i.

enter into a senior secured superiority debtor-in-possession note (the “RELY DIP Facility”) which will be provided to the Borrower after the entry date of the DIP Order in an aggregate amount not to exceed $4,000,000; and

ii.

issue to the Commitment Party on the Effective Date an amount of common stock in the Reorganized Borrower such that the Commitment Party shall own, or have the right to own, 45-49% of such common stock as of such date (after taking into account a distribution of any common stock in the Reorganized Borrower to Goldman on account of the Upfront Fee) upon payment of a purchase price of $10,000,000 (the “Equity Commitment”)1;

1.

Commitment; Titles and Roles.

2.

Conditions Precedent.

3.

Information.

4.

Indemnification and Related Matters.

5.

Assignments.

6.

Confidentiality.

7.

Absence of Fiduciary Relationship; Affiliates; Etc.

8.

Miscellaneous.

Very truly yours,

GOLDMAN SACHS & CO. LLC

By:

/s/ Daniel S. Oneglia

Daniel S. Oneglia

Authorized Signatory

By:

/s/ Michael J. Hobey

Name: Michael J. Hobey

Title: President, Interim Chief Executive Officer and CFO

BORROWER:

Real Industry, Inc. (the “Borrower” and after the Effective Date (as defined below), the “Reorganized Borrower”), a debtor in possession in the Chapter 11 case (the “Case”) filed with the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) (jointly administered under Case No. 17-12464) on November 17, 2017 (the “Petition Date”).

GUARANTORS:

Each of the Borrower’s existing and newly acquired or created domestic U.S. direct or indirect subsidiaries, which exclude the debtors in the Case other than Borrower, listed on Annex 1 to this Term Sheet (collectively, the “Guarantors”) will unconditionally guarantee the obligations of the Borrower in respect of the RELY DIP Financing (as defined below) on a joint and several basis.

LENDER:

Goldman Sachs & Co. LLC (or one of its affiliates) (“Goldman” or “Lender”).

RELY DIP FINANCING:

The “RELY DIP Financing” shall be a senior secured superpriority debtor-in-possession note in an aggregate principal amount not to exceed $4,000,000, to be made available to the Borrower in accordance with the Budget (as defined below) after the date on which the Bankruptcy Court enters an order approving the RELY DIP Financing in form and substance consistent with this Term Sheet and otherwise acceptable to Goldman (the “DIP Order”).   Portions of the RELY DIP Financing that are repaid or prepaid may not be reborrowed.

DIP CLOSING DATE:

The closing date with respect to the RELY DIP Financing (the “DIP Closing Date”) shall be no later than three (3) business days following the date of entry of the DIP Order, subject to (a) entry of the DIP Order, (b) satisfaction of all applicable conditions precedent and (c) the definitive documents, including a note purchase, security, collateral and guarantee agreements, having been executed and/or delivered in connection with the RELY DIP Financing (together with all documentation related to the RELY DIP Financing, collectively, the “RELY DIP Documents”).

MATURITY DATE:

The RELY DIP Financing and all other obligations of the Borrower and the Guarantors thereunder and under the RELY DIP Documents (the “DIP Obligations”) shall be repaid in full in cash at the earliest of:

(i)one (1) year following the Petition Date (the “Stated Maturity Date”);

(ii)the effective date of a plan of reorganization for the Borrower  which is confirmed by an order of the Bankruptcy Court; and

(iii)the acceleration of the RELY DIP Financing and related termination of the commitments under the RELY DIP Documents, including, without limitation, as a result of the occurrence of an Event of Default under the RELY DIP Documents or default under the DIP Order (any such date in clauses (i) through (iii), the “Maturity Date”).

USE OF PROCEEDS:

Subject to a budget to be agreed upon and updated on a monthly basis (or more frequently, at the request of Goldman) (the “Budget”), the proceeds shall be used to fund general working capital, operational expenses and restructuring expenses of the Borrower, solely to the extent permitted by the DIP Orders, the Budget and the RELY DIP Documents, as applicable.  The proceeds of the RELY DIP Financing shall not be used by the Borrower to assert or prosecute any claim, demand, or cause of action against the Lender, including, in each case, without limitation, any action, suit, or other proceeding for breach of contract or tort or pursuant to Sections 105, 510, 544, 547, 548, 549, 550, or 552 of the Bankruptcy Code, or under any other applicable law (state, federal, or foreign), or otherwise.  The initial Budget is attached hereto as Annex 2.

OPTIONAL COMMITMENT REDUCTIONS AND REPAYMENTS:

The commitments in respect of the RELY DIP Financing may be voluntarily reduced or terminated, and amounts borrowed under the RELY DIP Financing may be voluntarily repaid, in each case, upon two (2) business days’ notice to the Lender by the Borrower, at a redemption price equal to the sum of (i) 100% of the principal amount of the RELY DIP Financing being redeemed plus accrued and unpaid interest thereon as of the date of such redemption; plus (ii) (x) in the event of a repayment for specified events, 2.0% of the amount of the repayment or (y) in all other cases, the Make-Whole Amount (as defined below). For the avoidance of doubt, no Make-Whole Amount will be due in connection with a repayment of the RELY DIP Financing on the Maturity Date.

“Make-Whole Amount” means the greater of (x) 2.0% of the amount of the repayment and (y) an amount equal to the difference between (A) the aggregate amount of interest which would have otherwise been payable on the amount of the repayment from the date of repayment until the Maturity Date, minus (B) the aggregate amount of interest Lender would earn if the prepaid amount were reinvested for the period from the date of repayment until the Maturity Date at the Treasury Rate (to be defined) plus 50 basis points.

MANDATORY REPAYMENTS:

The RELY DIP Financing will be subject to customary and appropriate mandatory prepayment events, acceptable to Goldman, including the net proceeds of (a) any issuance of debt or equity securities (other than as contemplated by this Term Sheet) and (b) any asset sale, catastrophic event or extraordinary receipts of the Borrower, subject to certain exceptions and specified events to be included in definitive documentation.  Any mandatory prepayment and any payments upon acceleration shall be at the purchase price applicable to an optional redemption occurring on such date, plus accrued and unpaid interest.

SUPER PRIORITY ADMINISTRATIVE CLAIMS:

Subject and subordinate to the Carve-Out in all respects, the DIP Obligations shall constitute allowed superpriority administrative expense claims under Sections 364(c)(1), 503(b), 507(a)(2) and 507(d) of the Bankruptcy Code and shall in each case have priority over all other allowed chapter 11 and chapter 7 administrative expense claims specified or ordered pursuant to any provision of the Bankruptcy Code, including, but not limited to, Bankruptcy Code sections 105, 326, 328, 330, 331, 503(a), 503(b), 506(c), 507(a), 507(b), 546(c), 546(d), 726, 1113 and 1114 and including, for the avoidance of doubt, the expenses of a chapter 11 or chapter 7 trustee.

“Carve-Out” means (i) all fees required to be paid to the Clerk of the Bankruptcy Court and to the Office of the United States Trustee under section 1930(a) of title 28 of the United States Code; (ii) all accrued, allowed and unpaid fees and expenses of the Borrower’s professionals and the professionals for any official committee appointed in the Case through  and included the date of delivery of a Carve-Out Trigger Notice up to the amounts set forth in the Budget; and (iii) $150,000 for any fees and expenses of the Borrower’s professionals and the professionals for any official committee appointed in the Case following the delivery of a Carve-Out Trigger Notice; provided that, notwithstanding the foregoing, the fees and expenses described in clauses (i) through (iii) above shall include solely those fees and expenses directly relating to the chapter 11 case of the Borrower and Guarantors, if any, and any fees allocable to the Borrower pursuant to the Interim Compensation Procedures Order entered in the Borrower’s cases (and, for the avoidance of doubt, no fees or expenses directly related to the chapter 11 cases of any other affiliate of the Borrower).

No portion of the Carve-Out or proceeds of the RELY DIP Financing or any other amounts may be used for the payment of the fees and expenses of any person incurred in prosecuting any claims or causes of actions against the Lender under the RELY DIP Financing, their respective advisors, agents and sub-agents, including formal discovery proceedings in anticipation thereof, and/or any lien of the Lender under the RELY DIP Financing.

RELY DIP LIENS:

Subject to the prior payment of the Carve-Out from the proceeds of Collateral, pursuant to Sections 364(c)(2), and 364(d) of the Bankruptcy Code, the DIP Obligations shall be secured by senior priming liens (the “RELY DIP Liens”) on substantially all assets and property of the Borrower and the Guarantors,  wherever located, whether now owned or hereafter acquired, and all products and proceeds thereof, including, without limitation, intercompany claims and equity pledges (such assets and property, the “Collateral”) including, subject to the entry of the DIP Order, proceeds of the Borrower’s and the Guarantors’ claims and causes of action under sections 502(d), 544, 545, 547, 548, 549, 550 and 553 of the Bankruptcy Code and any other avoidance or similar action under the Bankruptcy Code or similar state or municipal law and the proceeds of each of the foregoing (collectively, the “Avoidance Actions”).

Except as set forth above, all of the RELY DIP Liens shall be effective and perfected upon entry of the DIP Order and without the necessity of the execution, delivery, or filing of mortgages, security agreements, pledge agreements, financing statements, intellectual property filings, any other filing or notice with any governmental authority or other agreements or instruments.

INTEREST RATE:

The interest rate for any funded RELY DIP Financing shall be twelve percent (12%) per annum, accruing and payable monthly.

DEFAULT INTEREST:

The default interest rate shall be the interest rate then in effect plus two percent (2%) per annum.

UPFRONT FEE:

In consideration for the RELY DIP Financing and the Equity Commitment (as defined below), Goldman shall receive payment of an Upfront Fee upon the DIP Closing Date equal to $300,000 in cash plus shares of common stock equal to 4.9% of the outstanding stock of Borrower pursuant to a private placement, subject to customary registration rights.

BREAK-UP FEE:

$450,000 to be approved pursuant to the DIP Order and paid as provided below.

ACQUISITION FINANCING DURING CHAPTER 11 CASE:

Lender will be granted a right of first refusal upon an offer by any third-party to provide financing of the Borrower’s acquisition activities during the period prior to the Maturity Date.  In connection with any such financing by Goldman, Goldman shall be entitled to certain customary fees to be agreed in the RELY DIP Documents.

CONDITIONS PRECEDENT TO RELY DIP FINANCING:

The obligation of the Lender to make the RELY DIP Financing will be subject to conditions precedent that are usual and customary for transactions of this kind, acceptable to Goldman, including, among others: (i) the execution of the RELY DIP Documents; (ii) entry by

the Bankruptcy Court of the DIP Order; and (iii) the conditions specified in the Commitment Letter, including in Exhibit B thereto.

REPRESENTATIONS AND WARRANTIES:

To be applicable to the Borrower and Guarantors, including but not limited to the representation and warranties listed on Exhibit E to the Commitment Letter, as well as the following: corporate existence and good standing; authority to enter into and due execution, delivery and enforceability of, the RELY DIP Documents; validity and continued effectiveness of the DIP Order, as applicable, including the creation, validity, perfection and priority of the RELY DIP Liens and Lender’s claims granted thereunder; governmental approvals; non-violation of organizational documents and material debt agreements (other than as a result of the commencement of the Case); accuracy of disclosure, including financial statements and information concerning the Borrower’s tax attributes (including the amount of net operating loss carryforwards of the Borrower and Guarantors, any limitations on the use thereof under section 382 of the Internal Revenue Code, and the degree to which past transactions could contribute to an “ownership change” of the Borrower within the meaning of section 382 of the Internal Revenue Code; no material litigation not stayed by reason of the Case; intellectual property; ownership of properties; compliance in all material respects with environmental, pension/ERISA and other laws (including, without limitation, FCPA, OFAC and the PATRIOT Act and similar laws applicable to sanctioned persons and any other anti-terrorism, anti-money laundering and anti-corruption and anti-bribery laws);  use of proceeds; payment of taxes; insurance; permits and licenses; absence of default or Event of Default; no material adverse change; the Borrower having not failed to disclose any material  assumptions or liabilities with respect to the Budget; and affirmation of the reasonableness of the assumptions and projections in the Budget by an appropriate financial officer of the Borrower.

COVENANTS:

The RELY DIP Documents will contain such affirmative and negative covenants as are customary in debtor-in-possession financings and acceptable to the Lender, which shall be applicable to the Borrower and the Guarantors and shall include, without limitation, the affirmative covenants provided in Exhibit F to the Commitment Letter and the negative covenants provided in Exhibit G to the Commitment Letter, as well as the following: (i) the Borrower shall deliver to Goldman detailed budgets (in the form consistent with Annex 2), which shall be subject in all respects to Goldman’s approval, and variation from the Budget not to exceed 10%, tested on a rolling four-week basis beginning one week following approval of the DIP Order1 and each week thereafter (each, a “Budget Period”) for each of the categories of

Payroll/Benefits, Occupancy, Discontinued Operations, Ordinary Course Professionals, and SG&A; provided that (x) amounts in all other categories and the portion of SG&A relating to amounts paid pursuant to D&O tail insurance shall be tested on a line-item basis, (y) the fees and expenses of Goldman and its professionals are not required to be included in the Budget and shall be excluded for determining any variance and (z) any cash receipts shall be excluded for all calculations of any variance; (ii) Borrower shall deliver in advance to Goldman all draft pleadings and public announcements relating to the Borrower’s and Guarantors assets and business plan and consider Goldman’s comments thereto in good faith; and (iii) Borrower and Guarantors shall not take any action to materially impair the assets of the Borrower or its subsidiaries including with respect to the availability of any tax attributes of the Borrower or its subsidiaries.

MILESTONES:

The RELY DIP Documents (to be executed no later than January 15, 2018) shall include the following milestones (the “DIP Milestones”):

(i)no later than January 31, 2018, the Borrower shall have filed a chapter 11 plan (the “Plan”) and Disclosure Statement with respect to the Plan (the “Disclosure Statement”), in each case in form satisfactory to the Lender;

(ii)entry by the Bankruptcy Court of an order approving the Disclosure Statement in form and substance acceptable to the Lender by no later than March 7, 2018, subject to court availability;

(iii)execution of the definitive documents related to the Equity Commitment no later than five (5) days before the hearing to consider confirmation of the Plan;

(iv)entry by the Bankruptcy Court of an order confirming the Plan in form and substance acceptable to the Lender (the “Confirmation Order”) by no later than April 13, 2018, subject to court availability; and

(v)no later than 10 days after entry of the Confirmation Order, the Borrower shall have taken all steps reasonably necessary to satisfy all conditions for consummating the Plan.

EVENTS OF DEFAULT:

The RELY DIP Financing shall have usual and customary events of default for transactions of this kind (an “Event of Default”), acceptable to Lender, including:

(i)default shall be made in the payment of any principal of or interest on the DIP Financing or in the payment of any fee

or other amount due under the DIP Orders, RELY DIP Documents or the RELY DIP Financing, in each case, when and as the same shall become due and payable, whether at the due date thereof or by acceleration thereof or otherwise;

(ii)any representation or warranty made or deemed made in any RELY DIP Document, or any representation or warranty contained in any certificate, or other document furnished in connection with or pursuant to any RELY DIP Document or the RELY DIP Financing, including the Commitment Letter, shall prove to have been false or misleading in any material respect when so made, deemed made or furnished;

(iii)breach of any covenant that is not cured within 30 days;

(iv)a Change of Control (to be defined in the RELY DIP Documents) shall have occurred;

(v)the Borrower fails to meet any DIP Milestone;

(vi)any prohibited variance from the Budget;

(vii)the DIP Order shall not have been entered within 30 calendar days after the filing of the motion to approve the RELY DIP Financing;

(viii)the Borrower shall obtain, or the Bankruptcy Court shall enter an order approving, any additional financing from a party other than the Lender, including from any of its subsidiaries;

(ix)the Borrower files a motion, or the Bankruptcy Court enters an order subordinating, disallowing, or otherwise challenging the claims and liens of the Lender under the RELY DIP Financing;

(x)any other claim which is senior to or pari passu with the Lenders' administrative claim or any lien on any assets or property of the Borrower shall be granted without the Lender’s consent, except as expressly permitted by the RELY DIP Documents;

(xi)the Borrower shall (A) contest the validity or enforceability of any RELY DIP Document in writing or deny in writing that it has any further liability thereunder or (B) contest the validity or perfection of the liens and security interests securing the RELY DIP Financing;

(xii)any attempt by the Borrower to invalidate or otherwise impair the RELY DIP Financing or the liens granted to the Lender with respect to the RELY DIP Financing;

(xiii)the DIP Order shall be reversed, stayed or vacated, shall be amended, supplemented or otherwise modified without the prior written consent of the Lender, or shall otherwise cease to be in full force and effect;

(xiv)the filing of any plan in the Case by the Borrower, or the confirmation of any plan in the Case, that does not provide for the termination of the commitments under the RELY DIP Financing and the payment in full in cash of all DIP Obligations on or before the effective date of such plan;

(xv)the Borrower fails to comply in any material respect with the DIP Order;

(xvi)any sale or other disposition of all or a material portion of the Collateral pursuant to section 363 of the Bankruptcy Code other than as permitted by the DIP Orders or pursuant to a transaction that is permitted under the RELY DIP Documents;

(xvii)conversion of the Case to a case under Chapter 7 of the Bankruptcy Code or the dismissal of the Case;

(xviii)the determination of the Borrower, whether by vote of the Borrower’s board of directors or otherwise, to suspend the operation of the Borrower’s business in the ordinary course, liquidate all or substantially all of the Borrower’s assets or the filing of a motion or other application in the Case seeking authority to do any of the foregoing;

(xix)the filing of a plan of reorganization or liquidation by the Borrower that is not acceptable to the Lender or does not provide for the payment in full of the DIP Obligations;

(xx)appointment of a trustee, interim receiver or receiver, or manager or a responsible officer or person or an examiner with enlarged powers (having powers beyond the investigatory and reporting powers set forth in the Bankruptcy Code sections 1106(a)(3) and (4)) in the Case; and

(xxi)the Borrower shall take any action, including the filing of an application, seeking or supporting of any of the foregoing or any person other than the Borrower shall do so and such application is not contested in good faith by the Borrower.

REMEDIES:

Among other remedies to be specified in the RELY DIP Documents, upon the occurrence and during the continuance of an Event of Default the Lender may suspend the availability of the RELY DIP Financing and, after giving five business days’  notice to the Borrower and the Guarantors (the “Remedies Notice Period”), which notice may be given simultaneously to the Bankruptcy Court, the automatic stay provided in Section 362 of the Bankruptcy Code shall be deemed automatically vacated without further action or order of the Bankruptcy Court, and the Lender, after the Remedies Notice Period, shall have relief from the automatic stay to exercise remedies under the RELY DIP Documents, including relief to foreclose on all or any portion of the security for the RELY DIP Financing, collect accounts receivable and apply the proceeds thereof to the DIP Obligations or otherwise exercise remedies against the Collateral permitted by applicable non-bankruptcy law. During the Remedies Notice Period, the Borrower shall be entitled to seek an emergency hearing before the Bankruptcy Court; provided that the only issue that may be raised at such hearing shall be whether an Event of Default has in fact occurred and is continuing. Subject to section 363(k) of the Bankruptcy Code, the Lender shall also have the authority to credit bid all or a portion of the amounts owed under the RELY DIP Financing, whether pursuant to a sale under section 363 of the Bankruptcy Code, a plan pursuant to section 1129(b) of the Bankruptcy Code or otherwise, but only to the extent the DIP Obligations have been discharged concurrently with the consummation of the transactions in respect of such credit bid.

EMERGENCE:

In connection with the RELY DIP Financing, Goldman shall commit to purchase on the effective date of the Plan (the “Effective Date”) an amount of common stock in the Reorganized Borrower such that Goldman shall own, or have the right to own, 45-49%2 of such common stock as of such date (after taking into account a distribution of any common stock in the Reorganized Borrower to Goldman on account of the Upfront Fee) for a purchase price of $10.00 million3 (the “Equity Commitment”), subject to the satisfaction of certain conditions to be specified in the RELY DIP Documents, including without limitation, (i) the Bankruptcy Court shall have entered an order, acceptable to Goldman, confirming the Plan and shall have approved all documents relating thereto, which documents shall be acceptable to Goldman; (ii) adoption of new governance documents and approval of related documents by the Reorganized Borrower acceptable to Goldman, including (a) articles of incorporation and by-laws that provide usual and customary rights for transactions of this kind, including among

other things, (1) requirements for 55%4 shareholder approval for certain transactions (e.g., incurrence or guarantee of any material indebtedness for borrowed money, incurrence of any liens in respect of the same, issuance of common or preferred stock,  making of any prohibited restricted payments), (2) board structure and composition to be agreed, which generally reflects the relative share ownership of Goldman and as reasonably acceptable to Goldman, including the appointment of at least one independent board member, (3) requirement for such independent board member’s approval for certain types of transactions (e.g., material transactions, waiver of stock transfer restrictions described below),  and (4) requirement that any transfer of stock in the Reorganized Borrower by or to a 4.75% holder of such stock (defined as appropriate for purposes of avoiding an “ownership change” of the Reorganized Borrower within the meaning of section 382 of the Internal Revenue Code) shall be null and void ab initio unless specifically approved in writing by board of directors of the Reorganized Borrower (which board may not provide such approval without the prior written consent of Goldman), (b) a new Shareholder Agreement between and among the Lender, the Borrower and the shareholders of the Reorganized Borrower (the “Shareholders”) and a registration rights agreement between and among the Lender and the Reorganized Borrower, that provide usual and customary rights for transactions of this kind, including among other things drag and tag rights, and (c) a right of first refusal to Goldman with respect to any financing for the Borrower’s acquisition activities for the two-year period following the Effective Date (and certain fees to be agreed among the parties prior to the Effective Date); (iii) no material impairment of the assets of the Borrower including with respect to the availability of any tax attributes of the Borrower after the Petition Date; (iv) no Change of Control (to be defined in the RELY DIP Documents); (v) the receipt by Lender of customary opinions of counsel for a transaction of this kind, including an opinion from nationally recognized tax counsel or a “Big 4” accounting firm regarding the reorganization of the Borrower in connection with the Plan; (vi) the absence of any events that would be an Event of Default under the RELY DIP Financing; (vii) the payment in full in cash of all amounts due under the RELY DIP Financing; and (viii) all direct and indirect subsidiaries of Borrower shall either be retained by Borrower or disposed of or abandoned by Borrower in a manner acceptable to Goldman.  In the event that the Reorganized Borrower determines not to proceed with the equity purchase transaction contemplated by this paragraph, Goldman shall be entitled to the Break-Up Fee.

WAIVERS AND AMENDMENTS:

Customary for financing of this nature.

CERTAIN MISCELLANEOUS PROVISIONS:

Customary for financing of this nature, including assignments, yield protection (including changes in reserve, capital adequacy, liquidity and capital requirements, illegality, unavailability and other requirements of law), taxes (including the imposition of or changes in certain withholding or other taxes), indemnity and expenses (including “breakage costs”, if any) and funding protections to be set forth in the RELY DIP Documents.

TAXES:

The RELY DIP Documents will provide that all payments are to be made free and clear of any taxes (other than franchise taxes and taxes on overall net income), imposes, assessments, withholdings or other deductions whatsoever. 

GOVERNING LAW:

The RELY DIP Documents, and the interpretation, construction and enforcement of the terms thereof, shall be governed by the laws of the State of New York and (to the extent applicable) the Bankruptcy Code.

OUT-OF-POCKET EXPENSES:

All reasonable and documented (subject to redaction for privileged, confidential or otherwise sensitive information) fees, including legal, accounting and other professional (including financial advisors) fees for the Lender, including no more than one counsel for each relevant material jurisdiction, in connection with the transactions described in this Term Sheet are to be paid by the Borrower without the need for the filing of any applications with the Bankruptcy Court but subject to customary notice requirements to Borrower, the United States Trustee and any official committee.

INDEMNITY:

Customary indemnity by the Borrower of the Lender and their respective partners, directors, officers, employees, agents and advisors, in respect of the RELY DIP Financing.

Nov

Nov

Dec

Dec

Dec

Dec

Jan

Jan

Jan

Jan

Jan

Feb

DIP Forecast

(US Dollars)

11/24/17

12/01/17

12/08/17

12/15/17

12/22/17

12/29/17

01/05/18

01/12/18

01/19/18

01/26/18

02/02/18

02/09/18

Week 1

Week 2

Week 3

Week 4

Week 5

Week 6

Week 7

Week 8

Week 9

Week 10

Week 11

Week 12

Total Operating Receipts

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

Operating Disbursements:

Payroll / Benefits

Total Payroll / Benefits

-

-

-

-

-

-

-

Occupancy

Total Occupancy

-

-

-

-

-

-

-

-

-

SG&A

Total SG&A

Discontinued Operations

Total Discontinued Operations

-

-

-

-

-

-

-

Ordinary Course Professionals

Ordinary Course Professionals

$-

$-

$-

$-

Total Operating Disbursements

Total Operating Cash Flow

Restructuring:

Restructuring (Project Connery)

-

-

-

-

-

-

-

-

-

-

Total Restructuring

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

DIP Fees and Interest

DIP Fees

-

-

-

-

-

-

-

-

-

-

-

DIP Interest

-

-

-

-

-

-

-

-

-

-

-

DIP Fees and Interest

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

Total Cash Flow - After Restructuring Items

Feb

Feb

Feb

Mar

Mar

Mar

Mar

Apr

Apr

Apr

Apr

May

DIP Forecast

(US Dollars)

02/16/18

02/23/18

03/02/18

03/09/18

03/16/18

03/23/18

03/30/18

04/06/18

04/13/18

04/20/18

04/27/18

05/04/18

Total

Week 13

Week 14

Week 15

Week 16

Week 17

Week 18

Week 19

Week 20

Week 21

Week 22

Week 23

Week 24

11/24 - 5/4

Total Operating Receipts

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

$-

Operating Disbursements:

Payroll / Benefits

Total Payroll / Benefits

-

-

-

-

-

Occupancy

Total Occupancy

-

-

-

-

-

-

-

-

-

SG&A

Total SG&A

Discontinued Operations

Total Discontinued Operations

-

-

-

-

-

-

-

-

-

Ordinary Course Professionals

Ordinary Course Professionals

$-

$-

$-

$-

$-

Total Operating Disbursements

Total Operating Cash Flow

Restructuring:

Restructuring (Project Connery)

-

-

-

-

-

-

-

-

-

Total Restructuring

$-

$-

$-

$-

$-

$-

$-

$-

$-

DIP Fees and Interest

DIP Fees

-

-

-

-

-

-

-

-

-

-

-

-

DIP Interest

-

-

-

-

-

-

-

-

-

DIP Fees and Interest

$-

$-

$-

$-

$-

$-

$-

$-

$-

Total Cash Flow - After Restructuring Items

(i)

All public statements and pleadings filed by Borrower and the Alloy Debtors after the date hereof relating to the RELY DIP Financing and the Borrower’s assets and business plan shall be in form and substance acceptable to the Commitment Party.

(ii)

Entry by the Bankruptcy Court of the DIP Order, which DIP Order approves the transactions and fees contemplated herein and grants superpriority administrative expense claim status and liens on the Collateral, as described in the Term Sheet, and such DIP Order shall be in form and substance acceptable to the Commitment Party and shall not have been reversed, modified, amended, stayed, vacated or subject to any pending appeal.

(iii)

No Material Adverse Change shall have occurred since the date hereof, other than the events typically resulting from the filing of Chapter 11 cases, as determined by the Commitment Party in its reasonable business judgment.

(iv)

The Commitment Party shall have received the Budget, which shall be in the form and substance acceptable to the Commitment Party, and, as of the Closing Date, any variation from the Budget shall not exceed 10% on a cumulative basis from the Budget attached to the DIP Term Sheet excluding any cash receipts from any variance calculations.

(v)

The representations and warranties of the Borrower to the Commitment Party, including without limitation those set forth in Exhibit E hereto, shall be true and correct in all material respects.

(vi)

No default or Event of Default under the DIP Order shall have occurred or be continuing.

(vii)

The Borrower and Guarantors shall be in compliance in all respects with the DIP Order.

(viii)

Execution and delivery of the RELY DIP Documents (including without limitation control agreements with respect to all cash accounts of the Borrower and Guarantors) in form and substance satisfactory to the Commitment Party, and the satisfaction of the conditions precedent contained therein.

(ix)

All necessary governmental, shareholder and third party approvals, consents, licenses, franchises and permits in connection with the RELY DIP Facility and the operation by the Borrower and Guarantors of their businesses shall have been obtained and remain in full force and effect.

(x)

The Borrower shall have paid to the Commitment Party all fees and expenses then owing to the Commitment Party in connection with this Commitment Letter and the RELY DIP Facility.

(xi)

The Commitment Party shall be satisfied that it has been granted, and still continues to hold, a perfected superpriority lien on all collateral of the Borrower and Guarantors, as described in the RELY DIP Documents, on and after the Closing Date, which collateral shall not be subject to any other liens, except existing liens acceptable to the Commitment Party.

(xii)

The cash balance of the Borrower shall be no less than $950,000.

1.

Financial Statements; No Change.  (a) The audited consolidated balance sheet of the Borrower and its subsidiaries (on a combined basis) (the “Financial Statement Entities”) dated December 31, 2016, and the related audited consolidated statements of income and of cash flows for the fiscal year of the Financial Statement Entities (on a combined basis) ended on that date (i) were prepared in accordance with GAAP applied consistently throughout the period reflected therein and with prior periods, except as disclosed therein, and (ii) fairly present in all material respects the consolidated financial condition of the Financial Statement Entities (on a combined basis) as of the date thereof and their consolidated results of operations and consolidated cash flows for the period covered thereby; (b) The unaudited consolidated balance sheets of the Financial Statement Entities(on a combined basis) dated September 30, 2017, and the related unaudited consolidated statements of income and of cash flows for the relevant quarterly period of the 2017 fiscal year of such Financial Statement Entities ended on that date (i) were prepared in accordance with GAAP (except that such financial statements may include abbreviated notes) applied consistently throughout the period reflected therein and with prior periods, except as disclosed therein, and (ii) fairly present in all material respects the consolidated financial condition of the Financial Statement Entities (on a combined basis) as of the date thereof and their consolidated results of operations and consolidated cash flows for the period covered thereby.  (c) Since November 17, 2017, there has been no development or event that has had or could reasonably be expected to have a Material Adverse Change.

2.

Existence; Compliance with Law.  The Borrower and each of the Guarantors is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, except for absences of such good standing in respect of such Subsidiaries as could not, in the aggregate, reasonably be expected to have a Material Adverse Change, (b) has the organizational power and authority and the legal right, to own and operate its property, to lease the property it operates as lessee and to conduct the business in which it is currently engaged, except for absences of such power, authority or right as could not, in the aggregate, reasonably be expected to have a Material Adverse Change, and (c) is in compliance with all requirements of law, including any laws that require the maintenance and effect of any permits or licenses, except to the extent that the failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse Change.

3.

Power; Authorization; Enforceable Obligation.  The Borrower and each of the Guarantors has the organizational power and authority, and the legal right to make, deliver and perform the RELY DIP Documents. The Borrower and each of the Guarantors has taken all necessary action under its organizational documents and material debt agreements (other than as a result of the commencement of the Case) to authorize the execution, delivery and performance of the RELY DIP Documents. No consent or authorization of, filing with, notice to or other act by or in respect of, any governmental authority or any other person is required in connection with the RELY DIP Documents or with the execution, delivery, performance, validity or enforceability of the RELY DIP Documents. The RELY DIP Documents have been duly executed and delivered on behalf of the Borrower and each of the Guarantors. The RELY DIP Documents upon execution will constitute, a legal, valid and binding obligation of the Borrower and each of the Guarantors,

4.

No Legal Bar.  The execution, delivery and performance of the RELY DIP Documents, the extension of credit thereunder and the use of proceeds thereof will not violate law or any material contractual obligation, including any post-petition agreement, of the Borrower and each of the Guarantors and will not result in, or require, the creation or imposition of any lien on any of their respective properties or revenues pursuant to any requirement of law or any such contractual obligation, other than RELY DIP Liens created under the RELY DIP Documents and the DIP Orders. No law or contractual obligation applicable to the Borrower and each of the Guarantors could reasonably be expected to have a Material Adverse Change.

5.

Litigation.  Other than the Case, no litigation, investigation or proceeding of or before any arbitrator or governmental authority (not stayed by reason of the Case) is pending or, to the knowledge of the Borrower and each of the Guarantors, threatened by or against the Borrower and each of the Guarantors or against any of their respective properties or revenues (a) with respect to any of the RELY DIP Documents or any of the transactions contemplated hereby or thereby, or (b) that could reasonably be expected to have a Material Adverse Change.

6.

Claims. The following have been disclosed, in writing, to the Commitment Party, and such disclosure is accurate in all material respects: (i) all claims (as such term is defined in 11 U.S.C. § 101(5)) of unaffiliated third parties against the Borrower or Guarantors and (ii) all indebtedness, liabilities or guarantees of any obligations of the Guarantors to any other person or entity, including each of the Alloy Debtors.  Excluding ordinary course expenses related to intercompany services2, none of the Borrower’s affiliates that have filed Chapter 11 cases (collectively, the “Alloy Debtors”) have any claims (whether asserted or not asserted) against the Borrower or any of the Guarantors.  Neither the Borrower nor any Guarantor is aware of any claim of a creditor of the Alloy Debtors against the Borrower or a Guarantor.

7.

No Breach of Covenant.  No breach of any affirmative covenant attached in Exhibit F or any negative covenant attached in Exhibit G has occurred since the entry of the DIP Order or is continuing.

8.

No Default.  Other than as a result of the commencement of the Case, none of the Borrower or any of the Guarantors is in default under or with respect to any of its contractual obligations in any respect that could reasonably be expected to have a Material Adverse Change. No default or event of default under the RELY DIP Facility has occurred and is continuing.

9.

Ownership of Property.  The Borrower and each of the Guarantors has title in fee simple to, or a valid leasehold interest in, all its material real property, and good title to, or a valid leasehold interest in, all its other material property, and none of such property is subject to any lien except as permitted by the RELY DIP Documents.

10.

Intellectual Property.  The Borrower and each of the Guarantors owns, or is licensed to use, all Intellectual Property necessary for the conduct of its business in all material respects as currently conducted. No material claim has been asserted and is pending by any person

11.

Taxes.  The Borrower and each of the Guarantors has timely filed or caused to be timely filed all foreign, national, state and local income and other material tax returns that are required to be filed (taking into account all proper extensions) and has timely paid all income Taxes and other material taxes required to be paid and paid any assessments made against it or any of its property and all other income taxes and other material taxes, fees or other charges imposed on it or any of its property by any governmental authority (other than any taxes, fees or other charges the amount or validity of which are currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided on the books of the Borrower and each of the Guarantors, as the case may be); no tax lien has been filed, and, to the knowledge of the Borrower or any Guarantor, no claim is being asserted, with respect to any tax, fee or other charge. Under the laws of its relevant jurisdiction it is not necessary that any stamp, registration, notarial or similar taxes or fees be paid on or in relation to the RELY DIP Documents or the transactions contemplated by the RELY DIP Documents.

12.

Environmental Matters.  Except as, in the aggregate, could not reasonably be expected to have a Material Adverse Change:  (a) the facilities and properties owned, leased or operated by the Borrower and each of the Guarantors (the “Properties”) do not contain, and have not previously contained, any materials of environmental concern in amounts or concentrations or under circumstances that constitute or constituted a violation of, or could give rise to liability under, any environmental law; (b) has received or is aware of any notice of violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters or compliance with environmental laws with regard to any of the Properties, nor do the Borrower or any of the Guarantors have knowledge or reason to believe that any such notice will be received or is being threatened; and (c) none of the Borrower or any of the Guarantors has assumed any liability of any other person under the environmental laws.

13.

Accuracy of Information. No statement or information, including information concerning the Borrower’s tax attributes (including the amount of net operating loss carryforwards of the Borrower and Guarantors, any limitations on the use thereof under section 382 of the Internal Revenue Code, and the degree to which past transactions could contribute to an “ownership change” of the Borrower within the meaning of section 382 of the Internal Revenue Code), contained in any RELY DIP Document, or any other document, certificate or statement furnished by or on behalf of the Borrower or any of the Guarantors to the Commitment Party, or any of them, for use in connection with the transactions contemplated by the RELY DIP Documents, contained as of the date such statement, information, document or certificate was so furnished, any untrue statement of a material fact or omitted to state a material fact necessary to make the statements contained herein or therein not misleading.

14.

Disclosure and Affirmation of Budget.  The Borrower has not failed to disclose any material assumptions or liabilities or any other material information with respect to the Budget or the accuracy of such Budget.  The Borrower has provided a written affirmation made by an appropriate financial officer of the Borrower to the Commitment Party affirming the reasonableness of each of the assumptions and projections in the Budget.

15.

AML Laws; Anti-corruption Laws and Sanctions.  The Borrower and each of the Guarantors and has implemented and maintains in effect policies and procedures designed to ensure compliance by the Borrower and each of other Guarantors and their respective directors, officers, employees and agents with anti- corruption laws and applicable sanctions. The Borrower and each of the Guarantors, any of their respective subsidiaries or, to the knowledge of either the Borrower or any Guarantor, any of their respective directors or officers, or any of their respective employees or affiliates, or (b) to the knowledge of either the Borrower or any Guarantor, any agent of the Borrower or Guarantors or other of its affiliates that will act in any capacity in connection with or benefit from the RELY DIP Facility, (i) is not a sanctioned person, (ii) is in compliance in all material respects with anti-corruption laws and sanctions, (iii) to the extent applicable, is in compliance in all material respects with anti-money laundering laws. No extension of credit under the RELY DIP Facility, use of proceeds thereof by the Borrower or any of other Guarantors or their respective subsidiaries or other transaction contemplated by the RELY DIP Documents will cause a violation of AML Laws, Anti-Corruption Laws or applicable Sanctions. The Borrower and each of the Guarantors represents that neither it nor any of its subsidiaries, or, to its knowledge, its parent company or any other of its affiliates has engaged in or intends to engage in any unlawful dealings or transactions with, or for the benefit of, any sanctioned person or with or in any sanctioned country.

16.

Security Interest.  (a) Upon entry of the DIP Order, such DIP Order shall be effective to create in favor of the Commitment Party, for the benefit of the Commitment Party, a legal, valid, enforceable and perfected security interest in the Collateral of the Borrower and proceeds thereof, as contemplated thereby, as described in the RELY DIP Documents. (b) The provisions of the RELY DIP Documents shall be effective to create in favor of the Commitment Party, for the benefit of the Commitment Party, a legal, valid, enforceable and perfected security interest and hypothecate in the Collateral3 of the Borrower and the Guarantors and proceeds thereof, contemplated thereby, as described in the RELY DIP Documents.

17.

DIP Financing Orders.  (a) At all times after its entry by the Bankruptcy Courts, the DIP Order, is in full force and effect, and has not been vacated, reversed, terminated, stayed modified or amended in any manner without the reasonable written consent of the Commitment Party  (b) Upon the occurrence of the maturity date (whether by acceleration or otherwise) of any of the obligations under the RELY DIP Facility, the Commitment Party shall, subject to the provisions of the “Events of Default” section in the Term Sheet and the applicable provisions of the DIP Order, be entitled to immediate payment of such obligations, and to enforce the remedies provided for under the RELY DIP Documents in accordance with the terms thereof and such DIP Order, as applicable, without further application to or order by the Bankruptcy Court. (c) If the DIP Order is the subject of a pending appeal in any respect, none of such DIP Order, the extension of credit or the performance by the Borrower of any of its obligations under any of the RELY DIP Documents shall be the subject of a presently effective stay pending appeal. The Borrower and the Commitment Party shall be entitled to rely in good faith upon the DIP Order, notwithstanding objection thereto or appeal therefrom by any interested party.    The Borrower and the Guarantors shall be permitted and required to perform their  respective obligations in compliance with the RELY DIP Documents notwithstanding any such objection or appeal unless the DIP Order has been stayed by a court of competent jurisdiction.

18.

Superpriority Claims; Liens.  Upon entry of the DIP Order, such DIP Order and the RELY DIP Loan Documents are sufficient to provide the DIP superpriority claims of the Commitment Party and security interests and liens on the Collateral of the Borrower described in, and with the priority provided in the RELY DIP Documents.

19.

Assets of Guarantors.  All material assets of the Guarantors have been disclosed, in writing, to the Commitment Party, and such disclosure is accurate in all material respects.

1.

Preservation and maintenance of existence, business and properties.

2.

Payment of income and other material taxes and other claims.

3.

Timely preparation of all financial statements, reports, and related documents and public filings.

4.

The proceeds of the RELY DIP Financing shall be used for purposes set forth in the “Use of Proceeds” section in the Term Sheet.

5.

Prompt delivery of litigation and other notices, including, but not limited to, with respect to (i) the occurrence of a default or Event of Default under the RELY DIP Documents of the Alloy Debtors debtor-in-possession financing agreements, (ii) after the Petition Date, any default under any contractual obligation of the Borrower or any of the Guarantors or litigation, investigation or proceeding that may exist at any time between the Borrower and any of the Guarantors and any governmental authority, that in either case, if not cured or if adversely determined, as the case may be, could reasonably be expected to have a Material Adverse Change, (iii) after the Petition Date, the commencement of any litigation or proceeding affect the Borrower or any of the Guarantors (1) in which the amount involved is $100,000 or more and not covered by insurance, (2) in which material injunctive or similar relief is sought or (3) which relates to any RELY DIP Document, (iv) any developments or event that has had or could reasonably be expected to have a Material Adverse Change and (v) such other information (financial or otherwise) with respect to the Borrower or any of the Guarantors as the Commitment Party may reasonably request.

6.

Compliance with laws and regulations.

7.

Maintenance of records, access to properties and inspections.

8.

Compliance with environmental laws.

9.

Provision of additional collateral, guarantees and mortgages; further assurances.

10.

Compliance in all respects, after entry thereof, with all requirements and obligations set forth in the DIP Order, “first day” orders and “second day” orders, as each order is amended and in effect from time to time in accordance with this Commitment and the RELY DIP Documents, as applicable.

11.

Bi-weekly update calls for the Commitment Party and its advisors.

12.

Borrower and Guarantors shall use its reasonable best efforts to enter into the RELY DIP Documents.

13.

Borrower shall deliver such other information (financial or otherwise, including detailed quarterly budgets, which shall be subject in all respects to the Commitment Party’s approval), as the Commitment Party may reasonably request.

14.

Variation from the Budget shall not exceed 10%, provided that (i) all variance calculations shall exclude any cash receipts and (ii) any proceeds of the DIP Financing that are available under the Budget but not used in a previous week shall be available in subsequent weeks notwithstanding a variance exceeding the permitted amount.

15.

Borrower shall deliver in advance to the Commitment Party all (i) draft pleadings and public announcements relating to the Borrower’s assets (including without limitation any tax attributes) and business plan and consider the Commitment Party’s comments thereto in good faith, and (ii) pleadings, motions, applications, judicial information, financial information and other documents filed by or on behalf of the Borrower or any of the Guarantors with the Bankruptcy Court, or distributed by or on behalf of any of the Borrower or any of the Guarantors to any appointed in the Case.

1.

No incurrence of indebtedness for borrowed money shall be permitted.

2.

Limitations on liens, except that the following liens shall be permitted:

a.

liens for taxes not yet due;

b.

leases, licenses, subleases or sublicenses granted to others in the ordinary course of business which do not secure any indebtedness; and

c.

liens securing the obligations under the RELY DIP Financing.

3.

No sale and leaseback transactions shall be permitted.

4.

No investments, loans and advances (collectively, the “Investments”) shall be permitted, except any Investments necessary in connection with the reorganization subject to the consent of the Commitment Party (not to be unreasonably withheld or delayed.

5.

Limitations on mergers, consolidations, sales of assets, including any sale of the assets owned by the Guarantors, (“Dispositions”) and acquisitions, except that the following shall be permitted:

a.

the Plan subject to the consent of the Commitment Party (not to be unreasonably withheld or delayed) and, to the extent permitted by the Bankruptcy Court, any other corporate reorganization;

b.

Specified transactions detailed in the definitive documentation that would not trigger a mandatory prepayment, subject to the consent of the Commitment Party.

c.

any other Dispositions permitted by the applicable order of the Bankruptcy Court and not otherwise prohibited by the RELY DIP Financing; and

d.

Dispositions made to comply with any order of any governmental authority or any applicable laws.

6.

No dividends and distributions shall be permitted, except for any dividend or distribution by a Guarantor to the Borrower.

7.

No action to materially impair the assets of the Borrower or its subsidiaries, including with respect to the availability of any tax attributes of the Borrower or its subsidiaries, shall be permitted without the prior written consent of the Commitment Party.

8.

Limitations on transactions with affiliates, except for:

a.

any transaction among Borrower and the Guarantors;

b.

ordinary course administration and transactions by the Borrower of the Alloy Debtors;

c.

any transactions in connection with the reorganization of the Borrower, subject to the consent of the Commitment Party (not to be unreasonably withheld or delayed);

d.

transactions in existence on the DIP Closing Date and any similar transaction among Borrower and the Guarantors as consistent with past practice; and

e.

any transaction on terms that are no less favorable to the Borrower or any of the Guarantors than might be obtained at the time in a comparable arm’s length transaction from a person who is not an affiliate.

9.

No payment and modification of subordinated or other prepetition indebtedness of the Borrower or Guarantors, except in the case of prepetition debt, pursuant to “first day” or other orders entered by the Bankruptcy Court that are in form and substance satisfactory to the Commitment Party.