Subject to the Conditions set out below, the Indenture is to be amended by way of one or more supplemental indentures or replaced with a new indenture (collectively, the “Indenture Amendments”), as follows:

So long as the SF Investors beneficially own more than 3% of the Ordinary Shares in issue, Mr. Fitzpatrick shall have the right and be entitled to remain on the board of directors of the Company (the “Board”) and VAGL (while receiving no compensation for service on either board), and Mudrick Capital shall take all actions necessary to implement the foregoing, including voting in favor of any resolution to appoint Mr. Fitzpatrick to the board of the Company and VAGL (“Mr Fitzpatrick’s Board Rights”).

Immediately upon the Partial Conversion Date and without limitation to Mr. Fitzpatrick’s Board Rights, the Board shall otherwise consist of a majority of independent directors (as determined by the Nomination and Corporate Governance Committee and as set forth in the NYSE rules) nominated for election by Mudrick Capital, and the Company and the Nominating and Corporate Governance Committee of the Board shall cause such nominees to be put forth for appointments in accordance with the Company’s memorandum and articles of association.

Thereafter and, in each case, without limitation to Mr. Fitzpatrick’s Board Rights:

(a)   So long as Mudrick Capital owns at least 10% of the outstanding Ordinary Shares (assuming the Notes that have not been converted to Ordinary Shares are not converted to Ordinary Shares), Mudrick Capital shall be entitled to nominate for election a proportionate number of directors to serve on the Board (rounded to the nearest whole number), and to nominate directors to fill any vacancies resulting from the departure from the Board of a director so-nominated by Mudrick Capital, and the Company and the Nominating and Corporate Governance Committee of the Board shall cause such nominees to be put forth for appointments in accordance with the Company’s memorandum and articles of association.

(b)   Subject to applicable law and NYSE rules, Mudrick Capital’s Board designees shall also be entitled to proportionate representation (with a minimum of one member) on the compensation committee and all other committees of the Board; provided that if applicable law or NYSE rules prevent Mudrick Capital’s Board designee(s) from serving on any committee, Mudrick Capital shall be entitled to appoint an observer to serve on such committee.

(c)   Mudrick Capital’s right to nominate member(s) of the Board shall terminate on the first date on which Mudrick Capital beneficially owns less than 10% of the outstanding Ordinary Shares (on a fully converted basis).

From and after the Partial Conversion Date until the date as of which Mudrick Capital beneficially owns less than 35% of the Ordinary Shares (on a fully converted basis), the Company shall be required to obtain Mudrick Capital’s consent prior to:

(a)   the Company’s proposing of any amendment to any provision of the Company’s memorandum and articles of association or bylaws (by merger, consolidation, reclassification, amendment or otherwise) that, once adopted, will materially and adversely affect the rights of Mudrick Capital in respect of the appointment of directors to the Board; and

(b)   any change to the Board (other than in accordance with the Company’s memorandum and articles of association, as amended, as contemplated by this Term Sheet).

From and after the Partial Conversion Date, the Company will grant Mudrick Capital a customary pre-emptive right to maintain its ownership percentage of the Company for so long as Mudrick Capital and its affiliates maintain at least a 20% beneficial ownership position (on a fully diluted basis), with customary exclusions for acquisitions and issuances to employees and directors.

So long as the SF Investors beneficially own more than 3% of the Ordinary Shares:

(a)   decisions relating to future equity raises by the Company shall be taken by a majority of (i) the independent members of the then-constituted Board or (ii) a committee of such independent members; and

(b)   Mr. Fitzpatrick shall retain a right to participate on a pro rata basis in any such future equity raises by the Company, subject to his 12-month option in respect of only the First Equity Placement (as set forth below).

For so long as Mr. Fitzpatrick remains on the Board or the board of directors of VAGL, (a) he shall have the right to appoint a representative for meetings of the Board or the board of directors of VAGL that he is unable to attend and (b) the Company shall cover the cost of his executive/administrative support, subject to a cap to be agreed.

The Company shall be required to obtain Mr. Fitzpatrick’s consent prior to the Company’s proposing of any amendment to any provision of the Company’s memorandum and articles of association or bylaws (by merger, consolidation, reclassification, amendment or otherwise) that, once adopted, will materially and adversely affect Mr. Fitzpatrick’s Board Rights.

With effect from the date on which each of the Indenture Amendments, the Partial Conversion, the Indenture Enhancements and, for the avoidance of doubt, the Governance Changes have taken place, each of Mudrick Capital, Mr. Fitzpatrick and the Company agree to release any and all claims against one another under or in connection with the Indenture, the Indenture Amendments, the Indenture Enhancements, the IAIL Investment Agreement and the Governance Changes.

Mudrick Capital shall be granted customary registration rights (including demand and piggyback registration rights to be agreed) with respect to the Ordinary Shares issued and issuable pursuant to the transactions set forth in this Term Sheet (including, for the avoidance of doubt, any additional Ordinary Shares issuable to Mudrick Capital pursuant to the Indenture Amendments) (subject to the “Lock-Up” and “Market Manipulation” provisions set forth in this Term Sheet).

Without limiting the foregoing, the Company will (i) promptly (and in any event no later than 30 days) following the Partial Conversion Date, file and cause to become effective a customary shelf registration statement covering (a) the Ordinary Shares issued and issuable to Mudrick Capital pursuant to the transactions set forth in this Term Sheet and (b) any additional Ordinary Shares issuable to Mudrick Capital pursuant to the Indenture and (ii) have such registration statements deemed effective by the Securities and Exchange Commission within 30 days of the Partial Conversion Date. The Company will cause such registration statement to remain effective until the earlier of the date (a) all registrable securities are sold by the holders thereof and (b) such securities are freely tradable under Rule 144 without limitation as to volume or manner of sale.

The Forbearance Agreement, the Subscription Agreement, the supplemental indenture(s) and any security documents to be entered into in connection with the Indenture Amendments and the Indenture Enhancements, and other documents required to effect the matters set forth in this Term Sheet shall be referred to as the “Transaction Documentation”.

The Transaction Documentation will incorporate review from the accounting, tax, diligence, trustee, local counsel and stock exchange perspectives, among other inputs for public company issuers.

Prior to execution of the Forbearance Agreement, the Company shall (subject to applicable fiduciary duties) progress contingency planning in connection with existing defaults under the Indenture and update Mudrick Capital (periodically or upon request) on such contingency planning.

Prior to execution of the remaining Transaction Documentation, the Company shall (subject to applicable fiduciary duties):

(a)    use best endeavors to agree and enter into the Transaction Documentation;

(b)    notify Mudrick Capital prior to taking any steps to commence any insolvency-related proceedings; and

(c)    other than as part of good faith contingency planning referred to above, not solicit or pursue any alternative funding or restructuring proposals and notify Mudrick Capital of any alternative financing and/or restructuring proposals received.

Mr. Fitzpatrick, in his capacity as majority shareholder of the Company, agrees to use his best efforts to (and cause his affiliates to) enter into one or more agreements (as applicable) to effectuate the transactions contemplated by this Term Sheet.  

The  Forbearance Agreement will contain customary provisions for expenses, including reimbursement by the Company of reasonable and documented expenses of legal counsel to Mudrick Capital (including one firm of Cayman counsel) and the SF Investors (including one firm of Cayman counsel), in connection with the transactions contemplated by this Term Sheet and the Forbearance Agreement.

This Term Sheet and the Transaction Documentation (other than the Company’s governing documents) will be governed by the laws of the State of New York. All disputes, legal actions, suits and proceedings arising out of or relating to this Term Sheet and the Transaction Documentation must be brought exclusively in the state courts of New York or in the federal courts located in the state and county of New York.

The Company’s governing documents will be governed by Cayman Islands law. VAGL’s governing documents will be governed by English law.

Nothing in this Term Sheet (or any related or final documentation) shall be interpreted as creating or forming a “group”, including with Mudrick Capital, Mr. Fitzpatrick or any other SF Investor, or any other person, for the purposes of Rule 13d-5(b)(1) under the U.S. Securities Exchange Act of 1934, as amended, or for any other similar provision of applicable law. The Company acknowledges and agrees that the obligations of each of Mudrick Capital and Mr. Fitzpatrick and the other SF Investors under this Term Sheet (and any related or final documentation) shall be several (and not joint) and none of the parties shall be responsible in any way for the actions or omissions of the other parties.