1.

INTRODUCTION

COMMENCEMENT AND DURATION

GENERAL PARTICULARS

COMMERCIAL PARTICULARS

CONDITIONS PRECEDENT

CONDITIONS SUBSEQUENT

OPERATIONAL AND CONTINUING CONDITIONS

FEES AND EXPENSES

SCHEDULE 1

Common terms

SCHEDULE 2

Receivables Purchase Facility terms and conditions

SCHEDULE 3

Inventory Facility terms and conditions

SCHEDULE 4

Over Advances

SCHEDULE 5

DATA PROTECTION

SCHEDULE 6

PARTIES

SCHEDULE 7

FORM OF NOTICE TO ACCOUNT BANK

SCHEDULE 8

FORM OF ACCESSION DEED

THIS DEED is made on

FAUNUS GROUP INTERNATIONAL, INC. a Delaware corporation, whose office is at 80 Broad Street, 22nd Floor, New York, NY 10004 (“FGI”);

The company whose details appear in Part 1 of schedule 6 (the “Client”); and

Those company whose details appear in Part 2 of schedule 6 (the “Original Security Obligor”).

INTRODUCTION

This Deed incorporates the schedules. Unless otherwise defined in this Deed or the context otherwise requires, terms used in this Deed have the meanings ascribed to them in schedule 1.

COMMENCEMENT AND DURATION

This Deed shall begin on the date of the Commencement Date and, subject to the other provisions of this Deed and shall continue until terminated in accordance with its terms.

Notwithstanding clause 2.1 above:

the Client may terminate the Facilities in full (but not in part only) at any time on giving written notice of not less than the Notice Period to FGI, such notice to end on the last Business Day of the Minimum Period and any subsequent Annual Renewal Period;

FGI may terminate all or any part of the Facilities at any time on giving notice of not less than the Notice Period to the Client; and

FGI may immediately terminate the Facility by written notice to the Client upon or at any time after the occurrence of an Event of Default which is continuing,

provided that the obligations of the Client arising under paragraph 5(b) (Early Termination Fee) of schedule 1 shall not be affected by this clause 2.2.

This Deed shall continue in full force and effect notwithstanding intermediate repayments (including the repayment of sums in advance of their due date for payment) until all outstanding sums of whatever nature (whether present, future, actual or contingent) have been fully repaid or discharged by the Client to FGI, including all and any costs, charges and expenses connected thereto or associated therewith.

GENERAL PARTICULARS

(a)

Commencement Date:

The date of this Deed

(b)

Minimum Period:

36 months

(c)

Notice Period:

3 months

(d)

Global Limit:

US$10,000,000

(e)

Approved Currencies:

US Dollars, Euro and Sterling

(f)

Permitted Territories:

Any jurisdiction, other than a Sanctioned Territory

COMMERCIAL PARTICULARS

Receivables Purchase Facility

(a)

Receivables Purchase Facility Limit:

$10,000,000 less the amount of any Advances outstanding under the Inventory Facility from time to time but not exceeding the Global Limit.

(b)

Prepayment Percentage:

85%

(c)

Class of Approved Receivables

All Receivables save as expressly excluded or Disapproved

(d)

Client’s business:

Manufacture and distribution of computer game equipment and accessories

(e)

Debtor Concentration:

35%

(f)

Intentionally deleted

(g)

Permitted Credit Period:

120 days from the Invoice date, but in any event within 60 days of the due payment date of the Invoice

(h)

Dilution Percentage:

28%

Inventory Facility

CONDITIONS PRECEDENT

FGI shall make no Prepayment or Advance pursuant to this Deed unless and until FGI confirms to the Client that FGI is satisfied with, or has waived, or the following have been received by FGI, or addressed in a form and substance satisfactory to FGI (as the case may be):

Corporate

Certified copies of the constitutional documents and certificate of incorporation of the Client, Mad Catz (Germany) and Mad Catz (France).

Certified copy board resolutions of the board of directors of the Client, Mad Catz (Germany) and Mad Catz (France) approving and authorising the execution of each Finance Document to which it is a party.

Specimen signatures of the persons authorised to execute Finance Documents and all documents ancillary thereto, including Notifications.

A certificate of an authorised signatory of the Client, Mad Catz (Germany) and Mad Catz (France) certifying that each copy document to which it is party delivered to FGI is correct, complete and in full force and effect and has not been amended or superseded as at a date no earlier than the Commencement Date.

Certified copies of resolutions passed by shareholders of Mad Catz (US).

Incumbency certificates, good standing certificates, state certified articles of incorporation and bylaws in respect of Mad Catz (US).

Officers certificates with supporting directors’ resolution, incumbency schedule and certificate of compliance for Ontario.

Finance documents and release documents

Original of this Deed executed by all parties to it.

Original of the Debenture executed by all parties to it.

Original of the US Guaranty executed by all parties to it.

Original US Patent, Copyright and Trademark Security Agreement executed by all parties to it.

Original Canadian Guarantee executed by all parties to it.

Original Canadian Security Agreement executed by all parties to it.

Standard account opening forms and mandates as advised by FGI.

Original of the US Payoff Letter executed by all parties to it.

Original deed of release in respect of the debenture dated 18 June 2002 between the Client and Congress Financial Corp, Inc.

Outgoing financier

N/A

Financial

Management Accounts to 31 May 2015.

Audited annual accounts for the Financial Year ending 31 March 2015

Receivables

An up to date audit of the Client’s Receivables by or on behalf of FGI

Electronic aged Receivables analysis and aged creditor analysis correct as at the Commencement Date.

Due diligence in relation to any Supply Contract specified by FGI;

Copies of all Supply Contracts specified by FGI.

A waiver from such debtors as FGI may specify waiving any ban on assignment, granting of security or similar in any Supply Contract between the Client and each such Debtor.

A waiver from such Debtors specified by FGI waiving any right of set-off or similar in any Supply Contract between the Client and each such Debtor.

Inventory

a Borrowing Base Certificate as at the Commencement Date;

an up-to-date audit of the Inventory;

a written valuation, conducted by an independent valuer approved by FGI and expressed to be capable of being relied upon by transferees and assignees of FGI, confirming the Net Orderly Liquidation Value of the Client’s Eligible Inventory.

Pension deficits

Insurance

certified copy of each of the policies, including written confirmation of the amount and terms of each policy;

satisfactory evidence that all premiums are paid up to date; and

written confirmation that FGI has been named as first loss payee under such insurance policies.

Other US and Canadian conditions precedent

UCC, Judgment Lien, Tax Lien and Litigation Searches in respect of Mad Catz (US).

USPTO Searches in respect of Mad Catz (US).

Insurance certificates under which FGI in named as “lender’s loss payee” (in respect of any property insurance) and named as “additionally insured” in respect of any liability insurance in connection with Mad Catz (US).

PPSA and lien searches in respect of Ontario.

PPSA registration in respect of Ontario.

Other

Satisfactory completion of all FGI’s “know your customer” checks.

Details of the amount of any PAYE and/or VAT arrears of the Client and, if relevant, an HM Revenue and Customs approved schedule for repayment together with evidence of arrangements for their payment and confirmation that such payments have been met up to the Commencement Date.

Signed fees indemnity letter addressed to FGI by the Client or other appropriate party providing for the payment by such party of all legal and other professional fees and disbursements reasonably and properly incurred by FGI in connection with the entry into of the Finance Documents.

Clear winding-up and administration searches of the Client and each Security Obligor.

Capacity and enforceability legal opinion from FGI’s English law counsel.

Any other document, assurance or opinion that FGI may specify upon written notice to the Client prior to the Commencement Date.

CONDITIONS SUBSEQUENT

within 10 Business Days of the Commencement Date, confirmation that a letter has been sent to all Debtors that pay by BACS, CHAPS or other means of electronic transmission, advising such Debtors to make payment to the Trust Account identified in paragraph 8(b)(i) (Payments) of schedule 2; and

within 5 Business Days of the Commencement Date, share certificates and a blank stock transfer form in respect of the Client.

within 10 Business Days of the Commencement Date, NVOCC agreements with each freight forwarder that holds Inventory for the Client;

within 10 Business Days of the Commencement Date, a distraint waiver from the warehouse operator of any property at which the Inventory is located; and

prior to any request by the Client for an Advance or a Prepayment, deposit account control agreements in relation to each account into which Remittances are to be paid.

OPERATIONAL AND CONTINUING CONDITIONS

Receivables Purchase Facility

Inventory

Eligible Inventory Formula

whichever is the lowest of:

the aggregate Net Orderly Liquidation Value of Eligible Inventory x 75 per cent;

aggregate value of Eligible Inventory x 50 per cent; or

aggregate Notified Value of Outstanding Approved Receivables x100 per cent;

less, the aggregate value (from time to time) of Inventory Reserves,

FEES AND EXPENSES

Audit Fee

CHAPS fee

Discount

5.50 per cent per annum; or

5.00 per cent above the Applicable Rate.

Early Termination Fee

Closing Fee

Non-Utilisation Fee Percentage

Collateral Management Fee

Misdirected Payment Fee

Interest on Inventory Payment Account

6.50 per cent per annum; or

6.00 per cent above the Applicable Rate.

Introduction

Definitions and Interpretation

Definitions

the amount calculated by applying the Prepayment Percentage to the aggregate Notified Value of Outstanding Approved Receivables (being the balance for the time being standing to the credit of the Receivables Purchased Account); and

the Receivables Purchase Facility Limit,

“control” of the Parent means:

the power (whether by way of ownership of shares, proxy, contract, agency or otherwise) to:

cast, or control the casting of, more than 50 per cent of the maximum number of votes that might be cast at a general meeting of the Parent; or

appoint or remove all, or the majority, of the directors or other equivalent officers of the Parent; or

give directions with respect to the operating and financial policies of the Parent with which the directors or other equivalent officers of the Parent are obliged to comply; and/or

the holding beneficially of more than 50 per cent of the issued share capital of the Parent (excluding any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital);

“acting in concert” means a group of persons who, pursuant to an agreement or understanding (whether formal or informal), actively co-operate, through the acquisition, directly or indirectly, of shares in the Parent by any of them to obtain or consolidate control of the Parent;

for payments in GBP:

for payments in Euro:

any member of the Group or any of its advisers; or

directly or indirectly from any member of the Group or any of its advisers,

is or becomes public information other than as a direct or indirect result of any breach by FGI of Clause 24 (Confidential Information); or

is identified in writing at the time of delivery as non-confidential by any member of the Group or any of its advisers; or

is known by FGI before the date the information is disclosed to it in accordance with paragraphs (a) or (b) above or is lawfully obtained by FGI after that date, from a source which is, as far as FGI is aware, unconnected with the Group and which, in either case, as far as FGI is aware, has not been obtained in breach of, and is not otherwise subject to, any obligation of confidentiality;

not slow-moving or obsolete;

unsold and undamaged;

not subject to any Security Interest (other than in favour of FGI);

in the case of finished goods, in a current marketable condition and readily saleable at prices no less than the lower of cost or market value,

fully insured by the Client against loss or damage; and

located in premises or locations owned or leased by the Client in the United Kingdom, which have been agreed by FGI in accordance with paragraph 6(b) (Storage of Inventory) of schedule 3,

is in transit and subject to customs duties and/or for which the Client does not hold title to such Inventory;

has been sold or Delivered to Debtors or is sold on a consignment basis; or

is subject to landlord’s liens, unpaid vendor’s liens, trade finance liens or any other rights in favour of creditors or are the subject of reservation of title rights in favour of any third party; or

is aged, obsolete or slow-moving; or

does not fall within the security held by FGI; or

is in a location not agreed with FGI; or

is packaging; or

is damaged or of unsuitable quality for sale or not fit for purpose; or

is subject to a trade finance lien or customs duties; or

is on consignment or subject to any conditional delivery to the Client; or

has been returned by any Debtor; or

has a value in excess of any applicable insurance limit,

moneys borrowed and debit balances at banks or other financial institutions;

any acceptance under any acceptance credit or bill discounting facility (or dematerialised equivalent);

any note purchase facility or the issue of bonds, notes, debentures, loan stock or any similar instrument;

the amount of any liability in respect of any lease or hire purchase contract which would, in accordance with applicable GAAP, be treated as a finance or capital lease;

receivables sold, assigned or discounted (other than any receivables to the extent they are sold on a non-recourse basis and meet any requirement for de-recognition under applicable GAAP);

any treasury transaction (and, when calculating the value of that treasury transaction, only the marked to market value (or, if any actual amount is due as a result of the termination or close-out of that treasury transaction, that amount) shall be taken into account);

any counter-indemnity obligation in respect of a guarantee, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution in respect of (i) an underlying liability of an entity other than the Client which liability would fall within one of the other paragraphs of this definition or (ii) any liabilities of the Client relating to any post-retirement benefit scheme;

any amount raised by the issue of redeemable shares;

any amount of any liability under an advance or deferred purchase agreement that is due and owing;

any amount raised under any other transaction (including any forward sale or purchase, sale and sale back or sale and leaseback agreement) having the commercial effect of a borrowing; and

the amount of any liability in respect of any guarantee for any of the items referred to in paragraphs (a) to (j) above;

any ledger, computer data, records, documents, disks, electronic data or machine-readable material on or by which the financial or other information pertaining to Collateral is recorded or evidenced; and

any equipment necessary for reading or amending the same;

the debit balance (if any) on the Funds In Use Account, calculated by aggregating all amounts debited to the Funds In Use Account; and

any debit balance then standing on the Reserve Account in accordance with paragraph 6(c)(iii) (Reserve Account) of schedule 2;

a distress, attachment, execution, sequestration, diligence or other legal process is levied, enforced or sued out on or against all or any part of the assets of that person;

any corporate action or other steps are taken or legal or other proceedings are started for its winding-up, dissolution or reorganisation other than for the purposes of a bona fide, solvent scheme of reconstruction or amalgamation previously approved in writing by FGI (other than a petition for winding-up which the Client or any Security Obligor has satisfied FGI, acting reasonably, is vexatious, groundless or an abuse of process and the Client or relevant Security Obligor has taken steps within seven days of the petition being presented to restrain the petitioner from advertising the petition, such petition has not been advertised and which in any event has been discharged within 14 days of the petition being presented);

any petition or proposal is presented or a meeting is convened with a view to a composition, assignment or arrangement with any creditors of that person; or

a meeting of that person is convened for the purpose of considering any resolution for its winding-up or for its administration or any such resolution is passed; or

a notice of intention to appoint an Administrator being given by any person or an Administrator being appointed; or

any person presents a petition for the administration of a person; or

an order for the administration or bankruptcy of that person is made; or

a moratorium pursuant to section 1A of and schedule A1 to the Insolvency Act 1986 or pursuant to paragraph 1A of schedule 1 to the Insolvent Partnerships Order 1994 is established; or

anything analogous to the events referred to in paragraphs (i) to (viii) above occurs under the laws of any applicable jurisdiction.

it is, or is deemed for the purposes of any law to be, unable to pay its debts or to be insolvent, or admits its inability to pay its debts as they fall due; or

it ceases to trade or notifies the Client or FGI of its intention to cease to trade or the Client or FGI otherwise becomes aware of such intention through a source reasonably considered to be reliable; or

it is subject to Insolvency Proceedings;

Preferential Creditors including, for the avoidance of doubt, the prescribed part of realisations under a floating charge over the Client’s net property that would be made available for the satisfaction of the Client’s unsecured creditors pursuant to section 176A of the Insolvency Act 1986;

an amount estimated by FGI (acting reasonably) as being necessary to reflect third party claims against assets of the Client ranking or which may rank pari passu with or prior to the claims of FGI under the Finance Documents;

(in the absence of a Landlord’s Waiver) an amount equal to one quarter’s rent payable by the Client (and accrued interest if any) in relation to any leased or rented premises, or any other locations owned by third parties, where Inventory is located from time to time;

an amount equal to such outstanding fees (and accrued interest if any) payable by the Client to any third party carrier of Inventory if payment of such sums is not made by the Client on its due date;

an amount equal to all and any due but unpaid Inventory Insurance premiums (and other costs connected thereto if any) if payment of such sums is not made by the Client on its due date; and

any amount payable under the Inventory Insurances in respect of which FGI is not noted as first loss payee from time to time;

such amounts as FGI shall determine and advise to the Client from time to time.

adversely affect the ability of a Client or a Security Obligor to perform its payment obligations under any of the Finance Documents;

have a material adverse effect on the business, operations, property, assets or condition (financial or otherwise) of the Group taken as a whole; or

adversely affect the validity or enforceability of, or the effectiveness or ranking of any Security Interest granted or purporting to be granted pursuant to any of the Finance Documents or the rights or remedies of FGI under any of the Finance Documents;

Financial Indebtedness of the Parent, Ontario and Mad Catz (US) to NewStar Business Credit provided that (i) such Financial Indebtedness is at all times subject to a deed of priority between NewStar Business Credit and FGI and (ii) neither the Client, Mad Ctaz (France) or Mad Catz (Germany) shall incur any Financial Indebtedness under such arrangements;

Financial Indebtedness under finance or capital leases of office equipment provided that the aggregate value of all such items so leased under outstanding leases by the Client does not exceed USD 100,000 (or its equivalent in other currencies) at any time;

sell, transfer or otherwise dispose of any of its assets on terms whereby they are or may be leased to or re-acquired by or any other member of the Group;

sell, transfer or otherwise dispose of any of its receivables on recourse terms;

enter into any arrangement under which money or the benefit of a bank or other account may be applied, set-off or made subject to a combination of accounts; or

enter into any other preferential arrangement having a similar effect,

other than rights relating to ownership of goods, any rights of the Client as an unpaid vendor or provider of services under the Supply Contract giving rise to a Receivable;

the benefit of all insurances;

all negotiable and non-negotiable instruments, all securities, bonds guarantees and indemnities;

the Financial Records;

any security interests securing the Receivables,

all collections and rights to collection on the Receivables; and

all other proceeds thereof;

its jurisdiction of incorporation;

any jurisdiction where any asset subject to or intended to be subject to the Security Documents to be created by it is situated; and

any jurisdiction where it conducts its business;

any other agreement or arrangement having the effect of conferring security (including any such interest arising under or in connection with any letter of credit);

any other security interest of any kind or preferring any obligation of any person; or

any other guarantee, indemnity, warranty, agreement or arrangement having the effect of conferring security;

which is controlled, directly or indirectly by the first-mentioned company or corporation; or

more than half the issued share capital of which is beneficially owned, directly or indirectly, by the first-mentioned company or corporation; or

which is a subsidiary of another subsidiary of the first mentioned company or corporation;

Interpretation

Unless a contrary intention appears, a reference in this Deed to:

a “Receivable” includes a reference to any part of a Receivable;

“FGI”, the “Client”, any “Security Obligor”, any “Party” or any other person shall be construed so as to include its and any subsequent successors assigns and transferees in accordance with their respective interests;

a “Finance Document” or any other agreement or instrument is a reference to that Finance Document or other agreement or instrument as varied, amended, supplemented, extended, restated, novated and/or replaced in any manner from time to time (however fundamentally and even if any of the same increases the obligations of any member of the Group or provides for further advances);

“assets” includes any present and future properties, revenues and rights of every description and includes uncalled capital;

a “month” is a reference to a period starting on one day in a calendar month and ending on the numerically corresponding day in the next succeeding calendar month save that, where any such period would otherwise end on a day which is not a Business Day, it shall end on the next succeeding Business Day, unless that day falls in the calendar month succeeding that in which it would otherwise have ended, in which case it shall end on the immediately preceding Business Day provided that, if a period starts on the last Business Day in a calendar month or if there is not numerically corresponding day in the month in which that period ends, that period shall end on the last Business Day in that later month;

“reasonable endeavours” includes payment by the relevant person of all its own and any third party’s reasonable costs, fees and expenses;

a “regulation” includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation;

“Related Rights” does not include the transfer to FGI of any obligation to complete the relevant Supply Contract;

“repay” (or any derivative from thereof) shall, subject to any contrary indication, be construed to include “prepay” (or, as the case may be, the corresponding derivative from thereof);

“VAT” shall be construed as a reference to value added tax including any similar tax which may be imposed in place thereof from time to time;

“including” or “includes” means including or includes without limitation;

the “winding-up”, “dissolution” or “administration” of a company or corporation shall be construed so as to include any equivalent or analogous proceedings under the law of the jurisdiction in which such company or corporation is incorporated or any jurisdiction in which such company or corporation carries on business, including the seeking of liquidation, winding-up, reorganisation, dissolution, administration, arrangement, adjustment, protection or relief of debtors.

currency symbols “€” and “euros” denote the lawful currency of the member states of the European Union that adopt the single currency in accordance with the Treaty and “£” and “Sterling” denote the lawful currency of the United Kingdom;

a provision of law is a reference to that provision as amended or re-enacted;

the singular includes the plural and vice versa; and

a time of day is a reference to New York time.

Where in connection with any legal jurisdiction outside England and Wales a word or phrase in this Deed has no precise counterpart, then this Deed shall be interpreted as if that word or phrase referred to the closest equivalent in the jurisdiction concerned.

Section, clause schedule and paragraph headings are for ease of reference only and shall not affect the construction of this Deed.

Unless otherwise stated, references to:

clauses are references to a clause in the main body of this Deed;

schedules are references to a schedule of and to this Deed; and

paragraphs are references to a paragraph of a schedule.

References to this Deed include its schedules.

Unless a contrary indication appears, a term used in any other Finance Document or in any notice given under or in connection with any Finance Document has the same meaning in that Finance Document or notice as in this Deed.

A Default is “continuing” if it has not been remedied or waived in writing and an Event of Default is “continuing” if it has not been waived in writing, in each case to the satisfaction of FGI. Any waiver given by FGI shall only apply to the specific occurrence of the specific event referred to in such waiver.

Third Party Rights

Grant of Facilities

Receivables Purchase Facility

Subject to the terms of this Deed and in particular schedule 2, FGI shall make available to the Client the Receivables Purchase Facility.

The Receivables Purchase Facility includes any provisions set out at clauses 4.1 (Receivables Purchase Facility), 5 (Conditions Precedent) and 7.1 (Operational and continuing conditions).

Inventory Facility

Subject to the terms of this Deed and in particular schedule 3, FGI shall make available to the Client the Inventory Facility.

The Inventory Facility including any of the provisions of clause 4.2 (Inventory Facility), any provisions completed at clauses 6 (Conditions subsequent) and 7 (Operational and continuing conditions).

Global Limit

all Funds In Use;

the Inventory Payment Account Balance;

all outstanding Advances, to the extent not covered by sub-paragraphs (i) and (ii) above;

all unpaid but due and payable Discount; and

all accrued but due and payable Collateral Management Fees and any other fees and expenses arising pursuant to this Deed,

Prepayments and Advances

Client as Obligors’ agent

Each Security Obligor by its execution of this Deed irrevocably appoints the Client to act on its behalf as its agent in relation to the Finance Documents and irrevocably authorises:

the Client on its behalf to supply all information concerning itself contemplated by this Deed to FGI and to give all notices and instructions, to execute on its behalf any deeds or documents required to be executed in connection with the Receivables Facility and/or any of the Facilities, to make such agreements and to effect the relevant amendments, supplements and variations capable of being given, made or effected by any Security Obligor, notwithstanding that they may affect any Security Obligor, without further reference to or the consent of any Security Obligor; and

FGI to give any notice, demand or other communication to that Security Obligor pursuant to the Finance Documents to the Client,

Every act, omission, agreement, undertaking, settlement, waiver, amendment, supplement, variation, notice or other communication given or made by the Client or given to the Client under or in connection with any Finance Document on behalf of any Security Obligor or (whether or not known to any Security Obligor) shall be binding for all purposes on the relevant Security Obligor as if it had expressly made, given or concurred with it. In the event of any conflict between any notices or other communications of the Client and any Security Obligor, those of the Client shall prevail.

Fees and expenses

Closing Fee

Early Termination Fee

if the Early Termination Date occurs prior to the first anniversary of the Commencement Date, the Early Termination Fee shall be an amount equal to three per cent of the Global Limit.

if the Early Termination Date occurs after the first anniversary of the Commencement Date, but on or before the second anniversary of the Commencement Date, the Early Termination Fee shall be an amount equal to two per cent of the Global Limit; and

if the Early Termination Date occurs after the second anniversary of the Commencement Date, but on or before the third anniversary of the Commencement Date, the Early Termination Fee shall be an amount equal to one per cent of the Global Limit.

Non-Utilisation Fee

is the Non-Utilisation Fee Percentage;

the amount by which average Funds in Use are less than:

from 1^st September to 31^st December, US$2,000,000; and;

from 1^st January to 31^st August, US$1,000,000

is the Non-Utilisation Fee.

Audit Fee

Monitoring Fee

Agency Termination Fee

VAT

All fees and expenses to which FGI shall be entitled under the terms of this Deed shall be calculated inclusive of VAT (unless FGI determines otherwise). VAT shall be payable by the Client upon FGI making a VAT invoice available to the Client.

The Client will comply with any directions given to it by FGI in relation to obtaining on FGI’s behalf any relief or refund of VAT included in any Receivable purchased by FGI under this Deed, to the extent that such relief or refund is available in the event of the Insolvency of the relevant Debtor.

General warranties and representations

Status

Power and authority

Authorisations

all Authorisations required or desirable:

to enable it lawfully to enter into, exercise its rights and comply with its obligations in the Finance Documents to which it is a party; and

to make the Finance Documents to which it is a party admissible in evidence in the Relevant Jurisdiction,

have been obtained or effected and are in full force and effect; and

all Authorisations necessary for the conduct of the business, trade and ordinary activities of members of the Group have been obtained or effected and are in full force and effect and any requirements thereof have been or will be at the appropriate time complied with or fulfilled where failure to effect such Authorisations has or is reasonably likely to have a Material Adverse Effect;

Binding obligations

Non-violation

Prior disclosure

whether or not to enter into a Finance Document; or

to accept any person as a guarantor or indemnifier for its obligations to FGI; or

as to the terms of a Finance Document; or

as to the making of any Prepayment or Advance;

Information

are and were (or shall be) when delivered, true and accurate in all material respects (in the case of factual information), and not misleading, based upon reasonable grounds, and honestly believed (in the case of opinions, forecasts and projections), and in all cases do not contain any misstatement or omit any material fact; and

there has been no Change of Control or Material Adverse Effect since the delivery of such information to FGI;

Litigation

Good title to assets

Existing Security Interests

all of its Collateral is Unencumbered save in favour of FGI (or if subject to an Security Interest other than to FGI, is subject to intercreditor arrangements in a form and substance satisfactory to FGI); and

no agreement is in place which could oblige it to create any Security Interest over its Collateral;

No default

Financial Statements

its Financial Statements were prepared in accordance with Applicable Accounting Principles and give a true and fair view (and accurate in all material respects) of its financial condition at the date as of which they were prepared and the results of its business and operations during the Financial Year (or, as the case may be, quarter) then ended and disclose or reserve against all material liabilities (contingent or otherwise) as at that date and all unrealised or anticipated losses from any commitment entered into by it and which existed on that date; and

the Latest Projections represent a reasonable estimate of its future financial performance for the periods referred to in them and have been prepared on the basis of the stated assumptions, which it believes are fair and reasonable in the light of current and reasonably foreseeable business conditions;

Management Accounts

Tax

Deductions and withholdings

Pari passu ranking

General covenants

Restrictions

incur any Financial Indebtedness (except pursuant to this Deed or any Permitted Financial Indebtedness);

create or permit to subsist any Security Interest or Quasi-Security Interest over any of its Receivables or Collateral (except pursuant to the Security Documents or any Permitted Security); or

be a creditor in respect of any Financial Indebtedness or otherwise make credit (other than normal trade credit permitted pursuant to the terms of a Supply Contract) available to any person;

sell, transfer, lease, lend or otherwise dispose of (whether by a single transaction or a number of transactions and whether related or not) the whole or any part of its interest in any Collateral except for the sale at full market value of stock in trade in the usual course of trading as conducted by the Client at the Commencement Date; or

trade under any business name or assumed name, other than those notified by writing in advance to FGI;

do or omit to do anything which would cause a breach of the Security Documents; or

acquire a company or any shares or securities or a business or undertaking (or, in each case, any interest in any of them) or incorporate a company.

Information and access

Collateral Reporting and Monitoring Requirements

Notification of default

Distributions

Repetition

General undertakings

Authorisations

enable it to perform its obligations under the Finance Documents;

subject to the Legal Reservations, ensure the legality, validity, enforceability or admissibility in evidence of any Finance Document; and

carry on its business where failure to do so has or is reasonably likely to have a Material Adverse Effect.

Compliance with laws

Continuing disclosure

Costs and expenses

Sale of business

Restriction on dealings

Insolvency Regulation

declares that its centre of main interest (as that term is used in Article 3(1) of the Regulation) is situated in its jurisdiction of incorporation and it has no “establishment” (as that term is used in Article 2(h) of the Regulation) in any other jurisdiction; and

undertakes that it will not change its centre of main interest without the prior written consent of FGI.

Change in Financial Year

Applicable Accounting Principles

a description of any change necessary for such Financial Statements to reflect Applicable Accounting Principles; and

sufficient information, in form and substance as may be reasonably required by FGI, to enable FGI to determine whether paragraph 6(m) (Financial Statements) of this schedule 1 has been complied with and make an accurate comparison between the financial position represented in such Financial Statements and previous Financial Statements.

Cessation or change of business

Conduct of business

Insurance

Without prejudice to any particular requirements of FGI, the Client and each Security Obligor shall maintain product and public liability insurances and such other insurances on and in relation to its business and assets against those risks and to the extent as is usual for companies carrying on the same or substantially similar business.

All insurances must be with reputable independent insurance companies or underwriters.

Additional Group companies

FX Unlimited

lend or otherwise transfer any funds to FX Unlimited; or

transfer cash or any other asset to FX Unlimited; or

permit any Security Interest to be granted in respect of FX Unlimited.

Increased costs

Financial information

Books and records

Provision of Financial Information

Financial Statements

Management Accounts

Latest Projections

Other information

Compliance certificate

Indemnity

General indemnity

Specific indemnities

any act or omission of the Client or any Security Obligor;

in connection with the negotiation, operation, variation or enforcement of the Finance Documents (including reasonably and properly incurred legal fees, charges, disbursements, survey and valuation fees, expenses, and VAT);

the release of Receivables from Security Interests;

dealing with disputes by Debtors;

issuing proceedings to collect Receivables (including all costs, interest and disbursements payable to any third party arising from claims or proceedings) or otherwise enforcing or attempting to enforce payment and collection of all and any Receivables and in settling or compromising any dispute or claim (whether justified or not) by a Debtor;

all claims, actions and demands made by any Debtor against FGI and all reasonably and properly incurred costs, Interest and expenses arising therefrom;

a Shortfall;

any stamp, documentary, registration, and other similar duties or Tax in connection with the Finance Documents;

converting any currency to a different currency, in accordance with the terms of this Deed; or

any of the fees and expenses detailed in clause 8 (Fees and Expenses),

Bank charges

Default

Events of Default

Breach of trust

Non-payment

Breach of representation

Breach of general undertakings

Breach of other obligations

Cross-default

Insolvency

Security Interest enforceable

Expropriation

Termination of any guarantee

Incapacity of any guarantor

Judgements

Loss of Collateral

Cessation of business

Absence of Notifications

Illegality

Repudiation

Invalidity

Material Adverse Effect

Change of Control

Qualification of Financial Statements

Withdrawal of waiver

Operational covenants

Repeated breaches

Consequences of Default

No Prepayment or Advance

Right of Recourse

Prepayment Percentage

Funds In Use

Increase Discount

Default Rate

Disapproved Receivables

Termination of agency

Loss

Fees and charges

Set-off

Notice of assignment

Security Documents

Outstanding Advances

Instructions

Auditors

Monitoring Fee

Termination

Accounts

Certification

No effect

Interest

Accrual of Interest and other sums

Debiting of Interest

Accrued Interest shall be debited to the relevant Account monthly although the Client and FGI agree that for administrative convenience all Interest payable in respect of the Inventory Payment Account Balance may be debited by FGI to the Reserve Account at such time.

FGI reserves the right to require actual payment of all Interest by cheque drawn by the Client or such other form of remittance as FGI may from time to time specify.

FGI may compound unpaid Interest with monthly rests at such times as FGI shall consider appropriate

Default Rate

No penalty

Currencies

Currency of account

Conversion

Currency indemnity

Variation

Partial Invalidity

Remedies and waivers

Amendments and waivers

Reliance

Disclosure

Set-off

Unfettered rights

In addition to any right of set-off or other similar right to which FGI may be entitled in law:

FGI may at any time and without notice to the Client combine and consolidate all or any of the Accounts; and

FGI may (but shall not be obliged to) set off any obligation (contingent or otherwise under the Finance Documents or which has been assigned to FGI) against any obligation (whether or not matured) owed by FGI to the Client, regardless of the place of payment, booking branch or currency of either obligation.

If the obligations are in different currencies, FGI may convert either obligation at a market rate of exchange in its usual course of business for the purpose of the set-off.

If either obligation is unliquidated or unascertained, FGI may set off in an amount estimated by it in good faith to be the amount of that obligation.

Restricted rights

Client payments

Deduction or withholding

Authority to contact bank

authorises FGI to provide the Client’s bankers (including for this purpose any bank with which the Client has or has had an account), accountants and/or auditors with, and to obtain from the Client’s bankers, accountants and/or auditors such information about its business, assets, financial condition or the operation of this Deed as FGI or they may require;

authorises its bankers, accountants and auditors to provide FGI with such information as it may require; and

authorises FGI to obtain from Debtors their consent to the taking of references from their bankers.

Confidentiality

Confidential Information

FGI agrees to keep all Confidential Information confidential and not to disclose it to anyone, save to the extent permitted by Clause 25 below, and to ensure that all Confidential Information is protected with security measures and a degree of care that would apply to its own confidential information.

FGI may disclose:

to any of its Associates and any of its or their officers, directors, employees, professional advisers, auditors, partners and representatives such Confidential Information as FGI shall consider appropriate if any person to whom the Confidential Information is to be given pursuant to this paragraph (b) is informed in writing of its confidential nature and that some or all of such Confidential Information may be price-sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of the information or is otherwise bound by requirements of confidentiality in relation to the Confidential Information;

to any person:

to (or through) whom it assigns or transfers (or may potentially assign or transfer) all or any of its rights and/or obligations under one or more Finance Documents, to any of that person’s Associates, representatives and professional advisers;

with (or through) whom it enters into (or may potentially enter into), whether directly or indirectly, any sub-participation in relation to, or any other transaction under which payments are to be made or may be made by reference to, one or more Finance Documents and/or one or more Credit Parties and to any of that person’s Associates, representatives and professional advisers;

appointed by FGI or by a person to whom paragraph (b)(ii)(1) or (b)(ii)(2) above applies to receive communications, notices, information or documents delivered pursuant to the Finance Documents on its behalf;

who invests in or otherwise finances (or may potentially invest in or otherwise finance), directly or indirectly, any transaction referred to in paragraph (b)(ii)(1) or (b)(ii)(2) above;

to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules of any relevant stock exchange or pursuant to any applicable law or regulation;

to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes; or

with the consent of the Parent,

in relation to paragraphs (b)(ii)(1), (b)(ii)(2) or (b)(ii)(3) above, the person to whom the Confidential Information is to be given has entered into a Confidentiality Undertaking except that there shall be no requirement for a Confidentiality Undertaking if the recipient is a professional adviser and is subject to professional obligations to maintain the confidentiality of the Confidential Information;

in relation to paragraph (b)(ii)(4) above, the person to whom the Confidential Information is to be given has entered into a Confidentiality Undertaking or is otherwise bound by requirements of confidentiality in relation to the Confidential Information they receive and is informed that some or all of such Confidential Information may be price-sensitive information; and

in relation to paragraphs (b)(ii)(5) and (b)(ii)(6) above, the person to whom the Confidential Information is to be given is informed of its confidential nature and that some or all of such Confidential Information may be price-sensitive information except that there shall be no requirement to so inform if, in the opinion of FGI, it is not practicable so to do in the circumstances.

Notices

Communications in writing

Addresses

Delivery

Subject to paragraph 24(c)(ii) below, any communication or document made or delivered by one person to another under or in connection with the Finance Documents will only be effective:

if by way of fax, when received in legible form; or

if by way of letter, when it has been left at the relevant address or five Business Days following the day on which it was despatched by first class mail postage prepaid,

Any communication or document to be made or delivered to FGI will be effective only when actually received by FGI and then only if it is expressly marked for the attention of the department or officer identified with the execution of FGI below (or any substitute department or officer as FGI shall specify for this purpose).

Electronic communication

Save where stated to the contrary, any communication to be made between the Parties under or in connection with the Finance Documents may be made by electronic mail or other electronic means, and the Parties agree:

that, unless and until notified to the contrary, this is to be an accepted form of communication;

to notify each other in writing of their electronic mail address and/or any other information required to enable the sending and receipt of information by that means; and

to notify each other of any change to their address or any other such information supplied by them.

Any electronic communication made between the Parties will be effective only when actually received in readable form and in the case of any

electronic communication made by the Client to FGI only if it is addressed in such a manner as FGI shall specify for this purpose.

English language

Any notice given under or in connection with any Finance Document must be in English.

All other documents provided under or in connection with any Finance Document must be:

in English; or

if not in English, and if so required by FGI, accompanied by a certified English translation and, in this case, the English translation will prevail unless the document is a constitutional, statutory or other official document.

Counterparts

Assignment and Agency

The Client and/or the Security Obligors shall not be entitled to assign, novate, charge or declare a trust over any of its rights or delegate any of its obligations under this Deed without the prior written consent of FGI.

FGI may assign or transfer all or any part of its rights under this Deed. The Client shall, immediately upon being requested to do so by FGI, enter into such documents as may be necessary or desirable to effect such assignment or transfer.

FGI may at its sole discretion and at the Client’s expense, appoint an agent in respect of any aspect of this Deed and any other Finance Document.

Syndication/Sub-Participation

Publicity

The Client and the Security Obligors shall consent (such consent not to be unreasonably withheld) to any reasonable request from FGI to publicise details of the transaction contemplated by the Finance Documents subject to receiving five Business Days’ notice of the details to be made public. Further, once any details have been made public in accordance with this paragraph 29, any further publicity relating to those details shall not require further consent from the Client.

The Client and the Security Obligors shall not publicise details of the transaction contemplated by the Finance Documents without first obtaining FGI’s written

Exclusion of prior agreements

Additional Security Obligors

FGI may request (and the Client shall procure) that any member of the Group become a Security Obligor and grant such Security Interests as FGI may require.

A member of the Group shall become a Security Obligor if:

the Client and the proposed Security Obligor deliver to FGI a duly completed and executed Accession Deed; and

FGI has received all of the documents and other evidence as it specifies in writing in relation to that Security Obligor, each in form and substance satisfactory to FGI.

Governing Law

Jurisdiction of English courts

The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Deed) (a “Dispute”).

The Parties agree that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no Party will argue to the contrary.

Without prejudice to any other mode of service allowed under any relevant law, each Security Obligor:

irrevocably appoints the Client as its agent for service of process in relation to any Dispute before the English courts in connection with any Finance Document, and the Client by its execution of this Deed, accepts that appointment; and

agrees that failure by an agent for service of process to notify the relevant Security Obligor of the process shall not invalidate the proceedings concerned.

This paragraph 33 is for the benefit of FGI only. As a result, FGI shall not be prevented from taking proceedings relating to a Dispute in any other courts with

jurisdiction. To the extent allowed by law, FGI may take concurrent proceedings in any number of jurisdictions.

Introduction

Assignment

By executing and delivering this Deed as a deed, the Client hereby assigns and transfers to FGI on a with-recourse basis all Receivables together with all Related Rights to such Receivables:

that are due and owing to the Client at the Commencement Date; and

that are created after the Commencement Date, regardless of whether an Event of Default has occurred and/or is continuing.

Receivables assigned to FGI on the Commencement Date shall vest absolutely in FGI on the Commencement Date. Receivables created after the Commencement Date shall vest absolutely in FGI automatically upon such Receivables coming into existence without any further act on the part of either FGI or the Client.

In respect of each Receivable assigned or transferred to FGI pursuant to this Deed, the Client agrees that:

the benefit of any Related Rights to that Receivable is assigned and transferred to FGI at the same time as the Receivable to which that Related Right is connected to is assigned and transferred to FGI; and

if, for any reason, title to or the benefit of that Receivable (or its Related Rights) fails to vest effectively in FGI, the Client will (A) take all necessary action to ensure that FGI has an effective first fixed charge over such Receivable; and (B) hold on trust for FGI (and separately from the Client’s own property) absolutely such Receivable and the proceeds of the same, howsoever such proceeds may arise.

Perfection of Title

execute, stamp (if appropriate) and deliver to FGI a written legal assignment of any Receivable and/or its Related Rights, in such form as FGI may require;

deliver to FGI any documents, deeds, instruments, policies, securities, records or data relating to any Receivable and/or its Related Rights; and/or

take any other action necessary to perfect the assignment or transfer to FGI of, or FGI’s title to, or the trust in FGI’s favour in relation to, any Receivable (and/or its Related Rights) and the proceeds of the same.

Notification of Receivables

Notification

clearly identifying and totalling Disapproved Receivables separately from other Receivables; and

accompanied by such supporting evidence regarding the existence and value of each Receivable as FGI may require, including but not limited to a copy of the sales contract, purchase order and invoice for each Notified Receivable together with evidence of shipment, furnishing and or delivery of the relevant goods and/or services.

Timing of Notification

Separate Notification

Disapproved Receivables

Disapproved Receivables

if it is not evidenced by an Invoice or other documentary evidence satisfactory to FGI;

if it arises out of a sale made by a Client to an Associate of a Client or to a person controlled by an Associate of a Client;

if it is due or unpaid more than the earlier of one hundred and twenty (120) days after the original Invoice date or sixty (60) days from the date for payment of the Invoice;

if any covenant, representation or warranty contained in this Deed with respect to such Receivable has been breached;

if the Debtor is subject to Insolvency Proceedings;

if such Receivable is payable in stages or relates to tooling;

if the sale to the Debtor is on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment or any other repurchase or return basis or is evidenced by chattel paper;

if the goods giving rise to such Receivable have not been Delivered to and accepted by the Debtor or the services giving rise to such Receivable have not been performed by the relevant Client and accepted by the Debtor or the Receivable otherwise does not represent a final sale;

if the Receivable is subject to any defence, dispute, or counterclaim or the Receivable is contingent in any respect or for any reason;

if such Receivable would breach any Limit set out in this Deed;

if any return, rejection or repossession of the merchandise has occurred or the rendition of services has been disputed;

any Receivable in relation to which the Supply Contract contains warranties that are, in the opinion of FGI (acting reasonably) unduly onerous or oppressive on the Client;

if when aggregated with all other Outstanding Receivables of the relevant Debtor, such Receivables total 35% or more of all Outstanding Receivables;

if the Supply Contract or any other document related to such Receivable is not governed by the laws of England & Wales, France, Spain or such other law as FGI may approve in writing, and does not provide for the Debtor’s submission to the jurisdiction of the courts of England & Wales, France, Spain or such other jurisdiction as FGI may approve in writing;

if such Receivable is owed by the Debtor acting in the capacity of a private individual;

if assignment of the Receivable is restricted or prohibited by the terms of such Receivable or by law;

if, pursuant to regulation, the proceeds of such Receivable would not become freely available; and

if such Receivable is not otherwise satisfactory to FGI as determined by FGI in the exercise of its discretion.

No Prepayments in respect of Disapproved Receivables

Recourse for Disapproved Receivables

FGI may require the Client, at any time after FGI has served a written notice (a “Repurchase Notice”) on the Client, to repurchase immediately any Disapproved Receivable.

Each Repurchase Notice will set out in reasonable detail:

the description of each Receivable to be repurchased; and

the Repurchase Price applicable to each such Receivable.

Until all the moneys payable by the Client under the relevant Repurchase Notice have been paid to FGI, the Receivables included in such notice and their respective Related Rights (together with any goods relating to them) will remain vested in FGI. FGI will, upon receiving payment of all such moneys and having FGI’s expenses paid by the Client, re-assign the relevant Receivables and their Related Rights (and the relevant goods, if any) to the Client, and may give or require the Client to give an accompanying notice to each relevant Debtor to that effect.

After the ownership of any Receivable has re-vested in the Client under paragraph 5(c)(iii) of this schedule 2, FGI will pay to the Client with all sums subsequently received or recovered by FGI in relation to that Receivable, after deduction of any amounts then due and owing by the Client to FGI.

Re-Approval

Purchase Price

Prepayment

Subject to the other provisions of this Deed and FGI’s rights of set-off, and provided no Event of Default has occurred or will occur as a result of making such Prepayment, FGI will make a Prepayment to the Client on account of the Purchase Price of each Receivable that is shown as Outstanding on the Receivables Purchased Account, up to an aggregate amount not exceeding the Availability.

FGI will debit to the Funds In Use Account an amount equal to the amount of each Prepayment made to the Client.

FGI will make Prepayments under paragraph 6(a)(i)above to an account of the Client (which must, unless FGI agrees otherwise in its absolute discretion, be an account in the Client’s name and maintained with a United Kingdom branch of any major bank or financial institution) by such method of transmission as FGI may approve from time to time.

Without prejudice to paragraph 6(b)(v) of this Schedule 2, each Prepayment made by FGI to the Client will be denominated in the same currency as the Purchase Price of the Receivable to which it relates. It is the Client’s responsibility to ensure that the account to which such payment is to be transmitted under paragraph (iii) above is suitable for the receipt of funds in the relevant currency. FGI will not be liable for any loss or damage suffered by the Client in the event that the bank or other institution at which such account is maintained declines to accept a payment transmitted to it in that currency.

Calculation of Purchase Price

The Purchase Price of each Receivable, including its Related Rights, will be equivalent to the amount received by FGI towards the discharge of such Receivable (including any Tax according to the relevant Supply Contract), LESS the aggregate of:

Discount and Collateral Management Fees in respect of the Receivable;

any amount payable in respect of VAT or any other Tax;

any discount, commission, credit, set-off or other deduction allowed or allowable by the Client to the Debtor;

if that Receivable is payable other than in US Dollars, any charges for collecting and/or converting as appropriate in accordance with paragraph 13 (Foreign currency) of this schedule 2; and

such other adjustments as FGI is permitted to make in accordance with this Deed.

The Purchase Price of a Receivable will be denominated in:

the same currency as the Receivable, if that currency is an Approved Currency; or

in any other case, such currency as FGI may agree.

Discount and Collateral Management Fees will be denominated, calculated and applied in US Dollars unless FGI otherwise agrees.

All other costs, charges and expenses will be denominated in the currency in which they arise unless otherwise expressly provided in this Deed or FGI otherwise agrees.

Where a sum is to be debited or credited to the Receivables Purchased Account, the Funds In Use Account or the Reserve Account, such sum shall be denominated in US Dollars, which will to the extent necessary for this purpose be computed by reference to the spot rate of exchange of FGI’s Bankers on the date of such debit or credit, but at its discretion FGI may provisionally apply the rate ruling on the date it receives the Notification relating to that Receivable, making such subsequent adjustments as may be necessary.

Payment mechanics and accounting

Notification

Collection Date

Reserve Account

FGI shall be entitled in its sole discretion, to apply the Required Reserve Amount to the Reserve Account from time to time if FGI deems it necessary to do so in order to protect FGI’s interests.

If at any time, the balance standing to the credit of the Reserve Account is less than the Required Reserve Amount, the Client shall, on demand, make such payment into the Collection Account or Trust Account as is required to ensure that the credit balance on the Reserve Account is not less than the Required Reserve Amount.

Repayment

the payment of which is in excess of Availability; and/or

the payment of which has caused any Limit to be exceeded; and/or

the amount of any Prepayment in relation to an Approved Receivable where such Approved Receivable subsequently becomes designated as a Disapproved Receivable.

Fees

Discount

on the monthly weighted average amount of Funds In Use;

by reference to the average Applicable Rate (to be calculated on the last day of the relevant calendar month) as published daily during that calendar month,

Collateral Management Fees

Bank charges and fees

Any payment effected by FGI to the Client or at the request of the Client by CHAPS shall incur a CHAPS Fee.

In addition, the Client shall pay to FGI on demand all bank commission and other charges and expenses incurred or payable by FGI in relation to this Deed and the arrangements contemplated in it.

Miscellaneous

Collection

Collection of Receivables

From the Commencement Date, FGI shall have the sole and exclusive right to collect and enforce payment of every Receivable other than Receivables sold back to the Client and the Client has no right to collect any Receivable (including any Disapproved Receivable ) unless FGI authorises the Client to do so in advance in writing.

Without prejudice to FGI’s rights pursuant to paragraph 8(a)(i) above, and subject to paragraph 15 (Disclosed Receivables Purchase Facility) of this schedule 2 (if applicable), FGI hereby appoints the Client as the agent of FGI, until notice to the contrary and for the purpose of administering the accounts of Debtors and procuring the collection of Receivables for the benefit of FGI. The Client hereby accepts such appointment and undertakes:

to act promptly and efficiently in carrying out the tasks in relation to which it is FGI’s agent;

not to hold itself out as an agent of FGI for any other purpose;

to adhere to the debt collection procedures of the Client in force at, and notified to and approved by FGI, on or before the Commencement Date and to obtain the prior written consent of FGI to any proposed variations to such procedures.

FGI may by notice to the Client withdraw the agency appointment made in paragraph 8(a)(ii) above and upon such withdrawal where an Event of

Default has occurred and is continuing, FGI shall be entitled to debit the Reserve Account with the Agency Termination Fee

Any notice of assignment given to any Debtor following such withdrawal, shall state, inter alia, that the Receivable to which it relates has been purchased by and assigned to FGI and the Client undertakes:

in respect of every Receivable, to give such notice in the manner and form prescribed by FGI; and

to use all reasonable endeavours to ensure that each Debtor makes payment in accordance with such notice and, without affecting such obligation, at the Client’s own expense, to despatch a letter in terms stipulated by FGI to any Debtor ignoring such notice or any part thereof and to send to FGI a copy of each such letter.

If a Debtor disputes any Receivable in excess of US$40,000, either individually or in aggregate with all other disputes, the Client will:

notify FGI promptly of such dispute;

use all reasonable endeavours to settle the dispute, subject always to FGI’s rights under this paragraph 8(a) (Collection of Receivables); and

promptly perform all its continuing obligations to the relevant Debtor under the contract giving rise to that Receivable.

The Client will assist FGI’s collection efforts, if FGI so requests, by promptly providing all information required for that purpose and the Client agrees that for collection purposes FGI may institute and conduct legal proceedings under FGI’s full control. The Client also agrees to co-operate in any such proceedings (including the giving of evidence) and agrees to be bound by anything done by FGI under this paragraph 8. Furthermore, the Client agrees, upon request of FGI, to initiate legal proceedings in their own name on behalf of FGI, and to act upon FGI’s instruction in that respect.

Payments

The Client shall ensure that it shall direct all its Debtors to make all payments in respect of Receivables owing by them to the Trust Account, the Collection Account or, if FGI in its sole discretion agrees (in writing), to such other account as directed by FGI (and not to any other bank account unless otherwise expressly agreed in writing by FGI that such other bank account is to be the Collection Account) and, in relation to any Collection Account, shall deliver to FGI a letter, signed by the Client in the form set out in schedule 8 (Form of notice to account bank), addressed to the bank or financial institution at which the Client maintains the Collection Account, instructing such bank or financial institution as to the disposition of Remittances received or to be received by it in purported settlement of any Receivable.

If and to the extent that a Debtor makes any payment in respect of a Receivable other than to the Trust Account, the Collection Account or as

directed by FGI, as the case may be (whether by way of making such payment to another account, by way of sending any cheque or other payment instrument directly to the Client, or in any other manner), the Client will notify FGI as soon as it becomes aware of the same and within one Business Days of becoming aware of the same:

transfer the full amount of such payment to the Trust Account or Collection Account as directed by FGI, as applicable, and (pending such transfer) hold the full amount of such payment on trust for FGI;

not otherwise deal with or dispose of such payment; and

direct the relevant Debtor to make all future payments in respect of Receivables to the Trust Account, the Collection Account or as directed by FGI, as applicable.

The Client will immediately pass to FGI or, to any bank FGI directs, any payment a Debtor makes to the Client directly in respect of a Receivable and the Client agrees:

if it is necessary for any cheque or other payment instrument to be endorsed to enable FGI to receive payment, to endorse the same prior to its delivery to FGI and not to mark or endorse any such cheque or other payment instrument other than in favour of FGI (or as FGI may direct).

to hold any such payment it receives for a Receivable on trust for FGI until FGI receives it; and

not to bank any such payment for its own account.

If payment of any amount to FGI is not made in accordance with paragraph 8(b)(iii) of this schedule 2 within 48 hours of receipt of the relevant amount by the Client, FGI shall be entitled to charge the Client a Misdirected Payment Fee. The provisions of this paragraph 8(b)(iv) are without prejudice to any other remedies that may be available to FGI at law.

If a Debtor makes a general payment either to FGI or to the Client without specifying which debts are covered by it then FGI shall apply it firstly against any Outstanding Receivables owed by that Debtor in chronological order, secondly against the discharge of the Client’s liability to FGI, if any, whether arising under this Deed or otherwise, and thirdly, any balance shall be paid as the Client wishes.

Credit notes

If FGI’s records show that a credit balance appears on any account with a Debtor, whether as a result of the issue of a credit note by the Client or otherwise, FGI may (and the Client authorises FGI to) pay that credit balance to the relevant Debtor and debit it to the Reserve Account. Pending any such payment by FGI to the relevant Debtor, that credit balance will constitute a contingent liability of the Client to FGI.

FGI shall keep a permanent record on the Reserve Account showing all sums payable or paid to the Client, all payments received in relation to Receivables and all fees, expenses and other sums payable or paid by the Client under this Deed or otherwise. A copy of the Reserve Account shall be taken as undisputed evidence of the matters stated in it at the date of its preparation unless within fourteen (14) days from the publication of the same online, the Client notifies FGI in writing of any discrepancy.

Online services

FGI shall provide the Client with online access via a secured website to information on the Receivables, the Purchase and Prepayment Statement and a reconciliation of the relationship relating to billing, collection and account maintenance such as aging, posting, error resolution, interest and fees payable hereunder, and mailing of statements in the ordinary course of FGI’s business.

All of the information provided on the online services shall be in a format, and in such detail, as FGI, in its sole and absolute discretion, deems appropriate. In the event of any dispute, FGI’s books and records shall be admissible in evidence, without objection, as prima facie evidence of the status of the Receivables, any non-vesting Receivables and the Reserve Account, unless the Client notifies FGI of any discrepancy in writing within 30 days of such information being made available to them.

Each statement, report, or accounting rendered or issued by FGI to the Client, if any, and all online information shall be deemed conclusively accurate and binding on the Client unless within fifteen (15) days after the date of issuance or posting of any information, the Client notifies FGI to the contrary by registered post, detailing the inaccuracies in such statement, report, or accounting, together with a statement of the correct amount.

FGI’s failure to provide, or the Client’s failure to receive, such online access shall not relieve the Client of any of its obligations under this Deed or the responsibility of the Client to request statements of account. If the Client does not make such a request, it shall be deemed to have agreed the amounts set out in FGI’s records.

Credit balances

Information relating to Receivables and Debtors

Provision of information

keep such accounting records as FGI may require in relation to its Receivables, in such format as FGI may specify;

immediately following the purchase by FGI of any Receivable, make

appropriate entries in its books of account, in accordance with generally accepted accounting principles where applicable, recording the sale of that Receivable and to ensure that in all such books of account and other records of the Client relating to the relevant Receivable, there are conspicuous notations that the Receivable has been sold to FGI;

on the first Business Day of each week, the Client shall deliver to FGI, in a format approved by FGI:

a report of all Dilutions made during the previous week together with (i) such original or copy documentation as FGI may require, evidencing such credit note or other Dilution and (ii) either a cheque addressed to FGI for the amount of such returns and allowances or a credit memorandum confirming that such amounts are to be debited to the Reserve Account (for the avoidance of doubt, the amount of each credit note, allowance or discount notified to FGI under this paragraph 11(a)(iii)(A) will be treated as a reduction to the Purchase Price of the Receivable to which it relates and will be debited to the Reserve Account);

details of all Receivables subject to any offset or deduction, or where the Debtor is also a creditor or supplier of a Client or the Receivable is contingent in any respect or for any reason; and

for each Debtor, a weekly report in a form and substance satisfactory to FGI setting out all returns and allowances made during the previous week with respect to Notified Receivables.

immediately notify FGI in writing of reclaimed, repossessed or returned Inventory, Debtors’ claims and disputes, and any other matters affecting any Receivables or Related Rights; and

promptly upon request, deliver to FGI:

a current listing of all open and unpaid accounts payable and Receivables; and

any other information concerning the Receivables that FGI may deem necessary from time to time.

Maintenance of information

deliver to FGI all and any proofs of delivery or other evidence of performance in full of the Client’s obligations under a Supply Contract (but the Client shall in any event maintain at all times all such proofs of delivery or evidence pending FGI’s request for sight of the same);

use all reasonable endeavours to procure from any relevant debt collection agency engaged to collect Receivables subject to this Deed a written acknowledgement of FGI’s ownership of Receivables; and

deliver to FGI a list of the names and addresses of all Debtors and/or copies of the statements issued by the Client to all Debtors.

Verification of Receivables

Receivable-specific warranties

Representations and warranties

Payment obligation

Legal and beneficial owner

has not previously been Notified to FGI;

has not previously been sold or assigned to any person other than FGI;

is not subject to any Security Interest in favour of any person other than FGI; and

is not an interest-bearing Receivable, nor is it subject to any withholding tax;

Title of FGI

Supply Contract

is valid, binding and enforceable against the Debtor;

has been made in the ordinary course of the Client’s business;

is governed by the laws of England, France, Spain or other law approved by FGI in writing, and provides for the Debtor’s

submission to the jurisdiction of the English, Spanish or French courts;

contains no prohibition of assignment of the Receivable or any Related Rights to or by FGI;

is not subject to any consumer protection legislation under the laws of England.;

provides for payment in an Approved Currency

does not conflict with or breach any law applicable to the Client; and

is otherwise as approved by FGI;

No disputes, etc.

the Debtor is not in default of any sums due to the Client and the Client has no reason to believe that the Debtor will be unable to, or will not for any reason, pay the Receivable in full when it falls due;

to the Client’s knowledge, the Debtor will pay the full amount of each Receivable within the Permitted Credit Period;

it has taken all reasonable steps to ascertain the creditworthiness of the Debtor prior to the delivery of goods or the rendering of services under the Supply Contract; and

the Debtor has accepted unconditionally and without any qualification the terms of the Supply Contract to which such Receivable relates and has no right of set-off, allowance, discount, deduction, abatement, dispute or counterclaim in respect of the Receivable; and

Insolvency

Delivery and performance

Supporting documentation

Associate

Dilutions

Repetition

Foreign currency

Receivables denominated other than in US Dollars

the collection of that Receivable; and/or

conversion of amounts collected into US Dollars (or into such other currency as FGI determines from time to time),

Change in currency

Power of attorney

Appointment

The Client hereby irrevocably appoints FGI, by way of security, to be the Client’s attorney in the name of the Client for the purpose of executing such deeds or documents and completing and endorsing such instruments and instituting or defending such proceedings and performing such other acts as FGI may consider requisite in order to perfect FGI’s title to any Receivable or Related Rights and to secure performance of any of the Client’s obligations under the Receivables Purchase Facility or under any Supply Contract or obtain payment of any Receivable.

The Client agrees that each of FGI’s directors, officers or duly authorised personnel from time to time may exercise the powers given to FGI in this paragraph 14(a) (Appointment).

The power of attorney shall only be exercisable upon or at any time following the occurrence of a Default or an Event of Default which is continuing.

Substitute attorney

Ratification

Disclosed Receivables Purchase Facility

in respect of each relevant Receivable and credit note, to give a notice of assignment to the Debtor on each and every Invoice, credit note, statement in the manner and form prescribed by FGI, such notice stating, inter alia, that the Receivable to which it relates has been purchased by and assigned to FGI;

to use all reasonable endeavours to ensure that each relevant Debtor complies with the payment instructions prescribed in such notice of assignment;

at its own expense, to despatch a letter in terms prescribed by FGI to any relevant Debtor that ignores a notice of assignment and to send to FGI a copy of such letter;

not to instruct any solicitor or other third party to commence any legal or other proceedings for the recovery of any relevant Receivable without the prior written consent of FGI; and

to instruct any such solicitor or third party to report promptly and fully to FGI as to the progress of any legal action for recovery of any relevant Receivable.

The Inventory Facility

Inventory Facility Limit

Application of funds

Conditions and covenants

Term and drawdown

Requests for Advances

Advances

Any request for an Advance made by the Client pursuant to paragraph 2(a) (Requests for Advances) of this schedule 3 shall, once given, be irrevocable and oblige the Client to borrow the amount requested on the Inventory Facility Advance Date but shall not be considered unless made prior to 11.00am on Business Day immediately preceding the Inventory Facility Advance Date.

An Advance shall not be made if an Event of Default has occurred and is continuing on the Inventory Facility Advance Date.

Inventory Payment Account

FGI will debit to the Inventory Payment Account an amount equal to the amount of each Advance on the date on which it is made.

If the Advance is to be made in a currency other than US Dollars, the amount to be debited to the Inventory Payment Account will be converted to US Dollars, which will to the extent necessary for this purpose be computed by reference to the spot rate of exchange of FGI’s Bankers on the date of such debit or credit.

Limits and restrictions

would cause the Inventory Payment Account Balance to exceed the lower of:

the Inventory Facility Limit; and

the sum produced by applying the Eligible Inventory Formula at that time, converted to US Dollars by reference to the spot rate of exchange of FGI’s Bankers on the date of such conversion,

would cause the Global Limit to be exceeded; and/or

is not denominated in an Approved Currency.

Interest and fees

Interest

Collateral Management Fee

Collateral Management Fee will be calculated on the daily Inventory Payment Account Balance for each month during which it is outstanding.

For administrative convenience, the Collateral Management Fee will be debited to the Reserve Account on the last day of each calendar month.

Other

Repayment

Default and termination

Payment of excess

exceeds the lower of:

the Inventory Facility Limit; and

the sum produced by applying the Eligible Inventory Formula at that time, converted to US Dollars by reference to the spot rate of exchange of FGI’s Bankers on the date of such conversion; or

exceeds the Global Limit,

Repeating warranties

Standard conditions - funding requirements

Status and condition

Storage of Inventory

Landlord’s Waiver

Location and access

Title

Returns of Inventory

Reporting system

Consignment

Insurance

provide cover against (A) loss or damage by fire (B) all risks which are normally insured against by other prudent companies owning or possessing similar assets and carrying on similar businesses and (C) all other risks which FGI may from time to time specify;

be in such amounts as would in the circumstances be prudent for such companies and shall include, an entitlement to receive the full replacement value from time to time of any Inventory destroyed or otherwise becoming a total loss; and

have FGI as co-insured and sole first loss payee.

Terms of Inventory Insurance

of any cancellation, alteration, termination or expiry of any Inventory Insurance at least 30 days before it is due to take effect;

of any default in the payment of any premium or failure to renew the Inventory Insurance at least 30 days before the renewal date;

of any act, omission or event of which the insurer has knowledge which may make any Inventory Insurance void, voidable or unenforceable (in whole or in part).

Inventory Insurance Undertakings

will promptly pay all premiums relating to the Inventory Insurances; and

will supply to FGI immediately upon issue copies of each Inventory Insurance policy document, together with the current premium receipts relating to it;

will not do or permit to be done or omit to do anything which may render any Inventory Insurance void, voidable or unenforceable (in whole or in part) and will not vary, amend or terminate any Inventory Insurance policy.

Payment of premiums

Proceeds of Inventory Insurance

the Client will notify FGI if any claim arises or may be made under the Inventory Insurances;

FGI shall have the sole right to settle or sue for any such claim and give any discharge for insurance monies; and

all claims and monies received or receivable under any Inventory Insurances must be applied in replacing or restoring the Inventory damaged or destroyed or (after the occurrence of an Event of Default which is continuing) in repayment of outstanding Advances in such order as FGI sees fit.

Carriers’ fees

Valuation

Borrowing Base Certificates

Creditors

Deposit of documents

Over Advances

Over Adances

Global Limit

Interest

Repayment

Repeating representations

If a Credit Party contacts FGI electronically, FGI may collect the Credit Party’s electronic identifier (e.g. Internet Protocol (IP) address or telephone number).

A Credit Party’s information includes information about the Finance Documents and FGI may use the Credit Party’s information to assess financial and insurance risks, recover debt, prevent and detect crime, understand requirements of Debtors; and develop and test products and services.

FGI will not disclose information about the Credit Party to anyone outside FGI except where FGI has the Credit Party’s permission, where FGI is required or permitted by law, to other companies who provide a service to FGI or to the Credit Party or where FGI may transfer rights and obligations under the Finance Documents.

FGI may transfer information about the Credit Party to other countries but if it does so it shall ensure that anyone to whom FGI passes the information provides an adequate level of protection.

From time to time FGI may change the way FGI uses information about the Credit Party. Where FGI believes the Credit Party may not reasonably expect such a change, FGI shall write to the Credit Party. If the Credit Party does not object to the change within 60 days, the Credit Party consents to that change.

For a copy of the information held by FGI about the Credit Party, the Credit Party may write to the data controller at FGI.

FGI may make periodic searches of and provide information to credit reference agencies to manage and take decisions about the Credit Party’s Facility.

FGI may wish to keep the Credit Party informed by letter, phone and electronic means (including email and mobile messaging) about products, services and additional benefits that FGI believe may be of interest to the Credit Party. If the Credit Party does not want FGI to do so the Credit Party should notify FGI.

Mad Catz Europe Limited

04017563

c/o Needle Partners Limited

Grove House

Mansion Gate Drive

Leeds

England

LS7 4DN

Mad Catz Europe Limited

04017563

c/o Needle Partners Limited

Grove House

Mansion Gate Drive

Leeds

England

LS7 4DN