidance of doubt, the Bank Product Obligations arising under any Hedge Agreement shall be determined by the Hedge Termination Value thereof.

CREDIT AGREEMENT – Page 5

“Bank Product Provider” means any Lender or Affiliate of a Lender (or any Person that was a Lender or an Affiliate of a Lender at the time the relevant Hedge Agreement was entered into) that provides Bank Products to the Loan Parties from time to time.

“Bank Products” means any service provided to, facility extended to, or transaction entered into with, any Loan Party by any Bank Product Provider consisting of (a) deposit accounts, (b) cash management services, including treasury, depository, return items, overdraft, controlled disbursement, merchant store value cards, e-payables services, electronic funds transfer, interstate depository network, automatic clearing house transfer (including the Automated Clearing House processing of electronic funds transfers through the direct Federal Reserve Fedline system) and other cash management arrangements maintained with any Bank Product Provider, (c) debit cards, stored value cards, and credit cards (including commercial credit cards (including so-called “procurement cards” or “P-cards”)) and debit card and credit card processing services or (d) Hedge Agreements.

“Base Rate” means, for any day, a rate of interest per annum equal to the highest of (a) the Prime Rate for such day; (b) the sum of the Federal Funds Rate for such day plus one half of one percent (0.5%); and (c) the Adjusted Eurodollar Rate for such day plus one percent (1.00%). Notwithstanding the foregoing, in no event shall the Base Rate be less than 1.00%.

“Base Rate Borrowing” means, as to any Borrowing, the Base Rate Loans comprising such Borrowing.

“Base Rate Loan” means a Loan bearing interest based on the Base Rate.

“Benchmark” means, initially, USD LIBOR; provided that if a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have occurred with respect to USD LIBOR or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 3.3(b).

“Benchmark Replacement” means, for any Available Tenor, the first alternative set forth in the order below that can be determined by Administrative Agent for the applicable Benchmark Replacement Date:

(a)the BSBY Rate;

(b)the sum of: (i) Term SOFR and (ii) the related Benchmark Replacement Adjustment;

(c)the sum of: (i) Daily Simple SOFR and (ii) the related Benchmark Replacement Adjustment;

CREDIT AGREEMENT – Page 6

(d) the sum of: (i) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower Representative as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (A) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (B) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for U.S. dollar-denominated syndicated credit facilities at such time and (ii) the related Benchmark Replacement Adjustment;

provided that, (x) in the case of clause (a), no BSBY Transition Event shall have occurred and the BSBY Rate is available and readily determinable as determined by the Administrative Agent in its sole discretion and (y) in the case of clause (b), such Unadjusted Benchmark Replacement is displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion. If the Benchmark Replacement as determined pursuant to clause (a), (b), (c) or (d) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.

“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest Period and Available Tenor for any setting of such Unadjusted Benchmark Replacement:

(a)       for purposes of clauses (a) and (b) of the definition of “Benchmark Replacement,” the first alternative set forth in the order below that can be determined by the Administrative Agent:

(i)       the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Interest Period that has been selected or recommended by the Relevant Governmental Body for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for the applicable Corresponding Tenor;

(ii)       the spread adjustment (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Interest Period that would apply to the fallback rate for a derivative transaction referencing the ISDA Definitions to be effective upon an index cessation event with respect to such Benchmark for the applicable Corresponding Tenor; and

(b)       for purposes of clause (c) of the definition of “Benchmark Replacement,” the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Administrative Agent and the Borrower Representative for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body on the applicable Benchmark Replacement Date or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated syndicated credit facilities;

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provided that, in the case of clause (a) above, such adjustment is displayed on a screen or other information service that publishes such Benchmark Replacement Adjustment from time to time as selected by the Administrative Agent in its reasonable discretion.

“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definitions of “Adjusted Eurodollar Rate”, “Base Rate”, “Business Day”, “Eurodollar Rate”, or “Interest Period,” the timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

“Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current Benchmark:

(a)       in the case of clauses (a) or (b) of the definition of “Benchmark Transition Event”, the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof);

(b)       in the case of clause (c) of the definition of “Benchmark Transition Event,” the date of the public statement or publication of information referenced therein; or

(c)       in the case of an Early Opt-in Election, the sixth (6th) Business Day after the date notice of such Early Opt-in Election is provided to the Lenders, so long as the Administrative Agent has not received, by 5:00 p.m. on the fifth (5th) Business Day after the date notice of such Early Opt-in Election is provided to the Lenders, written notice of objection to such Early Opt-in Election from Lenders comprising the Required Lenders;

provided that if the then-current Benchmark is BSBY, “Benchmark Replacement Date” shall mean the BSBY Replacement Date.

For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred in the case of clauses (a) or (b) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:

(a)a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

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(b)a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Board of Governors, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

(c)a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are no longer representative; or

(d)if the then current Benchmark is BSBY, the occurrence of a BSBY Transition Event.

For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).

“Benchmark Unavailability Period” means the period (if any) (a) beginning at the time that a Benchmark Replacement Date pursuant to clauses (a) or (b) of the definition thereof has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 3.3 and (b) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 3.3.

“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“BHC Act Affiliate” means, as to any Person, an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such Person.

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“BIA” means the Bankruptcy and Insolvency Act (Canada), as amended from time to time, and any successor statute, together with the regulations promulgated thereunder.

“Blocked Accounts” has the meaning set forth in Section 2.11.

“Board of Governors” means the Board of Governors of the Federal Reserve System of the U.S.

“Borrower” or “Borrowers” has the meaning set forth in the introductory paragraph hereto.

“Borrower Materials” has the meaning set forth in Section 11.11(e).

“Borrower Representative” has the meaning set forth in Section 2.13(a).

“Borrowing” means a Revolving Credit Borrowing or a Swing Line Borrowing, as the context may require.

“Borrowing Base” means, as of any date, an amount equal to the sum of, without duplication:

(a)       eighty-five percent (85%) of the Borrowers’ Eligible Accounts, plus

(b)       fifty percent (50%) of the Borrowers’ Eligible Inventory, valued at the lower of cost or market value, determined on a weighted average cost basis; provided, that the maximum amount of Eligible Inventory of the Borrowers that may be included in the Borrowing Base pursuant to this clause (b) after giving effect to the advance rate set forth herein shall not exceed $3,000,000, plus

(c)       the lesser of (i) the product of eighty percent (80%) of the Net Orderly Liquidation Value of the Borrowers’ Eligible Generator Units as determined pursuant to the most recent generator appraisal ordered, received and relied upon by Administrative Agent pursuant to Section 6.6(c) and (ii) ninety-five percent (95%) of the net book value of the Borrowers’ Eligible Generator Units; provided that (A) the value of Eligible Generator Units included in the Borrowing Base pursuant to clause (c)(i) after giving effect to the advance rate set forth herein shall be reduced, on the first day of each calendar month following the Closing Date, based on a 7-year straight line amortization schedule until Administrative Agent receives a new appraisal at which time the Net Orderly Liquidation Value will reset, and (B) the value of Eligible Generator Units included in the Borrowing Base pursuant to this clause (c) after giving effect to the advance rate set forth herein shall be reduced, on the date any item of Eligible Generator Units ceases to be Eligible Generator Units for any reason (including as a result of any sale, transfer or other disposition thereof or any casualty or condemnation event with respect thereto), by the amount then included in the Borrowing Base with respect to such item of Eligible Generator Units, plus

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(d)       the lesser of (i) the product of eighty percent (80%) of the Net Orderly Liquidation Value of the Borrowers’ Eligible Field Units as determined pursuant to the most recent field unit appraisal ordered, received and relied upon by Administrative Agent pursuant to Section 6.6(c) and (ii) ninety-five percent (95%) of the net book value of the Borrowers’ Eligible Field Units; provided that (A) the value of Eligible Field Units included in the Borrowing Base pursuant to clause (d)(i) after giving effect to the advance rate set forth herein shall be reduced, on the first day of each calendar month following the First Amendment Effective Date, based on a 5-year straight line amortization schedule until Administrative Agent receives a new appraisal at which time the Net Orderly Liquidation Value will reset, and (B) the value of Eligible Field Units included in the Borrowing Base pursuant to this clause (d) after giving effect to the advance rate set forth herein shall be reduced, on the date any item of Eligible Field Units ceases to be Eligible Field Units for any reason (including as a result of any sale, transfer or other disposition thereof or any casualty or condemnation event with respect thereto), by the amount then included in the Borrowing Base with respect to such item of Eligible Field Units, plus

(e)       eighty percent (80%) of the Net Invoice Cost of the Borrowers’ Eligible New Generator Units, minus

(f)       an amount equal to all Canadian Priority Payables, minus

(g)       without duplication of any amounts deducted pursuant to clause (f) above, any Availability Reserves established by Administrative Agent in its Permitted Discretion.

“Borrowing Base Report” means, as of any date of preparation, a certificate substantially the form of Exhibit B (including, without limitation, a Canadian Priority Payables report in substantially the form attached thereto), or in any other form agreed to in writing by Borrowers and Administrative Agent, prepared by and certified by a Responsible Officer of the Borrower Representative.

“Borrowing Request” means a writing, substantially in the form of Exhibit D, properly completed and signed by the Borrower Representative, requesting a Revolving Credit Borrowing.

“BSBY” means the Bloomberg Short-Term Bank Yield Index rate.

“BSBY Rate” means:

(a) for any Interest Period with respect to a BSBY Rate Loan, the rate per annum equal to the BSBY Screen Rate two Business Days prior to the commencement of such Interest Period with a term equivalent to such Interest Period; provided that if the rate is not published on such determination date then BSBY Rate means the BSBY Screen Rate on the first Business Day immediately prior thereto; and

(b)for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to the BSBY Screen Rate with a term of one month commencing that day;

provided that if the BSBY Rate determined in accordance with the foregoing provisions of this definition would otherwise be less than 0%, the BSBY Rate shall be deemed to be 0% for purposes of this Agreement.

“BSBY Replacement Date” has the meaning set forth in Section 3.3(b)(vii).

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“BSBY Screen Rate” means the Bloomberg Short-Term Bank Yield Index rate administered by Bloomberg and published on the applicable Reuters screen page (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time).

“BSBY Transition Event” means the occurrence of any of the events described in Section 3.3(b)(vii)(A) or (B).

“Business Day” means (a) for all purposes, a weekday, Monday through Friday, except a legal holiday or a day on which banking institutions in Dallas, Texas are authorized or required by Law to be closed, and (b) for purposes of the calculation of the Eurodollar Rate, a day that satisfies the requirements of clause (a) and that is a day on which commercial banks in the City of London, England are open for business and dealing in offshore Dollars. Unless otherwise provided, the term “days” when used herein means calendar days.

“Canada” means, collectively, Canada and each province and territory thereof.

“Canadian AML Legislation” means the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and other applicable anti-money laundering, anti-terrorist financing, government sanction and “know your client” laws within Canada (including any guidelines or orders thereunder).

“Canadian Borrower” has the meaning set forth in the introductory paragraph hereto.

“Canadian Defined Benefit Plan” means a “registered pension plan”, as that term is defined in subsection 248(1) of the ITA, which is or was sponsored, administered or contributed to, or required to be contributed to by, any Loan Party or under which any Loan Party has any actual or potential liability, and which contains a “defined benefit provision”, as defined in subsection 147.1(1) of the ITA.

“Canadian Pension Plan” means any pension plan to which a Loan Party contributes (or to which there is or may be an obligation to contribute by a Loan Party) or has made contributions on behalf of its employees and which is required to be registered under Canadian provincial or federal pension benefits standards legislation.

“Canadian Priority Payables” means, with respect to Canadian Borrower, any amount payable by Canadian Borrower which is secured by a Lien which ranks, or is capable of ranking, prior to or pari passu with the Liens created by the Security Documents in respect of any Eligible Accounts or Eligible Inventory, including amounts owing for wages, vacation pay, severance pay (to the extent capable of ranking prior to the Liens under the Security Documents under applicable Law), employee deductions, sales tax, excise tax, Tax payable pursuant to the ETA (net of GST input credits), income tax, workers compensation, government royalties, pension fund obligations, Canadian Pension Plan obligations (including in respect of unpaid or unremitted Canadian Pension Plan contributions, amounts representing any unfunded liability, solvency deficiency or wind-up deficiency whether or not due with respect to a Canadian Pension Plan (including “normal cost”, “special payments” and any other payments in respect of any funding deficiency or shortfall)), real property tax and other statutory or other claims that have or may have priority over, or rank pari passu with, such Liens created by the Security Documents.

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“Canadian Security Agreement” means that certain Canadian Pledge and Security Agreement (including any and all supplements thereto), dated as of the Third Amendment Effective Date, among Canadian Borrower and Administrative Agent, for the benefit of Administrative Agent and the other Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Capital Expenditure” means, with respect to any Person, any expenditure by such Person for (a) an asset which will be used in a year or years subsequent to the year in which the expenditure is made and which asset is properly classified in relevant financial statements of such Person as equipment, real Property, a fixed asset or a similar type of capitalized asset in accordance with GAAP or (b) an asset relating to or acquired in connection with an acquired business, and any and all acquisition costs related to clause (a) or (b) above.

“Capitalized Lease Obligation” means, with respect to any Person, the amount of Debt under a lease of Property by such Person that would be shown as a liability on a balance sheet of such Person prepared for financial reporting purposes in accordance with GAAP.

“Cash Collateralize” means to pledge and deposit with or deliver to Administrative Agent, for the benefit of one or more of L/C Issuer or Lenders, as collateral for L/C Obligations or obligations of Lenders to fund participations in respect of L/C Obligations, cash or deposit account balances or, if Administrative Agent and L/C Issuer shall agree in their sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to Administrative Agent and L/C Issuer. “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.

“Cash Interest Expense” means, for any Person for any period, total interest expense in respect of all outstanding Debt actually paid or that is payable by such Person during such period, including, without limitation, all commissions, discounts, and other fees and charges with respect to letters of credit and all net costs under Hedge Agreements in respect of interest rates to the extent such costs are allocable to such period, but excluding interest expense not payable in cash, all as determined in accordance with GAAP.

“CFC” means a “controlled foreign corporation” as defined in Section 957 of the Code.

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any Law, rule, regulation or treaty, (b) any change in any Law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the U.S., Canadian or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, implemented, adopted or issued.

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“Change of Control” means an event or series of events by which:

(a)(i)      at any time prior to the consummation of a Qualified IPO, the Permitted Holders shall cease for any reason (A) to have record and beneficial ownership (directly or indirectly) of more than 50% of the outstanding voting Equity Interests of Parent on a fully diluted basis, (B) to Control Parent; or (C) to have the ability to elect (either through share ownership or contractual voting rights) a majority of the board of directors or equivalent governing body of Parent; and (ii) at any time on or after the consummation of a Qualified IPO, (A) any “person” or “group” (as such terms are used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than the Permitted Holders, is or becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), in a single transaction or series of related transactions, directly or indirectly, of more than 50.0% of the issued and outstanding Voting Shares of the Parent on a fully diluted basis or (B) at the end of any period of 12 consecutive calendar months, the occupation of a majority of the seats on the board of directors of the Parent by Persons who were not members of the board of directors of the Parent on the first day of such period (other than any new directors whose election or appointment by such board of directors or whose nomination for election by the stockholders of the Parent was approved by (x) a vote of not less than three-fourths of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved or (y) the Ultimate Parent so long as the Ultimate Parent then holds stock representing at least 50% of the voting power of all of the then outstanding shares of capital stock of the Parent entitled to vote generally in the election of directors of the Parent);

(b)       Parent shall cease to own, free and clear of all Liens or other encumbrances (other than Permitted Liens), directly or indirectly, at least 100% of the outstanding direct or indirect Equity Interests of Company on a fully diluted basis; or

(c)       Company shall cease to own, free and clear of all Liens or other encumbrances (other than Permitted Liens), directly or indirectly, at least 100% of the outstanding direct or indirect Equity Interests of any other Loan Party on a fully diluted basis.

“Closing Date” means the first date all the conditions precedent in Section 4.1 are satisfied or waived in accordance with Section 11.10.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor statute, together with the regulations promulgated thereunder.

“Collateral” means substantially all of the Property of the Loan Parties and their Subsidiaries as described in the Security Documents, including 100% of the Equity Interests in Company and any other Loan Party, together with any other Property and collateral described in the Security Documents, including, among other things, any Property which may now or hereafter secure the Obligations or any part thereof (but which in no event will include any Excluded Asset).

“Collateral Access Agreement” means a landlord waiver, mortgagee waiver, bailee letter or similar acknowledgment of any lessor, warehouseman, processor or other Person in possession of any Collateral or on whose Property any Collateral is located, in form and substance reasonably satisfactory to Administrative Agent.

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“Commitment” means, as to each Lender, its obligation to (a) make Revolving Credit Loans to Borrowers pursuant to Section 2.1(a), (b) purchase participations in L/C Obligations, and (c) purchase participations in Swing Line Loans, in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Lender’s name on Schedule 2.1 under the caption “Commitment” or opposite such caption in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be (a) terminated or reduced from time to time in accordance with Section 2.9(a), (b) increased from time to time in accordance with Section 2.10 or (c) otherwise adjusted from time to time in accordance with this Agreement.

“Commitment Fee Rate” means, with respect to the commitment fees payable hereunder, the applicable percentages per annum set forth below under the caption “Commitment Fee Rate” as determined based on the daily average unused amount of the Commitments during any fiscal month in accordance with Section 2.4(c);

Pricing Level		Daily Average Unused Amount	Commitment Fee Rate
	1	≤  50% of the Commitments		0.225	%
	2	> 50% of the Commitments		0.475	%

“Commodity Account Control Agreement” has the meaning assigned to such term in the applicable Security Agreement.

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

“Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of the Loan Parties pursuant to any Loan Document or the transactions contemplated therein which is distributed to Administrative Agent, any Lender, L/C Issuer or Swing Line Lender by means of electronic communications pursuant to Section 11.11(d), including through the Platform.

“Company” has the meaning set forth in the introductory paragraph hereto.

“Compliance Certificate” means a certificate, substantially in the form of Exhibit C, or in any other form agreed to by Company and Administrative Agent, prepared by and certified by a Responsible Officer of Company.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Constituent Documents” means (a) in the case of a corporation, its articles or certificate of incorporation and bylaws; (b) in the case of a general partnership, its partnership agreement; (c) in the case of a limited partnership, its certificate of limited partnership or certificate of formation, as applicable, and partnership agreement; (d) in the case of a trust, its trust agreement; (e) in the case of a joint venture, its joint venture agreement; (f) in the case of a limited liability company, its articles of organization, operating agreement, regulations and/or other organizational and governance documents and agreements; and (g) in the case of any other entity, its organizational and governance documents and agreements.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have correlative meanings thereto.

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“Control Agreements” means, collectively, the Commodity Account Control Agreements, the Deposit Account Control Agreements and the Securities Account Control Agreements, in each case, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Corresponding Tenor” means, with respect to any Available Tenor, as applicable, either a tenor (including overnight) or an interest payment period having approximately the same length (disregarding business day adjustment) as such Available Tenor.

“Covered Entity” means any of the following: (a) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (b) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (c) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

“Covered Party” has the meaning set forth in Section 11.31.

“Credit Extension” means each of (a) a Borrowing and (b) an L/C Credit Extension.

“Cure Amount” has the meaning set forth in Section 9.3.

“Cure Right” has the meaning set forth in Section 9.3.

“Currency Date” has the meaning set forth in Section 11.2(b).

“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being established by the Administrative Agent in accordance with the conventions for this rate selected or recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for syndicated business loans; provided, that if the Administrative Agent decides that any such convention is not administratively feasible for the Administrative Agent, then the Administrative Agent may establish another convention in its reasonable discretion.

“Debt” means, of any Person as of any date of determination (without duplication): (a) all obligations of such Person for borrowed money; (b) all obligations of such Person evidenced by bonds, notes, debentures, or other similar instruments; (c) all obligations of such Person to pay the deferred purchase price of Property or services, except trade accounts payable of such Person arising in the ordinary course of business that are not past due by more than ninety (90) days; (d) all Capitalized Lease Obligations of such Person; (e) all Debt or other obligations of others Guaranteed by such Person; (f) all obligations secured by a Lien existing on Property owned by such Person, whether or not the obligations secured thereby have been assumed by such Person or are non-recourse to the credit of such Person; (g) any other obligation for borrowed money or other financial accommodations which in accordance with GAAP would be shown as a liability on the balance sheet of such Person; (h) any repurchase obligation or liability of a Person with respect to Accounts, chattel paper or notes receivable sold by such Person; (i) any liability under a sale and leaseback transaction that is not a Capitalized Lease Obligation; (j) any obligation under any so called “synthetic leases;” (k) any obligation arising with respect to any other transaction that is the functional equivalent of borrowing but which does not constitute a liability on the balance sheets of a Person; (l) all payment and reimbursement obligations of such Person (whether contingent or otherwise) in respect of letters of credit, bankers’ acceptances, surety or other bonds and similar instruments; (m) all liabilities of such Person in respect of unfunded vested benefits under any Plan; (n) all Hedge Obligations of such Person, valued at the Hedge Termination Value thereof; and (o) all obligations of such Person in respect of Disqualified Equity Interests.

For all purposes, the Debt of any Person shall include the Debt of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Debt is expressly made non-recourse to such Person.

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“Debtor Relief Laws” means Title 11 of the United States Code, the BIA, the Companies’ Creditors Arrangement Act (Canada), and the Winding-Up and Restructuring Act (Canada), in each case, as now or hereafter in effect, or any other applicable Law, domestic or foreign, as now or hereafter in effect, relating to bankruptcy, insolvency, liquidation, receivership, reorganization, assignment for the benefit of creditors, moratorium, arrangement or composition, extension or adjustment of debts, or similar Laws affecting the rights of creditors (including any applicable corporations legislation to the extent the relief sought under such corporations legislation relates to or involves the compromise, settlement, adjustment or arrangement of debt).

“Default” means an Event of Default or the occurrence of an event or condition which with notice or lapse of time or both would become an Event of Default.

“Default Interest Rate” means (a) when used with respect to Obligations other than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Margin, if any, applicable to a Base Rate Loan plus (iii) two percent (2%) per annum; provided, however, that with respect to a Eurodollar Rate Loan, the Default Interest Rate shall be an interest rate equal to the interest rate (including any Applicable Margin) otherwise applicable to such Loan plus two percent (2%) per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to the Applicable Margin plus two percent (2%) per annum; provided, however, in no event shall the Default Interest Rate exceed the Maximum Rate.

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

“Defaulting Lender” means, subject to Section 11.22(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two (2) Business Days of the date such Loans were required to be funded hereunder, or (ii) pay to Administrative Agent, the L/C Issuer, the Swing Line Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swing Line Loans) within two (2) Business Days of the date when due, (b) has notified the Borrower Representative, Administrative Agent, L/C Issuer or Swing Line Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect, (c) has failed, within three (3) Business Days after written request by Administrative Agent or the Borrower Representative, to confirm in writing to Administrative Agent and the Borrower Representative that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by Administrative Agent and the Borrower Representative), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver, custodian, conservator, trustee, monitor, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity, or (iii) become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 11.22(b)) upon delivery of written notice of such determination to the Borrower Representative and each Lender.

“Deposit Account Control Agreement” has the meaning assigned to such term in the applicable Security Agreement.

“Disposition” means any sale, lease, sub-lease, license, transfer, assignment, conveyance, release, loss or other disposition, or entry into any contract the performance of which would result in any of the foregoing, of any interest in Property, or of any interest in a Subsidiary that owns Property, in any transaction or event or series of transactions or events, and “Dispose” has the correlative meaning thereto.

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“Disqualified Equity Interest” means any Equity Interest that, by its terms (or the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (a) matures or is mandatorily redeemable (other than solely for Equity Interests that are not Disqualified Equity Interests), pursuant to a sinking fund obligation or otherwise (except as a result of a change of control or asset sale so long as any rights of the holders thereof upon the occurrence of a change of control or asset sale event shall be subject to the prior repayment in full of the Loans and all other Obligations that are accrued and payable and the termination of the Commitments), (b) is redeemable at the option of the holder thereof, in whole or in part, (c) provides for scheduled payments of dividends in cash, or (d) is or becomes convertible into or exchangeable for Debt or any other Equity Interests that would constitute Disqualified Equity Interests, in each case, prior to the date that is ninety-one days after the Maturity Date; provided that if such Equity Interests are issued pursuant to a plan for the benefit of employees of any Loan Party or any of its Subsidiaries or by any such plan to such employees, such Equity Interests shall not constitute Disqualified Equity Interests solely because they may be required to be repurchased by any Loan Party or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations or as a result of such employee’s termination, death or disability.

“Dollars” and “$” mean lawful money of the U.S.

“Domestic Subsidiary” means any Subsidiary that is organized under the Laws of any political subdivision of the U.S.

“Early Opt-in Election” means, if the then-current Benchmark is USD LIBOR, the occurrence of:

(a)a notification by the Administrative Agent to (or the request by the Borrower Representative to the Administrative Agent to notify) each of the other parties hereto that at least five currently outstanding U.S. dollar-denominated syndicated credit facilities at such time contain (as a result of amendment or as originally executed) a BSBY-based rate (or, alternatively, a SOFR-based rate, including SOFR, a term SOFR or any other rate based upon SOFR) as a benchmark rate (and such syndicated credit facilities are identified in such notice and are publicly available for review), and

(b)the joint election by the Administrative Agent and the Borrower Representative to trigger a fallback from USD LIBOR and the provision by the Administrative Agent of written notice of such election to the Lenders.

“EBITDA” means, for any Person for any period, an amount equal to: (a) Net Income plus (b) the sum (in each case, without duplication) of the following to the extent deducted in the calculation of Net Income: (i) interest expense; (ii)  Taxes based on income or profits; (iii) depreciation; (iv) amortization; (v)  losses that are unusual and infrequently occurring determined in accordance with GAAP; (vi) other non-recurring expenses reducing such Net Income which do not represent a cash item in such period or any future period; (vii) any amendment, waiver or consent fees (but excluding, for the avoidance of doubt, any upfront, structuring, commitment, arrangement or underwriting fees) paid by the Loan Parties to the Administrative Agent and/or the Lenders in connection with any amendment, waiver, or consent entered into in connection with this Agreement, and (viii) the amount of any Specified EBITDA Equity Contribution that is deemed to be EBITDA for any fiscal quarter included in the trailing four fiscal quarter period pursuant to Section 9.3; minus (c) the sum (in each case, without duplication) of the following to the extent included in the calculation of Net Income: (i) income tax credits; (ii) gains that are unusual and infrequently occurring determined in accordance with GAAP; and (iii) all non-recurring, non-cash items increasing Net Income.

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

CREDIT AGREEMENT – Page 18

“Electronic Record” has the meaning assigned to that term in, and shall be interpreted in accordance with, 15 U.S.C. 7006.

“Electronic Signature” has the meaning assigned to that term in, and shall be interpreted in accordance with, 15 U.S.C. 7006.

“Eligible Accounts” means, as of any applicable period of determination thereof, all Accounts of Borrowers (net of service charges, interest and finance fees) created in the ordinary course of business that Administrative Agent determines are eligible as the basis for the extension of the Credit Extensions. Without limiting the foregoing, no Account shall be an Eligible Account if:

(a)it does not comply in all material respects with all applicable Laws, rules, and regulations, including, without limitation, usury Laws, the Federal Truth in Lending Act, and Regulation Z of the Board of Governors of the Federal Reserve System;

(b)it has been outstanding for more than ninety (90) days past the original date of invoice or sixty (60) days after the original date payment is due;

(c)(i) the goods giving rise to it have not been delivered to the account debtor and do not constitute a final sale or (ii) the services giving rise to it have not been performed for the account debtor;

(d)it represents a progress billing or retainage, or relates to services for which a performance, surety or completion bond or similar assurance has been issued;

(e)it arises from a sale to an Affiliate, from a sale on a cash-on-delivery, bill-and-hold, sale-or-return, sale-on-approval, consignment, or other repurchase or return basis, or from a sale for personal, family or household purposes;

(f)it is not subject to a duly perfected, first priority Lien in favor of Administrative Agent;

(g)it is subject to any Lien other than (i) a Lien in favor of Administrative Agent, or (ii) a Permitted Lien which does not have priority over the Lien in favor of Administrative Agent;

(h) it arises out of a contract with or order from, an account debtor that, by its terms, prohibits or makes void or unenforceable the grant of a security interest by the applicable Borrower to Administrative Agent in and to such Account;

(i)it does not conform with a covenant or representation herein or in the other Loan Documents;

(j)it is owing by a creditor or supplier of any Loan Party or any Subsidiary thereof, or is otherwise subject to a potential offset, counterclaim, dispute, deduction, discount, recoupment, reserve, defense, chargeback, credit or allowance that has been asserted in writing;

(k)the account debtor is insolvent or the subject of any bankruptcy or insolvency proceeding, or has made an assignment for the benefit of creditors, suspended normal business operations, dissolved, liquidated, terminated its existence, ceased to pay its debts as they become due, or suffered a receiver or trustee to be appointed for any of its assets or affairs;

(l)it is evidenced by chattel paper or an instrument;

(m)a default exists under the Account by any party thereto;

CREDIT AGREEMENT – Page 19

(n)it is owed by an Affiliate, employee, officer, director or shareholder of Parent, any Loan Party or any of their Subsidiaries;

(o)it is owed in currency other than Dollars by the account debtor;

(p)the account debtor is organized or has its principal offices or assets outside the United States or Canada;

(q)the Account is owed by an individual or a Sanctioned Person;

(r)if more than twenty-five percent (25%) of the aggregate balances then outstanding on all Accounts owed by such account debtor and its Affiliates are unpaid for more than (i) sixty (60) days after the original date payment is due or (ii) ninety (90) days past the dates of their original invoices;

(s)it is owing by a Governmental Authority, unless the account debtor is (i) the U.S. or any department, agency, or instrumentality thereof and the Account has been assigned to Administrative Agent in compliance with the Federal Assignment of Claims Act of 1940; or (ii) the government of Canada (or any political subdivision thereof), or any department, agency, Crown corporation or instrumentality thereof and (A) the Financial Administration Act (Canada), as amended, or any comparable requirements under any other Canadian federal, provincial, territorial or municipal law regarding the assignment of Crown debts, has been duly complied with and any other steps necessary to perfect the Lien of the Administrative Agent in such Account have been completed and (B) all consents, licenses, approvals or authorizations of, or registrations or declarations with, any Governmental Authority required to be obtained, effected or given in connection with the execution, delivery and performance of such Account by each party obligated thereunder, or in connection with the enforcement and collection thereof by the Administrative Agent, have been duly obtained, effected or given and are in full force and effect;

(t)it includes a billing for interest, fees or late charges;

(u)when aggregated with all other Accounts owed, without duplication, (i) by an Investment Grade Account Debtor and its Affiliates to which such Account relates exceeds thirty-five percent (35%) of all Eligible Accounts owed by all of Borrowers’ account debtors; (ii) by a Non-Investment Grade Account Debtor and its Affiliates to which such Account relates exceeds twenty-five percent (25%) of all Eligible Accounts owed by all of Borrowers’ account debtors or (iii) solely for purposes of calculating the Borrowing Base in any period on or prior to December 31, 2019, by QEP Resources, Inc. and its Affiliates to which such Account relates exceeds thirty-five percent (35%) of all Eligible Accounts owed by all of Borrowers’ account debtors; provided, however, that, in each case under the foregoing clauses (i) through (iii), if such aggregate exceeds such percentage of all Eligible Accounts, only such excess shall be ineligible; and

(v)Administrative Agent otherwise reasonably determines it be ineligible.

The amount of the Eligible Accounts owed by an account debtor to any Borrower shall be reduced by the amount of all “contra accounts” and other obligations owed, whether by such Borrower or any other Loan Party or Subsidiary, to such account debtor. Administrative Agent shall have the right to create and adjust eligibility standards and related services from time to time in its reasonable discretion.

“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 11.8(b)(iii), (v) and (vi) (subject to such consents, if any, as may be required under Section 11.8(b)(iii)).

“Eligible Field Units” means the Eligible Inventory owned by the Borrowers consisting of Field Units.

“Eligible Generator Units” means the Eligible Inventory owned by the Borrowers consisting of Generator Units.

CREDIT AGREEMENT – Page 20

“Eligible Inventory” means, as of any applicable period of determination thereof, all Inventory of Borrowers that Administrative Agent determines is eligible as the basis for the extension of the Credit Extensions. Without limiting the foregoing, no Inventory shall be Eligible Inventory if:

(a)it is not subject to a duly perfected, first priority Lien in favor of Administrative Agent (including, in the case of Inventory of Canadian Borrower, perfected by registration in the jurisdiction in which such Inventory is located);

(b)it is subject to any Lien other than (i) a Lien in favor of Administrative Agent or (ii) a Permitted Lien which does not have priority over the Lien in favor of Administrative Agent;

(c) it is consigned to or from third parties;

(d)it is slow-moving, obsolete, unserviceable, perishable or spoiled, unless such Inventory can be (i) used or repurposed to create new Inventory of the Borrowers or (ii) sold to another customer of a Borrower;

(e)it is accounted for on the books of a Borrower as burden or overhead;

(f)comprised of packaging and shipping supplies, materials, boxes or containers (in each case, other than such packaging and shipping supplies, materials, boxes or containers that constitute actual Inventory of the Borrowers);

(g)it is used, damaged or defective, unless such Inventory can be (i) used or repurposed to create new Inventory of the Borrowers or (ii) sold to another customer of a Borrower;

(h)it is located on premises not owned by the Borrowers (other than a customer site or location), unless either: (i) Administrative Agent shall have received a Collateral Access Agreement with respect thereto, executed by the mortgagee, lessor, contract warehouseman, bailor or such other Person, as the case may be, and segregated or otherwise separately identifiable from goods of others, if any, stored on the premises and such Collateral Access Agreement shall remain in full force and effect; or (ii) Administrative Agent shall have established a Rent Reserve with respect to such premises in an amount satisfactory to Administrative Agent;

(i)it is located at any customer site or location or is in the possession of a customer of any Borrower, unless either: (i) Administrative Agent shall have received a Collateral Access Agreement from such customer; or (ii) such Inventory is subject to a valid uptime energy, servicing or lease agreement with terms acceptable to Administrative Agent in effect at such time; provided that for any Inventory located at any customer site or location or in the possession of any customer, which in each case is located in Canada, and subject to a “lease for a term of more than one year” (as defined in the PPSA), all registrations necessary or desirable to preserve, protect and perfect such Borrower’s interests in such leased Inventory shall have been made under the PPSA in the applicable jurisdiction;

(j)it is located outside of the continental United States or Canada, or is located in any jurisdiction in Canada in which the Administrative Agent does not hold a valid, perfected Lien (and for greater certainty is not located in Quebec unless the Administrative Agent has received a valid registered first priority deed of hypothec from Canadian Borrower);

(k)it is a sample item, is in-transit or is subject to any warehouse receipt or negotiable document;

(l)it constitutes work in process or raw materials; provided that Generator Units and Field Units are not raw materials;

CREDIT AGREEMENT – Page 21

(m) it is subject to repossession under the BIA except to the extent the applicable vendor has entered into an agreement with the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent, waiving its right to repossession;

(n)it has been acquired from a Sanctioned Person; or

(o)Administrative Agent otherwise determines it to be ineligible in its Permitted Discretion.

Administrative Agent shall have the right to create and adjust eligibility standards from time to time in its reasonable discretion.

“Eligible New Generator Units” means the Eligible Inventory owned by the Borrowers consisting of New Generator Units.

“Environmental Laws” means any and all federal, state, provincial, territorial and local Laws, regulations, judicial decisions, orders, decrees, plans, rules, permits, licenses, and other governmental restrictions and requirements pertaining to health, safety, or the environment, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §9601 et seq., the Resource Conservation and Recovery Act, 42 U.S.C. §6901 et seq., the Federal Water Pollution Control Act, as amended by the Clean Water Act, 33 U.S.C. §1251 et seq., the Clean Air Act, 42 U.S.C. §7401 et seq., the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. §11001 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. §5101 et seq., the Toxic Substances Control Act, 15 U.S.C. §2601 et seq., the Oil Pollution Act of 1990, 33 U.S.C. §2701 et seq., the Safe Drinking Water Act, 42 U.S.C. §300f et seq., the Occupational Safety and Health Act, 29 U.S.C. §651 et seq., the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. §136 et seq., the Endangered Species Act, U.S.C. §1531 et seq., the National Environmental Policy Act, 42 U.S.C. §4321 et seq., the Rivers and Harbors Appropriation Act of 1899, 33 U.S.C. §407, all similar state statutes and local ordinances, and all regulations promulgated under any of those statutes, and all administrative and judicial actions respecting such legislation, all as amended from time to time.

“Environmental Liabilities” means, as to any Person, all liabilities, obligations, responsibilities, Remedial Actions, losses, damages, punitive damages, consequential damages, treble damages, costs, and expenses (including, without limitation, all reasonable fees, disbursements and expenses of counsel, expert and consulting fees and costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand, by any Person, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, including any Environmental Law, permit, order or agreement with any Governmental Authority or other Person, arising from environmental, health or safety conditions or the Release or threatened Release of a Hazardous Material into the environment, resulting from the past, present, or future operations of such Person or its Affiliates.

“Equity Interests” means, as to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, together with the regulations promulgated thereunder.

“ERISA Affiliate” means any corporation or trade or business which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Code) as a Loan Party, is under common control (within the meaning of Section 414(c) of the Code) with a Loan Party, or is otherwise considered a single employer with a Loan Party pursuant to Sections 414(m) or (o) of the Code, for purposes of the provisions relating to Section 412 of the Code or Section 303 of ERISA.

CREDIT AGREEMENT – Page 22

“ERISA Event” means (a) a Reportable Event with respect to a Plan, (b) a withdrawal by any Loan Party or any ERISA Affiliate from a Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations which is treated as such a withdrawal under Section 4062(e) of ERISA, (c) a complete or partial withdrawal by any Loan Party or any ERISA Affiliate from a Multiemployer Plan, (d) the filing of a notice of intent to terminate a Plan, the treatment of a Plan or Multiemployer Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Plan or Multiemployer Plan, (e) the occurrence of an event or condition which might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan or Multiemployer Plan, (f) the imposition of any liability to the PBGC under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon any Loan Party or any ERISA Affiliate, (g) the failure of any Loan Party or ERISA Affiliate to meet any funding obligations with respect to any Plan or Multiemployer Plan, or (h) a Plan becomes subject to the at-risk requirements in Section 303 of ERISA or Section 430 of the Code or is in endangered or critical status under Section 305 of ERISA or Section 432 of the Code.

“Erroneous Payment” has the meaning set forth in Section 10.11(a).

“Erroneous Payment Deficiency Assignment” has the meaning set forth in Section 10.12(d).

“Erroneous Payment Impacted Class” has the meaning set forth in Section 10.11(d).

“Erroneous Payment Return Deficiency” has the meaning set forth in Section 10.11(d).

“Erroneous Payment Subrogation Rights” has the meaning set forth in Section 10.11(d).

“ETA” means Part IX of the Excise Tax Act (Canada), as amended from time to time, and any successor statute.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“Eurodollar Rate” means, subject to the implementation of a Benchmark Replacement in accordance with Section 3.3:

(a)with respect to any Eurodollar Rate Loan for any Interest Period, the per annum rate appearing on the ICE Benchmark Administration LIBOR Rates Page (or on any successor or substitute page or service providing quotations of interest rates applicable to Dollar deposits in the London interbank market comparable to those currently provided on such page, as determined by Administrative Agent from time to time) at approximately 11:00 a.m., London time, on the related Eurodollar Rate Determination Date, as the rate for Dollar deposits with a maturity comparable to such Interest Period, and if such rate does not appear on such screen or service, or such screen or service shall cease to be available, then the Eurodollar Rate shall be the offered rate (as determined by Administrative Agent in its sole discretion; provided that no Benchmark Transition Event shall have occurred at such time) on such other screen or service that displays an average interest settlement rate for deposits in Dollars (for delivery on the first day of such Interest Period) by such other authoritative source (as is selected by Administrative Agent in its sole discretion; provided that no Benchmark Transition Event shall have occurred at such time) to major banks in the London interbank eurodollar market for a term equivalent to such Interest Period as of 11:00 a.m. on the relevant Eurodollar Rate Determination Date; and

(b)with respect to any interest calculation with respect to a Base Rate Loan on any date, the per annum rate appearing on the ICE Benchmark Administration LIBOR Rates Page (or on any successor or substitute page or service providing quotations of interest rates applicable to Dollar deposits in the London interbank market comparable to those currently provided on such page, as determined by Administrative Agent from time to time) at approximately 11:00 a.m., London time, on the related Eurodollar Rate Determination Date for a term of one (1) month commencing on the date of calculation, and if such rate does not appear on such screen or service, or such screen or service shall cease to be available, then the Eurodollar Rate shall be the offered rate (as determined by Administrative Agent in its sole discretion; provided that no Benchmark Transition Event shall have occurred at such time) on such other screen or service that displays an average interest settlement rate for deposits in Dollars (for delivery on such date of calculation) by such other authoritative source (as is selected by Administrative Agent in its sole discretion; provided that no Benchmark Transition Event shall have occurred at such time) to major banks in the London interbank eurodollar market for a term of one (1) month as of 11:00 a.m. on the relevant Eurodollar Rate Determination Date.

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Notwithstanding the foregoing, (x) in no event shall the Eurodollar Rate (including any Benchmark Replacement with respect thereto) be less than 0% and (y) unless otherwise specified in any amendment to this Agreement entered into in accordance with Section 3.3, in the event that a Benchmark Replacement with respect to the Eurodollar Rate is implemented then all references herein to the Eurodollar Rate shall be deemed references to such Benchmark Replacement. Each calculation by Administrative Agent of the Eurodollar Rate shall be conclusive and binding for all purposes absent manifest error.

“Eurodollar Rate Borrowing” means, as to any Borrowing, the Eurodollar Rate Loans comprising such Borrowing.

“Eurodollar Rate Determination Date” means a day that is two (2) Business Days prior to the beginning of the relevant Interest Period or prior to the applicable date, as applicable.

“Eurodollar Rate Loan” means each Loan bearing interest based on the Adjusted Eurodollar Rate where the Eurodollar Rate is determined pursuant to clause (a) of the definition thereof.

“Event of Default” has the meaning set forth in Section 9.1.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

“Excluded Accounts” means any commodity account, deposit account or securities account (a) established solely as a payroll account and other zero-balance disbursement account, (b) held in a fiduciary capacity and established in connection with employee benefit plans in the ordinary course of business or pursuant to applicable legal requirements, or (c) with a balance in each such account individually not exceeding $100,000 at any time and the aggregate balance of all such accounts not exceeding $250,000.

“Excluded Assets” means, collectively:

(a)assets as to which Administrative Agent and Loan Parties agree in writing that the cost of creating or perfecting a pledge of, or a security interest in, such assets is excessive in relation to the value of the security to be afforded thereby;

(b)any rights or interest in any lease, contract, license or license agreement covering personal Property or real Property and/or such assets subject thereto, so long as under the terms of such lease, contract, license or license agreement, the grant of a security interest or Lien therein for the benefit of the Secured Parties (1) is prohibited, (2) would give any other party to such lease, contract, license or license agreement, instrument or indenture the right to terminate its obligations thereunder, or (3) is permitted only with the consent of another party (including, without limitation, any Governmental Authority) (or would render such lease, contract, license or license agreement cancelled, invalid or unenforceable) and such prohibition has not been or is not waived or the consent of the other party to such lease, contract, license or license agreement has not been or is not otherwise obtained; provided that, this exclusion shall in no way be construed to apply if any such prohibition is unenforceable under the UCC, the PPSA or any other Law (including any Debtor Relief Law) or so as to limit, impair or otherwise affect the unconditional continuing security interests in and Liens for the benefit of the Secured Parties upon any rights or interests in or to monies due or to become due under any such lease, contract, license or license agreement (including any receivables) and provided further that, with respect to any lease, contract, license or license agreement entered into after the Closing Date, the Loan Parties shall use commercially reasonable efforts to permit Liens for the benefit of the Secured Parties on each such lease, contract, license or license agreement and avoid prohibitions of the types described in clauses (1) through (3) above;

CREDIT AGREEMENT – Page 24

(c) any such account described in clause (b) of the definition of “Excluded Accounts”;

(d)any application for registration of a trademark filed in the United States Patent and Trademark Office on an intent to use basis to the extent that the grant of a security interest in any such trademark application would adversely affect the validity or enforceability or result in cancellation or voiding of such trademark application, provided, however, that such trademark applications shall no longer be considered Excluded Assets upon the filing of a Statement of Use or an Amendment to Allege Use has been filed and accepted in the United States Patent and Trademark Office; and

(e)any assets that are subject to a Lien permitted under Section 7.2(g) if the contract or other agreement in which the Lien is granted (or the documentation providing for the Debt secured thereby) prohibits the creation of any other Lien on such assets; provided that immediately upon the ineffectiveness, lapse or termination of any such Lien permitted under Section 7.2(g), such assets shall no longer be considered Excluded Assets pursuant to this clause (e) and the Collateral shall include all such rights and interest in such assets as if such Lien permitted under Section 7.2(g) had never been in effect (unless such asset would constitute as an Excluded Asset under any other clause herein).

To the extent that such Property constitutes as an “Excluded Asset” due to the failure by any Loan Party to obtain a consent as described in clause (b) above, such Loan Party shall use commercially reasonable efforts to obtain such consent and, upon obtaining such consent, such Property shall cease to constitute as an “Excluded Asset”.

“Excluded Swap Obligation” means, with respect to any Loan Party, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Loan Party of, or the grant by such Loan Party of a Lien to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Loan Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to any “keepwell, support or other agreement” for the benefit of such Loan Party and any and all guarantees of such Loan Party’s Swap Obligations by any Borrower or any other Loan Party) at the time the Guarantee of such Loan Party, or a grant by such Loan Party of a Lien, becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or Lien is or becomes excluded in accordance with the first sentence of this definition.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the Laws of, or having its principal office or, in the case of any Lender, its applicable Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal or Canadian withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a Law in effect on the date on which (i) such Lender acquires such interest in such Loan or Commitment (other than pursuant to an assignment request by any Borrower under Section 3.6(b)) or (ii) such Lender changes its Lending Office, except in each case to the extent that, pursuant to Section 3.4, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its Lending Office, (c) Taxes attributable to such Recipient’s failure to comply with Section 3.4(g) and (d) any U.S. federal withholding Taxes imposed under FATCA.

“FASB ASC” means the Accounting Standards Codification of the Financial Accounting Standards Board.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreement entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing such Sections of the Code.

CREDIT AGREEMENT – Page 25

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.

“Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published by the Federal Reserve Bank of New York, on the Business Day next succeeding such day, provided that (a) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average rate charged to Administrative Agent on such day on such transactions as determined by Administrative Agent.

“Fee Letter” means (a) the separate fee letter dated as of February 8, 2019, between Borrowers and Texas Capital Bank and (b) any other fee letter among Borrowers and Administrative Agent, Arranger and/or Texas Capital Bank concerning fees to be paid by Borrowers in connection with this Agreement including any amendments, restatements, supplements or modifications thereof. By its execution of this Agreement, each Lender acknowledges and agrees that Administrative Agent, Arranger and/or Texas Capital Bank may elect to treat as confidential and not share with Lenders any Fee Letters executed from time to time in connection with this Agreement.

“Field Units” means Inventory of the Borrowers generally consisting of diesel generators, oil and gas separators, electrical switchgear, and other related support equipment, which, in each case, are not part of any Generator Package.

“Fifth Amendment” means that certain Fifth Amendment to Credit Agreement dated as of the Fifth Amendment Effective Date, by and among the Company, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“Fifth Amendment Effective Date” means [_______], 2021.

“Financial Covenants” means the covenants set forth in Sections 8.1 and 8.2.

“First Amendment” means that certain First Amendment to Credit Agreement and First Amendment to Pledge and Security Agreement dated as of the First Amendment Effective Date, by and among the Company, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“First Amendment Effective Date” means January 27, 2020.

“Fixed Charge Coverage Ratio” means, for any date of determination, the ratio of (a) Annualized EBITDA of Company and its Subsidiaries minus Unfinanced Capital Expenditures, to (b) Fixed Charges of Company and its Subsidiaries.

“Fixed Charges” means, for any Person for any date of determination, the sum of (a) Annualized Debt Service, plus (b) cash income taxes paid during the trailing twelve (12) fiscal month period then ending on such date, plus (c) the sum of distributions and dividends (including any Permitted Tax Distributions) made during the trailing twelve (12) fiscal month period then ending on such date.

“FlexEnergy” means FlexEnergy, Inc., a Delaware corporation.

CREDIT AGREEMENT – Page 26

“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the Fifth Amendment Effective Date or any modification, amendment or renewal of this Agreement or otherwise) with respect to USD LIBOR.

“Foreign Lender” means a Lender that is not a U.S. Person.

“Foreign Subsidiaries” means each Subsidiary other than a Domestic Subsidiary.

“Fourth Amendment” means that certain Fourth Amendment to Credit Agreement dated as of the Fourth Amendment Effective Date, by and among the Company, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“Fourth Amendment Effective Date” means June 29, 2021.

“Fraudulent Transfer Laws” has the meaning set forth in Section 12.14.

“Fronting Exposure” means, at any time there is a Lender that is a Defaulting Lender, (a) with respect to L/C Issuer, such Defaulting Lender’s Applicable Percentage of the Outstanding Amount of the L/C Obligations other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to Swing Line Lender, such Defaulting Lender’s Applicable Percentage of the Outstanding Amount of Swing Line Loans other than Swing Line Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders in accordance with the terms hereof.

“Fund” means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

“GAAP” means generally accepted accounting principles, applied on a consistent basis, as set forth in opinions of the Accounting Principles Board of the American Institute of Certified Public Accountants and/or in statements of the Financial Accounting Standards Board and/or their respective successors and which are applicable in the circumstances as of the date in question. Accounting principles are applied on a “consistent basis” when the accounting principles applied in a current period are comparable in all material respects to those accounting principles applied in a preceding period.

“Generator Packages” means uptime energy power units, generally consisting of an engineered package of components, including, without limitation, a turbine engine, combustor, synchronous generator, recuperator, inlet guide vanes, generator braking resistor, and other control devices mounted on either a metal skid or trailer.

“Generator Units” means Inventory of the Borrowers consisting of completed Generator Packages. For the avoidance of doubt Generator Units will not include any Field Units.

“Governmental Authority” means the government of the U.S., Canada or any other nation, or any political subdivision thereof, whether state, provincial, territorial or local, and any agency, authority, instrumentality, regulatory body, court, central bank, tribal body or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank), and any group or body charged with setting financial accounting or regulatory capital rules or standards (including without limitation, the Financial Accounting Standards Board, the Bank for International Settlements or the Basel Committee on Banking Supervision or any successor or similar authority to any of the foregoing).

CREDIT AGREEMENT – Page 27

“GST” means the goods and services tax and all other amounts payable under the ETA or any similar legislation in any other jurisdiction of Canada, including (a) the Quebec sales tax imposed pursuant to an Act respecting the Québec sales tax and (b) all amounts payable as harmonized sales tax in the Provinces of Ontario, Nova Scotia, Newfoundland and Labrador, Prince Edward Island and New Brunswick under the ETA.

“Guarantee” by any Person means any obligation or liability, contingent or otherwise, of such Person directly or indirectly guaranteeing any Debt or other obligation of any other Person as well as any obligation or liability, direct or indirect, contingent or otherwise, of such Person (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or other obligation or liability (whether arising by virtue of partnership arrangements, by agreement to keep-well, to purchase assets, goods, securities or services, to operate Property, to take-or-pay, or to maintain net worth or working capital or other financial statement conditions or otherwise) or (b) entered into for the purpose of indemnifying or assuring in any other manner the obligee of such Debt or other obligation or liability of the payment thereof or to protect the obligee against loss in respect thereof (in whole or in part); provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business. The term “Guarantee” used as a verb has a corresponding meaning.

“Guarantors” means, collectively, (a) each of the Borrowers with respect to the Obligations under any Bank Product Agreement to the extent that each such Borrower is not the primary obligor with respect thereto, (b) Flex Power Co., a Delaware corporation, and each other Subsidiary of Company (other than Borrowers) and (c) each Person (other than Parent) who from time to time Guarantees all or any part of the Obligations under the Loan Documents, including any Person who becomes a party to this Agreement pursuant to a Joinder Agreement.

“Guaranty” means, collectively, the guaranty made by the Loan Parties party to this Agreement pursuant to Article 12 and each other written guaranty executed by one or more of the other Guarantors in favor of Administrative Agent, for the benefit of Secured Parties, in form and substance satisfactory to Administrative Agent.

“Hazardous Material” means any substance, product, waste, pollutant, material, chemical, contaminant, constituent, or other material which is or becomes listed, regulated, or addressed under any Environmental Law, including, without limitation, any petroleum and petroleum byproducts, natural gas, natural gas liquids, liquefied natural gas or synthetic gas usable for fuel (or mixture of natural gas and such synthetic gas), polychlorinated biphenyls, lead and lead-based paint, radon, radioactive materials, flammables and explosives, and mold.  “Hazardous Substances” shall include, without limitation, any hazardous or toxic substance, material or waste or any chemical, element, compound or mixture which is: (i) asbestos and asbestos-containing materials; (ii) designated as a “pollutant” or “toxic pollutant” pursuant to the Federal Water Pollution Control Act (33 U.S.C. Paragraph 1251 et seq.); (iii) defined as a “solid or hazardous waste” pursuant to the Federal Resource Conservation and Recovery Act (42 U.S.C. Paragraph 6901 et seq.); (iv) defined as “hazardous substances” pursuant to the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. Paragraph 9601 et seq.); (v) listed in the United States Department of Transportation Table (49 CFR 172.101) or by the Environmental Protection Agency as hazardous substances (40 CFR part 302); (vi) chemicals, elements, compounds, mixtures, substances, materials or wastes otherwise regulated under any applicable federal, state, provincial, territorial or local Environmental Laws; (vii) polychlorinated biphenyls; (viii) “pesticides” as defined in the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. §§ 136 et seq.; (ix) “contaminant” as defined in the Safe Drinking Water Act, 42 U.S.C. §§ 300f et seq.; (x) “extremely hazardous substances” as defined in the Emergency Planning and Community Right to Know Act, 42 U.S.C. §§ 11001 et seq.; (xi) “hazardous materials” as defined in the Hazardous Materials Transportation Act, 49 U.S.C. §§ 5101 et seq.; (xii) “hazardous air pollutants” as defined in the Clean Air Act, 42 U.S.C. §§ 7401 et seq.; and (xiii) “oil” as defined in the Oil Pollution Act of 1990, 33 U.S.C. §§ 2701 et seq.

CREDIT AGREEMENT – Page 28

“Hedge Agreement” means (a) any and all interest rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules and annexes, a “Master Agreement”), (c) any and all Master Agreements and any and all related confirmations and (d) any other agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Hedge Obligations” means, at any time with respect to any Person, all indebtedness, liabilities, and obligations of such Person under or in connection with any Hedge Agreement, whether actual or contingent, due or to become due and existing or arising from time to time.

“Hedge Termination Value” means, in respect of any one or more Hedge Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and settlement amounts, early termination amounts or termination value(s) determined in accordance therewith, such settlement amounts, early termination amounts or termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more commercially reasonable mid-market or other readily available quotations provided by any dealer which is a party to such Hedge Agreement or any other recognized dealer in such Hedge Agreements (which may include a Lender or any Affiliate of a Lender).

“Honor Date” has the meaning set forth in Section 2.2(c)(i).

“Increase Effective Date” has the meaning set forth in Section 2.10(c).

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Borrowers or any other Loan Party under any Loan Document and (b) to the extent not otherwise described in clause (a), Other Taxes.

“Information” has the meaning set forth in Section 11.26.

“Intellectual Property” means all copyrights, copyrightable works, patents, patent applications, industrial designs, trademarks, service marks, trade names, brand names, trade dress, slogans, logos and Internet domain names and uniform resource locators, and the goodwill associated with any of the foregoing, and other types of intellectual or industrial property rights and foreign equivalent or counterpart rights and forms of protection of a similar or analogous nature to any of the foregoing or having similar effect in any jurisdiction throughout the world, and registrations and applications for registration of any of the foregoing, and all documentation and embodiments of the foregoing, in whatever form, now owned or hereafter acquired.

CREDIT AGREEMENT – Page 29

“Interest Period” means with respect to any Eurodollar Rate Loan, the period commencing on the date such Loan becomes a Eurodollar Rate Loan (whether by the making of a Loan or its continuation or conversion) and ending on the numerically corresponding day in the calendar month that is one (1), two (2) or three (3) months thereafter (in each case subject to the availability of the Eurodollar Rate for such period), as the Borrower Representative may elect; provided that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (b) any Interest Period pertaining to a Eurodollar Rate Loan that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.

“Interest Rate” means the rate equal to the lesser of (a) the Maximum Rate and (b) the Applicable Rate.

“Inventory” means inventory, as defined in the UCC or PPSA, as applicable.

“Investment Grade Account Debtor” means, any account debtor whose securities are rated BBB- (or then equivalent grade) or higher by S&P or Baa3 (or then equivalent grade) or higher by Moody’s, or whose credit rating or credit quality has the characteristics of an Investment Grade Account Debtor as determined by Administrative Agent in its sole discretion.

“IRS” means the Internal Revenue Service or any entity succeeding to all or any of its functions.

“ISDA Definitions” means the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc. or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time by the International Swaps and Derivatives Association, Inc. or such successor thereto.

“ISP” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).

“Issuer Documents” means, with respect to any Letter of Credit, the Letter of Credit Application, and any other document, agreement and instrument entered into by L/C Issuer and any Borrower or in favor of L/C Issuer and relating to such Letter of Credit.

“ITA” means the Income Tax Act (Canada), as amended from time to time, and any successor statute, together with the regulations promulgated thereunder.

“Joinder Agreement” means a Joinder Agreement in the form of Exhibit H hereto.

“Judgment Currency” has the meaning set forth in Section 11.2(b).

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its participation in any L/C Borrowing in accordance with its Applicable Percentage.

CREDIT AGREEMENT – Page 30

“L/C Borrowing” means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed by Borrowers on the date when made or refinanced as a Revolving Credit Borrowing.

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.

“L/C Issuer” means Texas Capital Bank in its capacity as issuer of Letters of Credit hereunder, or any successor issuer of Letters of Credit hereunder.

“L/C Obligations” means, as of any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts, including all L/C Borrowings. For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.4. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

“Laws” means, collectively, all international, foreign, federal, state, provincial, territorial and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.

“Lease” of any Person means all of the right, title and interest of such Person as lessee or licensee in, to and under a lease or license of land, improvements and/or fixtures.

“Lenders” means, (a) at any time prior to the termination of the Commitments, any Person that has a Commitment at such time, and (b) at any time after the termination of the Commitments, any Person that has Revolving Credit Exposure at such time. Unless the context otherwise requires, the term “Lenders” includes Swing Line Lender, L/C Issuer and their respective successors and assigns permitted hereunder.

“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower Representative and Administrative Agent.

“Letter of Credit” means any standby letter of credit issued hereunder providing for the payment of cash upon the honoring of a presentation thereunder.

“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by L/C Issuer.

“Letter of Credit Expiration Date” means the day that is seven (7) days prior to the Maturity Date (or, if such day is not a Business Day, the next preceding Business Day).

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“Letter of Credit Fee” has the meaning set forth in Section 2.4(b).

“Letter of Credit Sublimit” means an amount equal to the lesser of (a) $5,000,000 and (b) the aggregate Commitments. The Letter of Credit Sublimit is part of, and not in addition to, the Commitments.

“Leverage Ratio” means, as of the last day of the last fiscal month of each fiscal quarter, the ratio of (i) all Debt of Company and its Subsidiaries, on a consolidated basis in accordance with GAAP, as of such date to (ii) Annualized EBITDA of Company and its Subsidiaries, on a consolidated basis in accordance with GAAP, as of such date.

“Lien” means, as to any Property of any Person, (a) any lien, mortgage, security interest, tax lien, pledge, charge, hypothecation, collateral assignment, preference, priority, or other encumbrance of any kind or nature whatsoever (including, without limitation, any conditional sale or title retention agreement), whether arising by contract, operation of law, or otherwise, affecting such Property and (b) the signing or filing of a financing statement which names the Person as debtor or the signing of any security agreement or the signing of any document authorizing a secured party to file any financing statement which names such Person as debtor.

“Loan” means an extension of credit by a Lender to any Borrower under Article 2 in the form of a Revolving Credit Loan or a Swing Line Loan.

“Loan Documents” means this Agreement, the First Amendment, the Second Amendment, the Third Amendment, the Fourth Amendment, each Guaranty, the Security Documents, the Notes, the Issuer Documents, and all other promissory notes, security agreements, deeds of trust, assignments, letters of credit, guaranties, and other instruments, documents, or agreements executed and delivered pursuant to or in connection with this Agreement or the Security Documents; provided that the term “Loan Documents” shall not include any Bank Product Agreement.

“Loan Party” means Borrowers, each other Guarantor or any other Person who is or becomes party to any agreement with any Secured Party that obligates such Person to pay or perform, or that Guarantees or secures payment or performance of, the Obligations under the Loan Documents or any part thereof. Notwithstanding the foregoing, the Parent shall not constitute as being a “Loan Party” for all purposes under the Loan Documents.

“Management Services Agreement” means that certain Management Services Agreement dated as of [_______], 2021, between the Company and FlexEnergy Energy Systems, Inc., a Delaware corporation, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with Section 7.16.

“Material Adverse Effect” means any act, event, condition, or circumstance which could reasonably be expected to materially and adversely affect (a) the operations, business, Properties, liabilities (actual or contingent), or condition (financial or otherwise) of the Loan Parties and their Subsidiaries, taken as a whole; (b) the ability of any Loan Party to perform its obligations under any Loan Document to which it is a party; (c) the legality, validity, binding effect or enforceability against any Loan Party of any Loan Document to which it is a party; or (d) the rights, remedies and benefits available to, or conferred upon, Administrative Agent or any Secured Party under any Loan Documents.

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“Maturity Date” means February 8, 2024, or such earlier date on which the Commitment of each Lender terminates as provided in this Agreement.

“Maximum Rate” means, at all times, the maximum rate of interest which may be charged, contracted for, taken, received or reserved by Lenders in accordance with applicable Law. The Maximum Rate shall be calculated in a manner that takes into account any and all fees, payments, and other charges in respect of the Loan Documents that constitute interest under applicable Law. Each change in any interest rate provided for herein based upon the Maximum Rate resulting from a change in the Maximum Rate shall take effect without notice to any Borrower at the time of such change in the Maximum Rate.

“Minimum Collateral Amount” means, at any time, (a) with respect to Cash Collateral consisting of cash or deposit account balances provided to reduce or eliminate Fronting Exposure during the time that a Defaulting Lender exists, an amount equal to 103% of the Fronting Exposure of L/C Issuer with respect to Letters of Credit issued and outstanding at such time, (b) with respect to Cash Collateral consisting of cash or deposit account balances provided in accordance with the provisions of Section 2.7(a)(i), (a)(ii) or (a)(iii), an amount equal to 103% of the Outstanding Amount of all L/C Obligations, and (c) otherwise, an amount determined by Administrative Agent and L/C Issuer in their sole discretion.

“Multiemployer Plan” means a multiemployer plan defined as such in Section 3(37) of ERISA to which contributions are being made or have been made by, or for which there is an obligation to make contributions by or there is any liability, contingent or otherwise, with respect to an Loan Party or any ERISA Affiliate and which is covered by Title IV of ERISA.

“Net Cash Proceeds” means:

(a)with respect to any Disposition by any Loan Party or any of its Subsidiaries the excess, if any, of (i) the sum of cash and cash equivalents received in connection with such transaction (including any cash or cash equivalents received by way of deferred payment pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received), over (ii) the sum of (A) the principal amount of any Debt that is secured by the applicable asset and that is required to be repaid in connection with such transaction (other than Debt under the Loan Documents), (B) the reasonable out-of-pocket expenses incurred by such Loan Party or such Subsidiary in connection with such transaction including legal, accounting, investment banking and other professional fees and (C) taxes paid or reasonably estimated to be payable within two years of the date of the relevant transaction as a result of any gain recognized in connection therewith; provided that, if (1) reserves established pursuant to subclause (A) exceeds the actual purchase price adjustment required to be paid in connection with such transactions, or (2) the amount of any estimated taxes pursuant to subclause (C) exceeds the amount of taxes actually required to be paid in cash in respect of such Disposition, in each case, the aggregate amount of such excess shall constitute Net Cash Proceeds.

CREDIT AGREEMENT – Page 33

(b) with respect to the sale or issuance of any Equity Interests by any Loan Party or any of its Subsidiaries, or the incurrence or issuance of any Debt by any Loan Party or any of its Subsidiaries, the excess of (i) the sum of the cash and cash equivalents received in connection with such transaction over (ii) the underwriting discounts and commissions, and other reasonable and customary out-of-pocket expenses, incurred by such Loan Party or such Subsidiary in connection therewith.

“Net Income” means, for any Person for any period, the net income (or loss) of such Person and its Subsidiaries on a consolidated basis as determined in accordance with GAAP; provided that Net Income shall exclude (a) the net income of any Subsidiary of such Person during such period to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary of such income is not permitted by operation of the terms of its Constituent Documents or any agreement, instrument or Law applicable to such Subsidiary during such period, except that such Person’s equity in any net loss of any such Subsidiary for such period shall be included in determining Net Income, and (b) any income (or loss) for such period of any other Person if such other Person is not a Subsidiary, except that Company’s equity in the net income of such Person for such period shall be included in Net Income up to the aggregate amount of cash actually distributed by such Person during such period to Company or a Subsidiary as a dividend or other distribution (and in the case of a dividend or other distribution to such Subsidiary, such Subsidiary is not precluded from further distributing such amount to Company as described in clause (a) of this proviso).

“Net Invoice Costs” means “hard costs” (i.e. the net invoice cost of Inventory excluding taxes, shipping, delivery, handling, installation, set-up costs or other soft costs) of any Inventory.

“Net Orderly Liquidation Value” means, with respect to Inventory of any Person, the orderly liquidation value thereof, expressed as a percentage of net book value, as determined in a manner acceptable to Administrative Agent by an appraiser acceptable to Administrative Agent, net of all costs of liquidation thereof.

“New Generator Units” means Generator Unites, whether held or deployed by the Borrowers in the ordinary course of business, and which are not included in the most recent appraisal ordered, received and relied upon by Administrative Agent pursuant to Section 6.6(c).

“Non-Consenting Lender” means any Lender that does not approve any consent, waiver or amendment that (a) requires the approval of all or all affected Lenders in accordance with the terms of Section 11.10 and (b) has been approved by the Required Lenders.

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

“Non-Investment Grade Account Debtor” means any account debtor which is not an Investment Grade Account Debtor.

“Notes” means a promissory note made by Borrowers in favor of a Lender evidencing Revolving Credit Loans or Swing Line Loans, as the case may be, made by such Lender, substantially in the form of Exhibit E.

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“Obligations” means all obligations, indebtedness, and liabilities of Borrowers and each other Loan Party to Administrative Agent, each Lender and each other Secured Party now existing or hereafter arising, whether direct, indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, arising under or pursuant to this Agreement, any Bank Product Agreements or the other Loan Documents, and all interest accruing thereon (whether a claim for post-filing or post-petition interest is allowed in any bankruptcy, insolvency, reorganization or similar proceeding) and all attorneys’ fees and other expenses incurred in the enforcement or collection thereof and Erroneous Payment Subrogation Rights; provided that, as to any Loan Party, the “Obligations” shall exclude any Excluded Swap Obligations of such Loan Party.

“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Guaranties” has the meaning set forth in Section 12.11.

“Other Guarantors” has the meaning set forth in Section 12.11.

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.6).

“Outstanding Amount” means (a) with respect to the Revolving Credit Loans and the Swing Line Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Revolving Credit Loans and Swing Line Loans, as the case may be, occurring on such date, and (b) with respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements by Borrowers of Unreimbursed Amounts.

“Parent” means, as of the Specified Contribution Effective Date, FlexEnergy Green Solutions, Inc., a Delaware corporation.

“Parent Pledge Agreement” means that certain Pledge and Limited Guaranty Agreement (including any and all supplements thereto), dated as of the Specified Contribution Effective Date, among Parent and Administrative Agent, for the benefit of Administrative Agent and the other Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time.

CREDIT AGREEMENT – Page 35

“Participant” means any Person (other than (a) a natural Person, (b) a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural Person, (c) a Defaulting Lender, or (d) Parent, any of Parent’s Affiliates, any Subsidiaries of Parent or any other Loan Party) to which a participation is sold by any Lender in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it).

“Participant Register” means a register in the United States on which each Lender that sells a participation enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents.

“Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. 107-56, signed into law October 26, 2001).

“Payment Conditions” means, with respect to any Restricted Payment made pursuant to Section 7.4(e):

(a)       no Default or Event of Default shall have occurred and be continuing on the date of such Restricted Payment or would result after giving effect to such Restricted Payment;

(b)       solely with respect to any Restricted Payment made pursuant to Section 7.4(e), (i) after giving effect to and at all times during the ninety (90) consecutive day period immediately prior to such Restricted Payment, Availability shall be greater than or equal to $6,500,000; and (ii) the Fixed Charge Coverage Ratio for Company and its Subsidiaries for the most recently ended fiscal quarter calculated on a pro forma basis, after giving effect to such Restricted Payment shall be greater than 1.25 to 1.00; and

(c)       Administrative Agent shall have received a certificate of a Responsible Officer of the Borrower Representative demonstrating satisfaction of the foregoing conditions concurrently with any such Restricted Payment.

“Payment Date” means (a) in respect of each Base Rate Loan, the first day of each and every calendar month during the term of this Agreement, upon prepayment of such Loan and the Maturity Date, and (b) in respect of each Eurodollar Rate Loan, the last day of each Interest Period applicable to such Eurodollar Rate Loan (or the day that is three (3) months after the first day of such Interest Period if such Interest Period has a length of more than three (3) months) and the Maturity Date.

“PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to all or any of its functions under ERISA.

“Perfection Certificate” means, collectively, (a) that certain Perfection Certificate dated as of the Closing Date, executed by the Loan Parties at such time and addressed to Administrative Agent and (b) any other perfection certificate from time to time delivered to Administrative Agent, executed by the Loan Parties, in each case in form and substance reasonably satisfactory to Administrative Agent.

CREDIT AGREEMENT – Page 36

“Permitted Discretion” means a determination made in good faith and in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment.

“Permitted Holders” means, collectively, RNS Flex, LLC, ESS Participation Fund II, L.P., Energy Special Situations Fund II, L.P., Intervale Capital Fund III, L.P. and Intervale Capital Co-Investment Fund III, L.P.

“Permitted Liens” means those Liens permitted by Section 7.2.

“Permitted Tax Distributions” means, for any taxable period after the Fifth Amendment Effective Date during which time the Company is either a pass-through entity or a member of a consolidated tax group of which Parent is a member for federal income tax purposes, any Restricted Payment to Parent to permit Parent to pay federal income taxes and all relevant state and local income taxes in an amount not to exceed the lesser of (a) the amount of such taxes that Parent is required to pay to a Governmental Authority and (b) the amount of federal income taxes and all relevant state and local income taxes that the Borrowers and their Subsidiaries would have paid had the Borrowers and such Subsidiaries been a stand-alone corporate taxpayer or a stand-alone corporate group, taking into account any such income taxes directly paid or withheld at the level of any Borrower or such Subsidiary.

“Person” means any natural person, corporation, limited liability company, trust, association, company, partnership, joint venture, Governmental Authority, or other entity, and shall include such Person’s heirs, administrators, personal representatives, executors, successors and assigns.

“Plan” means any employee benefit or other plan, other than a Multiemployer Plan, established or maintained by, or for which there is an obligation to make contributions by or there is any liability, contingent or otherwise with respect to a Borrower or any ERISA Affiliate and which is covered by Title IV of ERISA or subject to Section 412 of the Code.

“Platform” means Debt Domain, Intralinks, Syndtrak or a substantially similar electronic transmission system.

“PPSA” means the Personal Property Security Act (Alberta) and the regulations thereunder, as from time to time in effect, provided, however, if attachment, perfection or priority of the Administrative Agent’s security interests in any Collateral are governed by the personal property security laws of any jurisdiction in Canada other than Alberta, PPSA shall mean those personal property security laws in such other jurisdiction for the purposes of the provisions hereof relating to such attachment, perfection or priority and for the definitions related to such provisions.

“Prime Rate” means the rate of interest per annum publicly announced from time to time by Texas Capital Bank as its prime rate in effect at its Principal Office; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective. Such rate is set by Texas Capital Bank as a general reference rate of interest, taking into account such factors as Texas Capital Bank may deem appropriate; it being understood that many of Texas Capital Bank’s commercial or other loans are priced in relation to such rate, that it is not necessarily the lowest or best rate actually charged to any customer and that Texas Capital Bank may make various commercial or other loans at rates of interest having no relationship to such rate.

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“Principal Office” means the principal office of Administrative Agent, presently located at the address set forth on Schedule 11.11.

“Prohibited Transaction” means any transaction set forth in Section 406 of ERISA or Section 4975 of the Code.

“Property” of a Person means any and all property, whether real, personal, tangible, intangible or mixed, of such Person, or any other assets owned, operated or leased by such Person.

“Public Lenders” has the meaning set forth in Section 11.11(e).

“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).

“QFC Credit Support” has the meaning set forth in Section 11.31.

“Qualified ECP Guarantor” means, at any time, each Loan Party with total assets exceeding $10,000,000 or that qualifies at such time as an “eligible contract participant” under the Commodity Exchange Act or any regulation promulgated thereunder and can cause another Person to qualify as an “eligible contract participant” at such time under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Qualified IPO” means the issuance by the Parent of its common shares in an underwritten primary public offering (other than a public offering pursuant to a registration statement on Form S-1, Form S-8 or comparable filing in any other applicable jurisdiction) pursuant to an effective registration statement filed with the SEC or any other comparable Governmental Authority in any other applicable jurisdiction (whether alone or in connection with a secondary public offering) (a) generating (individually or in the aggregate together with any prior initial public offering) gross proceeds exceeding $15,000,000 and (b) occurring on or prior to January 31, 2022.

“Qualified IPO Expenses” means expenses actually incurred by either (a) prior to the consummation of the Qualified IPO, the Ultimate Parent or (b) on or after the consummation of the Qualified IPO, the Parent that are, in either case, allocable to the Company in connection with the Qualified IPO from the period commencing on July 9, 2020 through and including February 28, 2022.

“Receipts” has the meaning set forth in Section 2.12(a).

“Recipient” means Administrative Agent, L/C Issuer, Swing Line Lender, or any Lender, as applicable.

CREDIT AGREEMENT – Page 38

“Reference Time” means, with respect to any setting of the then-current Benchmark, (a) if such Benchmark is USD LIBOR, 11:00 a.m. (London time) on the day that is two London banking days preceding the date of such setting, and (b) if such Benchmark is not USD LIBOR, the time determined by the Administrative Agent in its reasonable discretion.

“Register” means a register for the recordation of the names and addresses of Lenders, and the Commitments of, and principal amounts of and stated interest on the Loans owing to, each Lender pursuant to the terms hereof from time to time.

“Related Indebtedness” means any and all indebtedness paid or payable by any Borrower or any other Loan Party to Administrative Agent or any Lender pursuant to any Loan Document other than any Note.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, sub agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.

“Release” means, as to any Person, any release, spill, emission, leaking, pumping, injection, deposit, disposal, disbursement, leaching, or migration of Hazardous Materials into the indoor or outdoor environment or into or out of Property owned by such Person, including, without limitation, the movement of Hazardous Materials through or in the air, soil, surface water, ground water, or Property.

“Release Date” means the last to occur of the dates on which Liens securing the Obligations may be released pursuant to Section 10.9(a)(i)(x).

“Relevant Governmental Body” means the Board of Governors or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board of Governors or the Federal Reserve Bank of New York, or any successor thereto.

“Remedial Action” means all actions required to (a) clean up, remove, treat, or otherwise address Hazardous Materials in the indoor or outdoor environment, (b) prevent the Release or threat of Release or minimize the further Release of Hazardous Materials so that they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, or (c) perform pre-remedial studies and investigations and post-remedial monitoring and care.

“Removal Effective Date” has the meaning set forth in Section 10.6(b).

“Rent Reserve” means, with respect to any facility, warehouse distribution center, regional distribution center or depot where any Inventory subject to Liens arising by operation of law is located and with respect to which no Collateral Access Agreement is in effect, a reserve equal to (a) in the case of any leased location, all rent, charges and fees scheduled or customarily falling due for payment during a three (3) month period at such facility, warehouse distribution center, regional distribution center or depot where any Inventory (including any Generator Units and Field Units) are stored or located, and (b) in the case of any other location, an amount determined by Administrative Agent in its sole discretion in respect of liabilities owed to the applicable consignee, bailee, processor or warehouseman.

CREDIT AGREEMENT – Page 39

“Replacement Rate” has the meaning set forth in Section 3.3(b).

“Reportable Event” means any of the events set forth in Section 4043 of ERISA.

“Required Lenders” means, as of any date of determination, Lenders holding more than 66 2/3% of the sum of the (a) the Revolving Credit Exposure of all Lenders (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Obligations and Swing Line Loans being deemed “held” by such Lender for purposes of this definition) and (b) aggregate unused Commitments; provided that, if one Lender holds more than 66 2/3% but less than 100% of the sum of the Revolving Credit Exposure and the unused Commitments at such time, subject to the last sentence of Section 11.10, Required Lenders shall be at least two Lenders. The unused Commitment of, and the portion of the Revolving Credit Exposure of all Lenders held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

“Resignation Effective Date” has the meaning set forth in Section 10.6(a).

“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.

“Responsible Officer” means the chief executive officer, president, chief financial officer, vice president, vice president of finance or treasurer of a Loan Party (or the chief executive officer, president, chief financial officer, vice president, vice president of finance or treasurer of the general partner or managing member of a Loan Party, as applicable); solely for purposes of the delivery of incumbency certificates pursuant to Section 4.1, the secretary or assistant secretary of a Loan Party (or the secretary or any assistant secretary of the general partner or managing member of a Loan Party, as applicable) or any Person designated by a Responsible Officer to act on behalf of a Responsible Officer; provided that such designated Person may not designate any other Person to be a Responsible Officer. Any document delivered hereunder that is signed by a Responsible Officer of an Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Person and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

“Restricted Payment” means, collectively, (a) any dividend or other distribution (whether in cash, securities or other Property) with respect to any capital stock or other Equity Interest of Company or any Subsidiary, and (b) any payment (whether in cash, securities or other Property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any capital stock or other Equity Interest or on account of any return of capital to Company’s stockholders, partners or members (or the equivalent Person thereof).

“Revolving Credit Borrowing” means a borrowing consisting of simultaneous Revolving Credit Loans of the same Type and, in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Lenders pursuant to Section 2.1(a).

“Revolving Credit Exposure” means, as to any Lender at any time, the aggregate Outstanding Amount of its Revolving Credit Loans and such Lender’s participation in L/C Obligations and Swing Line Loans at such time.

CREDIT AGREEMENT – Page 40

“Revolving Credit Facility” means, at any time, the aggregate amount of the Lenders’ Commitments at such time.

“Revolving Credit Loan” has the meaning set forth in Section 2.1(a).

“RICO” means the Racketeer Influenced and Corrupt Organization Act of 1970.

“Sanctioned Country” means, at any time, a country or territory which is itself the subject or target of any Sanctions.

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC, the U.S. Department of State or by the United Nations Security Council, the European Union, any European Union member state or Her Majesty’s Treasury of the United Kingdom, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person controlled by any such Person or Persons, in each case, to the extent dealings are prohibited or restricted with such Person under Sanctions.

“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by the U.S. government (including those administered by OFAC or the U.S. Department of State), the Canadian government (including those administered by the Department of Foreign Affairs, Trade and Development and Public Safety Canada), the United Nations Security Council, the European Union, any European Union member state or Her Majesty’s Treasury of the United Kingdom, or other relevant sanctions authority.

“SEC” means the Securities and Exchange Commission or any successor Governmental Authority.

“Second Amendment” means that certain Second Amendment to Credit Agreement dated as of August 28, 2020, by and among the Company, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“Secured Parties” means the collective reference to Administrative Agent, each Lender, L/C Issuer, Swing Line Lender, each Bank Product Provider, and any other Person the Obligations owing to which are, or are purported to be, secured by the Collateral under the terms of the Security Documents.

“Security Agreements” means, collectively, (a) the U.S. Security Agreement and (b) the Canadian Security Agreement.

“Security Documents” means (a) the Security Agreements, (b) the Control Agreements, (c) the Parent Pledge Agreement and (d) every mortgage, security agreement, pledge agreement, mortgage, deed of trust, control agreement or other collateral security agreement required by or delivered to Administrative Agent from time to time that purport to create a Lien in favor of any of the Secured Parties to secure payment or performance of the Obligations or any portion thereof.

“Securities Account Control Agreement” has the meaning assigned to such term in the applicable Security Agreement.

CREDIT AGREEMENT – Page 41

“SOFR” means, with respect to any Business Day, a rate per annum equal to the secured overnight financing rate for such Business Day published by the SOFR Administrator on the SOFR Administrator’s Website at approximately 8:00 a.m. (New York City time) on the immediately succeeding Business Day.

“SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

“SOFR Administrator’s Website” means the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.

“Specified Contribution Effective Date” has the meaning set forth in the Fifth Amendment.

“Specified EBITDA Equity Contribution” means any direct or indirect investment in the Company to cure a breach of Section 8.1 or Section 8.2 pursuant to Section 9.3 (and designated in writing at or about the time made as being a Specified EBITDA Equity Contribution) in cash in the form of a capital contribution (including the purchase of common Equity Interests issued by Company), directly or indirectly, to Company or the purchase of common Equity Interests issued by Parent (or other Equity Interests issued by Parent and reasonably acceptable to Administrative Agent, but not Disqualified Equity Interests) and the proceeds thereof distributed to Company.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one (1) and the denominator of which is the number one (1) minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board of Governors to which Administrative Agent is subject with respect to the Eurodollar Rate, for eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D of the Board of Governors). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurodollar Rate Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

“Subsidiary” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of Company.

“Supported QFC” has the meaning set forth in Section 11.31.

“Sureties” has the meaning set forth in Section 12.3(b).

CREDIT AGREEMENT – Page 42

“Swap Obligations” means, with respect to any Loan Party, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.

“Swing Line Borrowing” means a borrowing of a Swing Line Loan pursuant to Section 2.3.

“Swing Line Lender” means Texas Capital Bank in its capacity as provider of Swing Line Loans, or any successor swing line lender hereunder.

“Swing Line Loan” has the meaning set forth in Section 2.3(a).

“Swing Line Loan Request” means a writing, substantially in the form of Exhibit F, or in such other form agreed to by the Borrower Representative and Administrative Agent, properly completed and signed by the Borrower Representative, requesting a Swing Line Borrowing.

“Swing Line Sublimit” means an amount equal to the greater of (a) $5,000,000 and (b) 10% the aggregate Commitments in effect at any time. The Swing Line Sublimit is part of, and not in addition to, the Commitments.

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Tax Return” means any return (including any information report), report, statement, schedule, notice, form, or other document or information filed with or submitted to, or required to be filed with or submitted to, any Governmental Authority in connection with the determination, assessment, collection, or payment of any Tax or in connection with the administration, implementation, or enforcement of any Tax.

“Term SOFR” means, for the applicable Corresponding Tenor as of the applicable Reference Time, the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.

“Texas Capital Bank” means Texas Capital Bank, a Texas state-chartered bank, and its successors and assigns.

“Third Amendment” means that certain Third Amendment to Credit Agreement dated as of the Third Amendment Effective Date, by and among the Company, Canadian Borrower, the other Borrowers and the other Loan Parties party thereto, the Administrative Agent and the Lenders party thereto.

“Third Amendment Effective Date” means December 22, 2020.

“Trigger Period” means any period commencing on the first date on which (a) an Event of Default has occurred and is continuing or (b) Availability plus the amount, if any, by which the Borrowing Base on such date exceeds the aggregate Commitments of the Lenders then in effect, is less than the greater of (i) $3,500,000 and (ii) 10% of the aggregate Commitments then in effect, and continuing until the date upon which both (A) Availability (and solely to the extent such Trigger Period commenced only as a result of an event under subclause (b) above, plus the amount, if any, by which the Borrowing Base on such date exceeds the aggregate Commitments of the Lenders then in effect) has been equal to or greater than the greater of (x) $3,500,000 and (y) 10% of the aggregate Commitments then in effect, in each case, at all times during the preceding sixty (60) consecutive day period, and (B) no Event of Default has occurred and is continuing during such sixty (60) consecutive day period.

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“Type” means, with respect to a Loan, refers to whether such Loan is a Base Rate Loan or a Eurodollar Rate Loan, and, with respect to a Borrowing, refers to whether such Borrowing is a Base Rate Borrowing or a Eurodollar Rate Borrowing.

“UCC” means Chapters 1 through 11 of the Texas Business and Commerce Code.

“UK Financial Institution” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.

“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.

“Ultimate Parent” means FlexEnergy Power Solutions, LLC, a Delaware limited liability company.

“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

“Unfinanced Capital Expenditures” means, for any date of determination, Capital Expenditures of Company and its Subsidiaries made during the trailing twelve (12) fiscal month period then ending on such date which are not financed from the proceeds of any Debt (other than the Revolving Credit Loans); provided that, only twenty percent (20%) of the portion of Capital Expenditures made during such period financed from the proceeds of Revolving Credit Loans which were exclusively used to acquire or construct any New Generator Units after January 31, 2019 shall be deemed to be Unfinanced Capital Expenditures; provided, further that in no event shall the amount of Unfinanced Capital Expenditures for any period be less than zero.

“Unfunded Pension Liability” means the excess, if any, of (a) the funding target as defined under Section 430(d) of the Code without regard to the special at-risk rules of Section 430(i) of the Code, over (b) the value of plan assets as defined under Section 430(g)(3)(A) of the Code determined as of the last day of each plan year, without regard to the averaging which may be allowed under Section 430(g)(3)(B) of the Code and reduced for any prefunding balance or funding standard carryover balance as defined and provided for in Section 430(f) of the Code.

“Unreimbursed Amount” has the meaning set forth in Section 2.2(c)(i).

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“U.S.” or “United States” means the United States of America.

“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code.

“U.S. Security Agreement” means that certain Pledge and Security Agreement (including any and all supplements thereto), dated as of the Closing Date, among the Loan Parties (other than Canadian Borrower) and Administrative Agent, for the benefit of Administrative Agent and the other Secured Parties, and any other pledge or security agreement entered into, after the date of this Agreement by any other Loan Party (as required by this Agreement or any other Loan Document, but excluding Canadian Borrower) or any other Person (other than Canadian Borrower) for the benefit of Administrative Agent and the other Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time

“U.S. Special Resolution Regimes” has the meaning set forth in Section 11.31.

“U.S. Tax Compliance Certificate” has the meaning specified in Section 3.4(g)(ii)(B)(3).

“USD LIBOR” means the London interbank offered rate for Dollars.

“Voting Shares” means capital stock of any class of any corporation which carries voting rights to elect the board of directors thereof under any circumstances, provided that, for purposes hereof, shares which carry the right to so vote conditionally upon the happening of an event shall not be considered Voting Shares until the occurrence of such event.

“Withholding Agent” means each of the Loan Parties and Administrative Agent.

“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.

Section 1.2Accounting Matters.

(a)Generally. All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the audited financial statements described in Section 5.2, except as otherwise specifically prescribed herein. Notwithstanding the foregoing or anything to the contrary herein, (i) for purposes of determining compliance with any covenant (including the computation of any Financial Covenant) contained herein, Debt of Company and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof, and the effects of FASB ASC 825 on financial liabilities shall be disregarded and (ii) any lease that is treated as an operating lease for purposes of GAAP as of December 15, 2018 shall continue to be treated as an operating lease (and any future lease, if it were in effect on December 15, 2018, that would be treated as an operating lease for purposes of GAAP as of December 15, 2018 shall be treated as an operating lease), in each case for purposes of this Agreement, notwithstanding any change in GAAP after December 15, 2018.

CREDIT AGREEMENT – Page 45

(b)Changes in GAAP. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth herein, and either the Borrower Representative or the Required Lenders shall so request, Administrative Agent, Lenders and the Borrower Representative shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower Representative shall provide to Administrative Agent and Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

Section 1.3ERISA Matters. If, after the date hereof, there shall occur, with respect to ERISA, the adoption of any applicable Law, rule, or regulation, or any change therein, or any change in the interpretation or administration thereof by the PBGC or any other Governmental Authority, then either the Borrower Representative or Required Lenders may request a modification to this Agreement solely to preserve the original intent of this Agreement with respect to the provisions hereof applicable to ERISA, and the parties to this Agreement shall negotiate in good faith to complete such modification.

Section 1.4Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

Section 1.5Other Definitional Provisions. All definitions contained in this Agreement are equally applicable to the singular and plural forms of the terms defined. The words “hereof”, “herein”, and “hereunder” and words of similar import referring to this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Unless otherwise specified, all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear. Terms used herein that are defined in the UCC or the PPSA, as applicable, unless otherwise defined herein, shall have the meanings specified in the UCC or the PPSA, as applicable. Any definition of or reference to any agreement, instrument or other document shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document). Any reference to any Law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such Law and any reference to any Law or regulation shall, unless otherwise specified, refer to such Law or regulation as amended, modified or supplemented from time to time. Words denoting gender shall be construed to include the masculine, feminine and neuter, when such construction is appropriate; specific enumeration shall not exclude the general but shall be constructed as cumulative; the word “or” is not exclusive; the word “including” (in its various forms) means “including, without limitation”; in the computation of periods of time, the word “from” means “from and including” and the words “to” and “until” mean “to but excluding”; and all references to money refer to the legal currency of the U.S.

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Section 1.6Interpretative Provision. For purposes of Section 9.1, a breach of a Financial Covenant shall be deemed to have occurred as of any date of determination thereof by Borrowers or the Required Lenders or as of the last date of any specified measurement period, regardless of when the financial statements or the Compliance Certificate reflecting such breach are delivered to Administrative Agent.

Section 1.7Times of Day. Unless otherwise specified, all references herein to times of day shall be references to central time (daylight or standard, as applicable).

Section 1.8Other Loan Documents. The other Loan Documents, including the Security Documents, contain representations, warranties, covenants, defaults and other provisions that are in addition to and not limited by, or a limitation of, similar provisions of this Agreement. Such provisions in such other Loan Documents may be different or more expansive than similar provisions of this Agreement and neither such differences nor such more expansive provisions shall be construed as a conflict.

Section 1.9Divisions. For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its Equity Interests at such time.

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Section 1.10Rates. The interest rate on Eurodollar Rate Loans and Base Rate Loans (when determined by reference to clause (c) of the definition of Base Rate) is determined by reference to USD LIBOR, which is derived from the London interbank offered rate. The London interbank offered rate is intended to represent the rate at which contributing banks may obtain short-term borrowings from each other in the London interbank market. On March 5, 2021, ICE Benchmark Administration (the “IBA”), the administrator of the London interbank offered rate, and the Financial Conduct Authority (the “FCA”), the regulatory supervisor of the IBA, announced in public statements (the “Announcements”) that the final publication or representativeness date for the London interbank offered rate for dollars for: (a) 1-week and 2-month tenor settings will be December 31, 2021 and (b) overnight, 1-month, 3-month, 6-month and 12-month tenor settings will be June 30, 2023. No successor administrator for the IBA was identified in such Announcements. As a result, it is possible that commencing immediately after such dates, the London interbank offered rate for such tenors may no longer be available or may no longer be deemed a representative reference rate upon which to determine the interest rate on Eurodollar Rate Loans or Base Rate Loans (when determined by reference to clause (c) of the definition of Base Rate). There is no assurance that the dates set forth in the Announcements will not change or that the IBA or the FCA will not take further action that could impact the availability, composition or characteristics of any London interbank offered rate. Public and private sector industry initiatives have been and continue, as of the date hereof, to be underway to implement new or alternative reference rates to be used in place of the London interbank offered rate. In the event that the London interbank offered rate or any other then-current Benchmark is no longer available or in certain other circumstances set forth in Section 3.3, such Section 3.3 provides a mechanism for determining an alternative rate of interest. The Administrative Agent will notify the Borrower Representative, pursuant to Section 3.3, of any change to the reference rate upon which the interest rate on Eurodollar Rate Loans and Base Rate Loans (when determined by reference to clause (c) of the definition of Base Rate) is based. However, the Administrative Agent does not warrant or accept any responsibility for, and shall not have any liability with respect to, (i) the continuation of, administration of, submission of, calculation of or any other matter related to the London interbank offered rate or other rates in the definition of “Eurodollar Rate” or with respect to any alternative, successor, or replacement rate thereto (including any then-current Benchmark or any Benchmark Replacement), including whether the composition or characteristics of any such alternative, successor or replacement rate (including any Benchmark Replacement), as it may or may not be adjusted pursuant to Section 3.3, will be similar to, or produce the same value or economic equivalence of, USD LIBOR or any other Benchmark, or have the same volume or liquidity as did the London interbank offered rate or any other Benchmark prior to its discontinuance or unavailability, or (ii) the effect, implementation or composition of any Benchmark Replacement Conforming Changes. The Administrative Agent and its Affiliates or other related entities may engage in transactions that affect the calculation of a Benchmark, any alternative, successor or replacement rate (including any Benchmark Replacement) or any relevant adjustments thereto and such transactions may be adverse to the Borrowers. The Administrative Agent may select information sources or services in its reasonable discretion to ascertain any Benchmark, any component definition thereof or rates referenced in the definition thereof, in each case pursuant to the terms of this Agreement, and shall have no liability to the Borrowers, any Lender or any other person or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.

Section 1.11Rounding. Any financial ratios required to be maintained by the Company pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

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Article 2.

THE COMMITMENTS AND CREDIT EXTENSIONS

Section 2.1The Loans.

(a)Revolving Credit Borrowings. Subject to the terms and conditions of this Agreement, each Lender severally agrees to make one or more revolving credit loans (each such loan, a “Revolving Credit Loan”) to Borrowers from time to time from the Closing Date until the Maturity Date in an aggregate principal amount for such Lender at any time outstanding up to but not exceeding the amount of such Lender’s Commitment, provided that the Revolving Credit Exposure of all Lenders shall not exceed the lesser of (i) the aggregate amount of the Commitments of the Lenders and (ii) the Borrowing Base. Subject to the foregoing limitations, and the other terms and provisions of this Agreement, Borrowers may borrow, repay, and reborrow Revolving Credit Loans hereunder.

(b)Borrowing Procedure. Each Revolving Credit Borrowing, each conversion of a Borrowing from one Type to the other, and each continuation of a Eurodollar Rate Borrowing shall be made upon the Borrower Representative’s irrevocable notice to Administrative Agent, which may be given by telephone. Each such notice must be received by Administrative Agent not later than 11:00 a.m. (i) three (3) Business Days prior to the requested date of any Borrowing of, conversion to or continuation of a Eurodollar Rate Borrowing or of any conversion of a Eurodollar Rate Borrowing to a Base Rate Borrowing, and (ii) on the requested date of any Base Rate Borrowing. Each telephonic notice by the Borrower Representative pursuant to this Section 2.1(b) must be confirmed promptly by delivery to Administrative Agent of a written Borrowing Request, appropriately completed and signed by a Responsible Officer of the Borrower Representative. Each Borrowing of, conversion to or continuation of a Eurodollar Rate Borrowing shall be in a principal amount of $250,000 or a whole multiple of $50,000 in excess thereof. Except as provided in Sections 2.2(c) and 2.3(c), each Borrowing of or conversion to a Base Rate Borrowing shall be in a principal amount of $250,000 or a whole multiple of $50,000 in excess thereof; provided that a Base Rate Borrowing may be in an amount equal to Availability. Each Borrowing Request (whether telephonic or written) shall specify (A) whether the Borrower Representative is requesting a Revolving Credit Borrowing, a conversion of Borrowings from one Type to the other, or a continuation of Borrowings, (B) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (C) the principal amount of Borrowings to be borrowed, converted or continued, (D) the Type of Borrowings to be borrowed or to which existing Borrowings are to be converted, and (E) if applicable, the duration of the Interest Period with respect thereto. If the Borrower Representative fails to specify a Type of Borrowing in a Borrowing Request or if the Borrower Representative fails to give a timely notice requesting a conversion or continuation, then the applicable Borrowing shall be made as, or converted to, a Base Rate Borrowing. Any such automatic conversion to Base Rate Borrowings shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurodollar Rate Borrowing. If the Borrower Representative requests a Borrowing of, conversion to, or continuation of a Eurodollar Rate Borrowing in any such Borrowing Request, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one (1) month.

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(c)Funding. Following receipt of a Borrowing Request, Administrative Agent shall promptly notify each Lender of the amount of its Applicable Percentage of the applicable Borrowing, and if no timely notice of a conversion or continuation is provided by the Borrower Representative, Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Borrowing as described in Section 2.1(b). In the case of a Revolving Credit Borrowing, each Lender shall make the amount of its Loan available to Administrative Agent in immediately available funds at Administrative Agent’s Principal Office not later than 1:00 p.m. on the Business Day specified in the applicable Borrowing Request. Upon satisfaction of the applicable conditions set forth in Section 4.2 (and, if such Borrowing is the initial Credit Extension, Section 4.1), Administrative Agent shall make all funds so received available to the applicable Borrower in like funds as received by Administrative Agent either by (i) crediting the account of the applicable Borrower on the books of Texas Capital Bank with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) Administrative Agent by the Borrower Representative; provided, however, that if, on the date the Borrowing Request with respect to such Borrowing is given by the Borrower Representative, there are L/C Borrowings outstanding, then the proceeds of such Borrowing, first, shall be applied to the payment in full of any such L/C Borrowings, and second, shall be made available to the applicable Borrower as provided above.

(d)Continuations and Conversions. Except as otherwise provided herein, a Eurodollar Rate Borrowing may be continued or converted only on the last day of an Interest Period for such Eurodollar Rate Borrowing. During the existence of a Default, (i) no Loans may be requested as, converted to or continued as Eurodollar Rate Borrowings without the consent of the Required Lenders and (ii) unless repaid, each Eurodollar Rate Borrowing shall be converted to a Base Rate Borrowing at the end of the Interest Period applicable thereto.

(e)Notifications. Administrative Agent shall promptly notify the Borrower Representative and Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Borrowings upon determination of such interest rate. At any time that Base Rate Borrowings are outstanding, Administrative Agent shall notify the Borrower Representative and Lenders of any change in Texas Capital Bank’s prime rate used in determining the Base Rate promptly following the public announcement of such change.

(f)Interest Periods. After giving effect to all Borrowings, all conversions of Borrowings from one Type to the other, and all continuations of Borrowings as the same Type, there shall not be more than five (5) Interest Periods in effect with respect to Eurodollar Rate Borrowings.

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Section 2.2Letters of Credit.

(a)The Letter of Credit Commitment.

(i)Subject to the terms and conditions set forth herein, (A) L/C Issuer agrees, in reliance upon the agreements of the Lenders set forth in this Section 2.2, (1) from time to time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit for the account of any Borrower, and to amend or extend Letters of Credit previously issued by it, in accordance with subsection (b) below, and (2) to honor drawings under the Letters of Credit; and (B) Lenders severally agree to participate in Letters of Credit issued for the account of any Borrower and any drawings thereunder; provided that immediately after giving effect to any L/C Credit Extension with respect to any Letter of Credit, (x) the Revolving Credit Exposure of all Lenders shall not exceed the lesser of (I) the aggregate amount of the Commitments of the Lenders and (II) the Borrowing Base, in each case in effect at such time, (y) the Revolving Credit Exposure of any Lender shall not exceed such Lender’s Commitment, and (z) the Outstanding Amount of the L/C Obligations shall not exceed the Letter of Credit Sublimit. Each request by the Borrower Representative for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by Borrowers that the L/C Credit Extension so requested complies with the conditions set forth in the proviso to the preceding sentence. Within the foregoing limits, and subject to the terms and conditions hereof, each Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly Borrowers may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.

(ii)L/C Issuer shall not issue any Letter of Credit, if:

(A)subject to Section 2.2(b)(iii), the expiry date of the requested Letter of Credit would occur more than twelve (12) months after the date of issuance or last extension, unless Required Lenders have approved such expiry date; or

(B)the expiry date of the requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless all Lenders have approved such expiry date.

(iii)L/C Issuer shall not be under any obligation to issue any Letter of Credit if:

(A)any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain L/C Issuer from issuing the Letter of Credit, or any Law applicable to L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over L/C Issuer shall prohibit, or request that L/C Issuer refrain from, the issuance of letters of credit generally or the Letter of Credit in particular or shall impose upon L/C Issuer with respect to the Letter of Credit any restriction, reserve or capital requirement (for which L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which L/C Issuer in good faith deems material to it;

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(B)the issuance of the Letter of Credit would violate one or more policies of L/C Issuer applicable to letters of credit generally;

(C)except as otherwise agreed by Administrative Agent and L/C Issuer, the Letter of Credit is in an initial stated amount less than $50,000;

(D)the Letter of Credit is to be denominated in a currency other than Dollars;

(E)any Lender is at that time a Defaulting Lender, unless L/C Issuer has entered into arrangements, including the delivery of Cash Collateral, satisfactory to L/C Issuer (in its sole discretion) with Borrowers or such Lender to eliminate L/C Issuer’s actual or potential Fronting Exposure (after giving effect to Section 11.22(a)(iv)) with respect to the Defaulting Lender arising from either the Letter of Credit then proposed to be issued or that Letter of Credit and all other L/C Obligations as to which L/C Issuer has actual or potential Fronting Exposure, as it may elect in its sole discretion; or

(F)the Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing thereunder.

(iv)L/C Issuer shall not amend any Letter of Credit if L/C Issuer would not be permitted at such time to issue the Letter of Credit in its amended form under the terms hereof.

(v)L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) L/C Issuer would have no obligation at such time to issue the Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of the Letter of Credit does not accept the proposed amendment to the Letter of Credit.

(vi)L/C Issuer shall act on behalf of Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and L/C Issuer shall have all of the benefits and immunities (A) provided to Administrative Agent in Article 10 with respect to any acts taken or omissions suffered by L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and Issuer Documents pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in Article 10 included L/C Issuer with respect to such acts or omissions, and (B) as additionally provided herein with respect to L/C Issuer.

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(b)Procedures for Issuance and Amendment of Letters of Credit.

(i)Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Borrower Representative delivered to L/C Issuer (with a copy to Administrative Agent) in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officer of the Borrower Representative. Such Letter of Credit Application may be sent by facsimile, by United States mail, by overnight courier, by electronic transmission using the system provided by L/C Issuer, by personal delivery or by any other means acceptable to L/C Issuer. Such Letter of Credit Application must be received by L/C Issuer and Administrative Agent not later than 11:00 a.m. at least two (2) Business Days (or such later date and time as Administrative Agent and L/C Issuer may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be. In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to L/C Issuer: (A) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any drawing thereunder; (G) the purpose and nature of the requested Letter of Credit; and (H) such other matters as L/C Issuer may require. In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to L/C Issuer (1) the Letter of Credit to be amended; (2) the proposed date of amendment thereof (which shall be a Business Day); (3) the nature of the proposed amendment; and (4) such other matters as L/C Issuer may require. Additionally, the Borrower Representative shall furnish to L/C Issuer and Administrative Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, including any Issuer Documents, as L/C Issuer or Administrative Agent may require.

(ii)Promptly after receipt of any Letter of Credit Application, L/C Issuer will confirm with Administrative Agent (by telephone or in writing) that Administrative Agent has received a copy of such Letter of Credit Application from the Borrower Representative and, if not, L/C Issuer will provide Administrative Agent with a copy thereof. Unless L/C Issuer has received written notice from Administrative Agent or any Loan Party, at least one (1) Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Article 4 shall not then be satisfied, then, subject to the terms and conditions hereof, L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the applicable Borrower or enter into the applicable amendment, as the case may be, in each case in accordance with L/C Issuer’s usual and customary business practices. Immediately upon the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Letter of Credit.

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(iii)Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, L/C Issuer will also deliver to the Borrower Representative and Administrative Agent a true and complete copy of such Letter of Credit or amendment.

(c)Drawings and Reimbursements; Funding of Participations.

(i)Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, L/C Issuer shall notify the Borrower Representative and Administrative Agent thereof. Not later than 11:00 a.m. on the date of any payment by L/C Issuer under a Letter of Credit (each such date, an “Honor Date”), Borrowers shall reimburse L/C Issuer through Administrative Agent in an amount equal to the amount of such drawing. If Borrowers fail to so reimburse L/C Issuer by such time, Administrative Agent shall promptly notify each Lender of the Honor Date, the amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such Lender’s Applicable Percentage thereof. In such event, Borrowers shall be deemed to have requested a Revolving Credit Borrowing to be disbursed on the Honor Date in an amount equal to the Unreimbursed Amount, subject to the amount of Availability and the conditions set forth in Section 4.2 (other than the delivery of a Borrowing Request). Any notice given by L/C Issuer or Administrative Agent pursuant to this Section 2.2(c)(i) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

(ii)Each Lender shall upon any notice pursuant to Section 2.2(c)(i) make funds available (and Administrative Agent may apply Cash Collateral provided for this purpose) for the account of L/C Issuer at Administrative Agent’s Principal Office in an amount equal to its Applicable Percentage of the Unreimbursed Amount not later than 1:00 p.m. on the Business Day specified in such notice by Administrative Agent, whereupon, subject to the provisions of Section 2.2(c)(iii), each Lender that so makes funds available shall be deemed to have made a Revolving Credit Loan (or, if the conditions set forth in Section 4.2 are not satisfied, an L/C Borrowing as further described in clause (iii) below) to Borrowers in such amount. Administrative Agent shall remit the funds so received to L/C Issuer.

(iii)With respect to any Unreimbursed Amount that is not fully refinanced by a Revolving Credit Borrowing because the conditions set forth in Section 4.2 cannot be satisfied or for any other reason, Borrowers shall be deemed to have incurred from L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the Default Interest Rate. In such event, each Lender’s payment to Administrative Agent for the account of L/C Issuer pursuant to Section 2.2(c)(ii) shall be deemed payment in respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this Section 2.2.

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(iv)Until each Lender funds its Revolving Credit Loan or L/C Advance pursuant to this Section 2.2(c) to reimburse L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Applicable Percentage of such amount shall be solely for the account of L/C Issuer.

(v)Each Lender’s obligation to make Revolving Credit Loans or L/C Advances to reimburse L/C Issuer for amounts drawn under Letters of Credit, as contemplated by this Section 2.2(c), shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against L/C Issuer, Borrowers or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Revolving Credit Loans (but not its obligation to fund it pro rata share of L/C Advances) pursuant to this Section 2.2(c) is subject to the conditions set forth in Section 4.2 (other than delivery by the Borrower Representative of a Borrowing Request). No such making of an L/C Advance shall relieve or otherwise impair the obligation of Borrowers to reimburse L/C Issuer for the amount of any payment made by L/C Issuer under any Letter of Credit, together with interest as provided herein.

(vi)If any Lender fails to make available to Administrative Agent for the account of L/C Issuer any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.2(c) by the time specified in Section 2.2(c)(ii), then, without limiting the other provisions of this Agreement, L/C Issuer shall be entitled to recover from such Lender (acting through Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to L/C Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by L/C Issuer in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by L/C Issuer in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Revolving Credit Loan included in the relevant Revolving Credit Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case may be. A certificate of L/C Issuer submitted to any Lender (through Administrative Agent) with respect to any amounts owing under this clause (vi) shall be conclusive absent manifest error.

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(d)Repayment of Participations.

(i)At any time after L/C Issuer has made a payment under any Letter of Credit and has received from any Lender such Lender’s L/C Advance in respect of such payment in accordance with Section 2.2(c), if Administrative Agent receives for the account of L/C Issuer any payment in respect of the related Unreimbursed Amount or interest thereon (whether directly from Borrowers or otherwise, including proceeds of Cash Collateral applied thereto by Administrative Agent), Administrative Agent will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by Administrative Agent.

(ii)If any payment received by Administrative Agent for the account of L/C Issuer pursuant to Section 2.2(c)(i) is required to be returned under any of the circumstances described in Section 11.24 (including pursuant to any settlement entered into by L/C Issuer in its discretion), each Lender shall pay to Administrative Agent for the account of L/C Issuer its Applicable Percentage thereof on demand of Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Lender, at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

(e)Obligations Absolute. The obligation of Borrowers to reimburse L/C Issuer for each drawing under each Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

(i)any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document;

(ii)the existence of any claim, counterclaim, setoff, defense or other right that any Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), L/C Issuer or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

(iii)any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

(iv)waiver by L/C Issuer of any requirement that exists for L/C Issuer’s protection and not the protection of a Borrower or any waiver by L/C Issuer which does not in fact materially prejudice such Borrower;

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(v)honor of a demand for payment presented electronically even if such Letter of Credit requires that demand be in the form of a draft;

(vi)any payment made by L/C Issuer in respect of an otherwise complying item presented after the date specified as the expiration date of, or the date by which documents must be received under such Letter of Credit if presentation after such date is authorized by the UCC, PPSA or the ISP, as applicable;

(vii)any payment by L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

(viii)any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, any Borrower or any Subsidiary.

The applicable Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with such Borrower’s instructions or other irregularity, such Borrower will immediately notify L/C Issuer. Each Borrower shall be conclusively deemed to have waived any such claim against L/C Issuer and its correspondents unless such notice is given as aforesaid.

(f)Role of L/C Issuer. Each Lender and each Borrower agree that, in paying any drawing under a Letter of Credit, L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. None of L/C Issuer, Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of Required Lenders; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document. Each Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude such Borrower’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. None of L/C Issuer, Administrative Agent, any of their respective Related Parties nor any correspondent, participant or assignee of L/C Issuer shall be liable or responsible for any of the matters described in clauses (i) through (viii) of Section 2.2(e); provided, however, that anything in such clauses to the contrary notwithstanding, each Borrower may have a claim against L/C Issuer, and L/C Issuer may be liable to such Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by such Borrower which such Borrower proves were directly caused by L/C Issuer’s willful misconduct or gross negligence or L/C Issuer’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of the foregoing, L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason. L/C Issuer may send a Letter of Credit or conduct any communication to or from the beneficiary via the Society for Worldwide Interbank Financial Telecommunication message or overnight courier, or any other commercially reasonable means of communicating with a beneficiary.

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(g)Applicability of ISP; Limitation of Liability. Unless otherwise expressly agreed by L/C Issuer and the applicable Borrower when a Letter of Credit is issued,  the rules of the ISP shall apply to each standby Letter of Credit. Notwithstanding the foregoing, L/C Issuer shall not be responsible to any Borrower for, and L/C Issuer’s rights and remedies against such Borrower shall not be impaired by, any action or inaction of L/C Issuer required or permitted under any Law, order, or practice that is required or permitted to be applied to any Letter of Credit or this Agreement, including the Law or any order of a jurisdiction where L/C Issuer or the beneficiary is located, the practice stated in the ISP, or in the decisions, opinions, practice statements, or official commentary of the ICC Banking Commission, the Bankers Association for Finance and Trade - International Financial Services Association (BAFT-IFSA), or the Institute of International Banking Law & Practice, whether or not any Letter of Credit or other Issuer Document chooses such Law or practice.

(h)Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer. Borrowers shall pay directly to L/C Issuer for its own account a fronting fee at the rate per annum separately agreed between applicable Borrower and L/C Issuer, computed on the daily amount available to be drawn under such Letter of Credit and payable on a quarterly basis in arrears. Such fronting fee shall be due and payable on the first day after the end of each March, June, September and December in respect of the most recently-ended quarterly period (or portion thereof, in the case of the first payment), commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.4. In addition, Borrowers shall pay directly to L/C Issuer for its own account the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of L/C Issuer relating to letters of credit as from time to time in effect. Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

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(i)Conflict with Issuer Documents. In the event of any conflict between the terms hereof and the terms of any Issuer Document, the terms hereof shall control.

Section 2.3Swing Line Loans.

(a)The Swing Line. Subject to the terms and conditions set forth herein, Swing Line Lender, in reliance upon the agreements of the other Lenders set forth in this Section 2.3, may in its sole discretion make loans (each such loan, a “Swing Line Loan”) to any Borrower from time to time on any Business Day during the period from the Closing Date to the Maturity Date in an aggregate amount not to exceed at any time outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that such Swing Line Loans, when aggregated with the Applicable Percentage of the Outstanding Amount of Revolving Credit Loans and L/C Obligations of the Lender acting as Swing Line Lender, may exceed the amount of such Lender’s Commitment; provided, however, that (i) immediately after giving effect to any Swing Line Loan, (A) the Revolving Credit Exposure of all Lenders shall not exceed the lesser of (x) the aggregate amount of the Commitments of the Lenders and (y) the Borrowing Base, in each case in effect at such time, and (B) except as provided above with respect to the Swing Line Lender, the Revolving Credit Exposure of any Lender shall not exceed such Lender’s Commitment, (ii) no Borrower shall use the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan, and (iii) Swing Line Lender shall not be under any obligation to make any Swing Line Loan if it shall determine (which determination shall be in its sole discretion) that it has, or by such Credit Extension may have, Fronting Exposure. Within the foregoing limits, and subject to the other terms and conditions hereof, each Borrower may borrow under this Section 2.3, prepay under Section 2.9(b), and reborrow under this Section 2.3. Each Swing Line Loan shall bear interest as a Base Rate Loan. Immediately upon the making of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Lender’s Applicable Percentage times the amount of such Swing Line Loan.

(b)Borrowing Procedures. Each Swing Line Borrowing shall be made upon the Borrower Representative’s irrevocable notice to Swing Line Lender and Administrative Agent, which may be given by telephone. Each such notice must be received by Swing Line Lender and Administrative Agent not later than 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum of $100,000, and (ii) the requested borrowing date, which shall be a Business Day. Each such telephonic notice must be confirmed promptly by delivery to Swing Line Lender and Administrative Agent of a written Swing Line Loan Request, appropriately completed and signed by a Responsible Officer of the Borrower Representative. Any telephonic request for a Swing Line Loan by the Borrower Representative shall be promptly confirmed by submission of a properly completed Swing Line Loan Request, signed by a Responsible Officer of the Borrower Representative, to Swing Line Lender and Administrative Agent, but failure to deliver a Swing Line Loan Request shall not be a defense to payment of any Swing Line Borrowing. Neither Swing Line Lender nor Administrative Agent shall have any liability to any Borrower for any loss or damage suffered by such Borrower as a result of Swing Line Lender’s or Administrative Agent’s honoring of any requests, execution of any instructions, authorizations or agreements or reliance on any reports communicated to it telephonically, by facsimile or electronically and purporting to have been sent to Swing Line Lender or Administrative Agent by such Borrower and neither Swing Line Lender nor Administrative Agent shall have any duty to verify the origin of any such communication or the identity or authority of the Person sending it. Promptly after receipt by Swing Line Lender of any telephonic Swing Line Loan Request, Swing Line Lender will confirm with Administrative Agent (by telephone or in writing) that Administrative Agent has also received such Swing Line Loan Request and, if not, Swing Line Lender will notify Administrative Agent (by telephone or in writing) of the contents thereof. Unless Swing Line Lender has received notice (by telephone or in writing) from Administrative Agent prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing Swing Line Lender not to make such Swing Line Loan as a result of the limitations set forth in the first proviso to the first sentence of Section 2.3(a), or (B) that one or more of the applicable conditions specified in Article 4 is not then satisfied, then, subject to the terms and conditions hereof, Swing Line Lender may, not later than 3:00 p.m. on the borrowing date specified in such Swing Line Loan Request, make the amount of its Swing Line Loan available to the applicable Borrower at its office by crediting the account of such Borrower on the books of Swing Line Lender in immediately available funds.

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(c)Refinancing of Swing Line Loans.

(i)Swing Line Lender at any time in its sole discretion may request, on behalf of Borrowers (which hereby irrevocably authorize Swing Line Lender to so request on its behalf), that each Lender make a Revolving Credit Loan in an amount equal to such Lender’s Applicable Percentage of the amount of Swing Line Loans then outstanding. Such request shall be made in writing (which written request shall be deemed to be a Borrowing Request for purposes hereof) and in accordance with the requirements of Section 2.1, subject to Availability and the conditions set forth in Section 4.2. Swing Line Lender shall furnish the Borrower Representative with a copy of the applicable Borrowing Request promptly after delivering such notice to Administrative Agent. Each Lender shall make an amount equal to its Applicable Percentage of the amount specified in such Borrowing Request available to Administrative Agent in immediately available funds (and Administrative Agent may apply Cash Collateral available with respect to the applicable Swing Line Loan) for the account of Swing Line Lender at Administrative Agent’s Principal Office not later than 1:00 p.m. on the day specified in such Borrowing Request, whereupon, subject to Section 2.3(c)(ii), each Lender that so makes funds available shall be deemed to have made a Revolving Credit Loan to Borrowers in such amount. Administrative Agent shall remit the funds so received to Swing Line Lender.

(ii)If for any reason any Swing Line Loan cannot be refinanced by such a Revolving Credit Borrowing in accordance with Section 2.3(c)(i), the request for Revolving Credit Loans submitted by Swing Line Lender as set forth herein shall be deemed to be a request by Swing Line Lender that each Lender fund its risk participation in the relevant Swing Line Loan and each Lender’s payment to Administrative Agent for the account of Swing Line Lender pursuant to Section 2.3(c)(i) shall be deemed payment in respect of such participation.

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(iii)If any Lender fails to make available to Administrative Agent for the account of Swing Line Lender any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.3(c) by the time specified in Section 2.3(c)(i), Swing Line Lender shall be entitled to recover from such Lender (acting through Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to Swing Line Lender at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by Swing Line Lender in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by Swing Line Lender in connection with the foregoing. If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Revolving Credit Loan included in the relevant Revolving Credit Borrowing or funded participation in the relevant Swing Line Loan, as the case may be. A certificate of Swing Line Lender submitted to any Lender (through Administrative Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent manifest error.

(iv)Each Lender’s obligation to make Revolving Credit Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this Section 2.3(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have against Swing Line Lender, Borrowers or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Lender’s obligation to make Revolving Credit Loans pursuant to this Section 2.3(c) is subject to Availability and the conditions set forth in Section 4.2. No such funding of risk participations shall relieve or otherwise impair the obligation of Borrowers to repay Swing Line Loans, together with interest as provided herein.

(d)Repayment of Participations.

(i)At any time after any Lender has purchased and funded a risk participation in a Swing Line Loan, if Swing Line Lender receives any payment on account of such Swing Line Loan, Swing Line Lender will distribute to such Lender its Applicable Percentage thereof in the same funds as those received by Swing Line Lender.

(ii)If any payment received by Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by Swing Line Lender under any of the circumstances described in Section 11.24 (including pursuant to any settlement entered into by Swing Line Lender in its discretion), each Lender shall pay to Swing Line Lender its Applicable Percentage thereof on demand of Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned, at a rate per annum equal to the Federal Funds Rate. Administrative Agent will make such demand upon the request of Swing Line Lender. The obligations of Lenders under this clause shall survive the payment in full of the Obligations and the termination of this Agreement.

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(e)Interest for Account of Swing Line Lender. Swing Line Lender shall be responsible for invoicing Borrowers for interest on the Swing Line Loans. Until each Lender funds its Revolving Credit Loan or risk participation pursuant to this Section 2.3 to refinance such Lender’s Applicable Percentage of any Swing Line Loan, interest in respect of such Applicable Percentage shall be solely for the account of Swing Line Lender.

(f)Payments to Swing Line Lender or Lenders. Borrowers shall make all payments of principal and interest in respect of the Swing Line Loans to Administrative Agent for the account of Swing Line Lender or Lenders, as applicable.

Section 2.4Fees.

(a)Fees. Borrowers agree to pay to Administrative Agent and Arranger, for the account of Administrative Agent, Arranger and each Lender, as applicable, fees, in the amounts and on the dates set forth in any Fee Letter.

(b)Letter of Credit Fees. Borrowers shall pay to Administrative Agent for the account of each Lender in accordance, subject to Section 11.22, with its Applicable Percentage a Letter of Credit fee (the “Letter of Credit Fee”) equal to the Applicable Margin for Eurodollar Rate Loans times the daily amount available to be drawn under such Letter of Credit. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.4. Letter of Credit Fees shall be (i) due and payable in arrears on the first day after the end of each March, June, September and December, commencing with the first such date to occur after the issuance or renewal of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand and (ii) computed on a quarterly basis in arrears. If there is any change in the Applicable Margin for Eurodollar Rate Loans during any quarter, the daily amount available to be drawn under each standby Letter of Credit shall be computed and multiplied by the Applicable Margin for Eurodollar Rate Loan separately for each period during such quarter that such Applicable Margin for Eurodollar Rate Loans was in effect. Notwithstanding anything to the contrary contained herein while any Event of Default exists, all Letter of Credit Fees shall accrue at the Default Interest Rate.

(c)Commitment Fees. Borrowers agree to pay to Administrative Agent for the account of each Lender in accordance, subject to Section 11.22, with its Applicable Percentage a commitment fee on the daily average unused amount of the Commitment of such Lender for the period from and including the date of this Agreement to and including the Maturity Date (including at any time during which one or more of the conditions in Article 4 is not met), at a rate equal to the applicable Commitment Fee Rate. For the purpose of calculating the commitment fee hereunder, the Commitment of each Lender shall be deemed utilized by the amount of all outstanding Revolving Credit Loans and L/C Obligations, but excluding the amount of any outstanding Swing Line Loans, owing to such Lender whether directly or by participation. Accrued commitment fees shall be payable monthly in arrears on the first day of each and every calendar month during the terms of this Agreement and on the Maturity Date.

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Section 2.5Payments Generally; Administrative Agent’s Clawback.

(a)General. All payments of principal, interest, and other amounts to be made by any Borrower under this Agreement and the other Loan Documents shall be made to Administrative Agent for the account of Administrative Agent, L/C Issuer, or Swing Line Lender or the pro rata accounts of the applicable Lenders, as applicable, at the Principal Office in Dollars and immediately available funds, without setoff, deduction, or counterclaim, and free and clear of all taxes at the time and in the manner provided herein. Payments by check or draft shall not constitute payment in immediately available funds until the required amount is actually received by Administrative Agent in full. Payments in immediately available funds received by Administrative Agent in the place designated for payment on a Business Day prior to 11:00 a.m. at such place of payment shall be credited prior to the close of business on the Business Day received, while payments received by Administrative Agent on a day other than a Business Day or after 11:00 a.m. on a Business Day shall not be credited until the next succeeding Business Day. If any payment of principal or interest on the Notes shall become due and payable on a day other than a Business Day, then such payment shall be made on the next succeeding Business Day. Any such extension of time for payment shall be included in computing interest which has accrued and shall be payable in connection with such payment. Administrative Agent is hereby authorized upon notice to the Borrower Representative to charge the account of Borrowers maintained with Administrative Agent for each payment of principal, interest and fees as it becomes due hereunder.

(b)Funding by Lenders; Presumption by Administrative Agent. Unless Administrative Agent shall have received notice from a Lender that such Lender will not make available to Administrative Agent such Lender’s share of a Borrowing, Administrative Agent may assume that such Lender has made such share available on such date in accordance with this Agreement and may, in reliance upon such assumption, make available to Borrowers a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to Administrative Agent, then the applicable Lender and Borrowers severally agree to pay to Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to Borrowers to but excluding the date of payment to Administrative Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation, and (ii) in the case of a payment to be made by Borrowers, the interest rate applicable to the applicable Borrowing. If Borrowers and such Lender shall pay such interest to Administrative Agent for the same or an overlapping period, Administrative Agent shall promptly remit to Borrowers the amount of such interest paid by Borrowers for such period. If such Lender pays its share of the applicable Borrowing to Administrative Agent, then the amount so paid shall constitute such Lender’s Loan. Any payment by Borrowers shall be without prejudice to any claim Borrowers may have against a Lender that shall have failed to make such payment to Administrative Agent.

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(c)Payments by Borrowers; Presumption by Administrative Agent. Unless Administrative Agent shall have received notice from the Borrower Representative prior to the date on which any payment is due to Administrative Agent for the account of L/C Issuer, Swing Line Lender or the applicable Lenders hereunder that Borrowers will not make such payment, Administrative Agent may assume that Borrowers have made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to L/C Issuer, Swing Line Lender or the applicable Lenders the amount due. In such event, if Borrowers have not in fact made such payment, then each of L/C Issuer, Swing Line Lender and the applicable Lenders, as applicable, severally agrees to repay to Administrative Agent forthwith on demand the amount so distributed to L/C Issuer, Swing Line Lender, or such Lender, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation.

(d)Cash Dominion. During any Trigger Period, all funds credited to the Blocked Accounts shall be promptly applied by Administrative Agent to the Obligations whether or not such Obligations shall have, by its terms, matured, such application to be made to principal or interest or expenses as Administrative Agent may elect; provided, however, Administrative Agent need not apply or give credit for any item included in such sums until one Business Day after the final collection thereof; provided, further, however, that Administrative Agent’s failure to so apply any such sums shall not be a waiver of Administrative Agent’s right to so apply such sums or any other sums at any time during a Trigger Period. Notwithstanding anything herein to the contrary, to the extent any funds credited to the Blocked Accounts constitute Net Cash Proceeds (i) from any Disposition not otherwise permitted by Section 7.8 or (ii) from the incurrence of any Debt not permitted by Section 7.1, the application of such Net Cash Proceeds shall be subject to Section 2.9(c).

Section 2.6Evidence of Debt.

(a)The Loans made by Swing Line Lender and each Lender shall be evidenced by one or more accounts or records maintained by Swing Line Lender or such Lender and by Administrative Agent in the ordinary course of business; provided that such Lender or Administrative Agent may, in addition, request that such Loans be evidenced by the Notes. The Credit Extensions made by L/C Issuer shall be evidenced by one or more accounts or records maintained by L/C Issuer and by Administrative Agent in the ordinary course of business. The accounts or records maintained by Administrative Agent, Swing Line Lender, L/C Issuer, and each Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made to any Borrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of any Borrower hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and records maintained by L/C Issuer, Swing Line Lender, or any Lender and the accounts and records of Administrative Agent in respect of such matters, the accounts and records of Administrative Agent shall control in the absence of manifest error.

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(b)In addition to the accounts and records referred to in subsection (a) above, each Lender and Administrative Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans. In the event of any conflict between the accounts and records maintained by Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of Administrative Agent shall control in the absence of manifest error.

Section 2.7Cash Collateral.

(a)Certain Credit Support Events. If (i) L/C Issuer has honored any full or partial drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing, (ii) as of the Letter of Credit Expiration Date, any L/C Obligation for any reason remains outstanding, (iii) any Borrower shall be required to provide Cash Collateral pursuant to Section 9.2, or (iv) if there is more than one Lender at such time of determination, there shall exist a Lender that is a Defaulting Lender, Borrowers shall immediately (in the case of clause (iii) above) or within one (1) Business Day (in all other cases) following any request by Administrative Agent or L/C Issuer, provide Cash Collateral in an amount not less than the applicable Minimum Collateral Amount (determined in the case of Cash Collateral provided pursuant to clause (iv) above, after giving effect to Sections 11.22(a)(iv) and 11.22(a)(v) and any Cash Collateral provided by the Defaulting Lender).

(b)Grant of Security Interest. Each Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants to (and subjects to the control of) Administrative Agent, for the benefit of Administrative Agent, L/C Issuer and Lenders, and agrees to maintain, a first priority security interest in all such Cash Collateral, and all other Property so provided as Collateral pursuant hereto, and in all proceeds of the foregoing, all as security for the obligations to which such Cash Collateral may be applied pursuant to Section 2.7(c). If at any time Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than Administrative Agent or L/C Issuer as herein provided, or that the total amount of such Cash Collateral is less than the Minimum Collateral Amount, Borrowers will, promptly upon demand by Administrative Agent, pay or provide to Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency. All Cash Collateral (other than credit support not constituting funds subject to deposit) shall be maintained in one or more blocked, non-interest bearing deposit accounts at Texas Capital Bank. Borrowers shall pay on demand therefor from time to time all customary account opening, activity and other administrative fees and charges in connection with the maintenance and disbursement of Cash Collateral.

(c)Application. Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under any of this Section 2.7 or Sections 2.2, 9.2 or 11.22 in respect of Letters of Credit shall be held and applied to the satisfaction of the specific L/C Obligations, obligations to fund participations therein (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) and other obligations for which the Cash Collateral was so provided, prior to any other application of such Property as may otherwise be provided for herein.

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(d)Release. Cash Collateral (or the appropriate portion thereof) provided to reduce Fronting Exposure or to secure other obligations shall be released promptly following (i) the elimination of the applicable Fronting Exposure or other obligations giving rise thereto, including by the termination of Defaulting Lender status of the applicable Lender (or, as appropriate, its assignee following compliance with Section 11.8(b)(vii)) or (ii) the determination by Administrative Agent and L/C Issuer that there exists excess Cash Collateral; provided, however, (x) any such release shall be without prejudice to, and any disbursement or other transfer of Cash Collateral shall be and remain subject to, any other Lien conferred under the Loan Documents and the other applicable provisions of the Loan Documents, and (y) the Person providing Cash Collateral and L/C Issuer may agree that Cash Collateral shall not be released but instead held to support future anticipated Fronting Exposure or other obligations.

Section 2.8Interest; Payment Terms.

(a)Revolving Credit Loans – Payment of Principal and Interest; Revolving Nature. The unpaid principal amount of each Borrowing of the Revolving Credit Loans shall, subject to the following sentence and Section 2.8(e), bear interest at the applicable Interest Rate. If at any time such rate of interest would exceed the Maximum Rate but for the provisions thereof limiting interest to the Maximum Rate, then any subsequent reduction shall not reduce the rate of interest on the Revolving Credit Loans below the Maximum Rate until the aggregate amount of interest accrued on the Revolving Credit Loans equals the aggregate amount of interest which would have accrued on the Revolving Credit Loans if the interest rate had not been limited by the Maximum Rate. All accrued but unpaid interest on the principal balance of the Revolving Credit Loans shall be payable on each Payment Date and on the Maturity Date, provided that interest accruing at the Default Interest Rate pursuant to Section 2.8(e) shall be payable on demand. The then Outstanding Amount of the Revolving Credit Loans and all accrued but unpaid interest thereon shall be due and payable on the Maturity Date. The unpaid principal balance of the Revolving Credit Loans at any time shall be the total amount advanced hereunder by Lenders less the amount of principal payments made thereon by or for Borrowers, which balance may be endorsed on the Notes from time to time by Lenders or Swing Line Lender, as applicable, or otherwise noted in Lenders’, Swing Line Lender’s and/or Administrative Agent’s records, which notations shall be, absent manifest error, conclusive evidence of the amounts owing hereunder from time to time.

(b)Computation Period. Interest on the Loans and all other amounts payable by Borrowers hereunder on a per annum basis shall be computed on the basis of a 360-day year and the actual number of days elapsed (including the first day but excluding the last day) unless such calculation would result in a usurious rate or to the extent such Loan bears interest based upon the Base Rate, in which case interest shall be calculated on the basis of a 365-day year or 366-day year, as the case may be. In computing the number of days during which interest accrues, the day on which funds are initially advanced shall be included regardless of the time of day such advance is made, and the day on which funds are repaid shall be included unless repayment is credited prior to the close of business on the Business Day received. Each determination by Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error.

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(c)Unconditional Payment. Each Borrower is and shall be obligated to pay all principal, interest and any and all other amounts which become payable under any of the Loan Documents absolutely and unconditionally and without any abatement, postponement, diminution or deduction whatsoever and without any reduction for counterclaim or setoff whatsoever. If at any time any payment received by Administrative Agent hereunder shall be deemed by a court of competent jurisdiction to have been a voidable preference or fraudulent conveyance under any Debtor Relief Law, then the obligation to make such payment shall survive any cancellation or satisfaction of the Obligations under the Loan Documents and shall not be discharged or satisfied with any prior payment thereof or cancellation of such Obligations, but shall remain a valid and binding obligation enforceable in accordance with the terms and provisions hereof, and such payment shall be immediately due and payable upon demand.

(d)Partial or Incomplete Payments. Subject to Section 9.3, if at any time insufficient funds are received by and available to Administrative Agent to pay fully all amounts of principal, L/C Borrowings, interest, fees and other amounts then due hereunder, such funds shall be applied (i) first, to pay interest, fees and other amounts then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest, fees and other amounts then due to such parties, and (ii) second, to pay principal and L/C Borrowings then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal or L/C Borrowings, as applicable, then due to such parties. Remittances in payment of any part of the Obligations under the Loan Documents other than in the required amount in immediately available funds at the place where such Obligations are payable shall not, regardless of any receipt or credit issued therefor, constitute payment until the required amount is actually received by Administrative Agent in full in accordance herewith and shall be made and accepted subject to the condition that any check or draft may be handled for collection in accordance with the practice of the collecting bank or banks. Acceptance by Administrative Agent of any payment in an amount less than the full amount then due shall be deemed an acceptance on account only, and the failure to pay the entire amount then due shall be and continue to be an Event of Default.

(e)Default Interest Rate. For so long as any Event of Default exists, regardless of whether or not there has been an acceleration of the Loans, and at all times after the maturity of the Loans (whether by acceleration or otherwise), and in addition to all other rights and remedies of Administrative Agent or Lenders hereunder, (i) interest shall accrue on the Outstanding Amount of the Loans at the Default Interest Rate, (ii) interest shall accrue on any past due amount (other than the Outstanding Amount of the Loans) at the Default Interest Rate and (iii) upon the request of the Required Lenders, interest shall accrue on the principal amount of all other outstanding Obligations at the Default Interest Rate, and such accrued interest shall be immediately due and payable. Each Borrower acknowledges that it would be extremely difficult or impracticable to determine Administrative Agent’s or Lenders’ actual damages resulting from any late payment or Event of Default, and such accrued interest are reasonable estimates of those damages and do not constitute a penalty.

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(f)Interest Act (Canada). For the purposes of the Interest Act (Canada) and disclosure thereunder, whenever any interest or any fee to be paid under any Loan Document is to be calculated on the basis of a 360-day year, 365-day year or 366-day year, the yearly rate of interest to which the rate used in such calculation is equivalent is the rate so used multiplied by the actual number of days in the calendar year in which the same is to be ascertained and divided by 360, 365 or 366, as applicable. The rates of interest under this Agreement are nominal rates, and not effective rates or yields. The principle of deemed reinvestment of interest does not apply to any interest calculation under this Agreement. Each Borrower acknowledges and confirms that this Section 2.8(f) satisfies the requirements of Section 4 of the Interest Act (Canada) to the extent it applies to the expression or statement of any interest payable under any Loan Document and that it is able to calculate the yearly rate or percentage of interest payable under any Loan Document based upon the methodology set out in this Section 2.8(f). Any provision of this Agreement that would oblige Canadian Borrower to pay any fine, penalty or rate of interest on any arrears of principal or interest secured by a mortgage on real property or hypothec on immovables that has the effect of increasing the charge on arrears beyond the rate of interest payable on principal money not in arrears shall not apply to Canadian Borrower, which shall be required to pay interest on money in arrears at the same rate of interest payable on principal money not in arrears.

Section 2.9Voluntary Termination or Reduction of Commitments; Prepayments.

(a)Voluntary Termination or Reduction of Commitments. The Borrower Representative may, upon written notice to Administrative Agent, terminate the Commitments, or from time to time permanently reduce the Commitments; provided that (i) any such notice shall be received by Administrative Agent not later than 11:00 a.m. three (3) Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of $2,500,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the Borrower Representative shall not terminate or reduce the Commitments if, (A) immediately after giving effect thereto and to any concurrent prepayments hereunder, the Revolving Credit Exposure of all Lenders would exceed the lesser of (x) the aggregate amount of the Commitments of the Lenders and (y) the Borrowing Base, in each case in effect at such time or (B) the aggregate amount of the Commitments of the Lenders would be less than $10,000,000 (unless with respect to this clause (B), the aggregate Commitments are reduced to $0) and (iv) if, immediately after giving effect to any reduction of the Commitments, the Letter of Credit Sublimit or Swing Line Sublimit exceeds the amount of the Revolving Credit Facility, such sublimit shall be automatically reduced by the amount of such excess. Administrative Agent will promptly notify Lenders of any such notice of termination or reduction of the Commitments. Any reduction of the Commitments shall be applied to the Commitment of each Lender according to its Applicable Percentage. All fees accrued until the effective date of any termination of the Commitments shall be paid on the effective date of such termination.

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(b)Voluntary Prepayments. Subject to the conditions set forth below, Borrowers shall have the right, at any time and from time to time upon at least three (3) Business Days’ prior written notice to Administrative Agent, to prepay the principal of the Revolving Credit Loans or the Swing Line Loans in full or in part. If there is a prepayment of all or any portion of the principal of the Revolving Credit Loans or the Swing Line Loans on or before the Maturity Date, whether voluntary or because of acceleration or otherwise, such prepayment shall also include any and all accrued but unpaid interest on the amount of principal being so prepaid through and including the date of prepayment, plus any other sums which have become due to Lenders under the other Loan Documents on or before the date of prepayment, but which have not been fully paid.

(c)Mandatory Prepayment of Revolving Credit Facility. Borrowers shall make a prepayment of the Revolving Credit Loans or the Swing Line Loans upon the occurrence of any of the following:

(i)If at any time the Revolving Credit Exposure of the Lenders exceeds the lesser of (A) the aggregate amount of the Commitments of the Lenders and (B) the Borrowing Base, in each case in effect at such time, then Borrowers shall immediately prepay the entire amount of such excess to Administrative Agent, for the ratable account of Lenders, and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such excess; provided, however, that no Borrower shall be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.9(c) unless after the prepayment in full of the Revolving Credit Loans and Swing Line Loans the Revolving Credit Exposure of the Lenders exceeds the lesser of (x) the aggregate amount of the Commitments of the Lenders and (y) the Borrowing Base, in each case in effect at such time.

(ii)Concurrently with the receipt by any Loan Party of any Net Cash Proceeds from a Disposition not permitted by Section 7.8, the Borrowers shall prepay the Loans in an amount equal to 100% of such Net Cash Proceeds.

(iii)Concurrently with the receipt by any Loan Party of any Net Cash Proceeds from the incurrence of any Debt not permitted by Section 7.1, the Borrowers shall prepay the Loans in an amount equal to 100% of such Net Cash Proceeds.

(iv)Upon the receipt by any Loan Party of any cash proceeds of a Specified EBITDA Equity Contribution pursuant to Section 9.3, Borrowers shall prepay an aggregate principal amount of Loans equal to all Net Cash Proceeds received therefrom immediately upon receipt thereof by any such Loan Party or such Subsidiary.

(v)Upon the receipt by the Parent of any cash proceeds in connection with a Qualified IPO, Borrowers shall prepay an aggregate principal amount of Loans equal to at least $5,000,000 (or such lesser amount necessary for the Revolving Credit Exposure to equal $0) received therefrom.

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Each prepayment required by this Section 2.9(c) shall be applied, first, to any Base Rate Borrowings then outstanding, and, second, to any Eurodollar Rate Borrowings then outstanding, and if more than one Eurodollar Rate Borrowing is then outstanding, to such Eurodollar Rate Borrowings in such order as the Borrower Representative may direct, or if the Borrower Representative fails to so direct, as Administrative Agent shall elect.

Section 2.10Uncommitted Increase in Commitments.

(a)Request for Increase. Provided that no Default or Event of Default shall have occurred and be continuing, upon written notice to Administrative Agent (which shall promptly notify the Lenders), Borrowers may from time to time, request an increase in the aggregate Commitments by an amount not to exceed $15,000,000 (with the aggregate Commitments not to exceed $45,000,000 after giving effect to all such increases implemented pursuant to this Section 2.10); provided that (i) any such request for an increase shall be in a minimum amount of $5,000,000, and (ii) Borrowers may make a maximum of three such requests. To achieve the full amount of a requested increase, and subject to the approval of Administrative Agent and L/C Issuer, Borrowers may (A) request that one or more Lenders increase their Commitment, (B) invite all Lenders to increase their respective Commitment, and/or (C) invite additional Eligible Assignees to become Lenders pursuant to a joinder agreement in form and substance satisfactory to Administrative Agent and its counsel. Nothing contained in this Section 2.10 shall constitute, or otherwise be deemed to be, a commitment on the party of any Lender to increase its Commitment hereunder at any time.

(b)Notification by Administrative Agent; Additional Lenders. In the event the Borrowers invite all Lenders to increase their respective Commitment, then at the time of sending such notice, Borrowers (in consultation with Administrative Agent) shall specify the time period within which each Lender is requested to respond (which shall in no event be less than ten (10) Business Days from the date of delivery of such notice to the Lenders). Each Lender shall notify Administrative Agent within such time period whether or not it agrees to increase its Commitment and, if so, whether by an amount equal to, greater than, or less than its Applicable Percentage of such requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Commitment. Administrative Agent shall notify Borrowers and each Lender of the Lenders’ responses to each request made hereunder.

(c)Effective Date and Allocations. If the Commitments are increased in accordance with this Section 2.10, Administrative Agent and Borrowers shall determine the effective date (the “Increase Effective Date”) and the final allocation of such increase. Administrative Agent shall promptly notify Borrowers and the Lenders of the final allocation of such increase and the Increase Effective Date.

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(d)Conditions to Effectiveness of Increase. As a condition precedent to such increase, Borrowers shall deliver to Administrative Agent a certificate of each Loan Party dated as of the Increase Effective Date (in sufficient copies for each Lender) signed by a Responsible Officer of such Loan Party, in each case in form and substance satisfactory to Administrative Agent, (i) certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such increase, and (ii) in the case of Borrowers, certifying that, before and after giving effect to such increase, (A) the representations and warranties contained in Article 5 and the other Loan Documents are true and correct in all material respects (other than such representation or warranty expressly qualified by materiality or by reference to Material Adverse Effect) on and as of the Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (other than such representation or warranty expressly qualified by materiality or by reference to Material Adverse Effect) as of such earlier date, (B) no Default exists and (C) Borrowers are in pro forma compliance with the financial covenants contained in Sections 8.1 and 8.2.

(e)Pro Rata Treatment; Etc. On the Increase Effective Date, (i) any Lender increasing (or, in the case of any newly added Lender, extending) its Commitment shall make available to Administrative Agent such amounts in immediately available funds as Administrative Agent shall determine, for the benefit of the other Lenders, as being required in order to cause, after giving effect to such increase or addition and the use of such amounts to make payments to such other Lenders, each Lender’s portion of the outstanding Revolving Credit Loans of all the Lenders to equal its revised Applicable Percentage of such outstanding Revolving Credit Loans, and Administrative Agent shall make such other adjustments among the Lenders with respect to the Revolving Credit Loans then outstanding and amounts of principal, interest, commitment fees and other amounts paid or payable with respect thereto as shall be necessary, in the opinion of Administrative Agent, in order to effect such reallocation and (ii)  Borrowers shall be deemed to have repaid and reborrowed all outstanding Revolving Credit Loans as of the date of any increase (or addition) in the Commitments (with such reborrowing to consist of the Types of Revolving Credit Loans, with related Interest Periods if applicable, specified in a notice delivered by the Borrower Representative, in accordance with the requirements of Section 2.1(b)). The deemed payments made pursuant to clause (ii) of the immediately preceding sentence shall be accompanied by payment of all accrued interest on the amount prepaid and, in respect of each Eurodollar Rate Loan, shall be subject to the provisions of Section 3.5 if the deemed payment occurs other than on the last day of the related Interest Periods. Within a reasonable time after the effective date of any increase or addition, Administrative Agent shall, and is hereby authorized and directed to, revise Schedule 2.1 to reflect such increase or addition and shall distribute such revised Schedule 2.1 to each of the Lenders and the Borrowers, whereupon such revised Schedule 2.1 shall replace the old Schedule 2.1 and become part of this Agreement.

(f)Conflicting Provisions. This Section shall supersede any provisions in Sections 11.10 or 11.23 to the contrary.

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Section 2.11Cash Collateral Blocked Accounts. Subject to Section 6.12, each Borrower shall establish with Administrative Agent or any banks acceptable to Administrative Agent, certain lockboxes and blocked accounts (collectively “Blocked Accounts”), for the benefit of Administrative Agent, for the deposit of all receipts and collections in accordance with Section 2.12 hereof, pursuant to executed Deposit Account Control Agreements in form and substance satisfactory to Administrative Agent, in its reasonable discretion. At all times during a Trigger Period, each Borrower shall cause all receipts and collections of any accounts receivable to be deposited in such Blocked Accounts to be pledged to Administrative Agent, for the benefit of the Secured Parties, and, pursuant to Section 2.5(d), forwarded on a daily basis to an account held by Administrative Agent. During a Trigger Period, proceeds received from such Blocked Accounts shall be applied against any Obligations owing by any Borrower to the Lenders and shall be applied in accordance with Section 2.5(d) hereof. Only Administrative Agent shall have the right to direct withdrawals from such Blocked Accounts. Except as otherwise agreed to by Administrative Agent, each bank at which any such Blocked Account is maintained shall waive any right of offset such bank may otherwise have in such Blocked Account and the items deposited therein. Borrowers shall pay all fees and charges as may be required by any depository in which such Blocked Accounts are opened. Subject to Section 6.12, each Borrower shall, contemporaneously with the execution of this Agreement, provide Administrative Agent with the duly executed Deposit Account Control Agreements related to such Blocked Accounts. Subject to Section 6.12, each Borrower covenants and agrees to notify all of its customers and account debtors in writing on or before the date set forth in Section 6.12 directing such customers and account debtors to forward all current and future remittances and/or payments owed to such Borrower to the Blocked Accounts. The Blocked Accounts as of the Closing Date are set forth in Schedule 2.11.

Section 2.12Collection of Accounts.

(a)All receipts of cash, cash equivalents, checks, credit card receipts, drafts, instruments, and other items of payment arising out of the sale of inventory or other Property of the Loan Parties or the creation of accounts receivable, including without limitation, insurance proceeds and tax refunds (referred to as “Receipts”), and all Property of the Loan Parties in which Administrative Agent has a security interest or Lien, shall be deposited daily into one or more of the Blocked Accounts, and shall be held in trust by such Loan Party for Administrative Agent until so deposited.

(b)In the event, notwithstanding the provisions of this Section, any Loan Party receives or otherwise has dominion and control of any Receipts, or any proceeds or collections of any Property of the Loan Parties in which Administrative Agent has a security interest or Lien, such Receipts, proceeds, and collections shall be held in trust by such Loan Party for Administrative Agent and shall not be commingled with any of such Loan Party’s other funds or deposited in any account of such Loan Party other than a Blocked Account.

Section 2.13Appointment of Borrower Representative.

(a)Each Borrower hereby irrevocably appoints and constitutes Flex Leasing Power & Service LLC, a Delaware limited liability company (in such capacity, the “Borrower Representative”), as its agent to request and receive the proceeds of any Loan, Letter of Credit or any other extension of credit hereunder (and to otherwise act on behalf of such Borrower pursuant to this Agreement and the other Loan Documents) from the Lenders in the name or on behalf of each such Borrower. The Lenders may disburse such proceeds only to a bank account of a Borrower without notice to any other Borrower or any other Loan Party.

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(b)Each Loan Party hereby irrevocably appoints and constitutes the Borrower Representative as its agent to (i) receive statements of account and all other notices from Administrative Agent with respect to the Obligations or otherwise under or in connection with this Agreement and the other Loan Documents; (ii) execute and deliver Borrowing Base Reports and all other notices, certificates and documents to be executed and/or delivered by any Loan Party under this Agreement or the other Loan Documents; and (iii) otherwise act on behalf of such Loan Party pursuant to this Agreement and the other Loan Documents.

(c)The authorizations contained in this Section 2.13 are coupled with an interest and shall be irrevocable, and the Lenders may rely on any notice, request, information supplied by the Borrower Representative, every document executed by the Borrower Representative, every agreement made by the Borrower Representative or other action taken by the Borrower Representative in respect of any Borrower or other Loan Party as if the same were supplied, made or taken by such Borrower or such Loan Party. Without limiting the generality of the foregoing, the failure of one or more Borrowers or other Loan Parties to join in the execution of any writing in connection herewith shall not relieve any Borrower or other Loan Party from obligations in respect of such writing.

(d)No purported termination of the appointment of the Borrower Representative as agent shall be effective without the prior written consent of Administrative Agent.

(e)Any notice given by or to the Borrower Representative hereunder shall constitute and be deemed to be notice given by or to all Borrowers, jointly and severally. Notice given by Administrative Agent to the Borrower Representative hereunder or pursuant to any other Loan Documents in accordance with the terms hereof or thereof shall constitute notice to all Borrowers. The knowledge of any Borrower shall be imputed to all Borrowers and any consent by the Borrower Representative or any Borrower shall constitute the consent of and shall bind all Borrowers.

(f)The Borrower Representative hereby accepts the appointment by each Loan Party to act as the agent of the Loan Parties pursuant to this Section 2.13. The Borrower Representative shall ensure that the disbursement of any Loans, the issuance of any Letters of Credit or other extension of credit hereunder to each Borrower requested by or paid to or for the account of such Borrower shall be paid to or for the account of such Borrower.

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Section 2.14Joint and Several Liability. The Borrowers shall be jointly and severally liable for all Obligations due to the Secured Parties under this Agreement, regardless of which Borrower actually receives any Loans, Letters of Credit or other extensions of credit hereunder or the amount of such Loans or Letters of Credit received or the manner in which Administrative Agent accounts for such Loans, Letters of Credit or other extensions of credit on its books and records. The Obligations with respect to the Loans and Letters of Credit or other extensions of credit made to a Borrower, and the Obligations arising as a result of the joint and several liability of a Borrower hereunder, shall be primary obligations of all the Borrowers. The Obligations arising as a result of the joint and several liability of a Borrower hereunder with respect to the Loans, Letters of Credit or other extensions of credit made to the other Borrowers hereunder shall, to the fullest extent permitted by law, be unconditional irrespective of (a) the validity or enforceability, avoidance or subordination of the Obligations of the other Borrowers or of any promissory note or other document evidencing all or any part of the Obligations of the other Borrowers, (b) the absence of any attempt to collect the Obligations from the other Borrowers, any other Loan Party or any other security therefor, or the absence of any other action to enforce the same, (c) the failure by Administrative Agent to take any steps to perfect and maintain its security interest in, or to preserve its rights and maintain its security or collateral for the Obligations of the other Borrowers and the other Loan Parties, (d) the election of Administrative Agent or any other Secured Party in any proceeding instituted under any bankruptcy, insolvency or other Debtor Relief Law or of the application of Section 1111(b)(2) of the Bankruptcy Code of the United States or any similar provision of any other Debtor Relief Law, (e) the disallowance of all or any portion of the claim(s) of the Secured Parties for the repayment of the Obligations of the other Borrowers and other Loan Parties under Section 502 of the Bankruptcy Code of the United States or any similar provision of any other Debtor Relief Law, or (f) any other circumstances which might constitute a legal or equitable discharge or defense of any obligor. With respect to the Obligations arising as a result of the joint and several liability of a Borrower hereunder with respect to the Loans, Letters of Credit or other extensions of credit made to the other Borrowers hereunder, each Borrower waives, until the Obligations shall have been paid in full in immediately available funds and this Agreement shall have been terminated, any right to enforce any right of subrogation or any remedy which the Secured Parties now have or may hereafter have against the Borrowers and the other Loan Parties, any endorser or any guarantor of all or any part of the Obligations, and any benefit of, and any right to participate in, any security or collateral given to the Secured Parties. Upon any Event of Default and for so long as the same is continuing, Administrative Agent may proceed directly and at once, without notice, against any Borrower or any Guarantor to collect and recover the full amount, or any portion of the Obligations, without first proceeding against the other Borrowers or any other Person, or against any security or collateral for the Obligations. Each Borrower consents and agrees that Administrative Agent shall be under no obligation to marshal any assets in favor of any Borrower or any other Loan Party against or in payment of any or all of the Obligations.

Article 3.

TAXES, YIELD PROTECTION AND INDEMNITY

Section 3.1Increased Costs.

(a)Increased Costs Generally. If any Change in Law shall:

(i)impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in the Adjusted Eurodollar Rate);

(ii)subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

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(iii)impose on any Lender or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, converting to, continuing or maintaining any Loan or of maintaining its obligation to make any such Loan, or to increase the cost to such Lender or such other Recipient of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit) or to reduce the amount of any sum received or receivable by such Lender or other Recipient hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or other Recipient, Borrowers will pay to such Lender or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.

(b)Capital or Liquidity Requirements. If any Lender determines that any Change in Law affecting such Lender or any Lending Office of such Lender or such Lender’s holding company, if any, regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit or Swing Line Loans held by such Lender or the Letters of Credit issued by L/C Issuer, to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy and liquidity), then from time to time Borrowers will pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

(c)Certificates for Reimbursement. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in Sections 3.1(a) or (b) and delivered to the Borrower Representative, shall be conclusive absent manifest error. Borrowers shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.

(d)Delay in Requests. Failure or delay on the part of any Lender to demand compensation pursuant to this Section 3.1 shall not constitute a waiver of such Lender’s right to demand such compensation; provided that no Borrower shall be required to compensate a Lender pursuant to this Section 3.1 for any increased costs incurred or reductions suffered more than six (6) months prior to the date that such Lender notifies the Borrower Representative of the Change in Law giving rise to such increased costs or reductions, and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine (9) -month period referred to above shall be extended to include the period of retroactive effect thereof).

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Section 3.2Illegality. If any Lender determines that any Law or regulation has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its Lending Office to make, maintain or fund Loans whose interest is determined by reference to the Eurodollar Rate, or to determine or charge interest rates based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to the Borrower Representative through Administrative Agent, (i) any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans shall be suspended, and (ii) if such notice asserts the illegality of such Lender making or maintaining Base Rate Loans the interest rate on which is determined by reference to the Eurodollar Rate component of the Base Rate, the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by Administrative Agent without reference to the Eurodollar Rate component of the Base Rate, in each case until such Lender notifies Administrative Agent and the Borrower Representative that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, (x) Borrowers shall, upon demand from such Lender (with a copy to Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans (the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by Administrative Agent without reference to the Eurodollar Rate component of the Base Rate), either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar Rate Loans and (y) if such notice asserts the illegality of such Lender determining or charging interest rates based upon the Eurodollar Rate, Administrative Agent shall during the period of such suspension compute the Base Rate applicable to such Lender without reference to the Eurodollar Rate component thereof until Administrative Agent is advised in writing by such Lender that it is no longer illegal for such Lender to determine or charge interest rates based upon the Eurodollar Rate. Upon any such prepayment or conversion, Borrowers shall also pay accrued interest on the amount so prepaid or converted.

Section 3.3Alternate Rate of Interest.

(a)Inability to Determine Rates. Subject to clauses (b), (c), (d), (e) and (f) of this Section 3.3 and Section 3.2, if prior to the commencement of any Interest Period for a Eurodollar Rate Loan:

(i)the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for determining the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan or in connection with an existing or proposed Base Rate Borrowing (provided that no Benchmark Transition Event shall have occurred at such time); or

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(ii)the Administrative Agent is advised by the Required Lenders that the Eurodollar Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan will not adequately and fairly reflect the cost to such Lenders of funding such Eurodollar Rate Loans for such Interest Period, then Administrative Agent will promptly so notify Borrowers and each Lender. Thereafter, (A) the obligation of Lenders to make or maintain Eurodollar Rate Loans shall be suspended, and (B) in the event of a determination described in the preceding sentence with respect to the Eurodollar Rate component of the Base Rate, the utilization of the Eurodollar Rate component in determining the Base Rate shall be suspended, in each case until Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, the Borrower Representative may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans or, failing that, will be deemed to have converted such request into a request for a Base Rate Borrowing in the amount specified therein.

(b)Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Loan Document, if a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then (i) if a Benchmark Replacement is determined in accordance with clauses (a) or (b) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document and (ii) if a Benchmark Replacement is determined in accordance with clause (c) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of objection to such Benchmark Replacement from Lenders comprising the Required Lenders.

(c)Benchmark Replacement Conforming Changes. In connection with the implementation of a Benchmark Replacement, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.

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(d)Notices; Standards for Decisions and Determinations. The Administrative Agent will promptly notify the Borrower Representative and the Lenders of (i) any occurrence of a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date, (ii) the implementation of any Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement Conforming Changes, (iv) the removal or reinstatement of any tenor of a Benchmark pursuant to clause (e) below and (v) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section 3.3, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section 3.3.

(e)Unavailability of Tenor of Benchmark. Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (A) if the then-current Benchmark is a term rate (including BSBY, Term SOFR or USD LIBOR) and either (1) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by Administrative Agent in its reasonable discretion or (2) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is or will be no longer representative, then Administrative Agent may modify the definition of “Interest Period” for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (B) if a tenor that was removed pursuant to clause (i) above either (1) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (2) is not, or is no longer, subject to an announcement that it is or will no longer be representative for a Benchmark (including a Benchmark Replacement), then Administrative Agent may modify the definition of “Interest Period” for all Benchmark settings at or after such time to reinstate such previously removed tenor.

(f)Benchmark Unavailability Period. Upon the Borrower Representative’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Borrower Representative may revoke any request for a Eurodollar Rate Borrowing of, conversion to or continuation of Eurodollar Rate Loans to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Borrower Representative will be deemed to have converted any such request into a request for a Borrowing of or conversion to Base Rate Loans. During any Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of Base Rate based upon the then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of Base Rate.

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(g)London Interbank Offered Rate Benchmark Transition Event. On March 5, 2021, the IBA, the administrator of the London interbank offered rate, and the FCA, the regulatory supervisor of the IBA, made the Announcements that the final publication or representativeness date for dollars for (i) 1-week and 2-month London interbank offered rate tenor settings will be December 31, 2021 and (ii) overnight, 1-month, 3-month, 6-month and 12-month London interbank offered rate tenor settings will be June 30, 2023. No successor administrator for the IBA was identified in such Announcements. The parties hereto agree and acknowledge that the Announcements resulted in the occurrence of a Benchmark Transition Event with respect to the London interbank offered rate pursuant to the terms of this Agreement and that any obligation of the Administrative Agent to notify any parties of such Benchmark Transition Event pursuant to Section 3.3(d) shall be deemed satisfied; provided, however, (x) the Benchmark shall remain USD LIBOR until the occurrence of the Benchmark Replacement Date with respect thereto and (y) such Benchmark Replacement Date shall not be deemed to have occurred solely as a result of the Announcements and shall only occur in accordance with the definition thereof.

(h)BSBY Replacement. Notwithstanding anything to the contrary in this Agreement or any other Loan Documents, at any time that BSBY is the then current Benchmark, if the Administrative Agent determines (which determination shall be conclusive absent manifest error), or the Borrower Representative or Required Lenders notify the Administrative Agent (with, in the case of the Required Lenders, a copy to the Borrower Representative) that the Borrower Representative or Required Lenders (as applicable) have determined, that:

(i)adequate and reasonable means do not exist for ascertaining one month, three month and six month interest periods of BSBY, including, without limitation, because the BSBY Screen Rate is not available or published on a current basis and such circumstances are unlikely to be temporary; or

(ii)Bloomberg or any successor administrator of the BSBY Screen Rate or a Governmental Authority having jurisdiction over the Administrative Agent or Bloomberg or such administrator has made a public statement identifying a specific date after which one month, three month and six month interest periods of BSBY or the BSBY Screen Rate shall or will no longer be representative or made available, or used for determining the interest rate of loans, or shall or will otherwise cease, provided that, at the time of such statement, there is no successor administrator that is satisfactory to the Administrative Agent, that will continue to provide such representative interest periods of BSBY after such specific date (the latest date on which one month, three month and six month interest periods of BSBY or the BSBY Screen Rate are no longer representative or available permanently or indefinitely, the “Scheduled Unavailability Date”);

then, on a date and time determined by the Administrative Agent (any such date, the “BSBY Replacement Date”), which date shall be at the end of an Interest Period or on the relevant interest payment date, as applicable, for interest calculated and, solely with respect to clause (B) above, no later than the Scheduled Unavailability Date, BSBY will be replaced hereunder and under any Loan Document with a Benchmark Replacement determined in accordance with the definition thereof.

Section 3.4Taxes.

(a)Defined Terms. For purposes of this Section, the term “applicable Law” includes FATCA.

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(b)Payment Free of Taxes. Any and all payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable Law. If any applicable Law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 3.4) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

(c)Payment of Other Taxes by the Loan Parties. The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with applicable Law, or at the option of Administrative Agent timely reimburse it for the payment of, any Other Taxes.

(d)Indemnification by the Loan Parties. The Loan Parties shall jointly and severally indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 3.4) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower Representative by a Lender (with a copy to Administrative Agent), or by Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(e)Indemnification by Lenders. Each Lender shall severally indemnify Administrative Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that any Loan Party has not already indemnified Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.8 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by Administrative Agent to such Lender from any other source against any amount due to Administrative Agent under this Section 3.4(e).

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(f)Evidence of Payments. As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 3.4, such Loan Party shall deliver to Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Administrative Agent.

(g)Status of Lenders.

(i)Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower Representative and Administrative Agent, at the time or times reasonably requested by the Borrower Representative or Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower Representative or Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower Representative or Administrative Agent, shall deliver such other documentation prescribed by applicable Law or reasonably requested by the Borrower Representative or Administrative Agent as will enable the Borrower Representative or Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two (2) sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.4(g)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in such Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii)Without limiting the generality of the foregoing,

(A)any Lender that is a U.S. Person shall deliver to the Borrower Representative and Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower Representative or Administrative Agent), executed copies of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

(B)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower Representative and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower Representative or Administrative Agent), whichever of the following is applicable:

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(1)in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of IRS Form W-8BEN (or IRS Form W-8BEN-E, if applicable) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN (or IRS Form W-8BEN-E, if applicable) establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2)executed copies of IRS Form W-8ECI;

(3)in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit G-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of any Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed copies of IRS Form W-8BEN (or IRS Form W-8BEN-E, if applicable); or

(4)to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN (or IRS Form W-8BEN-E, if applicable), a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or Exhibit G-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-4 on behalf of each such direct and indirect partner;

(C)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower Representative and Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower Representative or Administrative Agent), executed copies of any other form prescribed by applicable Law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable Law to permit the Borrower Representative or Administrative Agent to determine the withholding or deduction required to be made; and

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(D)if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower Representative and Administrative Agent at the time or times prescribed by Law and at such time or times reasonably requested by the Borrower Representative or Administrative Agent such documentation prescribed by applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower Representative or Administrative Agent as may be necessary for the Borrower Representative and Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower Representative and Administrative Agent in writing of its legal inability to do so.

(h)Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.4 (including by the payment of additional amounts pursuant to this Section 3.4), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 3.4 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this Section 3.4(h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 3.4(h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this Section 3.4(h) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This Section 3.4(h) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

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(i)Survival. Each party’s obligations under this Section 3.4 shall survive the resignation or replacement of Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

Section 3.5Compensation for Losses. Upon demand of any Lender (with a copy to Administrative Agent) from time to time, Borrowers shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:

(a)any continuation, conversion, payment or prepayment of any Eurodollar Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise); or

(b)any failure by Borrowers (for a reason other than the failure of such Lender to lend a Eurodollar Rate Loan) to prepay, borrow, continue or convert any Eurodollar Rate Loan on the date or in the amount notified by the Borrower Representative; or

(c)any assignment of a Eurodollar Rate Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower Representative pursuant to Section 3.6(b);

including any loss of anticipated profits and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained. Borrowers shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by Borrowers to the Lenders under this Section 3.5, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at Adjusted Eurodollar Rate by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Loan was in fact so funded. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower Representative and shall be conclusive absent demonstrable error. Borrowers shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

Section 3.6Mitigation of Obligations; Replacement of Lenders.

(a)Designation of a Different Lending Office. If any Lender requests compensation under Section 3.1, or requires Borrowers to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.4, then such Lender shall (at the request of the Borrower Representative) use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or Affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.1 or Section 3.4, as the case may be, in the future, and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. Borrowers hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

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(b)Replacement of Lenders. If any Lender requests compensation under Section 3.1, or if Borrowers are required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.4 and, in each case, such Lender has declined or is unable to designate a different Lending Office in accordance with Section 3.6(a), or if any Lender is a Defaulting Lender or a Non-Consenting Lender, then Borrowers may, at their sole expense and effort, upon notice to such Lender and Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 11.8), all of its interests, rights (other than its existing rights to payments pursuant to Section 3.1 or Section 3.4) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:

(i)Borrowers shall have paid to Administrative Agent the assignment fee (if any) specified in Section 11.8;

(ii)such Lender shall have received payment of an amount equal to the Outstanding Amount of its Loans and L/C Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.5) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Borrowers (in the case of all other amounts);

(iii)in the case of any such assignment resulting from a claim for compensation under Section 3.1 or payments required to be made pursuant to Section 3.4, such assignment will result in a reduction in such compensation or payments thereafter;

(iv)such assignment does not conflict with applicable Law; and

(v)in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent.

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling Borrowers to require such assignment and delegation cease to apply.

Section 3.7Survival. All of the obligations under this Article 3 shall survive termination of the Commitments, repayment of all other Obligations hereunder, and resignation of Administrative Agent.

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Article 4.

CONDITIONS PRECEDENT

Section 4.1Initial Extension of Credit. The obligation of Lenders to make the initial Credit Extension hereunder is subject to the condition precedent that Administrative Agent shall have received all of the following, each dated (unless otherwise indicated or otherwise specified by Administrative Agent) the Closing Date, in form and substance satisfactory to Administrative Agent:

(a)Credit Agreement. Counterparts of this Agreement executed by Administrative Agent, the Lenders, Swing Line Lender, L/C Issuer and each Loan Party;

(b)Resolutions. Resolutions of the board of directors (or other governing body) of Parent and each Loan Party that is not a natural Person certified by the secretary or an assistant secretary (or a Responsible Officer or other custodian of records) of such Person which authorize the execution, delivery, and performance by such Person of this Agreement and the other Loan Documents to which such Person is or is to be a party;

(c)Incumbency Certificate. A certificate of incumbency certified by a Responsible Officer of Parent and each Loan Party that is not a natural Person certifying the names of the individuals or other Persons authorized to sign this Agreement and each of the other Loan Documents to which each Loan Party is or is to be a party (including the certificates contemplated herein) on behalf of such Person together with specimen signatures of such individual Persons;

(d)Certificate Regarding Consents and Approvals. A certificate of a Responsible Officer of each Loan Party either (i) attaching copies of all consents, licenses and approvals required in connection with the execution, delivery and performance by such Loan Party and the validity against such Loan Party of the Loan Documents to which it is a party, and such consents, licenses and approvals shall be in full force and effect, or (ii) stating that no such consents, licenses or approvals are so required;

(e)Closing Certificate. A certificate signed by a Responsible Officer of the Borrower Representative certifying (i) that the conditions specified in Sections 4.2(b), (c) and (d) have been satisfied and (ii) that attached to such certificate are true, accurate and complete copies of the Ultimate Parent loan documents, including any amendments and supplements thereto;

(f)Solvency Certificate. A solvency certificate signed by the chief financial officer or vice president of finance of Company;

(g)Perfection Certificate. The Perfection Certificate signed by a Responsible Officer of each Loan Party;

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(h)Constituent Documents. The Constituent Documents and all amendments thereto for Parent and each Loan Party that is not a natural Person, with the formation documents included in the Constituent Documents being certified as of a date acceptable to Administrative Agent by the appropriate government officials of the state of incorporation or organization of Parent and each Loan Party, and all such Constituent Documents being accompanied by certificates that such copies are complete and correct, given by an authorized representative acceptable to Administrative Agent;

(i)Governmental Certificates. Certificates of the appropriate government officials of the state of incorporation or organization of Parent and each Loan Party that is not a natural Person as to the existence and good standing of Parent and each Loan Party that is not a natural Person, each dated as of a recent date hereof;

(j)Notes. The Notes executed by Borrowers in favor of each Lender requesting Notes;

(k)Security Documents. The Security Documents executed by Parent, Borrowers, the other Loan Parties, the Subordinated Lenders and Administrative Agent, in each case, as the case may be;

(l)Pledged Equity Interests; Stock Powers; Pledged Notes. Subject to Section 6.17, Administrative Agent shall have received (i) the certificates (if any) representing any Equity Interests pledged pursuant to the Security Documents, together with an undated stock power for each such certificate executed in blank by a duly authorized officer of the pledgor thereof and (ii) each promissory note (if any) pledged to Administrative Agent pursuant to the Security Documents endorsed (without recourse) in blank (or accompanied by an executed transfer form in blank) by the pledgor thereof;

(m)Financing Statements. UCC financing statements reflecting Parent (solely with respect to its pledge of the Equity Interests in Company) and the Loan Parties, as debtors, and Administrative Agent, as secured party, which are required to grant a Lien which secures the Obligations and covering such Collateral as Administrative Agent may request;

(n)Borrowing Base Report. Borrowing Base Report which calculates the Borrowing Base as of a date specified by Administrative Agent prior to or on the Closing Date with customary supporting schedules and documentation;

(o)Field Examination. Such third-party field examinations and audits of the Borrowers’ Accounts, Inventory (including, without limitation, the Generator Units), related working capital matters and of the Borrowers’ related data processing and other systems and such other information or materials as Administrative Agent shall include within the scope of such third-party field examinations and audits, the results of which shall be satisfactory to Administrative Agent in its sole discretion;

(p)Appraisals. Such third-party asset appraisals of each Borrowers’ Inventory (including, without limitation, the Generator Units), which third-party appraisal shall be in form and substance satisfactory to Administrative Agent in its sole discretion;

(q)Corporate Structure. The corporate structure, capital structure and other material debt instruments, material accounts and governing documents of Parent, the Company and its Subsidiaries shall be acceptable to Administrative Agent in its reasonable discretion;

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(r)Insurance Matters. Subject to Section 6.17, copies of insurance certificates describing all insurance policies required by Section 6.5, together with lender loss payable and additional insured endorsements in favor of Administrative Agent with respect to all insurance policies covering Collateral;

(s)Lien Searches. The results of UCC, tax lien and judgment lien searches showing all financing statements and other documents or instruments on file against each Loan Party in the appropriate filing offices, such search to be as of a date no more than thirty (30) days prior to the date hereof, and reflecting no Liens against any of the intended Collateral other than Liens being released or assigned to Administrative Agent concurrently with the initial Credit Extension and Permitted Liens;

(t)Opinion of Counsel. A favorable opinion of Fennemore Craig, P.C., legal counsel to each Loan Party, as to such matters as Administrative Agent may reasonably request;

(u)Attorneys’ Fees and Expenses. Evidence that the costs and expenses (including reasonable attorneys’ fees) referred to in Section 11.1, to the extent invoiced, shall have been paid in full by Borrowers;

(v)Financial Statements. The financial statements set forth in Section 5.2;

(w)Financial Projections. Pro forma consolidated financial statements for Company and its Subsidiaries, and projections prepared by management of Company, of balance sheets, income statements and cash flow statements on a quarterly basis for the first year following the Closing Date and on an annual basis for each year thereafter during the term of this Agreement, which shall not be inconsistent with any financial information or projections previously delivered to Administrative Agent;

(x)KYC Information; Beneficial Ownership. Each Loan Party shall have provided to Administrative Agent and the Lenders (i) the documentation and other information requested by Administrative Agent as it deems necessary in order to comply with requirements of any anti-money laundering Laws, including, without limitation, the Patriot Act and any applicable “know your customer” rules and regulations and (ii) at least three (3) Business Days prior to the Closing Date, any Borrower that qualified as a “legal entity customer” under the Beneficial Ownership Regulation shall deliver a Beneficial Ownership Certification in relation to such Borrower;

(y)Minimum Availability. Evidence that, immediately after giving effect to the initial Credit Extension hereunder, Availability shall be at least $5,000,000;

(z)Legal Due Diligence. Administrative Agent and its counsel shall have completed all legal due diligence (including review of any material agreements disclosed on Schedule 5.26), the results of which shall be satisfactory to Administrative Agent in its sole discretion;

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(aa)Closing Fees. Evidence that (i) all fees required to be paid to Administrative Agent and Arranger on or before the Closing Date have been paid, and (ii) all fees required to be paid to the Lenders on or before the Closing Date have been paid; and

(bb)Additional Documentation. Such additional approvals, opinions, or documents as Administrative Agent or its legal counsel may reasonably request.

For purposes of determining compliance with the conditions set forth in this Section 4.1, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or be satisfied with, each document or other matter required thereunder to be consented to or approved by or be acceptable or satisfactory to a Lender unless Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

Section 4.2All Extensions of Credit. The obligation of Lenders to make any Credit Extension hereunder (including the initial Credit Extension) is subject to the following additional conditions precedent:

(a)Request for Credit Extension. Administrative Agent shall have received in accordance with this Agreement, as the case may be, a Borrowing Request, Letter of Credit Application, or Swing Line Loan Request, as applicable, pursuant to Administrative Agent’s requirements and executed by a Responsible Officer of the Borrower Representative;

(b)No Default. No Default or Event of Default shall have occurred and be continuing, or would result from or after giving effect to such Credit Extension;

(c)No Material Adverse Effect. No Material Adverse Effect shall have occurred and no circumstance shall exist that could reasonably be expected to have a Material Adverse Effect;

(d)Representations and Warranties. All of the representations and warranties of each Borrower and each other Loan Party contained in Article 5 and in the other Loan Documents shall (i) with respect to representations and warranties that contain a materiality qualification, be true and correct on and as of the date of such Borrowing, and (ii) with respect to representations and warranties that do not contain a materiality qualification, be true and correct in all material respects on and as of the date of such Borrowing, in each case with the same force and effect as if such representations and warranties had been made on and as of such date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects (or in the case of such representations and warranties that contain a materiality qualification, in all respects) as of such earlier date, and except that for purposes of this Section 4.2, the representations and warranties contained in Section 5.2 shall be deemed to refer to the most recent statements furnished pursuant to Section 6.1(a) and (b), respectively; and

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(e) Availability Under Revolving Credit Facility. With respect to any request for a Credit Extension under the Commitments, immediately after giving effect to the Credit Extension so requested, the total Revolving Credit Exposure of the Lenders shall not exceed the lesser of (i) the Borrowing Base in effect as of the date of such Credit Extension and (ii) the aggregate Commitments of the Lenders in effect as of the date of such Credit Extension.

Each Credit Extension hereunder shall be deemed to be a representation and warranty by each Borrower that the conditions specified in this Section 4.2 have been satisfied on and as of the date of the applicable Credit Extension.

Article 5.

REPRESENTATIONS AND WARRANTIES

To induce Administrative Agent and Lenders to enter into this Agreement, and to make Credit Extensions hereunder, each Loan Party represents and warrants to Administrative Agent and Lenders that:

Section 5.1Entity Existence. Each Loan Party and each Subsidiary thereof (a) is duly incorporated or organized, as the case may be, validly existing, and in good standing under the Laws of the jurisdiction of its incorporation or organization; (b) has all requisite power and authority to own its assets and carry on its business as now being or as proposed to be conducted; and (c) is qualified to do business in all jurisdictions in which the nature of its business makes such qualification necessary and where failure to so qualify could reasonably be expected to have a Material Adverse Effect. Each of the Loan Parties has the power and authority to execute, deliver, and perform its obligations under this Agreement and the other Loan Documents to which it is or may become a party.

Section 5.2Financial Statements; Etc. Company has delivered to Administrative Agent (a) audited financial statements of Company and its Subsidiaries as of and for the fiscal year ended December 31, 2017 and (b) unaudited consolidated and consolidating financial statements of Company and its Subsidiaries as of and for the calendar month and the portion of the fiscal year ended November 30, 2018. Such financial statements are true and correct, have been prepared in accordance with GAAP, and fairly and accurately present, on a consolidated basis, the financial condition of Company and its Subsidiaries as of the respective dates indicated therein and the results of operations for the respective periods indicated therein. Neither Company nor any of its Subsidiaries has any material contingent liabilities, liabilities for taxes, unusual forward or long-term commitments, unrealized or anticipated losses from any unfavorable commitments except as referred to or reflected in such financial statements. No Material Adverse Effect and no circumstance which could reasonably be expected to result in a Material Adverse Effect has occurred since the effective date of the financial statements referred to in this Section 5.2. All projections delivered by the Borrower Representative to Administrative Agent and Lenders have been prepared in good faith, with care and diligence and using assumptions that are reasonable under the circumstances at the time such projections were prepared and delivered to Administrative Agent and Lenders and all such assumptions are disclosed in the projections. Other than the Debt listed on Schedule 7.1 and Debt otherwise permitted by Section 7.1, Company and each Subsidiary have no Debt.

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Section 5.3Action; No Breach. The execution, delivery, and performance by each Loan Party of this Agreement and the other Loan Documents to which such Person is or may become a party and compliance with the terms and provisions hereof and thereof have been duly authorized by all requisite action on the part of such Person and do not and will not (a) violate or conflict with, or result in a breach of, or require any consent under (i) the Constituent Documents of such Person (if such Person is not a natural person), (ii) any applicable Law, rule, or regulation or any order, writ, injunction, or decree of any Governmental Authority or arbitrator, or (iii) any agreement or instrument to which such Person is a party or by which it or any of its Properties is bound or subject which could reasonably be expected to have a Material Adverse Effect, or (b) constitute a default under any such agreement or instrument which could reasonably be expected to have a Material Adverse Effect, or result in the creation or imposition of any Lien upon any of the revenues or assets of such Person.

Section 5.4Operation of Business. Each Loan Party and its Subsidiaries possesses all licenses, permits, consents, authorizations, franchises, patents, copyrights, trademarks, and trade names, or rights thereto, necessary to conduct its respective businesses substantially as now conducted and as presently proposed to be conducted, and no Loan Party or any of its Subsidiaries is in violation of any valid rights of others with respect to any of the foregoing which could reasonably be expected to have a Material Adverse Effect.

Section 5.5Litigation and Judgments. Except as specifically disclosed in Schedule 5.5 as of the date hereof, there is no action, suit, investigation, or proceeding before or by any Governmental Authority or arbitrator pending, or to the knowledge of any Loan Party after a reasonable investigation, threatened against or affecting any Loan Party or any of its Subsidiaries or against any of their Properties that could, if adversely determined, reasonably be expected to have a Material Adverse Effect. As of the Closing Date, there are no outstanding judgments against any Loan Party or any of its Subsidiaries. Since the date hereof, there has been no adverse change in the status of any matter set forth on Schedule 5.5 that, taking into account the availability of any appeals, could reasonably be expected to increase materially the likelihood of a Material Adverse Effect resulting therefrom.

Section 5.6Rights in Properties; Liens.

(a)Each Loan Party and its Subsidiaries has good and indefeasible title to or valid leasehold interests in its respective Properties, including the Properties reflected in the financial statements described in Section 5.2, and none of the Properties of any Loan Party or any of its Subsidiaries is subject to any Lien, except Permitted Liens.

(b)Schedule 5.6(b) sets forth a complete and accurate list of all real Property owned by each Loan Party and each of its Subsidiaries on the Closing Date, showing as of the date hereof the street address, county or other relevant jurisdiction, state and record owner thereof. Each Loan Party and each of its Subsidiaries has good, indefeasible and insurable fee simple title to the real Property owned by such Loan Party or such Subsidiary.

(c) Schedule 5.6(c) sets forth a complete and accurate list of all Leases under which any Loan Party or any of its Subsidiaries is the lessee on the Closing Date, showing as of the date hereof the street address, county or other relevant jurisdiction, state, lessor, lessee, expiration date and annual rental cost thereof. Each such Lease is a legal, valid and binding obligation of the lessor thereof, enforceable in accordance with its terms, except as enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other applicable Laws relating to or affecting generally the enforcement of creditors’ rights and except to the extent that availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor may be brought.

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Section 5.7Enforceability. This Agreement constitutes, and the other Loan Documents to which any Loan Party is a party, when delivered, shall constitute legal, valid, and binding obligations of such Person, enforceable against such Person in accordance with their respective terms, except as limited by Debtor Relief Laws.

Section 5.8Approvals. No authorization, approval, or consent of, and no filing or registration with, any Governmental Authority or third party (other than filings and registrations to perfect Liens) is or will be necessary for the execution, delivery, or performance by any Loan Party of this Agreement and the other Loan Documents to which such Person is or may become a party or the validity or enforceability thereof.

Section 5.9Taxes. Each Loan Party and its Subsidiaries has filed on a timely basis all Tax Returns required to be filed, including all income, franchise, employment, Property, and sales Tax Returns. Each such Tax Return is true, correct and complete in all respects. Each Loan Party and its Subsidiaries has paid all of its respective liabilities for Taxes, assessments, governmental charges, and other levies that are due and payable (whether or not shown on any Tax Return), other than Taxes, if any, set forth on Schedule 5.9, the payment of which is being contested in good faith and by appropriate proceedings and reserves for the payment of which are being maintained in accordance with GAAP. Each Loan Party knows of no pending investigation of any Loan Party or any of its Subsidiaries by any taxing authority or of any pending but unassessed tax liability of any Loan Party or any of its Subsidiaries. No claim has ever been made or is expected to be made by any Governmental Authority in a jurisdiction where any Loan Party or its Subsidiaries does not file Tax Returns that it is or may be subject to taxation by that jurisdiction. Each Loan Party and its Subsidiaries has not given or been requested to give waivers or extensions (or is or would be subject to a waiver or extension given by any other Person) of any statute of limitations relating to the payment of Taxes of each Loan Party or its Subsidiaries or for which each Loan Party or its Subsidiaries may be liable. No Loan Party or any Subsidiary thereof is, or has been party to any Tax sharing agreement, Tax allocation agreement, Tax indemnity obligation or similar written or unwritten agreement, arrangement, understanding or practice with respect to Taxes.

Section 5.10Use of Proceeds; Margin Securities. The proceeds of the Revolving Credit Borrowings shall be used by Borrowers for working capital in the ordinary course of business, capital expenditures and other general corporate purposes. No Loan Party nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulations T, U, or X of the Board of Governors of the Federal Reserve System), and no part of the proceeds of any Loan will be used to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying margin stock. No part of the proceeds of any Loan will be used directly or indirectly to fund any operations in, finance any investments or activities in or make any payments to, a Sanctioned Person, or in any other manner that will result in any violation by any Person (including any Lender, any Arranger or Administrative Agent) of any Anti-Terrorism Laws, Anti-Corruption Laws or any Sanctions.

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Section 5.11ERISA; Canadian Defined Benefit Plans.

(a)Each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application for such a letter is currently being processed by the IRS with respect thereto and, to the knowledge of each Loan Party, nothing has occurred which would prevent, or cause the loss of, such qualification. No application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan. There are no pending or, to the knowledge of any Loan Party, threatened claims, actions or lawsuits, or action by any Governmental Authority with respect to any Plan or Multiemployer Plan. There has been no Prohibited Transaction or violation of the fiduciary responsibility rules with respect to any Plan or Multiemployer Plan. No ERISA Event has occurred or is reasonably expected to occur. No Plan has any Unfunded Pension Liability. No Multiemployer Plan is insolvent within the meaning of Section 4245 of ERISA. No Loan Party or ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Plan (other than premiums due and not delinquent under Section 4007 of ERISA). No Loan Party or ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Section 4201 of ERISA with respect to a Multiemployer Plan. No Loan Party or ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA.

(b)No Loan Party sponsors, maintains, participates in, contributes to, or has otherwise incurred liability under, a Canadian Defined Benefit Plan.

Section 5.12Disclosure.

(a)No statement, information, report, representation, or warranty made by any Loan Party in this Agreement or in any other Loan Document or furnished to Administrative Agent or any Lender in connection with this Agreement or any of the transactions contemplated hereby contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements herein or therein not misleading. There is no fact known to any Loan Party which could reasonably be expected to have a Material Adverse Effect, or which might in the future could reasonably be expected to have a Material Adverse Effect that has not been disclosed in writing to Administrative Agent and each Lender.

(b)As of the Closing Date, the information included in the Beneficial Ownership Certification is true and correct in all respects.

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Section 5.13Subsidiaries. No Loan Party has any Subsidiaries other than those listed on Schedule 5.13 (and, if subsequent to the Specified Contribution Effective Date, such additional Subsidiaries have been formed or acquired in compliance with Section 6.13(a)) and Schedule 5.13 sets forth the jurisdiction of incorporation or organization of each Subsidiary and the percentage of each Loan Party’s ownership interest in such Subsidiary. Schedule 5.13 also sets forth the name and jurisdiction of incorporation or organization of Parent and the percentage of Parent’s ownership interest in Company. All of the outstanding capital stock or other Equity Interests of Parent and each Subsidiary described on Schedule 5.13 have been validly issued, are fully paid, and are nonassessable. There are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments of any nature relating to any Equity Interests of any Loan Party or any Subsidiary.

Section 5.14Agreements. No Loan Party nor any of its Subsidiaries is a party to any indenture, loan, or credit agreement, or to any lease or other agreement or instrument, or subject to any charter or corporate or other organizational restriction, in each case which could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Loan Party nor any of its Subsidiaries is in default in any respect in the performance, observance, or fulfillment of any of the obligations, covenants, or conditions contained in any agreement or instrument material to its business to which it is a party which could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 5.15Compliance with Laws. No Loan Party nor any of its Subsidiaries is in violation in any material respect of any Law, rule, regulation, order, or decree of any Governmental Authority or arbitrator.

Section 5.16Inventory. All Inventory of each Loan Party and its Subsidiaries has been and will hereafter be produced or maintained in compliance with all applicable Laws, rules, regulations, and governmental standards, including, without limitation, the minimum wage and overtime provisions of the Fair Labor Standards Act (29 U.S.C. §§ 201-219).

Section 5.17Regulated Entities. No Loan Party nor any of its Subsidiaries is (a) an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940 or (b) subject to regulation under any other federal or state statute, rule or regulation limiting its ability to incur Debt, pledge its assets or perform its obligations under the Loan Documents. No Loan Party is an Affected Financial Institution.

Section 5.18Environmental Matters.

(a)Each Loan Party and its Subsidiaries, and all of their respective Properties, assets, and operations, are in compliance with all Environmental Laws. No Loan Party is aware of, nor has any Loan Party received notice of, any past, present, or future conditions, events, activities, practices, or incidents which may interfere with or prevent the compliance or continued compliance of each Loan Party and its Subsidiaries with all Environmental Laws;

(b)Each Loan Party and its Subsidiaries has obtained all permits, licenses, and authorizations that are required under applicable Environmental Laws, and all such permits are in good standing and each Loan Party and its Subsidiaries are in compliance with all of the terms and conditions of such permits;

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(c)No Hazardous Materials exist on, about, or within, or have been used, generated, stored, transported, disposed of on, or Released from, any of the Properties or assets of any Loan Party or any of its Subsidiaries in violation of, or in a manner or to a location that could give rise to liability under, any applicable Environmental Laws. The use which each Loan Party and its Subsidiaries make and intend to make of their respective Properties and assets will not result in the use, generation, storage, transportation, accumulation, disposal, or Release of any Hazardous Material on, in, or from any of their Properties or assets in violation of, or in a manner that could give rise to liability under, any applicable Environmental Laws;

(d)No Loan Party or any of its Subsidiaries nor any of their respective currently or previously owned or leased Properties or operations is subject to any outstanding or threatened order from or agreement with any Governmental Authority or other Person or subject to any judicial or docketed administrative proceeding with respect to (i) any failure to comply with Environmental Laws, (ii) any Remedial Action, or (iii) any Environmental Liabilities arising from a Release or threatened Release;

(e)There are no conditions or circumstances associated with the currently or previously owned or leased Properties or operations of any Loan Party or any of its Subsidiaries that could reasonably be expected to give rise to any Environmental Liabilities;

(f)No Loan Party nor any of its Subsidiaries is a treatment, storage, or disposal facility requiring a permit under the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq., regulations thereunder or any comparable provision of state Law. Each Loan Party and its Subsidiaries are in compliance with all applicable financial responsibility requirements of all Environmental Laws;

(g)No Loan Party nor any of its Subsidiaries has filed or failed to file any notice required under applicable Environmental Law reporting a Release; and

(h)No Lien arising under any Environmental Law has attached to any Property or revenues of any Loan Party or any of its Subsidiaries.

Section 5.19Intellectual Property. Each Loan Party and each of its Subsidiaries owns, or is licensed to use, all Intellectual Property necessary to conduct its business as currently conducted except for such Intellectual Property the failure of which to own or license could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 5.20Anti-Corruption Laws; Sanctions; Etc.

(a)No Loan Party, Subsidiary, Affiliate of any Loan Party or, to the knowledge of any Loan Party, any director, officer, employee, agent, or Affiliate of a Loan Party or any of its Subsidiaries is an individual or entity (“person”) that is, or is owned or Controlled by persons that are: (i) the subject of any Sanctions, or (ii) located, organized or resident in a country or territory that is, or whose government is, the subject of Sanctions (including, Crimea, Cuba, Iran, North Korea, Sudan and Syria).

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(b)The Loan Parties, their Subsidiaries and their respective directors, officers and employees and, to the knowledge of the Loan Parties, the agents of the Loan Parties and their Subsidiaries, are in compliance with all applicable Sanctions and with the FCPA and any other applicable Anti-Corruption Law, in all material respects. Each Loan Party and its Subsidiaries have instituted and maintain policies and procedures designed to promote and achieve continued compliance with applicable Sanctions, the FCPA and any other applicable Anti-Corruption Laws.

Section 5.21Patriot Act; Canadian AML Legislation. The Loan Parties, each of their Subsidiaries, and each of their Affiliates are in compliance with (a) the Trading with the Enemy Act, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B Chapter V, as amended), and all other enabling legislation or executive order relating thereto, (b) the Patriot Act, (c) Canadian AML Legislation and (d) all other federal or state Laws relating to “know your customer” (collectively, the “Anti-Terrorism Laws”).

Section 5.22Insurance. The Properties of each Loan Party and its Subsidiaries are insured with financially sound and reputable insurance companies not Affiliates of any Loan Party, in such amounts (after giving effect to any self-insurance compatible with the following standards), with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar Properties in localities where such Loan Party or the applicable Subsidiary operates.

Section 5.23Solvency. After giving effect to the transactions contemplated hereby (including each Credit Extension hereunder), (a) the aggregate assets (after giving effect to amounts that could reasonably be received by reason of indemnity, offset, insurance or any similar arrangement), at a fair valuation, of the Loan Parties, taken as a whole, will exceed the aggregate liabilities of the Loan Parties on a consolidated basis, as their liabilities become absolute and mature, (b) each of the Loan Parties will not have incurred or intended to incur, and will not believe that it will incur, liabilities beyond its ability to pay such liabilities (after taking into account the timing and amounts of cash to be received by each of the Loan Parties and the amounts to be payable on or in respect of its liabilities, and giving effect to amounts that could reasonably be received by reason of indemnity, offset, insurance or any similar arrangement) as such liabilities become absolute and mature, and (c) each of the Loan Parties will not have (and will have no reason to believe that it will have thereafter) unreasonably small capital for the conduct of its business.

Section 5.24Security Documents. The provisions of the Security Documents are effective to create in favor of Administrative Agent for the benefit of the Secured Parties a legal, valid and enforceable Lien (subject to Permitted Liens) on all right, title and interest of the respective Loan Parties party thereto in the Collateral. Except for filings completed prior to the Closing Date and as contemplated hereby and by the Security Documents, no filing or other action will be necessary to perfect such Liens in Collateral.

Section 5.25Labor Matters. There are no labor controversies pending, or to the best knowledge of any Loan Party, threatened against any Loan Party or any of its Subsidiaries which could reasonably be expected to have a Material Adverse Effect.

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Section 5.26Material Agreements. Schedule 5.26 sets forth a complete and correct list of all agreements in effect or to be in effect on the Closing Date and on the date of each update thereof required hereunder, to the extent that a default, breach, termination or other impairment thereof could reasonably be expected to have a Material Adverse Effect.

Section 5.27Additional Representations of Guarantors. Each Guarantor (a) has received, or will receive, direct or indirect benefit from the making of the Guaranty and the Obligations, and (b) is familiar with, and has independently reviewed the books and records regarding, the financial condition of Borrowers and is familiar with the value of any and all Collateral intended to be created as security for the payment of the Obligations, but such Guarantor is not relying on such financial condition, such Collateral, or the agreement of any other party as an inducement to enter into this Agreement and provide the Guaranty. Each Guarantor confirms that neither Administrative Agent, any Lender, any other Guarantor, nor any other party has made any representation, warranty or statement to such Guarantor in order to induce such Guarantor to execute this Agreement and provide the Guaranty.

Section 5.28Qualified ECP Guarantor. Each Borrower is a Qualified ECP Guarantor.

Article 6.

AFFIRMATIVE COVENANTS

Each Loan Party covenants and agrees that, as long as the Obligations or any part thereof are outstanding or any Letter of Credit shall remain outstanding or any Lender has any Commitment hereunder:

Section 6.1Reporting Requirements. Borrowers will furnish, or cause to be furnished, to Administrative Agent (with copies for each Lender upon Administrative Agent’s request):

(a)Annual Financial Statements. As soon as available, and in any event within one hundred twenty (120) days after the last day of each fiscal year of Company, a copy of the annual audit report of Company and its Subsidiaries for such fiscal year containing, on a consolidated basis, balance sheets and statements of income, retained earnings, and cash flow as of the end of such fiscal year and for the twelve (12)-month period then ended, in each case (other than for the fiscal year ending December 31, 2020) setting forth in comparative form the figures for the preceding fiscal year, all in reasonable detail and audited and certified by independent certified public accountants of recognized standing acceptable to Administrative Agent, to the effect that such report has been prepared in accordance with GAAP and containing no material qualifications or limitations on scope;

(b)Interim Financial Statements. (i) At any time prior to and after the consummation of a Qualified IPO, as soon as available, and in any event within thirty (30) days after the last day of each fiscal month, and (ii) at any time on or after the consummation of a Qualified IPO, as soon as available, and in any event within fifty (50) days after the last day of each fiscal quarter (or, if earlier, on the date on which the Parent’s quarterly financial statements are required to be filed with the SEC after giving effect to any permitted extensions pursuant to Rule 12b-25 under the Exchange Act)), in either case, a copy of an unaudited financial report of Company and its Subsidiaries as of the end of such month or fiscal quarter, as applicable, and for the portion of the fiscal year then ended, containing, on a consolidated basis, respectively, balance sheets and statements of income, retained earnings, and cash flow, in each case setting forth in comparative form and figures for the corresponding period of the preceding fiscal year, all in reasonable detail certified by a Responsible Officer of Company to have been prepared in accordance with GAAP and to fairly and accurately present (subject to year-end audit adjustments) the financial condition and results of operations of Company and its Subsidiaries, on a consolidated basis, as of the dates and for the periods indicated therein;

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(c)Borrowing Base Report. As soon as available (or contemporaneously with a Disposition of Generator Packages, Generator Units or Field Units pursuant to Section 7.8(f)), and in any event within twenty (20) days after the last day of each fiscal month, a Borrowing Base Report, calculating the Borrowing Base and reflecting the components of the Borrowing Base, including (i) Eligible Accounts of each of the Borrowers as of the end of the preceding month and calculating the advance amounts based thereon, together with the Account Agings, (ii) Eligible Inventory, Eligible Generator Units, Eligible New Generator Units, and Eligible Field Units of each of the Borrowers as of the end of the preceding month and calculating the advance amounts based thereon and (iii) such worksheets detailing the Accounts excluded from Eligible Accounts and Inventory (including Generator Units and Field Units) excluded from Eligible Inventory, Eligible Generator Units, Eligible New Generator Units and Eligible Field Units, as the case may be, and the reason for such exclusion; provided that if a Trigger Period is in effect, a Borrowing Base Report and related documentation shall be due on or before the third (3rd) Business Day of each week (or contemporaneously with a Disposition of Generator Packages, Generator Units or Field Units pursuant to Section 7.8(f) during a Trigger Period) calculating the Borrowing Base and reflecting the Eligible Accounts, the Eligible Inventory, Eligible Generator Units, Eligible New Generator Units and Eligible Field Units of each of the Borrowers as of the end of the preceding week and calculating the advance amounts based thereon. Such report shall also reflect the amount of sales and receipts of Borrowers during the preceding period and such other information as Administrative Agent may reasonably request;

(d)Compliance Certificate. Concurrently with the delivery of each of the financial statements referred to in Section 6.1(a) and each of the financial statements delivered for each fiscal quarter or the last month of each fiscal quarter pursuant to Section 6.1(b), as applicable, a Compliance Certificate (i) certifying, in the case of the financial statements delivered under Sections 6.1(a) and 6.1(b), as applicable, that such statements present fairly in all material respects the financial condition and results of operations of Company and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes, (ii) stating that to the best of the knowledge of the Responsible Officer executing same, no Default has occurred and is continuing, or if a Default has occurred and is continuing, a statement as to the nature thereof and the action which is proposed to be taken with respect thereto, (iii) showing in reasonable detail the calculations demonstrating compliance with the covenants set forth in Article 8 and calculation of the Leverage Ratio for purposes of calculating the Applicable Margin, (iv) stating whether any change in GAAP or in the application thereof has occurred since the date of the audited financial statements most recently delivered pursuant to Section 6.1(a) above and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such certificate and (v) containing such other certifications set forth therein. For any financial statements delivered electronically by a Responsible Officer in satisfaction of the reporting requirements set forth in clause (a) or (b) preceding that are not accompanied by the required Compliance Certificate, that Responsible Officer shall nevertheless be deemed to have certified the factual matters described in this clause (d) with respect to such financial statements; however, such deemed certificate shall not excuse or be construed as a waiver of Company’s obligation to deliver the required Compliance Certificate;

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(e)Projections. Commencing with respect to the fiscal year ending December 31, 2019, as soon as available, but in any event not earlier than thirty (30) days before and not later than thirty (30) days after the end of each fiscal year of Company, forecasts prepared by management of Company, in form and substance satisfactory to Administrative Agent, of consolidated balance sheets of income or operations and cash flows of Company and its Subsidiaries on a monthly basis for the immediately following fiscal year;

(f)Notice of Litigation. Promptly after the commencement thereof, notice of all actions, suits, and proceedings before any Governmental Authority or arbitrator affecting any Loan Party or any of its Subsidiaries which, if determined adversely to such Loan Party or such Subsidiary, could reasonably be expected to have a Material Adverse Effect;

(g)Notice of Default. As soon as possible and in any event within five (5) days after the occurrence of any Default, a written notice setting forth the details of such Default and the action that the applicable Loan Party has taken and proposes to take with respect thereto;

(h)ERISA Reports. Promptly after the filing or receipt thereof, copies of all reports, including annual reports, and notices which any Loan Party or ERISA Affiliate files with or receives from the PBGC, the IRS, or the U.S. Department of Labor under ERISA; as soon as possible and in any event within five (5) days after any Loan Party or any ERISA Affiliate knows or has reason to know that any ERISA Event or Prohibited Transaction has occurred with respect to any Plan or Multiemployer Plan, a certificate of the chief financial officer or other Responsible Officer of the applicable Loan Party setting forth the details as to such ERISA Event or Prohibited Transaction and the action that the applicable Loan Party proposes to take with respect thereto; annually, a copy of the notice described in Section 101(f) of ERISA that any Loan Party or ERISA Affiliate files or receives with respect to a Plan or Multiemployer Plan;

(i) Updates to Security Document Schedules. Upon Administrative Agent’s request, at the time of delivery of the Compliance Certificate delivered in connection with the financial statements pursuant to Sections 6.1(a) and 6.1(b), updates to all Schedules to the Security Documents to the extent that information contained in such Schedules has become inaccurate or incomplete since delivery thereof and such Schedules are required to be updated from time to time pursuant to the terms of the applicable Security Document;

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(j)Insurance. Upon Administrative Agent’s request, at the time of delivery of the Compliance Certificate delivered in connection with the annual financial statements pursuant to Section 6.1(a), a report summarizing the insurance coverage (specifying type, amount and carrier) in effect for each Loan Party and its Subsidiaries and containing such additional information as Administrative Agent, or any Lender through Administrative Agent, may reasonably specify;

(k)Notice of Material Adverse Effect. As soon as possible and in any event within five (5) days after the occurrence thereof, written notice of any event or circumstance that could reasonably be expected to have a Material Adverse Effect;

(l) Account Agings. As soon as available and in any event within twenty (20) days (or earlier if a Trigger Period is in effect or if deemed necessary by Administrative Agent in its sole discretion) after the end of each fiscal month, consolidated and consolidating agings of all accounts payable and accounts receivable of the Borrowers (the “Account Agings”) showing each such account which is current and each such account which is thirty (30), sixty (60), ninety (90), and over ninety (90) days past invoice date and, with respect to accounts receivable, reconciling such aging with the Borrowing Base Reports;

(m)Inventory Report(s). As soon as available and in any event within twenty (20) days after the end of each calendar month (or earlier if a Trigger Period is in effect or if deemed necessary by Administrative Agent in its sole discretion), an Inventory perpetual report for the Borrowers and a schedule that lists Inventory (including Generator Units and Field Units) by item, quantity, cost, location, customer, utilization, leased or rented out or held for lease or rent, appraised or not appraised in most recent appraisal, and eligible or ineligible as Eligible Inventory;

(n)Monthly Customer Statements. If requested by Administrative Agent, as soon as available and in any event within twenty (20) days (or earlier to the extent available and a Trigger Period is then in effect) after the end of each fiscal month, monthly customer statements of the Borrowers;

(o)Notice of Certain Changes. Promptly, (i) notice of any change in the business conducted by any Loan Party or any of its Subsidiaries, (ii) copies of any amendment, restatement, supplement or other modification to any of the Constituent Documents of any Loan Party or any of its Subsidiaries and (iii) notice of any change in the information provided in the Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified in parts (c) or (d) of such certification;

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(p) Management Letters. Promptly upon receipt thereof, a copy of any management letter or written report submitted to Company or any of its Subsidiaries by independent certified public accountants with respect to the business, condition (financial or otherwise), operations, prospects, or Properties of Company or any of its Subsidiaries;

(q)General Information. Promptly, such other information concerning any Loan Party, any of its Subsidiaries or any of their respective Properties as Administrative Agent, or any Lender through Administrative Agent, may from time to time request, including, without limitation, any certification or other evidence Administrative Agent requests in order for it to (i) comply with any applicable federal, state, provincial or territorial Laws or regulations (including, but not limited to, information about the ownership and management of any Loan Party), (ii) confirm compliance by any Loan Party with all Anti-Terrorism Laws, and (iii) confirm that no Loan Party (nor any Person owning any interest of any nature whatsoever in any Loan Party) is a Sanctioned Person;

(r)Quarterly Financial Statements. As soon as available, and in any event within sixty (60) days after the last day of each fiscal quarter of FlexEnergy, a copy of an unaudited financial report of FlexEnergy and its Subsidiaries as of the end of such quarter and for the portion of the fiscal year then ended, containing, on a consolidated basis, respectively, balance sheets and statements of income, retained earnings, and cash flow, in each case setting forth in comparative form and figures for the corresponding period of the preceding fiscal year, all in reasonable detail and prepared in accordance with GAAP and to fairly and accurately present (subject to year-end audit adjustments) the financial condition and results of operations of FlexEnergy and its Subsidiaries, on a consolidated basis, as of the dates and for the periods indicated therein; and

(s)Additional Information. If requested by Administrative Agent, (i) cash receipt journals or copies of checks, invoices for new billings, sales journals and backup for all miscellaneous credits and debits, purchases journals and cost of goods sold reports and inventory reports, which support a Borrowing Base report, (ii) a schedule detailing each Borrower’s Inventory, in form satisfactory to Administrative Agent, (A) by location (showing Inventory in transit and any Inventory located with a third party under any consignment, bailee arrangement or warehouse agreement), by product type (including Generator Units or Field Units), and by volume on hand, which Inventory shall be valued at the lower of cost or market (which approximates cost) and adjusted for Availability Reserves as Administrative Agent has previously indicated to the Borrowers are deemed by Administrative Agent to be appropriate, and (B) including a report of any variances or other results of Inventory counts performed by the Borrowers since the last Inventory schedule (including information regarding sales or other reductions, additions, returns, credits issued by the Borrowers and complaints and claims made against any Borrower) and (iii) a status report regarding each uptime energy, servicing or lease agreement covering any Generator Unit or Field Units, including whether such uptime energy, servicing or lease agreement has been amended, restated, modified or terminated during such period and delivering a copy of any new uptime energy, servicing or lease agreement or any amendment, modification or termination of any uptime energy, servicing or lease agreement.

All representations and warranties set forth in the Loan Documents with respect to any financial information concerning any Loan Party shall apply to all financial information delivered to Administrative Agent by such Loan Party, or any Person purporting to be a Responsible Officer of such Loan Party or other representative of such Loan Party regardless of the method of such transmission to Administrative Agent or whether or not signed by such Loan Party, or such Responsible Officer or other representative, as applicable.

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Section 6.2Maintenance of Existence; Conduct of Business. Each Loan Party shall, and shall cause each of its Subsidiaries to, preserve and maintain its existence and all of its leases, privileges, licenses, permits, franchises, qualifications, and rights that are necessary or desirable in the ordinary conduct of its business, except to the extent a failure to so preserve and maintain could not reasonably be expected to have a Material Adverse Effect. Each Loan Party shall, and shall cause each of its Subsidiaries to, conduct its business in an orderly and efficient manner in accordance with good business practices.

Section 6.3Maintenance of Properties. Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain, keep, and preserve all of its Properties (tangible and intangible) necessary or useful in the proper conduct of its business in good working order and condition (reasonable wear and tear excepted).

Section 6.4Taxes and Claims. Each Loan Party shall, and shall cause each of its Subsidiaries to, pay or discharge at or before maturity or before becoming delinquent (a) all Taxes, levies, assessments, and governmental charges imposed on it or its income or profits or any of its Property, and (b) all lawful claims for labor, material, and supplies, which, if unpaid, might become a Lien upon any of its Property; provided, however, that no Loan Party nor any of its Subsidiaries shall be required to pay or discharge any Tax, levy, assessment, or governmental charge which is being contested in good faith by appropriate proceedings diligently pursued, and for which adequate reserves in accordance with GAAP have been established.

Section 6.5Insurance. Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain insurance with financially sound and reputable insurance companies satisfactory to Administrative Agent in such amounts and covering such risks as is usually carried by companies engaged in similar businesses and owning similar Properties in the same general areas in which such Loan Party and its Subsidiaries operate, provided that in any event each Loan Party will maintain and cause each of its Subsidiaries to maintain workmen’s compensation insurance, property insurance and comprehensive general liability insurance with coverage amounts and deductibles reasonably satisfactory to Administrative Agent. Each insurance policy shall name Administrative Agent as lender loss payee or additional insured, as applicable, and each such insurance policy shall provide that such policy will not be cancelled or reduced without 30 days’ prior written notice to Administrative Agent (or 10 days in the case of nonpayment of premium).

Section 6.6Inspection Rights; Field Examinations; Appraisals.

(a)Each Loan Party shall, and shall cause each of its Subsidiaries to, permit representatives and independent contractors of Administrative Agent and each Lender (i) to examine, inspect, review, evaluate and make physical verifications of the Inventory (including Generator Units and Field Units) and other Collateral in any manner and through any medium that Administrative Agent or such Lender considers advisable, (ii) to visit and inspect its Properties, (iii) to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom and (iv) to discuss its affairs, business, operations, financial condition and accounts with its directors, officers, employees and independent certified public accountants, all at the expense of Borrowers and at such reasonable times during normal business hours and as often as may be reasonably requested; provided that, other than with respect to such visits and inspections during the continuance of an Event of Default, (A) only Administrative Agent on behalf of the Lenders may exercise rights under this clause (a) and (B) subject to Section 6.6(c), Administrative Agent shall not exercise such rights more often than one time during any period of twelve (12) consecutive months; provided, further, that when an Event of Default exists Administrative Agent or any Lender (or any of their respective representatives or independent contractors) may do any of the foregoing under this Section at the expense of Borrowers and at any time during normal business hours and without advance notice.

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(b)Each Loan Party shall, and shall cause each of its Subsidiaries to, permit any representatives designated by Administrative Agent (including any consultants, accountants, lawyers and appraisers retained by Administrative Agent) to conduct field exams of the Accounts of the Loan Parties all at the expense of Borrowers and at such reasonable times; provided that Borrowers shall not be required to pay for more than one such field exam in any period of twelve (12) consecutive months unless an Event of Default has occurred and is continuing (in which case any limit of the number of field exams Administrative Agent may conduct shall not apply and any such field exams conducted when an Event of Default has occurred and is continuing shall be at the sole cost and expense of Borrowers).

(c)Each Loan Party shall, and shall cause each of its Subsidiaries to, permit any representatives designated by Administrative Agent (including any consultants, accountants, lawyers and appraisers retained by Administrative Agent) to conduct third-party appraisals or updates thereof of the Inventory (including Generator Units and Field Units) owned by the Loan Parties, all at the expense of Borrowers and at such reasonable times; provided that Borrowers shall not be required to pay for more than two such third-party appraisals in any period of twelve (12) consecutive months unless an Event of Default has occurred and is continuing (in which case any such third-party appraisal conducted when an Event of Default has occurred and is continuing shall be at the sole cost and expense of Borrowers).

Section 6.7Keeping Books and Records. Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain proper books of record and account in which full, true, and correct entries in conformity with GAAP shall be made of all dealings and transactions in relation to its business and activities.

Section 6.8Compliance with Laws. Each Loan Party shall, and shall cause each of its Subsidiaries to, comply in all material respects with all applicable Laws (including, without limitation, all Anti-Terrorism Laws, Anti-Corruption Laws and applicable Sanctions) and decrees of any Governmental Authority or arbitrator.

Section 6.9Compliance with Agreements. Each Loan Party shall, and shall cause each of its Subsidiaries to, comply in all material respects with all agreements, contracts, and instruments binding on it or affecting its Properties or business, except to the extent a failure to so comply could not reasonably be expected to have a Material Adverse Effect.

Section 6.10Further Assurances. Each Loan Party shall, and shall cause each of its Subsidiaries and each other Loan Party to, execute and deliver such further agreements and instruments and take such further action as may be reasonably requested by Administrative Agent or any Lender to carry out the provisions and purposes of this Agreement and the other Loan Documents and to create, preserve, and perfect the Liens of Administrative Agent in the Collateral.

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Section 6.11ERISA. Each Loan Party shall, and shall cause each of its Subsidiaries to, comply with all minimum funding requirements, and all other material requirements, of ERISA and the Code, if applicable, so as not to give rise to any liability thereunder.

Section 6.12Depository Relationship; Control Agreements; Blocked Accounts. Within sixty (60) days after the Closing Date (or such longer period as agreed to by Administrative Agent in its sole discretion), each Loan Party shall, and shall cause each of its Subsidiaries to, (a) use the financial institution serving as Administrative Agent as its principal depository bank, including for the maintenance of business, cash management, operating and administrative deposit accounts, (b) cause all commodity accounts, deposit accounts and securities accounts (in each case, excluding those accounts which are Excluded Accounts) to be subject to a Control Agreement in favor of Administrative Agent, in form and substance reasonably satisfactory to Administrative Agent, which provides that Administrative Agent shall have exclusive “Control” (as defined in the UCC) of such account and (c) will cause all collection and other Receipts to be directed to Blocked Accounts in accordance with Section 2.11. Loan Parties will at all times maintain Blocked Accounts required by Section 2.11.

Section 6.13Additional Loan Parties; Additional Collateral.

(a)Each Loan Party shall notify Administrative Agent at the time that any Person becomes a Subsidiary of such Loan Party, and promptly thereafter (and in any event within thirty (30) days (or such longer period as agreed to by Administrative Agent in its sole discretion)) (i) execute and deliver or cause to be delivered to Administrative Agent all Security Documents, stock certificates, stock powers and other agreements and instruments as may be requested by Administrative Agent to ensure that Administrative Agent has a perfected Lien on all ownership interests (other than Excluded Assets) held by such Loan Party in such Subsidiary, and (ii) cause such new Subsidiary to (A) become a Guarantor and/or a Borrower by executing and delivering to Administrative Agent a Guaranty (or a joinder to Guaranty) and/or a Joinder Agreement, (B) execute and deliver all Security Documents (or joinders or assumptions thereto) requested by Administrative Agent pledging to Administrative Agent for the benefit of the Secured Parties all of its Property (other than Excluded Assets or such other exceptions as Administrative Agent may permit) and take all actions required by Administrative Agent to grant to Administrative Agent for the benefit of Secured Parties a perfected first priority (subject to Permitted Liens) security interest in such Property, including the filing of UCC and/or PPSA financing statements in such jurisdictions as may be requested by Administrative Agent, and (C) deliver to Administrative Agent such other documents and instruments as Administrative Agent may require, including appropriate favorable opinions of counsel to such Person in form, content and scope reasonably satisfactory to Administrative Agent.

(b)Company will at all times cause Parent or any other holder of the direct Equity Interests in Company to be a party to the Parent Pledge Agreement and pledge 100% of the Equity Interests in Company that such Person owns (including, to the extent such Equity Interests are certificated, delivery of original stock certificates evidencing such Equity Interests, together with an appropriate undated membership power for each certificate duly executed in blank by the registered owner thereof).

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(c)Each Loan Party will cause 100% of the issued and outstanding Equity Interests of each of its Subsidiaries to be subject at all times to a first priority, perfected Lien in favor of the Administrative Agent, for the benefit of the Administrative Agent and the other Secured Parties, pursuant to the terms and conditions of the Loan Documents or other Security Documents as Administrative Agent shall reasonably request.

(d)Company will at all times cause Canadian Borrower to be a party to the Canadian Security Agreement.

Section 6.14Inventory; Collateral Access Agreements. If any Loan Party’s Inventory is located at a location leased by such Loan Party or in the possession or control of any Person (other than a customer of such Loan Party), the Borrower Representative shall notify the landlord or such Person, as applicable, of Administrative Agent’s security interest therein and, upon request by Administrative Agent, instruct such Person to execute a Collateral Access Agreement or otherwise acknowledge in writing its agreement to hold all such Inventory for the benefit of Administrative Agent and subject to Administrative Agent’s instructions; provided that if the Borrower Representative is unable to have such Person execute a Collateral Access Agreement, then such failure shall not constitute a Default or Event of Default under this Agreement, but Administrative Agent may establish a Rent Reserve. If so requested by Administrative Agent, the Borrower Representative and such other Loan Parties (as promptly as possible after requested by Administrative Agent but in any event within five (5) Business Days after any such request is made) will deliver (i) to Administrative Agent warehouse receipts covering any Loan Party’s Inventory located in warehouses showing Administrative Agent as the beneficiary thereof and (ii) to the warehouseman such agreements relating to the release of warehouse Inventory as Administrative Agent may reasonably request.

Section 6.15Certificates of Title. The Loan Parties shall (a) cause Administrative Agent to be named as lienholder on all of their (i) Generator Units that are evidenced by a certificate of title, (ii) New Generator Units acquired after the Closing Date that are evidenced by a certificate of title and (iii) Field Units that are evidenced by a certificate of title, in each case, in accordance with Section 4.3(d) of the U.S. Security Agreement and (b) identify the location and serial numbers or vehicle identification numbers of any Generator Units, New Generator Units and Field Units that are serial number goods on and after the Third Amendment Effective Date, in each case in accordance with Section 3.4 of the Canadian Security Agreement.

Section 6.16Sanctions; Anti-Corruption Laws. Each Loan Party will maintain in effect policies and procedures designed to promote compliance by such Loan Party, its Subsidiaries, and their respective directors, officers, employees, and agents with applicable Sanctions and with the FCPA and any other applicable Anti-Corruption Laws.

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Section 6.17Post-Closing Obligations.

(a)Within thirty (30) days following the Closing Date (or such longer period as agreed to by the Administrative Agent in its sole discretion), the Loan Parties shall deliver (or cause to be delivered) to the Administrative Agent copies of all lender loss payable and additional insured endorsements with respect to the insurance policies required pursuant to Section 6.5.

(b)Within thirty (30) days following the Closing Date (or such longer period as agreed to by the Administrative Agent in its sole discretion), the Loan Parties shall deliver (or cause to be delivered) to the Administrative Agent (i) Certificate No. 1 issued to Company evidencing 3,000 shares of Common Shares of Flex Power Co., (ii) an undated stock power executed in blank by a Responsible Officer of Company with respect to such stock certificate, (iii) Certificate No. 2AC issued to Flex Power Co. evidencing 65 shares of Class A Common Shares of Canadian Borrower and (iv) an undated stock power executed in blank by a Responsible Officer of Flex Power Co. with respect to such stock certificate.

For the avoidance of doubt, the Loan Parties’ failure to comply with any requirement of this Section 6.17 on or before the dates specified in this Section 6.17 shall constitute an immediate Event of Default.

Article 7.

NEGATIVE COVENANTS

Each Loan Party covenants and agrees that, as long as the Obligations or any part thereof are outstanding or any Letter of Credit is outstanding or any Lender has any Commitment hereunder:

Section 7.1Debt. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, incur, create, assume, or permit to exist any Debt, except:

(a)the Obligations (other than Hedge Obligations);

(b)existing Debt described on Schedule 7.1;

(c)purchase money Debt and Capitalized Lease Obligations not to exceed $2,500,000 in the aggregate at any time outstanding;

(d)(i) Debt of any Loan Party owing to any other Loan Party, (ii) Debt of any Subsidiary that is not a Guarantor owing to any other Subsidiary that is not a Guarantor, and (iii) Debt of any Subsidiary that is not a Guarantor owing to any Loan Party that is permitted under Section 7.5;

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(e)Debt owed to any Person providing workers’ compensation, health, disability or other employee benefits or property, casualty or liability insurance, performance, bid, surety or appeal bonds, performance and completion guarantees and similar obligations, pursuant to reimbursement or indemnification obligations to such Person, in each case incurred in the ordinary course of business;

(f)endorsements of negotiable or similar instruments for collection or deposit in the ordinary course of business;

(g)with respect to any Debt permitted to be incurred pursuant to this Section 7.1, guaranties of such Debt or guaranties by any Loan Party or any of its Subsidiaries of such Debt;

(h)Debt incurred in the ordinary course of business owed to any Person providing property, casualty, liability, or other insurance to the Loan Parties, including to finance insurance premiums, so long as the amount of such Debt is not in excess of the amount of the unpaid cost of, and shall be incurred only to defer the cost of, such;

(i)Hedge Obligations existing or arising under Hedge Agreements permitted by Section 7.17; and

(j)other Debt not to exceed $2,500,000 in the aggregate at any time outstanding.

Section 7.2Limitation on Liens. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, incur, create, assume, or permit to exist any Lien upon any of its Property, assets, or revenues, whether now owned or hereafter acquired, except:

(a)existing Liens disclosed on Schedule 7.2;

(b)Liens in favor of the Secured Parties or Administrative Agent for the benefit of Secured Parties;

(c)encumbrances consisting of minor easements, zoning restrictions, or other restrictions on the use of real Property that do not (individually or in the aggregate) materially affect the value of the assets encumbered thereby or materially impair the ability of any Loan Party or its Subsidiaries to use such assets in their respective businesses, and none of which is violated in any material respect by existing or proposed structures or land use;

(d)Liens for taxes, assessments, or other governmental charges which are not delinquent or which are being contested in good faith and for which adequate reserves in accordance with GAAP have been established and for which such contest operates to suspend the enforcement of any foreclosure or levy on any Property of each Loan Party or any of its Subsidiary;

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(e) Liens of landlords, vendors, mechanics, materialmen, warehousemen, carriers, or other similar statutory Liens securing obligations incurred in the ordinary course of business that are not yet due or which are being contested in good faith and for which adequate reserves in accordance with GAAP have been established and for which such contest operates to suspend the enforcement of any foreclosure or levy on any Property of each Loan Party or any of its Subsidiaries;

(f)Liens resulting from good faith deposits to secure payments of workmen’s compensation, unemployment insurance or other social security programs (other than Liens imposed by ERISA) or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, contracts (other than for payment of Debt), or leases made in the ordinary course of business;

(g)normal and customary rights of setoff upon deposits in favor of depository institutions, and Liens of a collecting bank on payment items in the course of collection;

(h)purported Liens evidenced by the filing of precautionary UCC or PPSA financing statements relating solely to operating leases or consignments of personal property entered into in the ordinary course of business;

(i)Liens granted in the ordinary course of business on the unearned portion of insurance premiums securing the financing of insurance premiums to the extent the financing is permitted under Section 7.1(h);

(j)purchase money Liens on specific Property to secure Debt used to acquire such Property and Liens securing Capitalized Lease Obligations with respect to specific leased Property, in each case to the extent permitted in Section 7.1(c); and

(k)other Liens securing Debt not to exceed $500,000 in the aggregate at any time outstanding.

Nothing in this Section 7.2 shall in and of itself cause the obligations of the Loan Parties to the Secured Parties under or pursuant to the Loan Documents to be subordinated to any Lien permitted by this Section 7.2 or cause any Liens in favor of the Secured Parties to rank subordinate to any such permitted Liens.

Section 7.3Mergers, Etc. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, become a party to a division, merger, amalgamation or consolidation, or purchase or otherwise acquire all or substantially all of the assets of any Person or any shares or other evidence of beneficial ownership of any Person, or wind-up, dissolve, or liquidate, except that (a) any Subsidiary of Company may merge, amalgamate or consolidate with any Borrower so long as such Borrower is the surviving entity, (b) any Subsidiary of Company may merge, amalgamate or consolidate with another Subsidiary so long as if such Subsidiary that is a Guarantor is involved in such merger, amalgamation or consolidation, such Guarantor is the surviving entity and (c) any Person may merge, amalgamate or consolidate with or into any Loan Party provided such Loan Party shall be the surviving entity.

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Section 7.4Restricted Payments. Each Loan Party shall not, nor shall it permit any of its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment, except:

(a)each Loan Party may make Restricted Payments with respect to its Equity Interests payable solely in additional shares of its Equity Interests (other than Disqualified Equity Interests);

(b)Subsidiaries may declare and pay dividends and other Restricted Payments, directly or indirectly, to Company and any other Subsidiary of Company that is a Loan Party;

(c)so long as no Default or Event of Default exists or would result therefrom, the Company may make Permitted Tax Distributions to the Parent;

(d)so long as no Default or Event of Default exists or would result therefrom, the Company may make Restricted Payments to allow the Parent or Ultimate Parent, as applicable, to pay Qualified IPO Expenses in an aggregate amount not to exceed (i) $1,672,603.11 during the period commencing on July 9, 2020 through (but not including) the Fifth Amendment Effective Date and (ii) $400,000 during the period commencing on the Fifth Amendment Effective Date through and including February 28, 2022; and

(e)commencing January 1, 2020, the Loan Parties and their Subsidiaries may make other Restricted Payments so long as the Payment Conditions have been satisfied at the time such Restricted Payment is made.

Section 7.5Loans and Investments. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, make, hold or maintain, any advance, loan, extension of credit, or capital contribution to or investment in, or purchase any stock, bonds, notes, debentures, or other securities of, any Person, except:

(a)existing investments described on Schedule 7.5;

(b)readily marketable direct obligations of the U.S. or any agency thereof with maturities of one (1) year or less from the date of acquisition;

(c)fully insured certificates of deposit with maturities of one (1) year or less from the date of acquisition issued by either (i) any commercial bank operating in the U.S. having capital and surplus in excess of $50,000,000 or (ii) any Lender;

(d)commercial paper of a domestic issuer if at the time of purchase such paper is rated in one (1) of the two (2) highest rating categories of Standard and Poor’s Corporation or Moody’s Investors Service;

(e)investments by a Borrower or a Guarantor in another Borrower or Guarantor;

(f)investments consisting of Hedge Agreements permitted under Section 7.17;

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(g) advances or extensions of credit in the form of accounts receivable incurred and trade credit extended in the ordinary course of business;

(h)investments in securities of account debtors received pursuant to any settlement, restructuring, plan of reorganization or similar arrangement in connection with a foreclosure, bankruptcy workout or otherwise with respect to such account debtors, or upon the foreclosure or enforcement of any Lien on such securities arising in the ordinary course of business in favor of a Loan Party or its Subsidiaries;

(i)loans or advances made by a Loan Party to its employees for travel and entertainment expenses, relocation costs and similar purposes up to a maximum of $250,000 in the aggregate at any one time outstanding or, on a non-cash basis, for the purchase of Equity Interests in any Loan Party or any direct or indirect parent thereof; and

(j)other investments so long as (i) no Event of Default shall have occurred and be continuing at the time of making such investment and immediately after giving effect thereto and (ii) the aggregate amount of all such investments under this clause (j) shall not exceed $2,000,000 at any time.

Section 7.6Limitation on Issuance of Equity. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, issue, sell, assign, or otherwise Dispose of (a) any of its stock or other Equity Interests, (b) any securities exchangeable for or convertible into or carrying any rights to acquire any of its stock or other Equity Interests, (c) any option, warrant, or other right to acquire any of its stock or other Equity Interests or (d) any Disqualified Equity Interests, in each case, other than (x) to any Loan Party or another Subsidiary or (y) the issuance of any Equity Interests in the Company (other than Disqualified Equity Interests) to the Parent.

Section 7.7Transactions With Affiliates. Except with respect to the making of Restricted Payments permitted by Section 7.4, Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, enter into any transaction, including, without limitation, the purchase, sale, or exchange of Property, the rendering of any service or the payment of any management, advisory or similar fees, with any Affiliate of Company or such Subsidiary, except in the ordinary course of and pursuant to the reasonable requirements of Company’s or such Subsidiary’s business, pursuant to a transaction which is otherwise expressly permitted under this Agreement, and upon fair and reasonable terms no less favorable to Company or such Subsidiary than would be obtained in a comparable arm’s-length transaction with a Person not an Affiliate of Company or such Subsidiary; provided that on and after the Fifth Amendment Effective Date, (a) the aggregate amount of intercompany receivables owing by Affiliates of the Company to the Company or its Subsidiaries to the extent such receivables are for transactions permitted by Section 7.5 and do not otherwise constitute a sale of goods or the rendering of services that is similar to other arm’s-length transactions with a Person that is not an Affiliate of the Company or such Subsidiary shall not exceed (i) $17,700,000 at any time outstanding prior to the consummation of a Qualified IPO and (ii) $12,700,000 at any time outstanding on or after the consummation of a Qualified IPO, and (b) to the extent unreimbursed, the aggregate amount of prepaid expenses made by the Company or any of its Subsidiaries to or on behalf of any of its Affiliates shall not exceed $11,000,000 at any time outstanding. Commencing on the Fifth Amendment Effective Date, the restrictions set forth in this Section 7.7 shall not apply to any payment of any management, development and engineering service fees and any expense reimbursement payments for general and administrative services made by the Company pursuant to the Management Services Agreement (collectively, the “Management Fees”) so long as (A) the aggregate amount of such fees and expenses do not exceed an amount of $200,000 in any calendar month and (B) such fees and expenses are not at any time paid in cash and in lieu thereof are accounted for by offsetting the amount of accounts receivable owed to the Company by one or more of its Affiliates, if any. 

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Section 7.8Disposition of Assets. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly make any Disposition, except (a) Dispositions of Inventory in the ordinary course of business, (b) Dispositions, for fair value, of worn-out, surplus and obsolete equipment not necessary or useful to the conduct of business, (c) Dispositions of Equity Interests permitted by Section 7.6, (d) Dispositions of Property to any Loan Party or any Subsidiary, provided that any such Disposition involving a Subsidiary that is not a Loan Party shall be made in compliance with Sections 7.5 or 7.6, (e) the unwinding of any Hedge Agreement, (f) Dispositions of Generator Packages, Generator Units or Field Units not to exceed $8,000,000 in the aggregate in any fiscal year; provided that (i) no Default or Event of Default shall have occurred and be continuing both before and after giving effect to such Disposition, (ii) Borrowers shall concurrently with such Disposition deliver a pro forma Borrowing Base Report to Administrative Agent giving effect to such Disposition (with such Disposition, for the avoidance of doubt, calculated based on the Net Orderly Liquidation Value of such Generator Packages, Generator Units and/or Field Units at such time) and the Borrowing Base shall be adjusted immediately upon receipt of such Borrowing Base Report to reflect such Disposition, (iii) after giving effect to such Disposition, including the reduction of the Borrowing Base in accordance with the foregoing clause (ii), Availability shall be equal to or greater than $0 or the Borrowers shall make any mandatory prepayment pursuant to Section 2.9(c)(i) concurrently with such Disposition, and (iv) such Disposition shall be made for fair value and for at least 80% cash consideration or (g) other Dispositions (other than with respect to any Accounts or other Property included in the Borrowing Base at any time) not to exceed $2,000,000 in the aggregate in any fiscal year.

Section 7.9Sale and Leaseback. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, enter into any arrangement with any Person pursuant to which it leases from such Person real or personal Property that has been or is to be sold or transferred, directly or indirectly, by it to such Person.

Section 7.10Prepayment of Debt. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, make any optional or voluntary payment, prepayment, repurchase or redemption of any Debt, except the Obligations under the Loan Documents.

Section 7.11Nature of Business. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, engage in any business other than the businesses in which they are engaged as of the date hereof or businesses directly related thereto. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, make any material change in its credit collection policies if such change would materially impair the collectability of any Account, nor will it rescind, cancel or modify any Account except in the ordinary course of business.

Section 7.12Environmental Protection. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly (a) use (or permit any tenant to use) any of their respective Properties or assets for the handling, processing, storage, transportation, or disposal of any Hazardous Material in violation of, or in a manner or to a location that could give rise to liability under, any applicable Environmental Laws, (b) generate any Hazardous Material in violation of any applicable Environmental Laws, (c) conduct any activity that is likely to cause a Release or threatened Release of any Hazardous Material in violation of any applicable Environmental Laws, or (d) otherwise conduct any activity or use any of their respective Properties or assets in any manner that is likely to violate any Environmental Law or create any Environmental Liabilities for which any Loan Party or any of its Subsidiaries would be responsible.

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Section 7.13Accounting. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, change its fiscal year or make any change (a) in accounting treatment or reporting practices, except as required by GAAP and disclosed to Administrative Agent and Lenders, or (b) in tax reporting treatment, except as required by Law and disclosed to Administrative Agent and Lenders.

Section 7.14Burdensome Agreements. Each Loan Party shall not, and shall not permit any of its Subsidiaries or any other Loan Party to, enter into or permit to exist any arrangement or agreement, other than pursuant to this Agreement or any other Loan Document, which (a) directly or indirectly prohibits Company, any of its Subsidiaries or any other Loan Party from creating or incurring a Lien on any of its Property, revenues, or assets, whether now owned or hereafter acquired, (b) directly or indirectly prohibits any of its Subsidiaries or any other Loan Party to make any payments, directly or indirectly, to any other Loan Party by way of dividends, distributions, advances, repayments of loans, repayments of expenses, accruals, or otherwise or (c) in any way would be contravened by such Person’s performance of its obligations hereunder or under the other Loan Documents; provided that clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Debt permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Debt.

Section 7.15Subsidiaries. Each Loan Party shall not, directly or indirectly, form or acquire any Domestic Subsidiary unless such Loan Party complies with the requirements of Section 6.13(a), 6.13(c) and 6.13(d), as applicable. Except with respect to the existence of Canadian Borrower, no Loan Party shall form or acquire any Foreign Subsidiaries.

Section 7.16Amendments of Certain Documents. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, amend, restate, supplement or otherwise modify (a) any of their respective Constituent Documents or (b) the Management Services Agreement, in each case, in a manner adverse to the interest of the Lenders (it being understood that any expansion in the scope of expenses or increase in any fees payable to any Affiliate of the Company pursuant to the Management Services Agreement shall be deemed to be adverse to the interests of the Lenders).

Section 7.17Hedge Agreements. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, enter into any Hedge Agreement, except those that are entered into for non-speculative purposes and that are (a) Hedge Agreements entered into to hedge or mitigate risks to which such Loan Party or any Subsidiary thereof has actual exposure which have terms and conditions reasonably acceptable to Administrative Agent, and (b) other Hedge Agreements entered into in order to effectively cap, collar or exchange interest rates (from fixed to floating rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment, Debt of such Loan Party or any of its Subsidiaries limited to the principal amount of such interest-bearing liability or investment or Debt which have terms and conditions reasonably acceptable to Administrative Agent.

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Section 7.18Anti-Corruption Laws; Sanctions; Anti-Terrorism Law. Each Loan Party will not, directly or indirectly, use the proceeds of the Loans or Letters of Credit, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person, (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of the FCPA or any other applicable Anti-Corruption Law, or (b) (i) to fund any activities or business of or with any Person, or in any country or territory, that, at the time of such funding, is, or whose government is, the subject of Sanctions, or (ii) in any other manner that would result in a violation of Sanctions by any Person (including any Person participating in the Loans or Letters of Credit, whether as Administrative Agent, Arranger, Lender, underwriter, advisor, investor, or otherwise).

Section 7.19Negative Pledge. Each Loan Party shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that limits the ability of such Loan Party or Subsidiary to create, incur, assume or suffer to exist Liens on any real estate owned by such Loan Party or Subsidiary to secure the Obligations.

Section 7.20Canadian Defined Benefit Plan. No Loan Party shall sponsor, maintain, participate in, contribute to, or have or otherwise incur liability under, a Canadian Defined Benefit Plan.

Article 8.

FINANCIAL COVENANTS

Each Loan Party covenants and agrees that, as long as the Obligations or any part thereof are outstanding or any Letter of Credit is outstanding or any Lender has any Commitment hereunder:

Section 8.1Leverage Ratio. Company shall not permit the Leverage Ratio to be greater than (a) 4.00 to 1.00 as of the last day of any fiscal quarter ending March 31, 2019 through September 30, 2019 and (b) 3.50 to 1.00 as of the last day of any fiscal quarter ending on and after December 31, 2019.

Section 8.2Fixed Charge Coverage Ratio. Company shall not permit the Fixed Charge Coverage Ratio to be less than (a) 1.10 to 1.00 as of the last day of any fiscal quarter ending March 31, 2019 through September 30, 2019 and (b) 1.25 to 1.00 as of the last day of any fiscal quarter ending on and after December 31, 2019.

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Article 9.

DEFAULT

Section 9.1Events of Default. Each of the following shall be deemed an “Event of Default”:

(a)Any Loan Parties shall fail to pay the Obligations under the Loan Documents or any part thereof shall not be paid when due or declared due and, other than with respect to payments of principal, such failure shall continue unremedied for three (3) Business Days after such payment became due;

(b)Any Loan Party shall breach any provision of Sections 6.1, 6.2 (with respect to a Loan Party’s existence), 6.5, 6.12, 6.13, 6.16 or 6.17 or Article 7 or Article 8 of this Agreement;

(c)Any representation or warranty made or deemed made by Parent or any Loan Party (or any of their respective officers) in any Loan Document or in any certificate, report, notice, or financial statement furnished at any time in connection with this Agreement or any other Loan Document shall be false, misleading, or erroneous in any material respect (without duplication of any materiality qualifier contained therein) when made or deemed to have been made;

(d)Parent, Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party shall fail to perform, observe, or comply with any covenant, agreement, or term contained in this Agreement or any other Loan Document (other than as covered by Sections 9.1(a) and (b)), and such failure continues for more than thirty (30) days following the date such failure first began;

(e)Parent, Company or any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party shall commence a voluntary proceeding seeking liquidation, reorganization, or other relief with respect to itself or its debts under any bankruptcy, insolvency, or other Debtor Relief Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian, monitor or other similar official of it or a substantial part of its Property or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it or shall make a general assignment for the benefit of creditors or shall generally fail to pay its debts as they become due or shall take any corporate action to authorize any of the foregoing;

(f)An involuntary proceeding shall be commenced against Parent, Company or any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party seeking liquidation, reorganization, or other relief with respect to it or its debts under any bankruptcy, insolvency, or other Debtor Relief Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian, monitor or other similar official for it or a substantial part of its Property, and such involuntary proceeding shall remain undismissed and unstayed for a period of thirty (30) consecutive days;

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(g) Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party shall fail to pay when due any principal of or interest on any Debt (other than the Obligations under the Loan Documents) with an outstanding principal amount of $1,000,000 or more, or the maturity of any such Debt shall have been accelerated, or any such Debt shall have been required to be prepaid, repurchased, defeased or redeemed prior to the stated maturity thereof or any cash collateral in respect thereof to be demanded, or any event shall have occurred that permits (or, with the giving of notice or lapse of time or both, after any applicable cure periods, would permit) any holder or holders of such Debt, or the counterparty under any Hedge Agreement constituting such Debt, or any Person acting on behalf of such holder or holders or such counterparty to accelerate the maturity thereof or require any such prepayment, repurchase, defeasance or redemption or any cash collateral in respect thereof to be demanded;

(h)This Agreement, the Guaranty or any other Loan Document shall cease to be in full force and effect or shall be declared null and void or the validity or enforceability thereof shall be contested or challenged by the Parent, Company, any of its Subsidiaries, any other Loan Party or any Subsidiary of any Loan Party or any of their respective equity holders, or Parent or any Loan Party shall deny that it has any further liability or obligation under any of the Loan Documents, or any Lien created by the Loan Documents shall for any reason cease to be a valid, first priority perfected Lien (subject to Permitted Liens) upon any of the Collateral purported to be covered thereby;

(i)Any of the following events shall occur or exist with respect to any Loan Party or any ERISA Affiliate: (i) any ERISA Event occurs with respect to a Plan or Multiemployer Plan, or (ii) any Prohibited Transaction involving any Plan or Multiemployer Plan; and in each case above, such event or condition, together with all other events or conditions, if any, have subjected or could in the reasonable opinion of Administrative Agent subject any Loan Party or any ERISA Affiliate to any tax, penalty, or other liability to a Plan, a Multiemployer Plan, the PBGC, the IRS, the U. S. Department of Labor, or otherwise (or any combination thereof) which in the aggregate exceed or could reasonably be expected to exceed $1,000,000;

(j)A Change of Control shall occur;

(k)Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party, or any of their Properties, revenues, or assets, shall become subject to an order of forfeiture, seizure, or divestiture (whether under RICO or otherwise) and the same shall not have been discharged within thirty (30) days from the date of entry thereof;

(l)Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party shall fail to discharge within a period of thirty (30) consecutive days after the commencement thereof any attachment, sequestration, or similar proceeding or proceedings involving an aggregate amount in excess of $500,000 against any of its assets or Properties; or

(m)A final judgment or judgments for the payment of money in excess of $500,000 not covered by insurance in the aggregate (and to which the applicable insurer has not denied coverage) shall be rendered by a court or courts against Company, any of its Subsidiaries, or any other Loan Party or any Subsidiary of any Loan Party and the same shall not be discharged (or provision shall not be made for such discharge), or a stay of execution thereof shall not be procured, within thirty (30) consecutive days from the date of entry thereof and Company, such Subsidiary, or such Loan Party or such Subsidiary of such Loan Party shall not, within such period of thirty (30) consecutive days, or such longer period during which execution of the same shall have been stayed, appeal therefrom and cause the execution thereof to be stayed during such appeal.

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Section 9.2Remedies Upon Default. If any Event of Default shall occur and be continuing, then Administrative Agent may, with the consent of Required Lenders, or shall, at the direction of Required Lenders, without notice do any or all of the following: (a) terminate the Commitments of Lenders (except for funding obligations of outstanding Letters of Credit), (b) terminate the obligations of L/C Issuer to make L/C Credit Extensions, (c) terminate the commitment of Swing Line Lender to make Swing Line Loans, (d) require that Borrowers Cash Collateralize the L/C Obligations (in an amount equal to the Minimum Collateral Amount with respect thereto), or (e) declare the Obligations (other than the Obligations arising out of Bank Product Agreements) or any part thereof to be immediately due and payable, and the same shall thereupon become immediately due and payable, without notice, demand, presentment, notice of dishonor, notice of acceleration, notice of intent to accelerate, notice of intent to demand, protest, or other formalities of any kind, all of which are hereby expressly waived by each Borrower and each other Loan Party; provided, however, that upon the occurrence of an Event of Default under Section 9.1(e) or (f), the Commitments of Lenders shall automatically terminate (except for funding obligations of outstanding Letters of Credit), the obligations of L/C Issuer to make L/C Credit Extensions shall automatically terminate, the commitment of Swing Line Lender to make Swing Line Loans shall automatically terminate, the obligation of each Borrower to Cash Collateralize the L/C Obligations as aforesaid shall automatically become effective, and the Obligations (other than the Obligations arising out of Bank Product Agreements) shall become immediately due and payable, in each case without notice, demand, presentment, notice of dishonor, notice of acceleration, notice of intent to accelerate, notice of intent to demand, protest, or other formalities of any kind, all of which are hereby expressly waived by each Borrower and each other Loan Party. In addition to the foregoing, if any Event of Default shall occur and be continuing, Administrative Agent may, with the consent of Required Lenders, or shall, at the direction of Required Lenders, exercise all rights and remedies available to it, Lenders and L/C Issuer in law or in equity, under the Loan Documents, or otherwise.

Section 9.3Right to Cure Financial Covenant Non-Compliance(a). Notwithstanding anything to the contrary contained in Section 9.1 or 9.2, in the event Company fails to comply with the financial covenants set forth in Section 8.1 or Section 8.2 as of the last day of such fiscal quarter, subject to the terms and conditions hereof, Company shall have the right (the “Cure Right”) from the last day of the applicable fiscal quarter until the expiration of the 10th Business Day subsequent to the date by which the financial statements for the last month of such fiscal quarter are required to be delivered to Administrative Agent pursuant to Section 6.1(b), to receive a Specified EBITDA Equity Contribution in an aggregate amount equal to, but not greater than, the amount necessary to cause Company to be in compliance with Section 8.1 and Section 8.2 for such period (hereinafter, the “Cure Amount”), and upon the receipt by Company of the cash proceeds thereof, the financial covenants shall then be recalculated giving effect to the following pro forma adjustments: Annualized EBITDA and/or EBITDA shall be calculated for the applicable fiscal quarter and any four fiscal quarter period that contains such fiscal quarter, solely for the purpose of measuring compliance with the financial covenants and not for any other purpose under this Agreement, by an amount equal to the Cure Amount (it being understood that, with respect to the calculation of Annualized EBITDA, the Cure Amount will be added after the amount of EBITDA set forth in clause (a) of the definition of Annualized EBITDA has been calculated for the applicable fiscal month for which Company has failed to comply with the financial covenants set forth in Section 8.2);

(b) if, after giving effect to the foregoing recalculations, Company shall then be in compliance with the requirements of all financial covenants, Company shall be deemed to have been in compliance with such financial covenants as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach, Default or Event of Default of such financial covenants that had occurred shall be deemed not to have occurred for this purpose of the Agreement;

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(c)notwithstanding anything herein to the contrary, (i) in each four consecutive fiscal quarter period of Company there shall be at least two fiscal quarters in which the Cure Right is not exercised, (ii) during the term of this Agreement, the Cure Right shall not be exercised more than five (5) times, (iii) the Cure Amount shall be no greater than the amount required for purposes of complying with the financial covenants and any amounts in excess thereof shall not be deemed to be a Cure Amount and (iv) there shall be no pro forma reduction in Debt with the proceeds of any Cure Amount. Notwithstanding any other provision in this Agreement to the contrary, the Cure Amount received pursuant to any exercise of the Cure Right shall be disregarded for purposes of determining the satisfaction of any Default or Event of Default condition, any financial ratio-based conditions or tests, the Applicable Margin or other pricing or any available basket under Article 7 of this Agreement; and

(d)the mandatory prepayment of the Loans made pursuant to Section 2.9(c) with respect to any cash proceeds of Specified EBITDA Equity Contribution shall not serve as a reduction to Debt for purposes of calculating the Leverage Ratio for the four fiscal quarter period then ending (even if the proceeds of any Specified EBITDA Equity Contribution are actually used to repay Debt, regardless of whether the proceeds of any Specified EBITDA Equity Contribution are received before or after the last day of such period).

Section 9.4Application of Funds. After the exercise of remedies provided for in Section 9.2 (or if an Event of Default exists and the written notice thereof, if any, to any Borrower from Administrative Agent expressly provides that this Section 9.4 shall thereafter apply to any amounts received on account of the Obligations or after the Loans have automatically become immediately due and payable), any amounts received on account of the Obligations shall be applied by Administrative Agent in the following order:

First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to Administrative Agent) payable to Administrative Agent in its capacity as such;

Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal, interest, and Letter of Credit Fees) payable to Lenders and L/C Issuer (including fees, charges and disbursements of counsel to the respective Lenders and L/C Issuer) arising under the Loan Documents, ratably among them in proportion to the respective amounts described in this clause Second payable to them;

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Third, to payment of that portion of the Obligations constituting accrued and unpaid Letter of Credit Fees and interest on the Loans, L/C Borrowings and other Obligations arising under the Loan Documents, ratably among Lenders and L/C Issuer in proportion to the respective amounts described in this clause Third payable to them;

Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans and L/C Borrowings and constituting unpaid Bank Product Obligations, ratably among Lenders and Bank Product Providers in proportion to the respective amounts described in this clause Fourth held by them;

Fifth, to Administrative Agent for the account of the L/C Issuer, to Cash Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of Letters of Credit to the extent not otherwise Cash Collateralized by any Borrower pursuant to Sections 2.2 and 2.7;

Sixth, to payment of that remaining portion of the Obligations, ratably among the Lenders and Bank Product Providers in proportion to the respective amounts described in this clause Sixth held by them; and

Last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to Borrowers or as otherwise required by Law.

Notwithstanding anything to the contrary herein or in any other Loan Document, no amount received from any Loan Party shall be applied to any Excluded Swap Obligation of such Loan Party, but appropriate adjustments shall be made with respect to payments from other Loan Parties to preserve allocation to Obligations otherwise set forth in this Section.

Further notwithstanding, Bank Product Obligations shall be excluded from the application described above if Administrative Agent has not received written notice thereof, together with supporting documentation as Administrative Agent may request from the applicable Bank Product Provider, provided that no such notice shall be required for any Bank Product Agreement for which Administrative Agent or any Affiliate of Administrative Agent is the applicable Bank Product Provider. Each Bank Product Provider that is not a party to this Agreement that has given notice contemplated by the preceding sentence shall, by such notice, be deemed to have acknowledged and accepted the appointment of Administrative Agent pursuant to the terms of Article 10 hereof for itself and its Affiliates as if a “Lender” party hereto.

Section 9.5Performance by Administrative Agent. If any Loan Party shall fail to perform any covenant or agreement contained in any of the Loan Documents, then Administrative Agent may perform or attempt to perform such covenant or agreement on behalf of such Loan Party. In such event, Borrowers shall, at the request of Administrative Agent, promptly pay to Administrative Agent any amount expended by Administrative Agent in connection with such performance or attempted performance, together with interest thereon at the Default Interest Rate from and including the date of such expenditure to but excluding the date such expenditure is paid in full. Notwithstanding the foregoing, it is expressly agreed that Administrative Agent shall not have any liability or responsibility for the performance of any covenant, agreement, or other obligation of any Borrower or any other Loan Party under this Agreement or any other Loan Document.

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Article 10.

AGENCY

Section 10.1Appointment and Authority.

(a)Each of the Lenders, L/C Issuer, and Swing Line Lender hereby irrevocably appoints Texas Capital Bank to act on its behalf as Administrative Agent hereunder and under the other Loan Documents and authorizes Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article 10 are solely for the benefit of Administrative Agent, Lenders, L/C Issuer, and Swing Line Lender, and no Loan Party shall have rights as a third-party beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” herein or in any other Loan Documents (or any other similar term) with reference to Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

(b)Administrative Agent shall also act as the “collateral agent” under the Loan Documents, and each of the Lenders (including for itself and its Affiliates in their capacities as potential Bank Product Providers) and L/C Issuer hereby irrevocably appoints and authorizes Administrative Agent to act as the agent of such Lender and L/C Issuer for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Loan Parties to secure any of the Obligations, together with such powers and discretion as are reasonably incidental thereto. In this connection, Administrative Agent, as “collateral agent” and any co-agents, sub-agents and attorneys-in-fact appointed by Administrative Agent pursuant to Section 10.5 for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted under the Security Documents, or for exercising any rights and remedies thereunder at the direction of Administrative Agent, shall be entitled to the benefits of all provisions of this Article 10 and Article 11 (including Section 11.1(b), as though such co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under the Loan Documents) as if set forth in full herein with respect thereto.

Section 10.2Rights as a Lender. The Person serving as Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not Administrative Agent, and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for, and generally engage in any kind of business with, any Loan Party or any Subsidiary or other Affiliate thereof as if such Person were not Administrative Agent hereunder and without any duty to account therefor to Lenders.

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Section 10.3Exculpatory Provisions.

(a)Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents, and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, Administrative Agent:

(i)shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(ii)shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that Administrative Agent is required to exercise as directed in writing by Required Lenders (or such other number or percentage of Lenders as shall be expressly provided for herein or in the other Loan Documents); provided that Administrative Agent shall not be required to take any action that, in its opinion or upon the advice of its counsel, may expose Administrative Agent to liability or that is contrary to any Loan Document or applicable Law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of Property of a Defaulting Lender in violation of any Debtor Relief Law;

(iii)shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any Loan Party or any of their respective Affiliates that is communicated to or obtained by the Person serving as Administrative Agent or any of its Affiliates in any capacity; and

(iv)shall be fully justified in failing or refusing to take any action hereunder or under any other Loan Document unless it shall first be indemnified to its satisfaction by Lenders pro rata against any and all liability, cost and expense that it may incur by reason of taking or continuing to take any such action.

(b)Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of Required Lenders (or such other number or percentage of Lenders as shall be necessary, or as Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 9.2 and 10.9), or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. SUCH LIMITATION OF LIABILITY SHALL APPLY REGARDLESS OF WHETHER THE LIABILITY ARISES FROM THE SOLE, CONCURRENT, CONTRIBUTORY OR COMPARATIVE NEGLIGENCE OF ADMINISTRATIVE AGENT. Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given to Administrative Agent in writing by any Loan Party, a Lender, L/C Issuer, or Swing Line Lender.

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(c)Neither Administrative Agent nor any Related Party thereof shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article 4 or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to Administrative Agent.

Section 10.4Reliance by Administrative Agent. Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Credit Extension, that by its terms must be fulfilled to the satisfaction of a Lender, L/C Issuer, or Swing Line Lender, Administrative Agent may presume that such condition is satisfactory to such Lender, L/C Issuer, or Swing Line Lender unless Administrative Agent shall have received notice to the contrary from such Lender prior to the making of such Credit Extension. Administrative Agent may consult with legal counsel (who may be counsel for any Loan Party), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

Section 10.5Delegation of Duties. Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub agents appointed by Administrative Agent. Administrative Agent and any such sub agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article 10 shall apply to any such sub agent and to the Related Parties of Administrative Agent and any such sub agent, and shall apply to their respective activities in connection with the syndication of the Revolving Credit Facility as well as activities as Administrative Agent. Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub agents.

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Section 10.6Resignation or Removal of Administrative Agent.

(a)Administrative Agent may at any time give notice of its resignation to Lenders, L/C Issuer, Swing Line Lender and Borrowers. Upon receipt of any such notice of resignation, Required Lenders shall have the right, in consultation with Borrowers (so long as no Event of Default has occurred and is continuing), to appoint a successor, which shall be a bank with an office in Dallas, Texas, or an Affiliate of any such bank with an office in Dallas, Texas. If no such successor shall have been so appointed by Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent gives notice of its resignation (or such earlier day as shall be agreed by Required Lenders) (the “Resignation Effective Date”), then the retiring Administrative Agent may (but shall not be obligated to), on behalf of Lenders, L/C Issuer, and Swing Line Lender, appoint a successor Administrative Agent meeting the qualifications set forth above; provided that in no event shall any successor Administrative Agent be a Defaulting Lender. Whether or not a successor has been appointed, such resignation shall become effective in accordance with such notice on the Resignation Effective Date. After the Resignation Effective Date, the provisions of this Article 10 relating to or indemnifying or releasing Administrative Agent shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement and the other Loan Documents.

(b)If the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, Required Lenders may, to the extent permitted by applicable Law, by notice in writing to the Borrower Representative and such Person remove such Person as Administrative Agent and, in consultation with the Borrower Representative, appoint a successor. If no such successor shall have been so appointed by Required Lenders and shall have accepted such appointment within thirty (30) days (or such earlier day as shall be agreed by Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date.

(c)With effect from the Resignation Effective Date or the Removal Effective Date (as applicable) (i) the retiring or removed Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any Collateral held by Administrative Agent on behalf of Secured Parties under any of the Loan Documents, the retiring or removed Administrative Agent shall continue to hold such Collateral until such time as a successor Administrative Agent is appointed) and (ii) except for any indemnity, fee or expense payments owed to the retiring or removed Administrative Agent, all payments, communications and determinations provided to be made by, to or through Administrative Agent shall instead be made by or to each Lender, L/C Issuer, or Swing Line Lender, as applicable, directly, until such time, if any, as Required Lenders appoint a successor Administrative Agent as provided for above. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring or removed Administrative Agent (other than any rights to indemnity payments owed to the retiring or removed Administrative Agent), and the retiring or removed Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents. The fees payable by Borrowers to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between Borrowers and such successor. After the retiring or removed Administrative Agent’s resignation or removal hereunder and under the other Loan Documents, the provisions of this Article 10, Section 11.1, and Section 11.2 shall continue in effect for the benefit of such retiring or removed Administrative Agent, its sub agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring or removed Administrative Agent was acting as Administrative Agent.

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(d)Any resignation by Texas Capital Bank as Administrative Agent pursuant to this Section shall also constitute its resignation as L/C Issuer and Swing Line Lender unless the notice thereof otherwise provides. If Texas Capital Bank resigns as an L/C Issuer, it shall retain all the rights, powers, privileges and duties of L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto, including the right to require Lenders to make Revolving Credit Loans or fund risk participations in Unreimbursed Amounts pursuant to Section 2.2(c). If Texas Capital Bank resigns as Swing Line Lender, it shall retain all the rights of Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such resignation, including the right to require Lenders to make Revolving Credit Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section 2.3(c). Upon the appointment by Borrowers of a successor L/C Issuer or Swing Line Lender hereunder (which successor shall in all cases be a Lender other than a Defaulting Lender), (i) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender, as applicable, (ii) the retiring L/C Issuer and Swing Line Lender shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (iii) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to Texas Capital Bank to effectively assume the obligations of Texas Capital Bank with respect to such Letters of Credit.

Section 10.7Non-Reliance on Administrative Agent and Other Lenders. Each Lender, L/C Issuer, and Swing Line Lender expressly acknowledges that neither Administrative Agent nor any other Lender nor any Related Party thereto has made any representation or warranty to such Person and that no act by Administrative Agent or any other Lender hereafter taken, including any review of the affairs of any Loan Party, shall be deemed to constitute any representation or warranty by Administrative Agent or any Lender to any other Lender. Each Lender, Swing Line Lender and L/C Issuer acknowledges that it has, independently and without reliance upon Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender, L/C Issuer, and Swing Line Lender also acknowledges that it will, independently and without reliance upon Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder. Except for notices, reports and other documents expressly required to be furnished to the Lenders or Swing Line Lender by Administrative Agent hereunder, Administrative Agent shall not have any duty or responsibility to provide any Lender or Swing Line Lender with any credit or other information concerning the business, operations, Property, condition (financial or otherwise), or creditworthiness of any Loan Party or the value of the Collateral or other Properties of any Loan Party or any other Person which may come into the possession of Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates.

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Section 10.8Administrative Agent May File Proofs of Claim. In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Loan Party, Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether Administrative Agent shall have made any demand on any Loan Party) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:

(a)to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations and all other Obligations under the Loan Documents that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of Lenders, L/C Issuer, Swing Line Lender, and Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of Lenders, L/C Issuer, Swing Line Lender, and Administrative Agent and their respective agents and counsel and all other amounts due Lenders, L/C Issuer, Swing Line Lender, and Administrative Agent under Section 11.1 or Section 11.2) allowed in such judicial proceeding; and

(b)to collect and receive any monies or other Property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender, L/C Issuer and Swing Line Lender to make such payments to Administrative Agent and, in the event that Administrative Agent shall consent to the making of such payments directly to Lenders, L/C Issuer, and Swing Line Lender, as applicable, to pay to Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of Administrative Agent and its agents and counsel, and any other amounts due Administrative Agent under Section 11.1 or Section 11.2.

Section 10.9Collateral and Guaranty Matters.

(a)The Secured Parties irrevocably authorize Administrative Agent, at its option and in its discretion:

(i) to release any Lien on any Property granted to or held by Administrative Agent under any Loan Document (x) upon termination of all Commitments and payment in full of all Obligations (other than (A) contingent indemnification obligations and (B) obligations and liabilities under Bank Product Agreements as to which arrangements satisfactory to the applicable Bank Product Provider shall have been made) and the expiration or termination of all Letters of Credit (other than Letters of Credit as to which other arrangements satisfactory to Administrative Agent and L/C Issuer shall have been made), (y) that is sold or otherwise disposed of or to be sold or otherwise disposed of as part of or in connection with any sale or other disposition permitted under the Loan Documents, or (z) if approved, authorized or ratified in writing by Required Lenders or all Lenders, as applicable, under Section 11.10;

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(ii)to subordinate any Lien on any Property granted to or held by Administrative Agent under any Loan Document to the holder of any Lien on such Property that is permitted by Section 7.2; and

(iii)to release any Guarantor from its obligations under the Guaranty if such Person ceases to be a Subsidiary as a result of a transaction permitted under the Loan Documents.

Upon request by Administrative Agent at any time, Required Lenders will confirm in writing Administrative Agent’s authority to release or subordinate its interest in particular types or items of Property, or to release any Guarantor from its obligations under the Guaranty pursuant to this Section 10.9. Upon the occurrence of any of the events specified in Section 10.9(a)(i)(x), (y) or (z) or Section 10.9(a)(iii), at Borrowers’ expense, Administrative Agent shall execute and deliver to Borrowers such documentation as Borrowers shall reasonably request to release the applicable Collateral from the Liens created by the Loan Documents and/or release the applicable Guarantor from its obligations under its Guaranty, as the case may be.

(b)Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of Administrative Agent’s Lien thereon, or any certificate prepared by any Loan Party in connection therewith, nor shall Administrative Agent be responsible or liable to Lenders for any failure to monitor or maintain any portion of the Collateral.

Section 10.10Bank Product Agreements. No Bank Product Provider who obtains the benefits of Section 9.4, any Guaranty or any Collateral by virtue of the provisions hereof or of any Guaranty or any Security Document shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) (or to notice of or to consent to any amendment, waiver or modification of the provisions hereof or of the Guaranty or any Security Document) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents. Notwithstanding any other provision of this Article 10 to the contrary, Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, Bank Product Obligations unless Administrative Agent has received written notice of such Bank Product Obligations, together with such supporting documentation as Administrative Agent may request, from the applicable Bank Product Provider. Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, Bank Product Obligations arising under Bank Product Agreements upon termination of all Commitments and payment in full of all Obligations under the Loan Documents (other than contingent indemnification obligations) and the expiration or termination of all Letters of Credit (other than Letters of Credit as to which other arrangements satisfactory to Administrative Agent and L/C Issuer shall have been made).

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Section 10.11Erroneous Payments.

(a)If the Administrative Agent notifies a Lender, L/C Issuer or Secured Party, or any Person who has received funds on behalf of a Lender, L/C Issuer or Secured Party (any such Lender, L/C Issuer, Secured Party or other recipient, a “Payment Recipient”) that the Administrative Agent has determined in its sole discretion (whether or not after receipt of any notice under immediately succeeding clause (b)) that any funds received by such Payment Recipient from the Administrative Agent or any of its Affiliates were erroneously transmitted to, or otherwise erroneously or mistakenly received by, such Payment Recipient (whether or not known to such Lender, L/C Issuer, Secured Party or other Payment Recipient on its behalf) (any such funds, whether received as a payment, prepayment or repayment of principal, interest, fees, distribution or otherwise, individually and collectively, an “Erroneous Payment”) and demands the return of such Erroneous Payment (or a portion thereof) (provided, that, without limiting any other rights or remedies (whether at law or in equity), the Administrative Agent may not make any such demand under this clause (a)(i) with respect to an Erroneous Payment unless such demand is made within 10 Business Days of the date of receipt of such Erroneous Payment by the applicable Payment Recipient), such Erroneous Payment shall at all times remain the property of the Administrative Agent and shall be segregated by the Payment Recipient and held in trust for the benefit of the Administrative Agent, and such Lender, L/C Issuer or Secured Party shall (or, with respect to any Payment Recipient who received such funds on its behalf, shall cause such Payment Recipient to) promptly, but in no event later than two Business Days thereafter, return to the Administrative Agent the amount of any such Erroneous Payment (or portion thereof) as to which such a demand was made, in same day funds (in the currency so received), together with interest thereon in respect of each day from and including the date such Erroneous Payment (or portion thereof) was received by such Payment Recipient to the date such amount is repaid to the Administrative Agent in same day funds at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect. A notice of the Administrative Agent to any Payment Recipient under this clause (a) shall be conclusive, absent manifest error.

(b)Without limiting immediately preceding clause (a), each Lender, L/C Issuer or Secured Party, or any Person who has received funds on behalf of a Lender, L/C Issuer or Secured Party, hereby further agrees that if it receives a payment, prepayment or repayment (whether received as a payment, prepayment or repayment of principal, interest, fees, distribution or otherwise) from the Administrative Agent (or any of its Affiliates) (x) that is in a different amount than, or on a different date from, that specified in a notice of payment, prepayment or repayment sent by the Administrative Agent (or any of its Affiliates) with respect to such payment, prepayment or repayment, (y) that was not preceded or accompanied by a notice of payment, prepayment or repayment sent by the Administrative Agent (or any of its Affiliates), or (z) that such Lender, L/C Issuer or Secured Party, or other such recipient, otherwise becomes aware was transmitted, or received, in error or by mistake (in whole or in part) in each case.

(i)(A) in the case of immediately preceding clauses (x) or (y), an error shall be presumed to have been made (absent written confirmation from the Administrative Agent to the contrary) or (B) an error has been made (in the case of immediately preceding clause (z)), in each case, with respect to such payment, prepayment or repayment; and

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(ii)such Lender, L/C Issuer or Secured Party shall (and shall cause any other recipient that receives funds on its respective behalf to) promptly (and, in all events, within one Business Day of its knowledge of such error) notify the Administrative Agent of its receipt of such payment, prepayment or repayment, the details thereof (in reasonable detail) and that it is so notifying the Administrative Agent pursuant to this Section 10.11(b).

(c)Each Lender, L/C Issuer or Secured Party hereby authorizes the Administrative Agent to set off, net and apply any and all amounts at any time owing to such Lender, L/C Issuer or Secured Party under any Loan Document, or otherwise payable or distributable by the Administrative Agent to such Lender, L/C Issuer or Secured Party from any source, against any amount due to the Administrative Agent under immediately preceding clause (a) or under the indemnification provisions of this Agreement.

(d)In the event that an Erroneous Payment (or portion thereof) is not recovered by the Administrative Agent for any reason, after demand therefor by the Administrative Agent in accordance with immediately preceding clause (a), from any Lender or L/C Issuer that has received such Erroneous Payment (or portion thereof) (and/or from any Payment Recipient who received such Erroneous Payment (or portion thereof) on its respective behalf) (such unrecovered amount, an “Erroneous Payment Return Deficiency”), upon the Administrative Agent’s notice to such Lender or L/C Issuer at any time, (i) such Lender or L/C Issuer shall be deemed to have assigned its relevant Loans (but not its Commitments) with respect to which such Erroneous Payment was made (the “Erroneous Payment Impacted Class”) in an amount equal to the Erroneous Payment Return Deficiency (or such lesser amount as the Administrative Agent may specify) (such assignment of the Loans (but not Commitments) of the Erroneous Payment Impacted Class, the “Erroneous Payment Deficiency Assignment”) at par plus any accrued and unpaid interest (with the assignment fee to be waived by the Administrative Agent in such instance), and is hereby (together with the Borrowers) deemed to execute and deliver an Assignment and Assumption with respect to such Erroneous Payment Deficiency Assignment, and such Lender or L/C Issuer shall deliver any Notes evidencing such Loans to the Borrowers or the Administrative Agent, (ii) the Administrative Agent as the assignee Lender shall be deemed to acquire the Erroneous Payment Deficiency Assignment, (iii) upon such deemed acquisition, the Administrative Agent as the assignee Lender shall become a Lender or L/C Issuer, as applicable, hereunder with respect to such Erroneous Payment Deficiency Assignment and the assigning Lender or assigning L/C Issuer shall cease to be a Lender or L/C Issuer, as applicable, hereunder with respect to such Erroneous Payment Deficiency Assignment, excluding, for the avoidance of doubt, its obligations under the indemnification provisions of this Agreement and its applicable Commitments which shall survive as to such assigning Lender or assigning L/C Issuer and (iv) the Administrative Agent may reflect in the Register its ownership interest in the Loans subject to the Erroneous Payment Deficiency Assignment. The Administrative Agent may, in its discretion, sell any Loans acquired pursuant to an Erroneous Payment Deficiency Assignment and upon receipt of the proceeds of such sale, the Erroneous Payment Return Deficiency owing by the applicable Lender or L/C Issuer shall be reduced by the net proceeds of the sale of such Loan (or portion thereof), and the Administrative Agent shall retain all other rights, remedies and claims against such Lender or L/C Issuer (and/or against any recipient that receives funds on its respective behalf). For the avoidance of doubt, no Erroneous Payment Deficiency Assignment will reduce the Commitments of any Lender or L/C Issuer and such Commitments shall remain available in accordance with the terms of this Agreement. In addition, each party hereto agrees that, except to the extent that the Administrative Agent has sold a Loan (or portion thereof) acquired pursuant to an Erroneous Payment Deficiency Assignment, and irrespective of whether the Administrative Agent may be equitably subrogated, the Administrative Agent shall be contractually subrogated to all the rights and interests of the applicable Lender, L/C Issuer or Secured Party under the Loan Documents with respect to each Erroneous Payment Return Deficiency (the “Erroneous Payment Subrogation Rights”).

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(e)The parties hereto agree that an Erroneous Payment shall not pay, prepay, repay, discharge or otherwise satisfy any Obligations owed by any Borrower or any other Loan Party, except, in each case, to the extent such Erroneous Payment is, and solely with respect to the amount of such Erroneous Payment that is, comprised of funds received by the Administrative Agent from any Borrower or any other Loan Party for the purpose of making such Erroneous Payment.

(f)To the extent permitted by applicable law, no Payment Recipient shall assert any right or claim to an Erroneous Payment, and hereby waives, and is deemed to waive, any claim, counterclaim, defense or right of set-off or recoupment with respect to any demand, claim or counterclaim by the Administrative Agent for the return of any Erroneous Payment received, including without limitation waiver of any defense based on “discharge for value” or any similar doctrine.

(g)Each party’s obligations, agreements and waivers under this Section 10.11 shall survive the resignation or replacement of the Administrative Agent, any transfer of rights or obligations by, or the replacement of, a Lender or L/C Issuer, the termination of the Commitments and/or the repayment, satisfaction or discharge of all Obligations (or any portion thereof) under any Loan Document.

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Article 11.

MISCELLANEOUS

Section 11.1Expenses.

(a)Each Borrower hereby agrees to pay on demand: (i) all costs and expenses of Arranger, Administrative Agent, L/C Issuer, Swing Line Lender and their Related Parties in connection with the syndication and distribution of the Revolving Credit Facility and the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents and any and all amendments, modifications, renewals, extensions, supplements, waivers, consents and ratifications thereof and thereto, including, without limitation, the reasonable fees and expenses of legal counsel, advisors, consultants, and auditors for Administrative Agent, L/C Issuer, Swing Line Lender and their Related Parties; (ii) all costs and expenses of Administrative Agent, L/C Issuer, Swing Line Lender and each Lender in connection with any Default and the enforcement of this Agreement or any other Loan Document, including, without limitation, court costs and fees and expenses of legal counsel, advisors, consultants, and auditors for Administrative Agent, L/C Issuer, Swing Line Lender and each Lender; (iii) all costs and expenses incurred by L/C Issuer in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder; (iv) all transfer, stamp, documentary, or other similar taxes, assessments, or charges levied by any Governmental Authority in respect of this Agreement or any of the other Loan Documents; (v) all costs, expenses, assessments, and other charges incurred in connection with any filing, registration, recording, or perfection of any Lien contemplated by this Agreement or any other Loan Document; and (vi) all other costs and expenses incurred by Administrative Agent, L/C Issuer, Swing Line Lender and any Lender in connection with the enforcement or protection of its rights under this Agreement or any other Loan Document, any workout or restructuring (including the negotiations thereof), any litigation, dispute, suit, proceeding or action, the enforcement of its rights and remedies, and the protection of its interests in bankruptcy, insolvency or other legal proceedings, including, without limitation, all costs, expenses, and other charges (including Administrative Agent’s and such Lender’s, L/C Issuer’s, and Swing Line Lender’s internal charges) incurred in connection with evaluating, observing, collecting, examining, auditing, appraising, selling, liquidating, or otherwise disposing of the Collateral or other assets of the Loan Parties. Borrowers shall be responsible for all expenses described in this clause (a) whether or not any Credit Extension is ever made. Any amount to be paid under this Section 11.1 shall be a demand obligation owing by Borrowers and if not paid within ten (10) days of demand shall bear interest, to the extent not prohibited by and not in violation of applicable Law, from the date of expenditure until paid at a rate per annum equal to the Default Interest Rate. The obligations of Borrowers under this Section 11.1 shall survive payment of the Notes and other obligations hereunder and the assignment of any right hereunder.

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(b)To the extent that Borrowers for any reason fail to indefeasibly pay any amount required under Section 11.1(a) or Section 11.2 to be paid by it to Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any sub-agent thereof) or any Related Party of Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any sub-agent thereof), each Lender severally agrees to pay to Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any such sub-agent) or such Related Party, as the case may be, such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought based on each Lender’s share of the Revolving Credit Exposure at such time) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender); provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any such sub-agent) or against any Related Party of Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any sub-agent thereof) acting for Arranger, Administrative Agent, L/C Issuer, or Swing Line Lender (or any such sub-agent) in connection with such capacity. EACH LENDER ACKNOWLEDGES THAT SUCH PAYMENTS MAY BE IN RESPECT OF LOSSES, CLAIMS, DAMAGES, LIABILITIES OR RELATED EXPENSES ARISING OUT OF OR RESULTING FROM THE SOLE, CONTRIBUTORY, COMPARATIVE, CONCURRENT OR ORDINARY NEGLIGENCE OF THE PERSON (OR THE REPRESENTATIVES OF THE PERSON) TO WHOM SUCH PAYMENTS ARE TO BE MADE.

Section 11.2INDEMNIFICATION.

(a)EACH BORROWER SHALL INDEMNIFY ARRANGER, ADMINISTRATIVE AGENT, L/C ISSUER, SWING LINE LENDER, EACH LENDER AND EACH RELATED PARTY THEREOF (EACH, AN “INDEMNITEE”) FROM, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’ FEES) TO WHICH ANY OF THEM MAY BECOME SUBJECT WHICH DIRECTLY OR INDIRECTLY ARISE FROM OR RELATE TO (A) THE NEGOTIATION, EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION, OR ENFORCEMENT OF ANY OF THE LOAN DOCUMENTS, (B) ANY OF THE TRANSACTIONS CONTEMPLATED BY THE LOAN DOCUMENTS, (C) ANY BREACH BY ANY BORROWER OF ANY REPRESENTATION, WARRANTY, COVENANT, OR OTHER AGREEMENT CONTAINED IN ANY OF THE LOAN DOCUMENTS, (D) THE PRESENCE, RELEASE, THREATENED RELEASE, DISPOSAL, REMOVAL, OR CLEANUP OF ANY HAZARDOUS MATERIAL LOCATED ON, ABOUT, WITHIN, OR AFFECTING ANY OF THE PROPERTIES OR ASSETS OF COMPANY OR ANY OF ITS SUBSIDIARIES OR ANY OTHER LOAN PARTY, (E) ANY LOAN OR LETTER OF CREDIT OR USE OR PROPOSED USE OF THE PROCEEDS THEREFROM (INCLUDING ANY REFUSAL BY THE L/C ISSUER TO HONOR A DEMAND FOR PAYMENT UNDER A LETTER OF CREDIT IF THE DOCUMENTS PRESENTED IN CONNECTION WITH SUCH DEMAND DO NOT STRICTLY COMPLY WITH THE TERMS OF SUCH LETTER OF CREDIT) OR (F) ANY INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY THREATENED OR PROSPECTIVE INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, RELATING TO ANY OF THE FOREGOING, WHETHER BROUGHT BY A THIRD PARTY OR BY ANY LOAN PARTY. WITHOUT LIMITING ANY PROVISION OF THIS AGREEMENT OR OF ANY OTHER LOAN DOCUMENT, IT IS THE EXPRESS INTENTION OF THE PARTIES HERETO THAT EACH INDEMNITEE SHALL BE INDEMNIFIED FROM AND HELD HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS’ FEES) ARISING OUT OF OR RESULTING FROM THE SOLE, CONTRIBUTORY, COMPARATIVE, CONCURRENT OR ORDINARY NEGLIGENCE OF SUCH INDEMNITEE (OR THE REPRESENTATIVES OF SUCH PERSON); provided that such indemnity shall not, as to any Indemnitee, be available to the extent such losses, liabilities, claims, damages, penalties, judgments, disbursements, costs and expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or (y) result from a claim not involving an act or omission of any Loan Party and that is brought by an Indemnitee against another Indemnitee (other than against the Arranger or Administrative Agent in their capacities as such).

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(b)If, for the purposes of obtaining judgment in any court in any jurisdiction with respect to this Agreement or any other Loan Document, it becomes necessary to convert into a particular currency (the “Judgment Currency”) any amount due under this Agreement or under any other Loan Document in any currency other than the Judgment Currency (the “Currency Due”), then conversion shall be made at the rate of exchange prevailing on the Business Day before the day on which judgment is given. For this purpose “rate of exchange” means the rate at which the Administrative Agent is able, on the relevant date, to purchase the Currency Due with the Judgment Currency in accordance with its normal practice. In the event that there is a change in the rate of exchange prevailing between the Business Day immediately preceding the day on which the judgment is given and the date of receipt by the Administrative Agent of the amount due, the Borrowers shall, on the date of receipt by the Administrative Agent, pay such additional amounts, if any, or be entitled to receive reimbursement of such amount, if any, as may be necessary to ensure that the amount received by the Administrative Agent on such date is the amount in the Judgment Currency which when converted at the rate of exchange prevailing on the date of receipt by the Administrative Agent is the amount then due under this Agreement or such other Loan Document in the Currency Due. If the amount of the Currency Due which the Administrative Agent is so able to purchase is less than the amount of the Currency Due originally due to it, the Borrowers shall indemnify and save the Administrative Agent and the Lenders harmless from and against all loss or damage arising as a result of such deficiency. This indemnity shall constitute an obligation separate and independent from the other obligations contained in this Agreement and the other Loan Documents, shall give rise to a separate and independent cause of action, shall apply irrespective of any indulgence granted by the Administrative Agent from time to time and shall continue in full force and effect notwithstanding any judgment or order for a liquidated sum in respect of an amount due under this Agreement or any other Loan Document or under any judgment or order.

(c)Any amount to be paid under this Section 11.2 shall be a demand obligation owing by Borrowers and if not paid within ten (10) days of demand shall bear interest, to the extent not prohibited by and not in violation of applicable Law, from the date of expenditure until paid at a rate per annum equal to the Default Interest Rate. The obligations of Borrowers under this Section 11.2 shall survive payment of the Notes and other obligations hereunder and the assignment of any right hereunder.

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Section 11.3Limitation of Liability. None of Arranger, Administrative Agent, L/C Issuer, Swing Line Lender, or any Lender, or any of their Related Parties, shall have any liability with respect to, and each Loan Party hereby waives, releases, and agrees not to sue any of them upon, any claim for any special, indirect, incidental, or consequential damages (whether in contract, tort or otherwise) suffered or incurred by any Loan Party in connection with, arising out of, or in any way related to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by this Agreement or any of the other Loan Documents. Each Loan Party hereby waives, releases, and agrees not to sue Arranger, Administrative Agent, L/C Issuer, Swing Line Lender, or any Lender, or any of their Related Parties, for punitive damages in respect of any claim in connection with, arising out of, or in any way related to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by this Agreement or any of the other Loan Documents.

Section 11.4No Duty. All attorneys, accountants, appraisers, and other professional Persons and consultants retained by Arranger, Administrative Agent, any Lender, L/C Issuer, or Swing Line Lender shall have the right to act exclusively in the interest of Arranger, Administrative Agent or such Lender, L/C Issuer, or Swing Line Lender and shall have no duty of disclosure, duty of loyalty, duty of care, or other duty or obligation of any type or nature whatsoever to any Loan Party or any of such Loan Party’s equity holders, Affiliates, officers, employees, attorneys, agents, or any other Person.

Section 11.5Lenders Not Fiduciary. The relationship between Borrowers and each other Loan Party on the one hand, and Administrative Agent, Arranger and each Lender, L/C Issuer, and Swing Line Lender is solely that of debtor and creditor, and none of Administrative Agent, Arranger, any Lender, L/C Issuer, or Swing Line Lender, on the other hand, has any fiduciary or other special relationship with Borrowers or any other Loan Party, and no term or condition of any of the Loan Documents shall be construed so as to deem the relationship between Borrowers and each other Loan Party on the one hand, and Administrative Agent, Arranger and each Lender, L/C Issuer, and Swing Line Lender, on the other hand, to be other than that of debtor and creditor.

Section 11.6Equitable Relief. Each Loan Party recognizes that in the event any Borrower or any other Loan Party fails to pay, perform, observe, or discharge any or all of the Obligations, any remedy at law may prove to be inadequate relief to Administrative Agent or Lenders, L/C Issuer, or Swing Line Lender. Each Loan Party therefore agrees that Administrative Agent, any Lender, L/C Issuer, or Swing Line Lender, if Administrative Agent or such Lender, L/C Issuer, or Swing Line Lender so requests, shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages.

Section 11.7No Waiver; Cumulative Remedies. No failure on the part of Administrative Agent, any Lender, L/C Issuer, or Swing Line Lender to exercise and no delay in exercising, and no course of dealing with respect to, any right, remedy, power, or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege. The rights and remedies provided for in this Agreement and the other Loan Documents are cumulative and not exclusive of any rights and remedies provided by Law.

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Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, Administrative Agent in accordance with Section 9.2 for the benefit of all the Lenders; provided, however, that the foregoing shall not prohibit (a) Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) Swing Line Lender from exercising the rights and remedies that inure to its benefit (solely in its capacity as Swing Line Lender) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in accordance with Section 4.2 (subject to the terms of Section 11.23), or (d) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party under any Debtor Relief Law; and provided, further, that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwise ascribed to Administrative Agent pursuant to Section 9.2 and (ii) in addition to the matters set forth in clauses (b), (c) and (d) of the preceding proviso and subject to Section 11.23, any Lender may, with the consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.

Section 11.8Successors and Assigns.

(a)Successors and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that no Loan Party may assign or otherwise transfer any of its rights, duties, or obligations under this Agreement or the other Loan Documents without the prior written consent of Administrative Agent and each Lender, and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of Section 11.8(b), (ii) by way of participation in accordance with the provisions of Section 11.8(d), or (iii) by way of pledge or assignment of a security interest subject to the restrictions of Section 11.8(e) (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in Section 11.8(d) and, to the extent expressly contemplated hereby, the Related Parties of each of Administrative Agent and Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

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(b)Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment(s) and the Loans at the time owing to it); provided that any such assignment shall be subject to the following conditions:

(i)Minimum Amounts. (A) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment(s) and/or the Loans at the time owing to it or contemporaneous assignments to related Approved Funds (determined after giving effect to such assignments) that equal at least the amount specified in Section 11.8(b)(i)(B) in the aggregate or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and (B) in any case not described in Section 11.8(b)(i)(A), the aggregate amount of the Commitment(s) (which for this purpose includes Loans outstanding hereunder) or, if the applicable Commitment is not then in effect, the Outstanding Amount of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000, unless each of Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower Representative otherwise consents (each such consent not to be unreasonably withheld or delayed).

(ii)Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loan or the Commitment(s) assigned.

(iii)Required Consents. No consent shall be required for any assignment except to the extent required by Section 11.8(b)(i)(B) and, in addition: (A) the consent of the Borrower Representative (such consent not to be unreasonably withheld or delayed) shall be required unless (x) an Event of Default has occurred and is continuing at the time of such assignment, or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided that the Borrower Representative shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to Administrative Agent within five (5) Business Days after having received notice thereof; (B) the consent of Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of any Commitment or Revolving Credit Loans if such assignment is to a Person that is not a Lender with a Commitment, an Affiliate of such Lender or an Approved Fund with respect to such Lender; and (C) the consent of L/C Issuer and Swing Line Lender shall be required for any assignment in respect of the Revolving Credit Facility.

(iv)Assignment and Assumption. The parties to each assignment shall execute and deliver to Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500; provided that Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment; and provided further that Borrowers shall not be obligated to pay for such processing and recording fee except in the case of any assignment made pursuant to Section 3.6(b). The assignee, if it is not a Lender, shall deliver to Administrative Agent an Administrative Questionnaire.

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(v)No Assignment to Certain Persons. No such assignment shall be made to (A)  Parent, any Loan Party, or any their respective Affiliates or Subsidiaries or (B) any Defaulting Lender or any of its Affiliates, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (b).

(vi)No Assignment to Natural Persons. No such assignment shall be made to a natural Person (or a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural Person).

(vii)Certain Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to such assignment shall make such additional payments to Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower Representative and Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by such Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to: (A) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to Administrative Agent or any Lender hereunder (and interest accrued thereon) and (B) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit and Swing Line Loans in accordance with its Applicable Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

Subject to acceptance and recording thereof by Administrative Agent pursuant to Section 11.8(c), from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Section 3.1, Section 3.2, Section 11.1 and Section 11.2 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided that, except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 11.8(d). Upon the consummation of any assignment pursuant to this Section 11.8(b), if requested by the transferor or transferee Lender, the transferor Lender, Administrative Agent and Borrowers shall make appropriate arrangements so that replacement Notes are issued to such transferor Lender (if applicable) and new Notes or, as appropriate, replacement Notes, are issued to the assignee.

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(c)Register. Administrative Agent, acting solely for this purpose as a non-fiduciary agent of Borrowers, shall maintain at one of its offices in Dallas, Texas a copy of each Assignment and Assumption delivered to it and a Register. The entries in the Register shall be conclusive absent manifest error, and Borrowers, Administrative Agent and Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by Borrowers and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

(d)Participations. Any Lender may at any time, without the consent of, or notice to, any Loan Party or Administrative Agent, sell participations to a Participant in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment(s) and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, and (iii) each Loan Party, Administrative Agent, and Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. For the avoidance of doubt, each Lender shall be responsible for the indemnity under Section 11.1(b) without regard to the existence of any participation.

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Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in Section 11.10 which requires the consent of all Lenders and affects such Participant. Each Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.1, 3.4 and 3.5 (subject to the requirements and limitations therein, including the requirements under Section 3.4(g) (it being understood that the documentation required under Section 3.4(g) shall be delivered to the participating Lender)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant (A) agrees to be subject to the provisions of Section 3.6 as if it were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment under Sections 3.1 or 3.4, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that sells a participation agrees, at Borrowers’ request and expense, to use reasonable efforts to cooperate with Borrowers to effectuate the provisions of Section 3.6 with respect to any Participant. To the extent permitted by Law, each Participant also shall be entitled to the benefits of Section 11.25 as though it were a Lender; provided that such Participant agrees to pay to Administrative Agent any amount set-off for application to the Obligations under the Loan Documents as required pursuant to Section 11.25; provided further that such Participant agrees to be subject to Section 11.23 as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of Borrowers, maintain a Participant Register; provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

(e)Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

(f)Dissemination of Information. Each Loan Party authorizes Administrative Agent and each Lender to disclose to any actual or prospective purchaser, assignee or other recipient of a Lender’s Commitment, any and all information in Administrative Agent’s or such Lender’s possession concerning Borrowers, the other Loan Parties and their respective Affiliates.

Section 11.9Survival. All representations and warranties made in this Agreement or any other Loan Document or in any document, statement, or certificate furnished in connection with this Agreement shall survive the execution and delivery of this Agreement and the other Loan Documents, and no investigation by Administrative Agent or any Lender or any closing shall affect the representations and warranties or the right of Administrative Agent or any Lender to rely upon them. Without prejudice to the survival of any other obligation of any Loan Party hereunder, the obligations of Borrowers under Sections 11.1 and 11.2 shall survive repayment of the Obligations and termination of the Commitments.

Section 11.10Amendment. Subject to Section 3.3(b), the provisions of this Agreement and the other Loan Documents to which Borrowers or any other Loan Party is a party (other than the Issuer Documents) may be amended or waived only by an instrument in writing signed by Required Lenders (or by Administrative Agent with the consent of Required Lenders) and each Loan Party party thereto and acknowledged by Administrative Agent; provided, however, that no such amendment or waiver shall:

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(a)waive any condition set forth in Section 4.1, without the written consent of each Lender;

(b)extend or increase any Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 9.2) without the written consent of such Lender;

(c)postpone any date fixed by this Agreement or any other Loan Document for any payment (excluding mandatory prepayment) of principal, interest, fees or other amounts due to Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

(d)reduce the principal of, or the rate of interest specified herein on, any Loan, or any fees or other amounts payable hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby; provided, however, that (i) any amendment or modification of the financial covenants in this Agreement (or any defined term used therein) shall not constitute a reduction in the rate of interest or fees for purposes of this clause (d) and (ii) only the consent of Required Lenders shall be necessary to adjust the Default Interest Rate or to waive any obligation of Borrowers to pay interest at such rate;

(e)change any provision of this Section 11.10 or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender;

(f)(i) change Section 9.4 in a manner that would alter the pro rata sharing of payments required thereby or otherwise adversely affect the priority of payment of any such Obligations, (ii) subordinate any of the Obligations owed to the Lenders in right of payment or otherwise adversely affect the priority of payment of any such Obligations or (iii) subordinate any of the Liens securing the Obligations owed to the Lenders (except as otherwise set forth in Section 10.9), in each case, without the written consent of each Lender; or

(g)release any Guaranty or all or substantially all of the Collateral (in each case, except as provided herein) without the written consent of each Lender;

and, provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the L/C Issuer in addition to the Lenders required above, affect the rights or duties of the L/C Issuer under this Agreement or any Issuer Document relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swing Line Lender in addition to the Lenders required above, affect the rights or duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by Administrative Agent in addition to Lenders required above, affect the rights or duties of Administrative Agent under this Agreement or any other Loan Document; (iv) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto; and (v) Borrowers and Administrative Agent may amend this Agreement or any other Loan Document without the consent of Lenders (unless the Required Lenders object in writing within five (5) Business Days of notice by Administrative Agent of such amendment) in order to (A) correct, amend or cure any ambiguity, inconsistency or defect or correct any typographical error or other manifest error in any Loan Document or (B) comply with local Law or advice of local counsel in any jurisdiction the Laws of which govern any Security Document or that are relevant to the creation, perfection, protection and/or priority of any Lien in favor of Administrative Agent, (C) effect the granting, perfection, protection, expansion or enhancement of any security interest in any Collateral or additional property to become Collateral for the benefit of the Secured Parties, (D) make administrative or operational changes not adverse to any Lender or (E) add a Guarantor or Collateral or otherwise enhance the rights and benefits of the Lenders.

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Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment(s) of any Defaulting Lender may not be increased or extended without the consent of such Lender; and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.

Section 11.11Notices.

(a)Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in Section 11.11(b)), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile as set forth on Schedule 11.11. Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received. Notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications, to the extent provided in Section 11.11(b) shall be effective as provided in Section 11.11(b).

(b)Electronic Communications. Notices and other communications to Lenders and hereunder may be delivered or furnished by electronic communication (including e-mail and internet or intranet websites) pursuant to procedures approved by Administrative Agent, provided that the foregoing shall not apply to notices to any Lender pursuant to Article 2 if such Lender has notified Administrative Agent that it is incapable of receiving notices under Article 2 by electronic communication. Administrative Agent or any Loan Party may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

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Unless Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such facsimile, email or other electronic communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.

(c)Change of Address, etc. Any party hereto may change its address or facsimile number for notices and other communications hereunder by notice to the other parties hereto, Schedule 11.11 shall be deemed to be amended by each such change, and Administrative Agent is authorized, in its discretion, from time to time to reflect each such change in an amended Schedule 11.11 provided by Administrative Agent to each party hereto.

(d)Platform.

(i)Each Loan Party agrees that Administrative Agent may, but shall not be obligated to, make the Communications (as defined below) available to the Lenders, L/C Issuer or Swing Line Lender by posting the Communications on the Platform.

(ii)The Platform is provided “as is” and “as available.” The Agent Parties do not warrant the adequacy of the Platform and expressly disclaim liability for errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Communications or the Platform. In no event shall the Agent Parties have any liability to any Loan Party, any Lender or any other Person or entity for damages of any kind, including, without limitation, direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of any Loan Party’s or Administrative Agent’s transmission of Communications through the Platform.

(iii)Each Loan Party (by its, his or her execution of a Loan Document) hereby authorizes Administrative Agent, each Lender, Swing Line Lender and their respective counsel and agents and Related Parties (each an “Authorized Party”) to communicate and transfer documents and other information (including confidential information) concerning this transaction or any Loan Party and the business affairs of such Loan Parties via the Internet or other electronic communication method. In no event shall any Authorized Party have any liability to any Loan Party, any Lender or any other Person or entity for damages of any kind (whether in tort, contract or otherwise) arising out of any such communications or transmissions, except to the extent that such damages are determined by a court of competent jurisdiction in a final and nonappealable judgment to have directly resulted from the gross negligence or willful misconduct of such Authorized Party; provided, however, that in no event shall any Authorized Party have any liability for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages).

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(e)Public Information. Each Loan Party hereby acknowledges that certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to receive material non-public information with respect to any Loan Party or its Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such securities. Each Loan Party hereby agrees that it will use commercially reasonable efforts to identify that portion of the materials and information provided by or on behalf of any Loan Party hereunder and under the other Loan Documents (collectively, “Borrower Materials”) that may be distributed to the Public Lenders and that (i) all such Borrower Materials shall be clearly and conspicuously marked “PUBLIC,” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (ii) by marking Borrower Materials “PUBLIC,” each Loan Party shall be deemed to have authorized Administrative Agent and the other Lenders to treat such Borrower Materials as not containing any material non-public information with respect to any Loan Party or its securities for purposes of U.S. federal and state securities Laws (provided, however, that to the extent that such Borrower Materials constitute Information, they shall be subject to Section 11.26); (iii) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Side Information;” and (iv) Administrative Agent shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Side Information”. Each Public Lender will designate one or more representatives that shall be permitted to receive information that is not designated as being available for Public Lenders, in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and under applicable Law, including United States federal and state securities Laws, to make reference to Borrower Materials that are not made available through the “Public Side Information” portion of the Platform and that may contain material non-public information with respect to any Loan Party or its Subsidiaries and its securities for the purposes of United States federal or state securities Laws.

Section 11.12Governing Law; Venue; Service of Process.

(a)Governing Law. This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be governed by, and construed in accordance with, the Laws of the State of Texas (without reference to applicable rules of conflicts of Laws), except to the extent the Laws of any jurisdiction where Collateral is located require application of such Laws with respect to such Collateral.

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(b)Jurisdiction. Each Loan Party irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding of any kind or description, whether in law or equity, whether in contract or in tort or otherwise, against Administrative Agent, any Lender, L/C Issuer, Swing Line Lender or any Related Party of the foregoing in any way relating to this Agreement or any other Loan Document or the transactions relating hereto or thereto, in any forum other than the courts of the State of Texas sitting in Dallas County, Texas, and of the United States District Court of the Northern District of Texas, and any appellate court from any thereof, and each of the parties hereto irrevocably and unconditionally submits to the jurisdiction of such courts and agrees that all claims in respect of any such action, litigation or proceeding may be heard and determined in such Texas state court or, to the fullest extent permitted by applicable Law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action, litigation or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Nothing in this Agreement or in any other Loan Document shall affect any right that Administrative Agent, any Lender, L/C Issuer or Swing Line Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Borrower or any of the other Loan Parties or their Properties in the courts of any jurisdiction.

(c)Waiver of Venue. Each Loan Party irrevocably and unconditionally waives, to the fullest extent permitted by applicable Law, any objection that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable Law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(d)Service of Process. Each party hereto irrevocably consents to service of process by the mailing thereof, in the manner provided for the mailing of notices in Section 11.11. Nothing in this Agreement will affect the right of any party hereto to serve process in any other manner permitted by applicable Law.

Section 11.13Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Except as provided in Section 4.1, this Agreement shall become effective when it shall have been executed by Administrative Agent and when Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic imaging means (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Agreement.

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Section 11.14Severability. Any provision of this Agreement or any other Loan Document held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Agreement and the effect thereof shall be confined to the provision held to be invalid or illegal. Furthermore, in lieu of such invalid or unenforceable provision there shall be added as a part of this Agreement or the other Loan Documents a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.

Section 11.15Headings. The headings, captions, and arrangements used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement.

Section 11.16Construction. Each Loan Party, Administrative Agent and each Lender acknowledge that each of them has had the benefit of legal counsel of its own choice and has been afforded an opportunity to review this Agreement and the other Loan Documents with its legal counsel and that this Agreement and the other Loan Documents shall be construed as if jointly drafted by each Loan Party, Administrative Agent and each Lender.

Section 11.17Independence of Covenants. All covenants hereunder shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitations of, another covenant shall not avoid the occurrence of a Default if such action is taken or such condition exists.

Section 11.18WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.18.

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Section 11.19Additional Interest Provision. It is expressly stipulated and agreed to be the intent of each Loan Party, Administrative Agent and each Lender at all times to comply strictly with the applicable Law governing the maximum rate or amount of interest payable on the indebtedness evidenced by any Note, any other Loan Document, and the Related Indebtedness (or applicable United States federal Law to the extent that it permits any Lender to contract for, charge, take, reserve or receive a greater amount of interest than under applicable Law). If the applicable Law is ever judicially interpreted so as to render usurious any amount (a) contracted for, charged, taken, reserved or received pursuant to any Note, any of the other Loan Documents or any other communication or writing by or between any Borrower or any other Loan Party and any Lender related to the transaction or transactions that are the subject matter of the Loan Documents, (b) contracted for, charged, taken, reserved or received by reason of Administrative Agent’s or any Lender’s exercise of the option to accelerate the maturity of any Note and/or the Related Indebtedness, or (c) any Loan Party will have paid or Administrative Agent or any Lender will have received by reason of any voluntary prepayment by Borrowers or any other Loan Party of any Note and/or the Related Indebtedness, then it is Borrowers’ and each other Loan Party’s, Administrative Agent’s and Lenders’ express intent that all amounts charged in excess of the Maximum Rate shall be automatically canceled, ab initio, and all amounts in excess of the Maximum Rate theretofore collected by Administrative Agent or any Lender shall be credited on the principal balance of any Note and/or the Related Indebtedness (or, if any Note and all Related Indebtedness have been or would thereby be paid in full, refunded to Borrowers or such other Loan Party, as applicable), and the provisions of any Note and the other Loan Documents shall immediately be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced, without the necessity of the execution of any new document, so as to comply with the applicable Law, but so as to permit the recovery of the fullest amount otherwise called for hereunder and thereunder; provided, however, if any Note or Related Indebtedness has been paid in full before the end of the stated term thereof, then Borrowers, each other Loan Party, Administrative Agent and each Lender agree that Administrative Agent or any Lender, as applicable, shall, with reasonable promptness after Administrative Agent or such Lender discovers or is advised by any Loan Party that interest was received in an amount in excess of the Maximum Rate, either refund such excess interest to such Loan Party, as applicable, and/or credit such excess interest against such Note and/or any Related Indebtedness then owing by Borrowers and the other Loan Parties to Administrative Agent or such Lender. Each Loan Party hereby agrees that as a condition precedent to any claim seeking usury penalties against Administrative Agent or such Lender, such Loan Party will provide written notice to Administrative Agent or any Lender, advising Administrative Agent or such Lender in reasonable detail of the nature and amount of the violation, and Administrative Agent or such Lender shall have sixty (60) days after receipt of such notice in which to correct such usury violation, if any, by either refunding such excess interest to such Loan Parties, as applicable, or crediting such excess interest against the Note to which the alleged violation relates and/or the Related Indebtedness then owing by the Loan Parties to Administrative Agent or such Lender. All sums contracted for, charged, taken, reserved or received by Administrative Agent or any Lender for the use, forbearance or detention of any debt evidenced by any Note and/or the Related Indebtedness shall, to the extent permitted by applicable Law, be amortized or spread, using the actuarial method, throughout the stated term of such Note and/or the Related Indebtedness (including any and all renewal and extension periods) until payment in full so that the rate or amount of interest on account of any Note and/or the Related Indebtedness does not exceed the Maximum Rate from time to time in effect and applicable to such Note and/or the Related Indebtedness for so long as debt is outstanding. In no event shall the provisions of Chapter 346 of the Texas Finance Code (which regulates certain revolving credit loan accounts and revolving triparty accounts) apply to the Notes and/or any of the Related Indebtedness. Notwithstanding anything to the contrary contained herein or in any of the other Loan Documents, it is not the intention of Administrative Agent or any Lender to accelerate the maturity of any interest that has not accrued at the time of such acceleration or to collect unearned interest at the time of such acceleration.

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Section 11.20Ceiling Election. To the extent that any Lender is relying on Chapter 303 of the Texas Finance Code to determine the Maximum Rate payable on any Note and/or any other portion of the Obligations under the Loan Documents, such Lender will utilize the weekly ceiling from time to time in effect as provided in such Chapter 303. To the extent United States federal Law permits any Lender to contract for, charge, take, receive or reserve a greater amount of interest than under Texas Law, such Lender will rely on United States federal Law instead of such Chapter 303 for the purpose of determining the Maximum Rate. Additionally, to the extent permitted by applicable Law now or hereafter in effect, any Lender may, at its option and from time to time, utilize any other method of establishing the Maximum Rate under such Chapter 303 or under other applicable Law by giving notice, if required, to Borrowers as provided by applicable Law now or hereafter in effect.

Section 11.21USA Patriot Act and Canadian AML Legislation Notice. Administrative Agent and each Lender hereby notifies each Loan Party that pursuant to the requirements of the Patriot Act and applicable Canadian AML Legislation, it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of each Loan Party and other information that will allow Administrative Agent and such Lender to identify each Loan Party in accordance with the Patriot Act and applicable Canadian AML Legislation. In addition, each Loan Party agrees to (a) ensure that no Person who owns a Controlling interest in or otherwise controls any Loan Party or any Subsidiary of Company or any other Loan Party is or shall be a Sanctioned Person, (b) not to use or permit the use of proceeds of the Obligations to violate any Anti-Corruption Laws, Anti-Terrorism Laws or any applicable Sanctions, and (c) comply, or cause its Subsidiaries to comply, with the applicable Laws.

Section 11.22Defaulting Lenders.

(a)Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:

(i)Waivers and Amendments. Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of “Required Lenders” and in Section 11.10.

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(ii)Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article 9 or otherwise) or received by Administrative Agent from a Defaulting Lender shall be applied at such time or times as may be determined by Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to L/C Issuer or Swing Line Lender hereunder; third, to Cash Collateralize L/C Issuer’s Fronting Exposure, if any, with respect to such Defaulting Lender in accordance with Section 2.7; fourth, as Borrowers may request (so long as no Default or Event of Default exists), to the funding of any Revolving Credit Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by Administrative Agent; fifth, if so determined by Administrative Agent and Borrowers, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Revolving Credit Loans under this Agreement and (y)  Cash Collateralize L/C Issuer’s future Fronting Exposure, if any, with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with Section 2.7; sixth, to the payment of any amounts owing to Lenders, L/C Issuer or Swing Line Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, L/C Issuer or Swing Line Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to Borrowers as a result of any judgment of a court of competent jurisdiction obtained by Borrowers against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that, if (x) such payment is a payment of the principal amount of any Loans or L/C Borrowings in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 4.2 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Obligations owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Obligations owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in L/C Obligations and Swing Line Loans are held by Lenders pro rata in accordance with the Commitments under the Revolving Credit Facility without giving effect to Section 11.22(a)(iv). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 11.22(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii)Certain Fees.

(A)No Defaulting Lender shall be entitled to receive any fee payable under Section 2.4(c) for any period during which that Lender is a Defaulting Lender (and Borrowers shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).

(B)Each Defaulting Lender shall be entitled to receive Letter of Credit Fees for any period during which that Lender is a Defaulting Lender only to the extent allocable to its Applicable Percentage of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.7.

(C)With respect to any fee payable under Section 2.4(c) or to any Letter of Credit Fee not required to be paid to any Defaulting Lender pursuant to clause (A) or (B) above, Borrowers shall (x) pay to each Lender that is a Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in L/C Obligations or Swing Line Loans that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to L/C Issuer and Swing Line Lender, as applicable, the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to such L/C Issuer’s or Swing Line Lender’s Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee.

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(iv)Reallocation of Applicable Percentages to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in L/C Obligations and Swing Line Loans shall be reallocated among the Lenders that are Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that such reallocation does not cause the aggregate Revolving Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Commitment. Subject to Section 11.23, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

(v)Cash Collateral, Repayment of Swing Line Loans. If the reallocation described in clause (a)(iv) above cannot, or can only partially, be effected, Borrowers shall, without prejudice to any right or remedy available to it hereunder or under applicable Law, (x) first, prepay Swing Line Loans in an amount equal to Swing Line Lender’s Fronting Exposure and (y) second, Cash Collateralize L/C Issuers’ Fronting Exposure in accordance with the procedures set forth in Section 2.7.

(b)Defaulting Lender Cure. If Borrowers, Administrative Agent, Swing Line Lender and L/C Issuer agree in writing that a Lender is no longer a Defaulting Lender, Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held on a pro rata basis by Lenders in accordance with their Applicable Percentages (without giving effect to Section 11.22(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of Borrowers while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

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Section 11.23Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of the Loans made by it or other obligations hereunder, resulting in such Lender’s receiving payment of a proportion of the aggregate amount of such Loans and accrued interest thereon greater than its pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall:

(a)notify Administrative Agent of such fact; and

(b)purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other amounts owing them, provided that:

(i)if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

(ii)the provisions of this Section 11.23 shall not be construed to apply to: (A) any payment made by or on behalf of Borrowers pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender); or (B) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or subparticipations in L/C Obligations or Swing Line Loans to any assignee or participant, other than an assignment to any Borrower or any Affiliate thereof (as to which the provisions of this Section 11.23 shall apply).

Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against such Loan Party, as applicable, rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of such participation.

Section 11.24Payments Set Aside. To the extent that any payment by or on behalf of any Loan Party is made to Administrative Agent, L/C Issuer or any Lender, or Administrative Agent, L/C Issuer or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by Administrative Agent, L/C Issuer or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (b) each Lender and L/C Issuer severally agrees to pay to Administrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of Lenders and L/C Issuer under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

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Section 11.25Setoff. If an Event of Default exists, Administrative Agent and each Lender shall have the right to set off against the Obligations under the Loan Documents, at any time and without notice to any Loan Party, any and all deposits (general or special, time or demand, provisional or final) or other sums at any time credited by or owing from Administrative Agent or such Lender to such Loan Party whether or not the Obligations under the Loan Documents are then due; provided that in the event that any Defaulting Lender shall exercise any such right of setoff: (a) all amounts so set off shall be paid over immediately to Administrative Agent for further application in accordance with the provisions of Section 11.22 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of Administrative Agent and Lenders; and (b) such Defaulting Lender shall provide promptly to Administrative Agent a statement describing in reasonable detail the Obligations under the Loan Documents owing to such Defaulting Lender as to which it exercised such right of setoff. Each amount set off shall be paid to Administrative Agent for application to the Obligations under the Loan Documents in the order set forth in Section 9.4. As further security for the Obligations, each Loan Party hereby grants to Administrative Agent and each Lender a security interest in all money, instruments, and other Property of such Loan Party, as applicable, now or hereafter held by Administrative Agent or such Lender, including, without limitation, Property held in safekeeping. In addition to Administrative Agent’s and each Lender’s right of setoff and as further security for the Obligations, each Loan Party hereby grants to Administrative Agent and each Lender a security interest in all deposits (general or special, time or demand, provisional or final) and other accounts of such Loan Party now or hereafter on deposit with or held by Administrative Agent or such Lender and all other sums at any time credited by or owing from Administrative Agent or such Lender to such Loan Party. The rights and remedies of Administrative Agent and each Lender hereunder are in addition to other rights and remedies (including, without limitation, other rights of setoff) which Administrative Agent or such Lender may have.

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Section 11.26Confidentiality. Each of Administrative Agent, L/C Issuer, Swing Line Lender and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its Related Parties (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential or shall otherwise be subject to confidentiality provisions generally), (b) to any regulatory authority purporting to have jurisdiction over it (including any self-regulatory authority, such as the National Association of Insurance Commissioners) or any Governmental Authority, quasi-Governmental Authority or legislative committee, (c) to the extent required by applicable Laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement or any other Loan Document, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to its being under a duty of confidentiality no less restrictive than this Section 11.26, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, (ii) any actual or prospective counterparty (or its Related Parties) to any Bank Product relating to any Loan Party and its obligations, (iii) any actual or prospective purchaser of a Lender or its holding company, (iv) any rating agency or any similar organization in connection with the rating of any Loan Party or the Revolving Credit Facility or (v) the CUSIP Service Bureau or any similar organization in connection with the issuance and monitoring of CUSIP numbers with respect to the Revolving Credit Facility, (g) with the consent of Borrowers or such other applicable Loan Parties, or (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section 11.26 or (ii) becomes available to Administrative Agent, L/C Issuer, Swing Line Lender, any Lender or any of their respective Affiliates on a nonconfidential basis from a source other than Borrowers. In addition, Administrative Agent and the Lenders may disclose the existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry and service providers to Administrative Agent and the Lenders in connection with the administration of this Agreement, the other Loan Documents, and the Commitments. For purposes of this Section 11.26, “Information” means all information received from any Borrower or any other Loan Party or any Subsidiary thereof relating to any Borrower or any other Loan Party or any Subsidiary thereof or any of their respective businesses which is clearly identified as confidential, other than any such information that is available to Administrative Agent, L/C Issuer, Swing Line Lender or any Lender on a nonconfidential basis prior to disclosure by any Borrower or any other Loan Party or any Subsidiary thereof; provided that, in the case of information received from any Borrower or any other Loan Party or any Subsidiary thereof after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section 11.26 shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information. Each Loan Party party hereto agrees and confirms that, as between such Loan Party and Texas Capital Bank, the obligations of Texas Capital Bank under this Section 11.26 supersede and replace in their respective entireties all confidentiality, non-disclosure and similar obligations of Texas Capital Bank, if any, set forth in any previous agreement between such Loan Party and Texas Capital Bank notwithstanding anything to the contrary contained therein.

Each of the Loan Parties hereby authorize Administrative Agent, with the written consent of the Borrower Representative, to publish the name and logo of any Loan Party and the amount of the credit facility provided hereunder in any “tombstone” or comparable advertisement which Administrative Agent desires to publish; provided, however, that Administrative Agent may provide industry trade organizations information necessary for inclusion in league table measurements without the written consent of the Borrower Representative.

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Section 11.27Electronic Execution of Assignments and Certain Other Documents. The words “execute”, “execution”, “signed”, “signature”, and words of like import in or related to this Agreement, any other Loan Document or any Assignment and Assumption or in any amendment or other modification hereof (including waivers and consents) shall be deemed to include Electronic Signatures or execution in the form of an Electronic Record, the electronic matching of assignment terms and contract formations on electronic platforms approved by Administrative Agent, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state Laws based on the Uniform Electronic Transactions Act. Notwithstanding anything contained herein to the contrary, Administrative Agent is under no obligation to accept an Electronic Signature in any form or in any format unless expressly agreed to by Administrative Agent pursuant to procedures approved by it; provided that  without limiting the foregoing, (a) to the extent Administrative Agent has agreed to accept such Electronic Signature from any party hereto, Administrative Agent and the other parties hereto shall be entitled to rely on any such Electronic Signature purportedly given by or on behalf of the executing party without further verification and (b) upon the request of Administrative Agent or any Lender, any Electronic Signature shall be promptly followed by an original manually executed counterpart thereof.

Section 11.28Acknowledgement and Consent to Bail-In of Affected Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender that is an Affected Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a)the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender that is an Affected Financial Institution; and

(b)the effects of any Bail-In Action on any such liability, including, if applicable:

(i)a reduction in full or in part or cancellation of any such liability;

(ii)a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(iii)the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of the applicable Resolution Authority.

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Section 11.29Keepwell. Each Qualified ECP Guarantor party hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of such other Loan Party’s (a) Swap Obligations and (b) obligations under the Guaranty including those with respect to Swap Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section, or otherwise under this Agreement or any other Loan Document, voidable under applicable Law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section shall remain in full force and effect until the Obligations (other than contingent indemnification obligations that survive the termination of this Agreement) have been paid in full and the Commitments have expired or terminated. Each Qualified ECP Guarantor intends that this Section constitute, and this Section shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(ii) of the Commodity Exchange Act.

Section 11.30NOTICE OF FINAL AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

Section 11.31Acknowledgement Regarding Any Supported QFCs. To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Hedge Agreements or any other agreement or instrument that is a QFC (such support, “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of Texas and/or of the United States or any other state of the United States):

In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regimes if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regimes, Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States.

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Article 12.

GUARANTY

Section 12.1Guaranty. In consideration of the Loans, advances and other credit heretofore or hereafter granted by the Secured Parties to Borrowers pursuant to this Agreement and the other Loan Documents and in further consideration of any Bank Product Agreements, Guarantors hereby, jointly and severally, unconditionally, absolutely and irrevocably, guarantee to the Secured Parties, the due and punctual payment at maturity, whether by acceleration or otherwise, and the due fulfillment and performance of the Obligations. Each Guarantor is jointly and severally liable for the full payment and performance of the Obligations as a primary obligor.

Section 12.2Payment. If any of the Obligations is not punctually paid when such indebtedness becomes due and payable, either by its terms or as a result of the exercise of any power to accelerate, Guarantors shall, immediately on demand and without presentment, protest, notice of protest, notice of nonpayment, notice of intent to accelerate, notice of acceleration or any other notice whatsoever (all of which are expressly waived in accordance with Section 12.3 hereof), pay the amount due and payable thereon to Administrative Agent, at its Principal Office. It is not necessary for Administrative Agent, in order to enforce such payment by Guarantors, first to institute suit or exhaust its remedies against Borrowers or others liable on the Obligations, or to enforce its rights against any security given to secure such Obligations. Administrative Agent is not required to mitigate damages or take any other action to reduce, collect or enforce the Obligations. No setoff, counterclaim, reduction or diminution of any obligation, or any defense of any kind which any Guarantor has or may have against any Borrower or any Secured Party shall be available hereunder to Guarantors. No payment by any Guarantor shall discharge the liability of Guarantors hereunder until the Obligations have been fully satisfied and the Release Date shall have occurred. If Administrative Agent must rescind or restore any payment, or any part thereof, received by Administrative Agent on any part of the Obligations, any prior release or discharge from the terms of this Guaranty given Guarantors by Administrative Agent or any reduction of any Guarantor’s liability hereunder shall be without effect, and this Guaranty shall remain in full force and effect.

Section 12.3Agreements and Waivers. Each Guarantor

(a)agrees to all terms and agreements heretofore or hereafter made by Borrowers with Administrative Agent and/or any other Secured Party;

(b)agrees that Administrative Agent may without impairing its rights or the obligations of such Guarantor hereunder (i) waive or delay the exercise of any of its rights or remedies against or release Borrowers or any other Person, including, without limitation, any other party who is or whose Property is liable with respect to the Obligations or any part thereof (Guarantors and any such other Person or Persons are hereafter collectively called the “Sureties” and individually called a “Surety”); (ii) take or accept any other security, collateral or guaranty, or other assurance of the payment of all or any part of the Obligations; (iii) release, surrender, exchange, subordinate or permit or suffer to exist any deterioration, waste, loss or impairment (including without limitation negligent, willful, unreasonable or unjustified impairment) of any collateral, Property or security, at any time existing in connection with, or assuring or securing payment of, all or any part of the Obligations or the liability of such Guarantor or any other Surety; (iv) increase, renew, extend, or modify the terms of any of the Obligations or any instrument or agreement evidencing the same; (v) apply payments by Borrowers, any Surety, or any other Person, to any of the Obligations; (vi) bring suit against any one or more Sureties without joining any other Surety or Borrowers in such proceeding; (vii) compromise or settle with any one or more Sureties in whole or in part for such consideration or no consideration as Administrative Agent may deem appropriate; or (viii) partially or fully release any Guarantor or any other Surety from liability hereunder;

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(c)agrees that the obligations of such Guarantor under this Guaranty shall not be released, diminished, or adversely affected by any of the following: (i) the insolvency, bankruptcy, rearrangement, adjustment, composition, liquidation, disability, dissolution or lack of power of Borrowers or any Surety; (ii) the invalidity, illegality or unenforceability of all or any part of the Obligations or any document or agreement executed in connection with the Obligations, for any reason, or the fact that any debt included in the Obligations exceeds the amount permitted by Law; (iii) the failure of Administrative Agent or any other party to exercise diligence or reasonable care or to act in a commercially reasonable manner in the preservation, protection, enforcement, sale or other handling or treatment of all or any part of such collateral, Property or security; (iv) the fact that any collateral, security or Lien contemplated or intended to be given, created or granted as security for the repayment of the Obligations is not properly perfected or created, or proves to be unenforceable or subordinate to any other Lien; (v) the fact that any Borrower has any defense to the payment of all or any part of the Obligations; (vi) any payment by Borrowers or any Surety to Administrative Agent and/or any other Secured Party is a preference under applicable Debtor Relief Laws, or for any reason Administrative Agent and/or any other Secured Party is required to refund such payment or pay such amounts to Borrowers, any such Surety, or someone else; (vii) any defenses which Borrowers could assert on the Obligations, including but not limited to failure of consideration, breach of warranty, fraud, payment, accord and satisfaction, strict foreclosure, statute of frauds, bankruptcy, statute of limitations, lender liability and usury; or (viii) any other action taken or omitted to be taken with respect to this Agreement, the Loan Documents, the Obligations, the security and collateral therefor whether or not such action or omission prejudices such Guarantor or any Surety, or increases the likelihood that such Guarantor will be required to pay the Obligations pursuant to the terms hereof;

(d)agrees that such Guarantor is obligated to pay the Obligations when due, notwithstanding any occurrence, circumstance, event, action or omission whatsoever, whether or not particularly described herein, except for the full and final payment and satisfaction of the Obligations;

(e)to the extent allowed by applicable Law, waives all rights and remedies now or hereafter accorded by applicable Law to guarantors or sureties, including without limitation any defense, right of offset or other claim which such Guarantor may have against Borrowers or which Borrowers may have against Administrative Agent and/or the Lenders;

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(f) waives all notices whatsoever with respect to this Guaranty or with respect to the Obligations, including, but without limitation, notice of (i) Administrative Agent’s and/or any other Secured Party’s acceptance hereof or its intention to act, or its action, in reliance hereon; (ii) the present existence, future incurring, or any amendment of the provisions of any of the Obligations or any terms or amounts thereof or any change therein in the rate of interest thereon; (iii) any default by Borrowers or any Surety; or (iv) the obtaining, enforcing, or releasing of any guaranty or surety agreement (in addition hereto), pledge, assignment or other security for any of the Obligations;

(g)waives notice of presentment for payment, notice of protest, protest, demand, notice of intent to accelerate, notice of acceleration and notice of nonpayment, protest in relation to any instrument evidencing any of the Obligations, and any demands and notices required by Law, except as such waiver may be expressly prohibited by Law, and diligence in bringing suits against any Surety; and

(h)waives each right to which it may be entitled by virtue of the Laws of the State of Texas governing or relating to suretyship and guaranties, including, without limitation, any rights under Rule 31, Texas Rules of Civil Procedure, Chapter 51 of the Texas Property Code, Section 17.001 of the Texas Civil Practice and Remedies Code, Section 3.605 of the Uniform Commercial Code, and Chapter 43 of the Texas Civil Practice and Remedies Code, as any or all of the same may be amended or construed from time to time, or the common law of the State of Texas at all relevant times.

Section 12.4Liability. The liability of each Guarantor under this Guaranty is irrevocable, absolute and unconditional, without regard to the liability of any other Person, and shall not in any manner be affected by reason of any action taken or not taken by Administrative Agent and/or any other Secured Party, which action or inaction is herein consented and agreed to, nor by the partial or complete unenforceability or invalidity of any other guaranty or surety agreement, pledge, assignment or other security for any of the Obligations. No delay in making demand on Sureties or any of them for satisfaction of the liability hereunder shall prejudice Administrative Agent’s right to enforce such satisfaction. All of Administrative Agent’s rights and remedies shall be cumulative and any failure of Administrative Agent to exercise any right hereunder shall not be construed as a waiver of the right to exercise the same or any other right at any time, and from time to time, thereafter. This is a continuing guaranty of payment, not a guaranty of collection, and this Guaranty shall be binding upon Guarantors regardless of how long before or after the date hereof any of the Obligations were or are incurred.

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Section 12.5Subordination. If a Borrower or any other Loan Party is now or hereafter becomes indebted to one or more Guarantors (such indebtedness and all interest thereon is referred to as the “Affiliated Debt”), such Affiliated Debt shall be subordinate in all respects to the full payment and performance of the Obligations, and no Guarantor shall be entitled to enforce or receive payment with respect to any Affiliated Debt until the Release Date. Each Guarantor agrees that any Liens, mortgages, deeds of trust, security interests, judgment liens, charges or other encumbrances upon any Loan Party’s assets securing the payment of the Affiliated Debt shall be and remain subordinate and inferior to any Liens, mortgages, deeds of trust, security interests, judgment liens, charges or other encumbrances upon any Loan Party’s assets securing the payment of the Obligations, and without the prior written consent of Administrative Agent, no Guarantor shall exercise or enforce any creditor’s rights of any nature against any Loan Party to collect the Affiliated Debt (other than demand payment therefor). In the event of the receivership, bankruptcy, reorganization, arrangement, debtor’s relief or other insolvency proceedings involving any Borrower or any applicable Loan Party as a debtor, Administrative Agent has the right and authority, either in its own name or as attorney-in-fact for any applicable Guarantor, to file such proof of debt, claim, petition or other documents and to take such other steps as are necessary to prove its rights hereunder and receive directly from the receiver, trustee or other court custodian, payments, distributions or other dividends which would otherwise be payable upon the Affiliated Debt. Each Guarantor hereby assigns such payments, distributions and dividends to Administrative Agent, and irrevocably appoints Administrative Agent as its true and lawful attorney-in-fact with authority to make and file in the name of such Guarantor any proof of debt, amendment of proof of debt, claim, petition or other document in such proceedings and to receive payment of any sums becoming distributable on account of the Affiliated Debt, and to execute such other documents and to give acquittances therefor and to do and perform all such other acts and things for and on behalf of such Guarantor as may be necessary in the opinion of Administrative Agent in order to have the Affiliated Debt allowed in any such proceeding and to receive payments, distributions or dividends of or on account of the Affiliated Debt.

Section 12.6Subrogation. No Guarantor waives or releases any rights of subrogation, reimbursement or contribution which such Guarantor may have, after full and final payment of the Obligations, against others liable on the Obligations. Each Guarantor’s rights of subrogation and reimbursement are subordinate in all respects to the rights and claims of Administrative Agent and the other Secured Parties, and no Guarantor may exercise any rights it may acquire by way of subrogation under this Guaranty, by payment made hereunder or otherwise, until the Release Date. If any amount is paid to any Guarantor on account of such subrogation rights prior to the Release Date, such amount shall be held in trust for the benefit of Administrative Agent and/or the other Secured Parties to be credited and applied on the Obligations, whether matured or unmatured.

Section 12.7Other Indebtedness or Obligations of Guarantors. If any Guarantor is or becomes liable for any indebtedness owed by any Loan Party to the Lenders by endorsement or otherwise than under this Guaranty, such liability shall not be affected by this Guaranty, and the rights of Administrative Agent and the Lenders hereunder shall be cumulative of all other rights that Administrative Agent and the Lenders may have against such Guarantor. The exercise by Administrative Agent of any right or remedy hereunder or under any other instrument or at law or in equity shall not preclude the concurrent or subsequent exercise of any other instrument or remedy at law or in equity and shall not preclude the concurrent or subsequent exercise of any other right or remedy. Further, without limiting the generality of the foregoing, this Guaranty is given by Guarantors as an additional guaranty to all guaranties heretofore or hereafter executed and delivered to Administrative Agent and/or the Lenders by Guarantors in favor of Administrative Agent and/or the Lenders relating to the indebtedness of the Loan Parties to the Secured Parties, and nothing herein shall be deemed to replace or be in lieu of any other of such previous or subsequent guarantees.

Section 12.8Costs and Expenses. Guarantors jointly and severally agree to pay to Administrative Agent and the Lenders, upon demand, all losses and costs and expenses, including attorneys’ fees, that may be incurred by Administrative Agent and the Lenders in attempting to cause the Obligations to be satisfied or in attempting to cause satisfaction of Guarantors’ liability under this Guaranty.

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Section 12.9Exercising Rights, Etc. No notice to or demand upon any Guarantor in any case shall, of itself, entitle such Guarantor or any other Guarantor to any other or further notice or demand in similar or other circumstances. No delay or omission by Administrative Agent in exercising any power or right hereunder shall impair such right or power or be construed as a waiver thereof or any acquiescence therein, nor shall any single or partial exercise of any such power preclude other or further exercise thereof, or the exercise of any other right or power hereunder.

Section 12.10Benefit; Binding Effect. This Guaranty shall inure to the benefit of Administrative Agent and each other Secured Party and their respective successors and assigns, and to any interest in any of the Obligations. All of the obligations of Guarantors arising hereunder shall be jointly and severally binding on each of the Persons signing this Guaranty, and their respective successors and assigns (provided, however, that no Guarantor may, without the prior written consent of Administrative Agent in each instance, assign or delegate any of its rights, powers, duties or obligations hereunder, and any attempted assignment or delegation made without Administrative Agent’s prior written consent shall be void ab initio and of no force or effect).

Section 12.11Multiple Guarantors. It is specifically agreed that Administrative Agent may enforce the provisions hereof with respect to one or more Guarantors without seeking to enforce the same as to all or any Guarantors. If one or more additional guaranty agreements (“Other Guaranties”) are executed by one or more additional guarantors (“Other Guarantors”), which guarantee, in whole or in part, any of the Obligations, it is specifically agreed that Administrative Agent may enforce the provisions of this Guaranty or of Other Guaranties with respect to one or more of Guarantors or any one or more of Other Guarantors under Other Guaranties without seeking to enforce the provisions of this Guaranty or Other Guaranties as to all or any of Guarantors or Other Guarantors. Each Guarantor hereby waives any requirement of joinder of all or any other Guarantor or all or any of Other Guarantors in any suit or proceeding to enforce the provisions of this Guaranty or of Other Guaranties. The liability hereunder of all Guarantors hereunder shall be joint and several.

Section 12.12Additional Guarantors. From time to time subsequent to the date hereof, additional Persons may become parties hereto as additional Guarantors (each, an “Additional Guarantor”), by executing a Joinder Agreement. Upon delivery of any such Joinder Agreement to Administrative Agent, notice of which is hereby waived by Guarantors, each Additional Guarantor shall be a Guarantor and shall be as fully a party hereto as if Additional Guarantor were an original signatory hereto. Each Guarantor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the addition or release of any other Guarantor hereunder, nor by any election of Administrative Agent not to cause any Subsidiary or Affiliate of Company to become an Additional Guarantor hereunder. This Guaranty shall be fully effective as to any Guarantor that is or becomes a party hereto regardless of whether any other Person becomes or fails to become or ceases to be a Guarantor hereunder.

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Section 12.13Reinstatement. Notwithstanding anything contained in this Agreement or the other Loan Documents, the obligations of each Guarantor under this Article 12 shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of any Person in respect of the Obligations is rescinded or must be otherwise restored by any holder of any of the Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise, and each Guarantor agrees that it will indemnify each Secured Party on demand for all reasonable costs and expenses (including, without limitation, reasonable fees of counsel) incurred by such Person in connection with such rescission or restoration, including any such costs and expenses incurred in defending against any claim alleging that such payment constituted a preference, fraudulent transfer or similar payment under any Debtor Relief Law.

Section 12.14Maximum Liability. Anything in this Guaranty to the contrary notwithstanding, the obligations of each Guarantor hereunder shall be limited to a maximum aggregate amount equal to the largest amount that would not render its obligations hereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11 of the United States Code or any applicable provisions of comparable Law (collectively, the “Fraudulent Transfer Laws”), in each case after giving effect to all other liabilities of such Guarantor, contingent or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically excluding, however, any liabilities of such Guarantor in respect of intercompany indebtedness to other Loan Parties or Affiliates of other Loan Parties to the extent that such indebtedness would be discharged in an amount equal to the amount paid or Property conveyed by such Guarantor under the Loan Documents) and after giving effect as assets, subject to Section 12.6, to the value (as determined under the applicable provisions of the Fraudulent Transfer Laws) of any rights to subrogation or contribution of such Guarantor pursuant to (a) applicable Law or (b) any agreement providing for an equitable allocation among such Guarantor and other Loan Parties of obligations arising under the Loan Documents and Bank Product Agreements.

[Remainder of Page Intentionally Left Blank; Signature Page Follows]

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ANNEX C

SCHEDULE 5.13

Parent

Parent	Jurisdiction of Organization	Ownership in Company
FlexEnergy Green Solutions, Inc.	Delaware	100%

Subsidiaries

Loan Party	Jurisdiction of Organization	Ownership in Subsidiary
Flex Power Co.	Delaware	Flex Leasing Power & Service LLC – 100%
Flex Leasing Power and Service, ULC	Alberta, Canada	Flex Power Co. – 100%

ANNEX C

EX-10.34

Exhibit 10.34

THIS INSTRUMENT AND ANY SECURITIES ISSUABLE PURSUANT HERETO HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED EXCEPT AS PERMITTED IN THIS SAFE AND UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION THEREFROM.

FLEXENERGY POWER SOLUTIONS, LLC

AMENDED AND RESTATED
SAFE

(Simple Agreement for Future Equity)

THIS CERTIFIES THAT in exchange for the payment by the undersigned investor (the “Investor”) of the Funded Amount, FlexEnergy Power Solutions, LLC, a Delaware limited liability corporation (the “Company”), issues to the Investor the right to certain equity securities, subject to the terms described below. This Amended and Restated Safe (this “Safe”) amends, restates, supersedes and replaces that the Original Safe (defined below). Certain capitalized terms used herein have the meanings ascribed to them in Section 2.

WHEREAS, the Company previously issued to the Investor that certain Safe dated August 16, 2021 (the “Original Safe”);

WHEREAS, the Investor previously paid $1,500,000 of the Purchase Amount to the Company, portions of which were contributed by the Company to FlexEnergy, Inc. and Flex Leasing Power & Service LLC, thereby benefiting FGS; and

WHEREAS, the Company, the Investor and FGS desire to enter into this Safe to, among other things, (i) extend the Conversion Date to January 31, 2022, (ii) increase the Purchase Amount to $2,000,000, and (iii) require that FGS redeem FGS Stock from the Investor to the extent FGS receives net proceeds from the sale of securities with respect to any underwriter overallotment in the IPO Transaction.

NOW THEREFORE, the Investor hereby agrees to pay to the Company the remaining $500,000 of the Purchase Amount at the sole discretion of the Company within the five (5)-day period following written notice from the Company delivered to the Investor no later than January 31, 2022 (provided that any such written notice by the Company shall also be made proportionately with respect to the relative unpaid Purchase Amount of each other Safe issued by the Company).

1.Events.

(a)IPO Transaction.

(i)If an IPO Transaction occurs on or before the Conversion Date, the Investor will automatically be entitled to payment by the Company of the Cash-Out Amount to the extent the Company receives any proceeds from the sale of FGS Stock in the IPO Transaction.

(ii)If an IPO Transaction occurs on or before the Conversion Date and the Investor does not receive the full Cash-Out Amount pursuant to Section 1(a)(i) above in connection therewith, then (A) this Safe’s “Funded Amount” shall be reduced by 80% of any portion of the Cash-Out Amount paid to the Investor pursuant to Section 1(a)(i), and (B) this Safe will automatically convert into the right to immediately receive from the Company a number of shares of FGS Stock equal to the Funded Amount (as reduced pursuant to clause (A) above, if applicable), divided by the IPO Discount Price. To the extent FGS receives net proceeds (after deduction of underwriting commissions and applicable offering expenses) from the sale of FGS Stock with respect to any underwriter overallotment shares in the IPO Transaction, FGS shall redeem the shares of FGS Stock transferred by the Company to the Investor pursuant to this Section 1(a)(ii) at a price per share equal to the per Unit price at which Units are sold in the IPO.

(b)No IPO Transaction.

(i)If an IPO Transaction does not occur on or before the Conversion Date or if an Other Event occurs prior to the Conversion Date, then this Safe will automatically convert into the right to immediately receive from the Company FLPS Equity representing percentage economic and ownership interest equal to (A) 36.666667% multiplied by (B) a fraction, (I) the numerator of which is the Funded Amount and (II) the denominator of which is $5,500,000.

(ii)Notwithstanding the foregoing, this Section 1(b) shall have no legal force or effect unless and until TCB shall have approved or otherwise amended or waived the terms of the credit agreement between TCB and FLPS to permit the ownership in FLPS by the Investor contemplated by this Section 1(b).

(c)Liquidity Event. If there is a Liquidity Event before the termination of this Safe, the Investor will automatically be entitled to receive a portion of Liquidity Proceeds equal to the Cash-Out Amount, due and payable to the Investor immediately prior to the consummation of the Liquidity Event.

(d)Termination. This Safe will automatically terminate (without relieving the Company of any obligations arising from a prior breach of or non-compliance with this Safe or relieving FGS of any redemption obligations under Section 1(a)(ii)) immediately following the earliest to occur of: (i) the delivery of FGS Stock and/or payment of Cash-Out Amount to the Investor under Section 1(a); (ii) the delivery of FLPS Equity to the Investor pursuant to the automatic conversion of this Safe under Section 1(b); or (iii) the payment, or setting aside for payment, of the Cash-Out Amount due the Investor pursuant to Section 1(c).

2.Definitions.

(a)“Cash-Out Amount” means 125% of the Funded Amount.

(b)“Conversion Date” means January 31, 2022.

(c)“Discount Rate” means 80%.

(d)“Effective Date” means the corresponding date set forth on the signature page to this Safe.

(e)“FGS” means FlexEnergy Green Solutions, Inc., a Delaware corporation.

(f)“FGS Stock” means common stock of FGS.

(g)“FLPS” means Flex Leasing Power & Service LLC, a Delaware limited liability company.

(h)“FGS Equity” means equity securities of FLPS.

(i)“Funded Amount” means that portion of the Purchase Amount that has been paid to the Company pursuant to the terms of this Safe, subject to reduction pursuant to clause (A) of Section 1(a)(ii) above.

(j)“IPO Discount Price” means (i) the gross cash price per Unit at which Units are sold in the IPO, multiplied by (ii) the Discount Rate.

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(k)“IPO Transaction” means (i) the final closing (including any closing with respect to the sale of overallotment shares) of the first firm commitment underwritten initial public offering of Units pursuant to a registration statement filed under the Securities Act (the “IPO”), and (ii) a related pre-closing contribution or other transfer to FGS of the Company’s equity interests in FlexEnergy, Inc. and FLPS in exchange for FGS Stock (the “FGS Contribution”).

(l)“Liquidity Event” means (i) a transaction or series of related transactions in which any “person” or “group” (within the meaning of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), other than any “person” or “group” that is an existing beneficial owner of t Company or affiliate thereof, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of more than 50% of the outstanding voting securities of the Company having the right to vote for the election of members of the Company’s board of directors, (ii) any reorganization, merger or consolidation of the Company, other than a transaction or series of related transactions in which the holders of the voting securities of the Company outstanding immediately prior to such transaction or series of related transactions retain, immediately after such transaction or series of related transactions, at least a majority of the total voting power represented by the outstanding voting securities of the Company or such other surviving or resulting entity, or (iii) a sale, lease or other disposition of all or substantially all of the assets of the Company.

(m)“Liquidity Proceeds” means cash and other assets (including without limitation stock and other securities consideration) that are proceeds from the Liquidity Event and legally available for distribution.

(n)“Other Event” means, with respect to the Company or any material direct or indirect subsidiary thereof, (i) a voluntary termination of operations, (ii) a general assignment for the benefit of the its creditors, (iii) any other liquidation, dissolution or winding up of the entity, whether voluntary or involuntary, or (iv) commencement of a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect, or consent to any such relief or to the appointment of or taking possession of its property by any official in an involuntary case or other proceeding commenced against it; provided, however that the FGS Contribution in connection with an IPO Transaction shall not be deemed an Other Event.

(o)“Purchase Amount” means the corresponding amount set forth on the signature page to this Safe.

(p)“Safe” means an instrument containing a future right to receive shares of FGS Stock or FLPS Equity from the Company, similar in form and content to this instrument, purchased by investors for the purpose of funding the Company’s business operations. References to “this Safe” mean this specific instrument.

(q)“Securities Act” means the Securities Act of 1933, as amended.

(r)“TCB” means Texas Capital Bank, National Association.

(s)“Units” means units, each consisting of one share of FGS Stock and one warrant to purchase a share of FGS Stock being offered and sold in the IPO.

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3.Company Representations.

(a)The Company is a limited liability company duly organized, validly existing and in good standing under the laws of its state of incorporation, and has the power and authority to own, lease and operate its properties and carry on its business as now conducted.

(b)The execution, delivery and performance by the Company of this Safe is within the power of the Company and has been duly authorized by all necessary actions on the part of the Company. This Safe constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity. To its knowledge, the Company is not in violation of (i) its current certificate of formation or limited liability company operating agreement, (ii) any material statute, rule or regulation applicable to the Company, or (iii) any material debt or contract to which the Company is a party or by which it is bound, where, in each case, such violation or default, individually, or together with all such violations or defaults, could reasonably be expected to have a material adverse effect on the Company.

(c)The performance and consummation of the transactions contemplated by this Safe do not and will not: (i) violate any material judgment, statute, rule or regulation applicable to the Company, (ii) result in the acceleration of any material debt or contract to which the Company is a party or by which it is bound, or (iii) result in the creation or imposition of any lien on any property, asset or revenue of the Company or the suspension, forfeiture, or nonrenewal of any material permit, license or authorization applicable to the Company, its business or operations.

(d)To its knowledge, the Company owns or possesses (or can obtain on commercially reasonable terms) sufficient legal rights to all patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information, processes and other intellectual property rights necessary for its business as now conducted and as currently proposed to be conducted, without any conflict with, or infringement of the rights of, others.

4.Investor Representations.

(a)The Investor has full legal capacity, power and authority to execute and deliver this Safe and to perform its obligations hereunder. This Safe constitutes valid and binding obligation of the Investor, enforceable in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity.

(b)The Investor is an accredited investor as such term is defined in Rule 501 of Regulation D under the Securities Act. The Investor has been advised that this Safe and the underlying securities have not been registered under the Securities Act, or any state securities laws and, therefore, cannot be resold unless they are registered under the Securities Act and applicable state securities laws or unless an exemption from such registration requirements is available. The Investor is acquiring this Safe and the securities to be acquired by the Investor hereunder for its own account for investment, not as a nominee or agent, and not with a view to, or for resale in connection with, the distribution thereof, and the Investor has no present intention of selling, granting any participation in, or otherwise distributing the same except in full compliance with all applicable securities laws. The Investor has such knowledge and experience in financial and business matters that the Investor is capable of evaluating the merits and risks of such investment, is able to incur a complete loss of such investment without impairing the Investor’s financial condition and is able to bear the economic risk of such investment for an indefinite period of time.

5.FGS Representations.

(a)FGS is a corporation duly incorporated, validly existing and in good standing under the laws of its state of incorporation, and has the power and authority to own, lease and operate its properties and carry on its business as now conducted.

(b)The execution, delivery and performance by FGS of this Safe is within the power of FGS and has been duly authorized by all necessary actions on the part of FGS. This Safe constitutes a legal, valid and binding obligation of FGS, enforceable against FGS in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity. To its knowledge, FGS is not in violation of (i) its current certificate of incorporation or bylaws, (ii) any material statute, rule or regulation applicable to FGS, or (iii) any material debt or contract to which FGS is a party or by which it is bound, where, in each case, such violation or default, individually, or together with all such violations or defaults, could reasonably be expected to have a material adverse effect on FGS.

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(c)The performance and consummation of the transactions contemplated by this Safe do not and will not: (i) violate any material judgment, statute, rule or regulation applicable to FGS, (ii) result in the acceleration of any material debt or contract to which FGS is a party or by which it is bound, or (iii) result in the creation or imposition of any lien on any property, asset or revenue of FGS or the suspension, forfeiture, or nonrenewal of any material permit, license or authorization applicable to FGS, its business or operations.

6.Additional Covenants.

(a)FLPS LLC Operating Agreement. In connection with the delivery of FLPS Equity pursuant to Section 1(b), the Company and the Investor will execute and deliver a limited liability company operating agreement for FLPS based on the Company’s existing limited liability company operating agreement with respect to governance practices and other matters (but with the Company as the controlling FLPS owner, and with customary minority owner protections to include tag-along rights, drag-along rights and non-punitive amendment provisions).

(b)FLPS Equity Pledge and Limited Guaranty. In connection with the delivery of FLPS Equity pursuant to Section 1(b), the Investor shall execute and deliver to the Company and TCB such agreements and other documents as TCB may reasonably require for a pledge by the Investor of such Investor’s FLPS Equity under a limited guaranty of the obligations of FLPS under the credit agreement between FLPS and TCB, consistent with the Company’s pledge of FLPS Equity and limited guaranty of obligations of FLPS under the credit agreement between FLPS and TCB.

(c)Third Party Approvals. The Company shall exercise its best efforts to secure within 30 days any and all third party approvals or actions necessary with respect to any and all of the terms of this Agreement (including without limitation securing from approval, amendment or waiver with respect to the terms of the credit agreement between TCB and FLPS to permit ownership in FLPS by the Investor contemplated by Section 1(b)).

(d)Registration Rights. In connection with the delivery of FGS Stock pursuant to Section 1(a), the Company and the Investor will execute and deliver a registration rights agreement provided by the Company substantially in the form of the draft agreement prepared in connection with the execution of this Safe.

(e)Other IPO Transaction Documents. In connection with the delivery of FGS Stock pursuant to Section 1(a), the Investor will execute and deliver to the Company all transaction documents (including a lock-up agreement) required of an FGS stockholder in the IPO Transaction.

(f)Pro Rata Payment of Cash-Out Amount. To extent the Investor and any other Safe holder is entitled to receipt of any Cash-Out Amount but Liquidity Proceeds or proceeds from the Company’s sale of FGS Stock, as applicable, are insufficient to pay the full amount of the Cash-Out Amount, the Company shall partially pay the Cash-Out Amount with respect each Safe in proportion to the relative Funded Amount of each Safe.

(g)Pro Rata Redemptions. To extent the Investor and any other Safe holder is entitled to redemption of FGS Stock pursuant to Section 1(a)(ii), but net proceeds from underwriter IPO overallotment exercise are insufficient for FGS to redeem all FGS Stock transferred by the Company pursuant to Section 1(a)(ii) of the Safes, FGS shall partially redeem FGS Stock with respect each Safe in proportion to the relative Funded Amount of each Safe. For the avoidance of doubt, other than with respect to the net proceeds of any underwriter IPO overallotment exercise, FGS is not obligated by this Safe to redeem any FGS Stock.

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7.Miscellaneous.

(a)Any provision of this Safe may be amended, waived or modified by written consent of the Company, the Investor and FGS.

(b)Any notice required or permitted by this Safe will be deemed sufficient when delivered personally or by overnight courier or sent by email to the relevant address listed on the signature page, or 48 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, addressed to the party to be notified at such party’s address listed on the signature page, as subsequently modified by written notice.

(c)The Investor is not entitled, as a holder of this Safe, to vote or be deemed a holder of equity securities for any purpose other than tax purposes, nor will anything in this Safe be construed to confer on the Investor, as such, any rights of a Company, FGS or FLPS equity holder or rights to vote for the election of any directors or managers thereof, or on any matter submitted to equity holders of the Company, FGS or FLPS, or to give or withhold consent to any action or to receive notice of meetings, until such FGS Stock or FLPS Equity has been issued on the terms described in Section 1.

(d)Neither this Safe nor the rights in this Safe are transferable or assignable, by operation of law or otherwise, by either party without the prior written consent of the other; provided, however, that this Safe and/or its rights may be assigned without the Company’s consent by the Investor (i) to the Investor’s estate, heirs, executors, administrators, guardians and/or successors in the event of Investor’s death or disability, or (ii) to any other entity who directly or indirectly, controls, is controlled by or is under common control with the Investor, including, without limitation, any general partner, managing member, officer or director of the Investor, or any venture capital fund now or hereafter existing which is controlled by one or more general partners or managing members of, or shares the same management company with, the Investor; and provided, further, that the Company may assign this Safe in whole, without the consent of the Investor, in connection with a reincorporation to change the Company’s domicile.

(e)In the event any one or more of the provisions of this Safe is for any reason held to be invalid, illegal or unenforceable, in whole or in part or in any respect, or in the event that any one or more of the provisions of this Safe operate or would prospectively operate to invalidate this Safe, then and in any such event, such provision(s) only will be deemed null and void and will not affect any other provision of this Safe and the remaining provisions of this Safe will remain operative and in full force and effect and will not be affected, prejudiced, or disturbed thereby.

(f)All rights and obligations hereunder will be governed by the laws of the State of Delaware, without regard to the conflicts of law provisions of such jurisdiction.

(Signature page follows)

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IN WITNESS WHEREOF, the undersigned have caused this Amended and Restated Safe to be duly executed and delivered.

Purchase Amount:                    $2,000,000.00

Effective Date:          December 2, 2021

Company:
FlexEnergy Power Solutions, LLC
By:	/s/ W. Patrick Connelly
Name:	W. Patrick Connelly
Title:	Manager
Investor:
	RNS Flex LLC
	(Investor Name)
By: RNS Management, LLC, its Manager
By:	/s/ Thomas R. Denison
Name:	Thomas R. Denison
Title:	Manager
FGS:
FlexEnergy Green Solutions, LLC
By:	/s/ Wes Kimmel
Name:	Wes Kimmel
Title:	Chief Financial Officer

FlexEnergy Power Solutions, LLC

Amended and Restated Safe (Simple Agreement for Future Equity)

Signature Page

EX-10.35

Exhibit 10.35

THIS INSTRUMENT AND ANY SECURITIES ISSUABLE PURSUANT HERETO HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED EXCEPT AS PERMITTED IN THIS SAFE AND UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION THEREFROM.

FLEXENERGY POWER SOLUTIONS, LLC

AMENDED AND RESTATED

SAFE

(Simple Agreement for Future Equity)

THIS CERTIFIES THAT in exchange for the payment by the undersigned investor (the “Investor”) of the Funded Amount, FlexEnergy Power Solutions, LLC, a Delaware limited liability corporation (the “Company”), issues to the Investor the right to certain equity securities, subject to the terms described below. This Amended and Restated Safe (this “Safe”) amends, restates, supersedes and replaces that the Original Safe (defined below). Certain capitalized terms used herein have the meanings ascribed to them in Section 2.

WHEREAS, the Company previously issued to the Investor that certain Safe dated August 16, 2021 (the “Original Safe”);

WHEREAS, the Investor previously paid $1,500,000 of the Purchase Amount to the Company, portions of which were contributed by the Company to FlexEnergy, Inc. and Flex Leasing Power & Service LLC, thereby benefiting FGS; and

WHEREAS, the Company, the Investor and FGS desire to enter into this Safe to, among other things, (i) extend the Conversion Date to January 31, 2022, (ii) increase the Purchase Amount to $3,500,000, and (iii) require that FGS redeem FGS Stock from the Investor to the extent FGS receives net proceeds from the sale of securities with respect to any underwriter overallotment in the IPO Transaction.

NOW THEREFORE, the Investor hereby agrees to pay to the Company the remaining $2,000,000 of the Purchase Amount at the sole discretion of the Company within the five (5)-day period following written notice from the Company delivered to the Investor no later than January 31, 2022 (provided that any such written notice by the Company shall also be made proportionately with respect to the relative unpaid Purchase Amount of each other Safe issued by the Company).

1.Events.

(a)IPO Transaction.

(i)If an IPO Transaction occurs on or before the Conversion Date, the Investor will automatically be entitled to payment by the Company of the Cash-Out Amount to the extent the Company receives any proceeds from the sale of FGS Stock in the IPO Transaction.

(ii)If an IPO Transaction occurs on or before the Conversion Date and the Investor does not receive the full Cash-Out Amount pursuant to Section 1(a)(i) above in connection therewith, then (A) this Safe’s “Funded Amount” shall be reduced by 80% of any portion of the Cash-Out Amount paid to the Investor pursuant to Section 1(a)(i), and (B) this Safe will automatically convert into the right to immediately receive from the Company a number of shares of FGS Stock equal to the Funded Amount (as reduced pursuant to clause (A) above, if applicable), divided by the IPO Discount Price. To the extent FGS receives net proceeds (after deduction of underwriting commissions and applicable offering expenses) from the sale of FGS Stock with respect to any underwriter overallotment shares in the IPO Transaction, FGS shall redeem the shares of FGS Stock transferred by the Company to the Investor pursuant to this Section 1(a)(ii) at a price per share equal to the per Unit price at which Units are sold in the IPO.

(b)No IPO Transaction.

(i)If an IPO Transaction does not occur on or before the Conversion Date or if an Other Event occurs prior to the Conversion Date, then this Safe will automatically convert into the right to immediately receive from the Company FLPS Equity representing percentage economic and ownership interest equal to (A) 36.666667% multiplied by (B) a fraction, (I) the numerator of which is the Funded Amount and (II) the denominator of which is $5,500,000.

(ii)Notwithstanding the foregoing, this Section 1(b) shall have no legal force or effect unless and until TCB shall have approved or otherwise amended or waived the terms of the credit agreement between TCB and FLPS to permit the ownership in FLPS by the Investor contemplated by this Section 1(b).

(c)Liquidity Event. If there is a Liquidity Event before the termination of this Safe, the Investor will automatically be entitled to receive a portion of Liquidity Proceeds equal to the Cash-Out Amount, due and payable to the Investor immediately prior to the consummation of the Liquidity Event.

(d)Termination. This Safe will automatically terminate (without relieving the Company of any obligations arising from a prior breach of or non-compliance with this Safe or relieving FGS of any redemption obligations under Section 1(a)(ii)) immediately following the earliest to occur of: (i) the delivery of FGS Stock and/or payment of Cash-Out Amount to the Investor under Section 1(a); (ii) the delivery of FLPS Equity to the Investor pursuant to the automatic conversion of this Safe under Section 1(b); or (iii) the payment, or setting aside for payment, of the Cash-Out Amount due the Investor pursuant to Section 1(c).

2.Definitions.

(a)“Cash-Out Amount” means 125% of the Funded Amount.

(b)“Conversion Date” means January 31, 2022.

(c)“Discount Rate” means 80%.

(d)“Effective Date” means the corresponding date set forth on the signature page to this Safe.

(e)“FGS” means FlexEnergy Green Solutions, Inc., a Delaware corporation.

(f)“FGS Stock” means common stock of FGS.

(g)“FLPS” means Flex Leasing Power & Service LLC, a Delaware limited liability company.

(h)“FGS Equity” means equity securities of FLPS.

(i)“Funded Amount” means that portion of the Purchase Amount that has been paid to the Company pursuant to the terms of this Safe, subject to reduction pursuant to clause (a) of Section 1(a)(ii) above.

(j)“IPO Discount Price” means (i) the gross cash price per Unit at which Units are sold in the IPO, multiplied by (ii) the Discount Rate.

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(k) “IPO Transaction” means (i) the final closing (including any closing with respect to the sale of overallotment shares) of the first firm commitment underwritten initial public offering of Units pursuant to a registration statement filed under the Securities Act (the “IPO”), and (ii) a related pre-closing contribution or other transfer to FGS of the Company’s equity interests in FlexEnergy, Inc. and FLPS in exchange for FGS Stock (the “FGS Contribution”).

(l)“Liquidity Event” means (i) a transaction or series of related transactions in which any “person” or “group” (within the meaning of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), other than any “person” or “group” that is an existing beneficial owner of t Company or affiliate thereof, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of more than 50% of the outstanding voting securities of the Company having the right to vote for the election of members of the Company’s board of directors, (ii) any reorganization, merger or consolidation of the Company, other than a transaction or series of related transactions in which the holders of the voting securities of the Company outstanding immediately prior to such transaction or series of related transactions retain, immediately after such transaction or series of related transactions, at least a majority of the total voting power represented by the outstanding voting securities of the Company or such other surviving or resulting entity, or (iii) a sale, lease or other disposition of all or substantially all of the assets of the Company.

(m)“Liquidity Proceeds” means cash and other assets (including without limitation stock and other securities consideration) that are proceeds from the Liquidity Event and legally available for distribution.

(n)“Other Event” means, with respect to the Company or any material direct or indirect subsidiary thereof, (i) a voluntary termination of operations, (ii) a general assignment for the benefit of the its creditors, (iii) any other liquidation, dissolution or winding up of the entity, whether voluntary or involuntary, or (iv) commencement of a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect, or consent to any such relief or to the appointment of or taking possession of its property by any official in an involuntary case or other proceeding commenced against it; provided, however that the FGS Contribution in connection with an IPO Transaction shall not be deemed an Other Event.

(o)“Purchase Amount” means the corresponding amount set forth on the signature page to this Safe.

(p)“Safe” means an instrument containing a future right to receive shares of FGS Stock or FLPS Equity from the Company, similar in form and content to this instrument, purchased by investors for the purpose of funding the Company’s business operations. References to “this Safe” mean this specific instrument.

(q)“Securities Act” means the Securities Act of 1933, as amended.

(r)“TCB” means Texas Capital Bank, National Association.

(s)“Units” means units, each consisting of one share of FGS Stock and one warrant to purchase a share of FGS Stock being offered and sold in the IPO.

3.Company Representations.

(a)The Company is a limited liability company duly organized, validly existing and in good standing under the laws of its state of incorporation, and has the power and authority to own, lease and operate its properties and carry on its business as now conducted.

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(b) The execution, delivery and performance by the Company of this Safe is within the power of the Company and has been duly authorized by all necessary actions on the part of the Company. This Safe constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity. To its knowledge, the Company is not in violation of (i) its current certificate of formation or limited liability company operating agreement, (ii) any material statute, rule or regulation applicable to the Company, or (iii) any material debt or contract to which the Company is a party or by which it is bound, where, in each case, such violation or default, individually, or together with all such violations or defaults, could reasonably be expected to have a material adverse effect on the Company.

(c)The performance and consummation of the transactions contemplated by this Safe do not and will not: (i) violate any material judgment, statute, rule or regulation applicable to the Company, (ii) result in the acceleration of any material debt or contract to which the Company is a party or by which it is bound, or (iii) result in the creation or imposition of any lien on any property, asset or revenue of the Company or the suspension, forfeiture, or nonrenewal of any material permit, license or authorization applicable to the Company, its business or operations.

(d)To its knowledge, the Company owns or possesses (or can obtain on commercially reasonable terms) sufficient legal rights to all patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information, processes and other intellectual property rights necessary for its business as now conducted and as currently proposed to be conducted, without any conflict with, or infringement of the rights of, others.

4.Investor Representations.

(a)The Investor has full legal capacity, power and authority to execute and deliver this Safe and to perform its obligations hereunder. This Safe constitutes valid and binding obligation of the Investor, enforceable in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity.

(b)The Investor is an accredited investor as such term is defined in Rule 501 of Regulation D under the Securities Act. The Investor has been advised that this Safe and the underlying securities have not been registered under the Securities Act, or any state securities laws and, therefore, cannot be resold unless they are registered under the Securities Act and applicable state securities laws or unless an exemption from such registration requirements is available. The Investor is acquiring this Safe and the securities to be acquired by the Investor hereunder for its own account for investment, not as a nominee or agent, and not with a view to, or for resale in connection with, the distribution thereof, and the Investor has no present intention of selling, granting any participation in, or otherwise distributing the same except in full compliance with all applicable securities laws. The Investor has such knowledge and experience in financial and business matters that the Investor is capable of evaluating the merits and risks of such investment, is able to incur a complete loss of such investment without impairing the Investor’s financial condition and is able to bear the economic risk of such investment for an indefinite period of time.

5.FGS Representations.

(a)FGS is a corporation duly incorporated, validly existing and in good standing under the laws of its state of incorporation, and has the power and authority to own, lease and operate its properties and carry on its business as now conducted.

(b)The execution, delivery and performance by FGS of this Safe is within the power of FGS and has been duly authorized by all necessary actions on the part of FGS. This Safe constitutes a legal, valid and binding obligation of FGS, enforceable against FGS in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity. To its knowledge, FGS is not in violation of (i) its current certificate of incorporation or bylaws, (ii) any material statute, rule or regulation applicable to FGS, or (iii) any material debt or contract to which FGS is a party or by which it is bound, where, in each case, such violation or default, individually, or together with all such violations or defaults, could reasonably be expected to have a material adverse effect on FGS.

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(c)The performance and consummation of the transactions contemplated by this Safe do not and will not: (i) violate any material judgment, statute, rule or regulation applicable to FGS, (ii) result in the acceleration of any material debt or contract to which FGS is a party or by which it is bound, or (iii) result in the creation or imposition of any lien on any property, asset or revenue of FGS or the suspension, forfeiture, or nonrenewal of any material permit, license or authorization applicable to FGS, its business or operations.

6.Additional Covenants.

(a)FLPS LLC Operating Agreement. In connection with the delivery of FLPS Equity pursuant to Section 1(b), the Company and the Investor will execute and deliver a limited liability company operating agreement for FLPS based on the Company’s existing limited liability company operating agreement with respect to governance practices and other matters (but with the Company as the controlling FLPS owner, and with customary minority owner protections to include tag-along rights, drag-along rights and non-punitive amendment provisions).

(b)FLPS Equity Pledge and Limited Guaranty. In connection with the delivery of FLPS Equity pursuant to Section 1(b), the Investor shall execute and deliver to the Company and TCB such agreements and other documents as TCB may reasonably require for a pledge by the Investor of such Investor’s FLPS Equity under a limited guaranty of the obligations of FLPS under the credit agreement between FLPS and TCB, consistent with the Company’s pledge of FLPS Equity and limited guaranty of obligations of FLPS under the credit agreement between FLPS and TCB.

(c)Third Party Approvals. The Company shall exercise its best efforts to secure within 30 days any and all third party approvals or actions necessary with respect to any and all of the terms of this Agreement (including without limitation securing from approval, amendment or waiver with respect to the terms of the credit agreement between TCB and FLPS to permit ownership in FLPS by the Investor contemplated by Section 1(b)).

(d)Registration Rights. In connection with the delivery of FGS Stock pursuant to Section 1(a), the Company and the Investor will execute and deliver a registration rights agreement provided by the Company substantially in the form of the draft agreement prepared in connection with the execution of this Safe.

(e)Other IPO Transaction Documents. In connection with the delivery of FGS Stock pursuant to Section 1(a), the Investor will execute and deliver to the Company all transaction documents (including a lock-up agreement) required of an FGS stockholder in the IPO Transaction.

(f)Pro Rata Payment of Cash-Out Amount. To extent the Investor and any other Safe holder is entitled to receipt of any Cash-Out Amount but Liquidity Proceeds or proceeds from the Company’s sale of FGS Stock, as applicable, are insufficient to pay the full amount of the Cash-Out Amount, the Company shall partially pay the Cash-Out Amount with respect each Safe in proportion to the relative Funded Amount of each Safe.

(g)Pro Rata Redemptions. To extent the Investor and any other Safe holder is entitled to redemption of FGS Stock pursuant to Section 1(a)(ii), but net proceeds from underwriter IPO overallotment exercise are insufficient for FGS to redeem all FGS Stock transferred by the Company pursuant to Section 1(a)(ii) of the Safes, FGS shall partially redeem FGS Stock with respect each Safe in proportion to the relative Funded Amount of each Safe. For the avoidance of doubt, other than with respect to the net proceeds of any underwriter IPO overallotment exercise, FGS is not obligated by this Safe to redeem any FGS Stock.

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7.Miscellaneous.

(a)Any provision of this Safe may be amended, waived or modified by written consent of the Company, the Investor and FGS.

(b)Any notice required or permitted by this Safe will be deemed sufficient when delivered personally or by overnight courier or sent by email to the relevant address listed on the signature page, or 48 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, addressed to the party to be notified at such party’s address listed on the signature page, as subsequently modified by written notice.

(c)The Investor is not entitled, as a holder of this Safe, to vote or be deemed a holder of equity securities for any purpose other than tax purposes, nor will anything in this Safe be construed to confer on the Investor, as such, any rights of a Company, FGS or FLPS equity holder or rights to vote for the election of any directors or managers thereof, or on any matter submitted to equity holders of the Company, FGS or FLPS, or to give or withhold consent to any action or to receive notice of meetings, until such FGS Stock or FLPS Equity has been issued on the terms described in Section 1.

(d)Neither this Safe nor the rights in this Safe are transferable or assignable, by operation of law or otherwise, by either party without the prior written consent of the other; provided, however, that this Safe and/or its rights may be assigned without the Company’s consent by the Investor (i) to the Investor’s estate, heirs, executors, administrators, guardians and/or successors in the event of Investor’s death or disability, or (ii) to any other entity who directly or indirectly, controls, is controlled by or is under common control with the Investor, including, without limitation, any general partner, managing member, officer or director of the Investor, or any venture capital fund now or hereafter existing which is controlled by one or more general partners or managing members of, or shares the same management company with, the Investor; and provided, further, that the Company may assign this Safe in whole, without the consent of the Investor, in connection with a reincorporation to change the Company’s domicile.

(e)In the event any one or more of the provisions of this Safe is for any reason held to be invalid, illegal or unenforceable, in whole or in part or in any respect, or in the event that any one or more of the provisions of this Safe operate or would prospectively operate to invalidate this Safe, then and in any such event, such provision(s) only will be deemed null and void and will not affect any other provision of this Safe and the remaining provisions of this Safe will remain operative and in full force and effect and will not be affected, prejudiced, or disturbed thereby.

(f)All rights and obligations hereunder will be governed by the laws of the State of Delaware, without regard to the conflicts of law provisions of such jurisdiction.

(Signature page follows)

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IN WITNESS WHEREOF, the undersigned have caused this Amended and Restated Safe to be duly executed and delivered.

Purchase Amount:	$3,500,000.00
Effective Date:	December 2, 2021

Company:
FlexEnergy Power Solutions, LLC
By:	/s/ Thomas R. Denison
Name:	Thomas R. Denison
Title:	Manager
Investor:
TRF Platform Holdings, LLC
(Investor Name)
By:	/s/ W. Patrick Connelly
Name:	W. Patrick Connelly
Title:	Manager
FGS:
FlexEnergy Green Solutions, LLC
By:	/s/ Wes Kimmel
Name:	Wes Kimmel
Title:	Chief Financial Officer

FlexEnergy Power Solutions, LLC

Amended and Restated Safe (Simple Agreement for Future Equity)

Signature Page

EX-23.1

Exhibit 23.1

CONSENTS OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use in this Registration Statement on Form S-1 of our report dated June 4, 2021, relating to the financial statements of FlexEnergy Green Solutions, Inc. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

/s/ Deloitte & Touche LLP

Hartford, Connecticut

January 11, 2022

CONSENTS OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use in this Registration Statement on Form S-1 of our report dated June 4, 2021, relating to the financial statements of FlexEnergy, Inc. and Flex Leasing Power & Services, LLC. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

/s/ Deloitte & Touche LLP

Hartford, Connecticut

January 11, 2022