VerifyMe, Inc. Form 8-K Current Report Filed 2022-04-26

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

On April 22, 2022, VerifyMe, Inc. (the “Company”) entered into an Asset Purchase Agreement (the “Agreement”) by and among the Company, PeriShip Global, LLC, a Delaware limited liability company and wholly owned subsidiary of the Company (“PeriShip Global”), PeriShip, LLC, a Connecticut limited liability company (“PeriShip” or “Seller”) and Luciano Morra (“Founder”). Pursuant to the terms of the Agreement PeriShip Global agreed to purchase from PeriShip and PeriShip agreed to sell to PeriShip Global substantially all of the assets of PeriShip and certain specified liabilities (the “Transaction”). The Transaction closed simultaneously with the execution of the Agreement on April 22, 2022 (the “Closing”).

The total consideration paid to the Seller in connection with the Transaction was $10,500,000, which consisted of $7,500,000 in cash (the “Cash Consideration”) paid by PeriShip Global; a promissory note issued by PeriShip Global payable to the Seller for $2,000,000 (the “Promissory Note), with a fixed interest rate of 6% per annum on the unpaid principal balance, to be paid in three installments on the sixth, fifteenth, and eighteenth month anniversaries of the Closing and which was guaranteed by the Company (the “Guaranty”); and the issuance of 305,473 shares of restricted common stock of the Company at $3.2736 per share (the “Stock Consideration”) (representing $1,000,000 in Stock Consideration) which was the volume weighted average price (VWAP) of the Company’s Common Stock as reported by Nasdaq for the fifteen (15) trading days ending on the Closing date, inclusive. The amounts due under the Promissory Note may be adjusted as a result of certain post-Closing adjustments or indemnity claims by PeriShip Global pursuant to the Agreement.

The Agreement contains customary confidentiality and indemnification provisions and customary representations, warranties and covenants by the parties for transactions of this type. It also contains a five-year non-compete and non-solicitation provision applicable to the Seller and Founder in favor of the Company and PeriShip Global.

The Promissory Note may be accelerated by the holder upon an Event of Default, as defined in the Promissory Note. Pursuant to the Guaranty, the Company unconditionally guaranteed to the Seller the prompt and unconditional payment of the Promissory Note and any interest thereon, whether at stated maturity, by acceleration or otherwise, any and all sums of money that, at the time, may have become due and payable under the provisions of the Promissory Note, and all expenses that may be paid or incurred by the Seller in the collection of any portion of the Promissory Note or enforcement thereof, including reasonable attorney’s fees.

Also on April 22, 2022, in connection with the closing of the Transaction, PeriShip Global and the Founder entered into a Transition Services Agreement (the “Transition Agreement”) whereby the Founder will provide, or cause Seller’s affiliates, including the Seller, to provide PeriShip Global with all services reasonably necessary in support of completion of the audit of Seller in connection with the public filings required by PeriShip Global and its affiliates, and all services reasonably necessary for the orderly transition of the business from Seller to PeriShip Global, including but not limited to administrative support, marketing support, client relationship management and transition, employee management and transition, and vendor relationship management and transition. The Transition Agreement has an initial term of 90 days and requires payments by PeriShip Global to the Founder of $23,750 per month. PeriShip Global and the Founder may agree to extend the term of the Transition Agreement at which time the compensation for such extended services would be determined.

Also on April 22, 2022, in connection with the closing of the Transaction, PeriShip Global entered into employment agreements with certain executive officers of PeriShip, namely Curt Kole, Fred Volk III and Jack Wang.

Curt Kole, age 68, will serve as PeriShip Global’s Executive Vice President of Sales and Global Strategy. Mr. Kole served as Vice President of Sales and Business Development of the Seller from May 2017 until April 22, 2022 when the Transaction Closed. Mr. Kole has over 30 years of sales, marketing, and leadership experience in the transportation and logistics industry. Having spent over 17 of these years at FedEx® Custom Critical, Mr. Kole was intimately involved in the development of their highly-specialized Cold Chain suite of services and was directly involved in their entry into the Pharmaceutical market. Following his experience at FedEx®, Mr, Kole spent a combined 10 years in the truckload and global cryogenics spaces, has been an established panelist on Cold Chain logistics at numerous industry conferences, and is a current member of both the Parenteral Drug Association and Health and Personal Care Logistics Council.

Fred Volk III, age 54, will continue the role he served at PeriShip and serve as PeriShip Global’s Vice President of Operations. Mr. Volk served as Vice President of Operations of the Seller from September 2001 until April 22, 2022 when the Transaction Closed. As Vice President of Operations Mr. Volk was responsible for PeriShip's system performance and quality control. Mr. Volk has over 22 years of supply chain expertise, which includes many years at FedEx®. Throughout his tenure there, he worked in multiple leadership positions across the Transportation, Logistics, and Customer Service spaces, allowing him to become intimately familiar with the principles required for operational effectiveness. With later experiences in leadership positions at various local law enforcement agencies, Fred's acumen spans from supply chain management to compliance, and beyond.

Jack Wang, age 62, will continue the role he served at PeriShip and serve as PeriShip Global’s Chief Information Officer. Mr. Wang served as Chief Information Officer of the Seller from December 2011 to 2016 and from 2018 until April 22, 2022, when the Transaction Closed. From 2016 to 2018 Mr. Wang served as Chief Information Officer for IMEX Global Solutions, an international logistics company that distributes parcels, publication and business mail worldwide. In addition to the leadership responsibility of daily IT operation, Jack was also responsible for the strategic development of PeriShip's next generation infrastructure and future business plans. Prior to joining PeriShip, Jack served as the head of IT operations and development at the Package Portfolio division of United Parcel Service. At UPS, Jack managed IT services for worldwide package operations. Before UPS, Jack was the managing director of Continental Airlines, where he was responsible for strategic system architecture and development as well as providing IT services for many of the airline's customer facing systems. Many of the core systems that Jack instituted at Continental Airlines were eventually selected as the baseline systems for the new United Airlines. Jack holds a Master's degree in Computer Science from State University of New York at New Paltz.

The Company’s Board of Directors approved Messrs. Kole, Volk and Wang’s appointment subject to Closing of the Transaction and each of them and PeriShip Global entering into his respective employment agreement (each an “Employment Agreement”). Under the Employment Agreements, Messrs. Kole, Volk and Wang’s will receive an annual base salary of $230,000, $200,000 and $189,000, respectively, and a grant of restricted stock units with a grant date value equal to his annual base salary, each such unit representing the contingent right to receive one share of the Company’s common stock, par value $0.001 per share (“Common Stock”), subject to the terms of the Company’s 2020 Equity Incentive Plan (the “Plan”). These restricted stock units, except as otherwise provided in the award agreement, will vest, subject to continuous employment and other conditions, as follows: 50% if the Company’s Common Stock price exceeds $5.00 per share for a period of 20 consecutive days, and the remaining 50% if the Company’s Common Stock price exceeds $7.00 per share for a period of 20 consecutive days, in each case prior to the two-year anniversary of the grant date. The Employment Agreement for Mr. Kole provides for a commission of 1.5% on eligible annual sales in excess of $30,000,000, increasing to 2.0% on eligible annual sales in excess of $32,000,000. The Employment Agreement for Mr. Volk provides for a commission of 1.0% on eligible annual sales in excess of $30,000,000. The Employment Agreement for Mr. Wang provides that he will be eligible for an annual bonus payment at the discretion of the Company. The Employment Agreements each also have an initial term of 2 years, provide for customary indemnification, non-competition, non-disclosure, and severance payments to the executives, along with continuation of employee benefits and disability benefits in the event the executives are terminated under certain circumstances.

None of Messrs. Kole, Volk or Wang have any family relationship with any of the Company's executive officers or members of the Company's Board of Directors. Other than as disclosed herein, there are no arrangements or understandings between Messrs. Kole, Volk or Wang and any other person pursuant to which each was appointed an executive officer of PeriShip Global.

As a condition to the Closing of the Transaction Founder and Seller entered into lock-up agreements, pursuant to which they have agreed not to sell any of the shares of Company common stock constituting Stock Consideration received in the Transaction for a period of 9 months.

Also on April 22, 2022, in connection with the closing of the Transaction, PeriShip Global entered into a lease agreement (the “Lease”), guaranteed by the Company (the “Lease Guarantee”), with Mordo, LLC, a Connecticut limited liability company controlled by the Founder, whereby PeriShip Global will rent the current office space used by the Seller for a term of five years with two options to renew the lease for additional five year terms. Base rent under the Lease is $120,000 per year, payable in equal monthly installments, with annual escalations of 3% for each year following the initial lease year. Rent during any renewal period will be equal to the greater of the base rent as escalated or fair market rental value as provided in the Lease.

The foregoing descriptions of the Agreement, the Promissory Note, the Guaranty, the Transition Agreement, the Employment Agreements, Form of Restricted Stock Unit Award Agreement (Subsidiary Employees), the Lease and Lease Guarantee do not purport to be complete and are qualified in their entirety by reference to the full text of each document, copies of which are included as exhibits to this Current Report on Form 8-K and are incorporated herein by reference.

To the extent required by Item 2.01 of Form 8-K, the disclosure in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

To the extent required by Item 2.03 of Form 8-K, the disclosure in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

To the extent required by Item 3.02 of Form 8-K, the disclosure in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference. On April 22, 2022, we issued the Stock Consideration to the Seller. The Stock Consideration issued pursuant to the Agreement has not been registered under the Securities Act of 1933 (the “Securities Act”) and has been issued under an exemption from the registration requirements of the Securities Act afforded by Section 4(a)(2) thereof. The Stock Consideration may not be offered or sold in the United States in the absence of an effective registration statement or exemption from applicable registration requirements.

To the extent required by Item 5.02 of Form 8-K, the disclosure in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

On April 25, 2022, we issued a press release announcing the Transaction. A copy of the press release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K.

On April 26, 2022, the Company plans to host an Investor Call through a conference call and webcast consisting of a presentation by the Company’s executive management team of the Transaction followed by a question and answer period. The presentation slides and webcast will be archived on the Investors section of the Company’s website and will remain available for 90 days. A copy of the presentation is being furnished as Exhibit 99.2 to this Current Report on Form 8-K.

The information furnished pursuant to this Item 7.01, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under such section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of April 22, 2022, by and among PeriShip Global LLC, a Delaware limited liability company (“Buyer”), Buyer’s parent entity, VerifyMe, Inc., a Nevada corporation (“Parent”), PeriShip, LLC, a Connecticut limited liability company taxed as an S-corporation (“Seller”) and Luciano Morra (“Founder”).

A. Seller operates a business specializing in transit management and operational oversight of time and temperature shipments to businesses and consumers.

B. Upon the terms and subject to the conditions set forth herein, Seller proposes to sell and transfer, and Buyer proposes to buy and assume, those assets and liabilities specifically set forth herein, in exchange for the consideration set forth herein.

NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and agreements contained herein and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and upon the terms and subject to the conditions hereinafter set forth, the parties hereto, intending to be legally bound hereby, agree as follows:

(a) Purchase and Sale of Acquired Assets. Subject to the terms and conditions hereof, at the Closing, Seller shall sell, convey, transfer, assign and deliver to Buyer, and Buyer shall purchase from Seller, all of Seller’s right, title and interest in and to all of Seller’s property and assets, real, personal or mixed, tangible and intangible, short-term or long-term of every kind and description, wherever located and whether or not any of such assets have any value for accounting purposes or are carried or reflected on or specifically referred to in Seller’s books of account or financial statements, excluding only the Excluded Assets (the foregoing collectively, the “Acquired Assets”), free and clear of any and all Encumbrances other than Permitted Encumbrances, including all of the following:

(i) all trade and other notes and accounts receivable, advance payments, deposits (including customer deposits), prepaid items and expenses, deferred charges, rights of offset and credits and claims for refund;

(ii) all inventory of raw materials, work in process, parts, subassemblies and finished goods, wherever located and whether or not obsolete or carried on Seller’s books of account, in each case with any transferable warranty and service rights of Seller with respect to such Acquired Assets;

(iii) all personal property and interests therein, wherever located, including all vehicles, tools, parts and supplies, fuel, machinery, equipment, tooling, furniture, furnishings, appliances, fixtures, office equipment and supplies, owned and licensed computer hardware and software and related documentation (including any source code or systems documentation associated therewith), stored data, communication equipment, trade fixtures and leasehold improvements, in each case with any transferable warranty and service rights of Seller with respect to such Acquired Assets;

(iv) all rights under the Contracts set forth on Schedule 1.1(a)(iv) (the “Assumed Contracts”);

(v) telephone and fax numbers, including the ones identified on Schedule 1.1(a)(v);

(vi) all books and records, except as specifically provided by Section 1.1(b)(v);

(vii) all Tax Returns to the extent of, or to the extent maintained for, the Acquired Assets, but excluding any such items if (A) they are included in, or to the extent related to, any Excluded Assets or Retained Liabilities or (B) any Law prohibits their transfer;

(viii) any claims or causes of action of Seller (except those claims or causes of action that are specifically related to and arise in connection with the Retained Liabilities) against any third party relating to the Business or the Acquired Assets, whether choate or inchoate, known or unknown, contingent or non-contingent;

(ix) all trademarks, service marks and trade names of Seller (including the trademarks and trade names “PeriShip”) and any logos, designs, symbols, trade dress or other source indicators associated therewith, any fictitious names, d/b/a’s or similar filings related thereto, or any variant of any of them, all business goodwill associated therewith and any applications therefor or registrations thereof, and any other forms of technology, intangibles, know-how, Intellectual Property or industrial property rights, including any patents, trade secrets, proprietary manufacturing processes, copyrights, rights of publicity, and any licenses, consents or other agreements relating thereto;

(xi) all of Seller’s intangible assets related to the Business, including Seller’s goodwill related to the Business;

(xii) all lists, documents, records and information, in all formats (tangible and intangible) used by Seller and its Affiliates in connection with or otherwise related to the Business, concerning past, present or prospective clients, customers, suppliers, vendors or other business relations of the Business; and

(xiii) all insurance benefits of Seller (except those insurance benefits that are specifically related to and arise in connection with the Retained Liabilities), including rights to make claims and proceeds, arising from or relating to the Business, the Acquired Assets or the Assumed Liabilities prior to the Closing.

Without limiting the generality of the foregoing, the Acquired Assets shall include all of the assets of Seller reflected on the Interim Financial Statements and all assets acquired by Seller since the Balance Sheet Date, except to the extent disposed of in the Ordinary Course of Business since the Balance Sheet Date or except to the extent specifically identified herein as an Excluded Asset.

(b) Excluded Assets. Notwithstanding anything herein to the contrary, from and after the Closing, Seller shall retain all of its right, title and interest in and to, and there shall be excluded from the sale, conveyance, assignment or transfer to Buyer hereunder, and the Acquired Assets shall not include, solely the following assets and properties (such retained assets and properties being the “Excluded Assets”):

(iv) all Benefit Plans, (including all trusts, insurance policies and administration service Contracts related thereto) except for the self-insured medical plan sponsored by Seller and the stop-loss insurance policy associated therewith (“Seller H&W Plans”), and all assets in respect of the Benefit Plans, except for the Seller H&W Plans;

(vi) any books and records which Seller is required by applicable Law to retain as set forth in Schedule 1.1(b)(vi); provided, however, that Seller shall provide Buyer with copies of all such books and records at or prior to the Closing;

(viii) the personal assets of Founder immaterial to the operation of the Business in the Ordinary Course.

(c) Assumed Liabilities. Subject to the terms and conditions hereof, at the Closing, Buyer shall, pursuant to a Bill of Sale, Assignment and Assumption Agreement in the form of Exhibit A attached hereto (the “Bill of Sale, Assignment and Assumption Agreement”), assume and agree to fully pay, discharge, satisfy and perform, the following Liabilities of Seller, except in each case to the extent any such Liabilities would have been performed, paid or otherwise discharged on or prior to the Closing Date, but for a breach or default by Seller or Shareholder (the “Assumed Liabilities”):

(i) those working capital liabilities of Seller that were incurred in the Ordinary Course of Business and accrued on the books and records of Seller as of the Closing Date, including accounts payable;

(ii) the Liabilities of Seller arising under or relating to any Assumed Contract to the extent such Liabilities relate to events or occurrences following the Closing Date, were incurred in the ordinary course of business and do not relate to any failure to perform, improper performance, breach of warranty or other breach, default or violation by Seller on or prior to the Closing; and

(iii) the Liabilities under or related to the Seller H&W Plans attributable to the period after the Closing Date, excluding, for the avoidance of doubt (A) any Liabilities attributable to the operational or compliance failures of the Seller H&W Plans arising during the period prior to or on the Closing Date and for claims under the Seller H&W Plans incurred on or prior to the Closing Date to the extent not reimbursed by or paid by a stop loss policy, and (B) notwithstanding (A) above, claims incurred by individuals entitled to COBRA coverage as of the Closing Date (including any “M&A Qualified Beneficiaries” as such term is defined in Treas. Reg. section 54.4980B-9), regardless of when such claim was incurred or paid, to the extent not reimbursed by or paid by a stop loss policy and, only in the case of claims incurred after the Closing Date, less any COBRA premiums (exclusive of the administrative fee) collected from such individual. To the extent that the sum of Liabilities retained by Seller under (A) and (B) exceed $50,000 in the aggregate, the excess shall be an Assumed Liability.

(d) Retained Liabilities. Notwithstanding anything contained herein to the contrary, the Retained Liabilities shall not be assumed by Buyer, but instead shall be retained, performed, paid and discharged by Seller and Shareholder. The term “Retained Liabilities” means all Liabilities of Seller or any of its Affiliates including, without limitation, all Liabilities arising out of the use, ownership, possession or operation of the Acquired Assets or the conduct of the Business on or prior to the Closing Date, excepting only the Assumed Liabilities; provided however that without limiting the foregoing, the Retained Liabilities shall include the following:

(i) except for real or personal property Taxes to the extent reflected as current liabilities on the books and records of Seller as of the Closing Date, any Liability for Taxes incurred by Seller, including the Transfer Taxes as set forth in Section 6.2, and any Liability of Seller for the Taxes of another Person under a contractual indemnity or covenant, as a transferee or otherwise under applicable Tax Laws, regulations or administrative rules;

(ii) any claim or Liability in connection with or arising from or relating to any Excluded Asset, including any Taxes associated therewith;

(iv) any and all fees, costs and expenses (including legal fees and accounting fees) that have been incurred or that are incurred by Seller or Shareholder in connection with the transactions contemplated by this Agreement, including all fees, costs and expenses incurred in connection with or by virtue of (a) the negotiation, preparation and review of this Agreement (including the exhibits and Schedules hereto) and all Ancillary Agreements (except those between Buyer and current management personnel of Seller), (b) the preparation and submission of any filing or notice required to be made or given in connection with any of the transactions contemplated by this Agreement, and the obtaining of any consent required to be obtained in connection with any of such transactions, and (c) the consummation of the transactions contemplated by this Agreement and the Ancillary Agreements, including any retention bonuses, “success” fees, change of control payments and any other payment obligations payable as a result of or in connection with the consummation of the transactions contemplated by this Agreement and the Ancillary Agreements;

(v) any Liability of Seller to its shareholders respecting dividends, distributions in liquidation, redemptions of interests, option payments or otherwise, and any Liability of Seller pursuant to the agreements and arrangements set forth on Schedule 3.21;

(vi) any Liability of Seller arising out of this Agreement and any Ancillary Agreement;

(vii) any Liability arising out of or relating to any business or property formerly owned or operated by Seller, any Affiliate or predecessor thereof, or by Founder related to the Business, but not presently owned and operated by Seller or Founder;

(viii) (A) any Liability under or related to the Seller H&W Plans attributable to the period on or prior to the Closing Date, including for avoidance of doubt, any Liabilities attributable to the operational or compliance failures of the Seller H&W Plans arising during the period prior to or on the Closing Date and for claims under the Seller H&W Plans incurred on or prior to the Closing Date, (B) any Liability under or related to the Seller H&W Plans for claims incurred by individuals entitled to COBRA coverage as of the Closing Date (including any “M&A Qualified Beneficiaries” as such term is defined in Treas. Reg. section 54.4980B-9), regardless of when such claim was incurred or paid, to the extent not reimbursed by or paid by a stop loss policy and, only in the case of claims incurred after the Closing Date, less any COBRA premiums (exclusive of the administrative fee) collected from such individual, and (C) any Liability under or related to all other Benefit Plans, provided that the maximum aggregate Liability retained by Seller under (A) and (B) shall be $50,000 (such maximum, the “H&W Cap”)

(ix) any Liability of Seller or its predecessors arising out of any Contract, Permit, franchise or claim that is not transferred to Buyer as part of the Acquired Assets or, subject to Section 1.1(e), is not transferred to Buyer because of any failure to obtain any third-party or governmental consent required for such transfer;

(x) any Liability with respect to compensation, severance or benefits of any nature owed to any current or former employee, officer, director, member, partner or independent contractor of Seller or any ERISA Affiliate (or any beneficiary or dependent of any such individual), whether or not employed by Buyer or any of its Affiliates after the Closing, that (A) arises out of or relates to the employment, service provider or other relationship between Seller or ERISA Affiliate and any such individual, including the termination of such relationship, or (B) arises out of or relates to events or conditions occurring on or before the Closing Date;

(xi) any product liability or similar claim for injury to person or property which arises out of or is based upon any express or implied representation, warranty, agreement or guarantee made by Seller or its Affiliates or alleged to have been made by Seller or its Affiliates or which arises out of or is based upon a theory of strict liability under Section 402A of the Restatement (2nd) of Torts or any similar or analogous provision of statutory or common law or which is imposed or asserted to be imposed by operation of law, in connection with any service performed or product manufactured, sold or leased by or on behalf of Seller or its Affiliates, including any claim relating to any product delivered in connection with the performance of such service and any claim seeking recovery for consequential damages, lost revenue or income;

(xii) any general warranty claims against Seller or its Affiliates to the extent not reflected as current liabilities on the books and records of Seller as of the Closing Date;

(xiv) any Liabilities of or relating to the Business (or the operation thereof prior to Closing), ownership or use of the Acquired Assets prior to the Closing.

(e) Nonassignable Assets. Nothing in this Agreement shall be construed as an attempt to assign, and Buyer shall not assume any Liabilities with respect to, any Contract or Permit intended to be included in the Acquired Assets that by applicable Law is non-assignable, or that by its terms is non-assignable without the consent of the other party or parties thereto to the extent such party’s or parties’ consent was not so obtained, or as to which all the remedies for the enforcement thereof enjoyed by Seller would not, as a matter of law, pass to Buyer as an incident of the assignments provided for by this Agreement. Seller and Founder shall, at the request and under the direction of Buyer and in the name of Seller or otherwise (as Buyer shall specify), make commercially reasonable efforts to do or cause to be done all such things as shall in the reasonable judgment of Buyer be necessary or proper (a) to assure that the rights and benefits of Seller under such Contracts or Permits shall be preserved for the benefit of Buyer and (b) to facilitate receipt of the consideration to be received by Seller in and under every such Contract or Permit, which consideration shall be held for the benefit of, and shall be delivered to, Buyer. Notwithstanding the foregoing, provided Seller and/or Founder has exercised commercially reasonable efforts to do so, the failure to receive such consideration shall not be deemed an event of default under this Agreement or any Ancillary Agreement.

1.2 Purchase Price. In full consideration of the purchase of the Acquired Assets, at Closing, Buyer shall:

(a) pay and deliver an amount equal to the Cash Consideration to Seller by wire transfer of immediately available funds to one or more accounts that have been designated in writing by Seller;

(c) issue to Seller a promissory note in the form attached hereto as Exhibit B made by Buyer in favor of Seller (the “Seller’s Note”);

(d) pay and deliver an amount equal to the Estimated Indebtedness by wire transfer of immediately available funds to the accounts designated by Seller in the Estimated Closing Statement; and

(e) pay and deliver an amount equal to the Estimated Transaction Expenses by wire transfer of immediately available funds to the accounts designated by Seller in the Estimated Closing Statement.

The Seller acknowledges and agrees that Buyer shall be entitled to reduce any cash payments to Seller by all applicable deductions and tax withholdings in respect of the payments pursuant to this Section 1.2.

(a) Delivery of Closing Statement. Within 90 days after the Closing Date, Buyer shall cause to be prepared and shall deliver to Seller a balance sheet of Seller as of the Effective Time prepared in good faith in accordance with the Accounting Methods and a statement (collectively, the “Closing Statement”) setting forth in reasonable detail Closing Indebtedness and Closing Transaction Expenses, with the components thereof prepared in accordance with Accounting Methods.

(b) Cooperation. Each of Seller and Buyer agrees that it will, and it will use reasonable efforts to cause its respective Affiliates, agents and representatives to, cooperate and assist in the preparation of the Closing Statement and the calculation of Closing Indebtedness and Closing Transaction Expenses and in the conduct of the reviews and dispute resolution process referred to in this Section 1.3.

(c) Review Period. During the 30-day period following Seller’s receipt of the Closing Statement, Seller shall be permitted to review the working papers of Buyer relating to the Closing Statement. The Closing Statement and the calculation of Closing Indebtedness and Closing Transaction Expenses shall become final and binding upon the parties on the 30th day following delivery thereof, unless Seller gives written notice of its disagreement with the Closing Statement (“Notice of Disagreement”) to Buyer prior to such date, which notice, to be valid, must comply with this Section 1.3. Any Notice of Disagreement shall (i) specify in reasonable detail the nature of any disagreement so asserted, and include all supporting schedules, analyses, working papers and other documentation, (ii) include only disagreements based on Closing Indebtedness or Closing Transaction Expenses not being calculated in accordance with Section 1.3, (iii) specify the line item or items in the calculation of Closing Indebtedness or Closing Transaction Expenses with which Seller disagrees and the amount of each such line item or items as calculated by Seller, and (iv) include Seller’s calculation of Closing Indebtedness or Closing Transaction Expenses. Seller shall be deemed to have agreed with all items and amounts included in the calculation of the Closing Indebtedness and Closing Transaction Expenses delivered pursuant to Section 1.1(a) except such items that are specifically disputed in the Notice of Disagreement.

(d) Resolution of Disputes. If Seller delivers, in a timely manner, a Notice of Disagreement pursuant to this Section 1.1(c), then the Closing Statement (as revised in accordance with this Section 1.1(d)), and the resulting calculation of Closing Indebtedness and Closing Transaction Expenses resulting therefrom, shall become final and binding upon the parties on the earlier of (a) the date any and all matters specified in the Notice of Disagreement are finally resolved in writing by Seller and Buyer and (b) the date any and all matters specified in the Notice of Disagreement not resolved by Seller and Buyer are finally resolved in writing by the Arbiter. The Closing Statement shall be revised to the extent necessary to reflect any resolution by Seller and Buyer and any final resolution made by the Arbiter in accordance with this Section 1.1(d). During the 30-day period following the delivery of a timely Notice of Disagreement or such longer period as Seller and Buyer shall mutually agree, Seller and Buyer shall seek in good faith to resolve in writing any differences that they may have with respect to the matters specified in the Notice of Disagreement. If, at the end of such 30-day period (or such longer period as mutually agreed by Seller and Buyer), Seller and Buyer have not so resolved such differences, Seller and Buyer shall submit the dispute for resolution to an independent accounting or valuation firm (the “Arbiter”) for review and resolution of any and all matters which remain in dispute and which were included in the Notice of Disagreement in accordance with this Section 1.3. The Arbiter shall be a mutually acceptable nationally recognized independent public accounting or valuation firm agreed upon by Seller and Buyer in writing; provided, that in the event the parties are not able to mutually agree on an accounting or valuation firm, the Arbiter shall be The Bonadio Group. Seller and Buyer shall use reasonable efforts to cause the Arbiter to render a decision resolving the matters in dispute within 30 days following the submission of such matters to the Arbiter, or such longer period as Seller and Buyer shall mutually agree. Seller and Buyer agree that the determination of the Arbiter shall be final and binding upon the parties and that judgment may be entered upon the determination of the Arbiter in any court having jurisdiction over the party against which such determination is to be enforced; provided, that the scope of the disputes to be resolved by the Arbiter is limited to only such items included in the Closing Statement that Seller has properly disputed in the Notice of Disagreement based upon Closing Indebtedness or Closing Transaction Expenses not having been calculated in accordance with this Section 1.3. The Arbiter shall determine, based solely on presentations by Buyer and Seller and their respective representatives, and not by independent review, only those issues in dispute specifically set forth on the Notice of Disagreement and shall render a written report as to the dispute and the resulting calculation of Closing Indebtedness and Closing Transaction Expenses which shall be conclusive and binding upon the parties. In resolving any disputed item, the Arbiter: (i) shall be bound by the principles set forth in this Section 1.3, (ii) shall limit its review to the line items and items specifically set forth in and properly raised in the Notice of Disagreement and (iii) shall not assign a value to any line item or items greater than the greatest value for such item claimed by either party or less than the smallest value for such item claimed by either party. The fees, costs, and expenses of the Arbiter (i) shall be borne by Seller in the proportion that the aggregate dollar amount of such disputed items so submitted that are unsuccessfully disputed by Seller (as finally determined by the Arbiter) bears to the aggregate dollar amount of such items so submitted and (ii) shall be borne by Buyer in the proportion that the aggregate dollar amount of such disputed items so submitted that are successfully disputed by Seller (as finally determined by the Arbiter) bears to the aggregate dollar amount of such items so submitted. The fees, costs and expenses of Buyer’s independent accountants incurred in connection with the preparation of the Closing Statement and review of any Notice of Disagreement shall be borne by Buyer, and the fees, costs and expenses of Seller’s independent accountants incurred in connection with their review of the Closing Statement and preparation of any Notice of Disagreement shall be borne by Seller.

(i) If the Final Closing Consideration is greater than the Estimated Closing Consideration, then the principal amount of the Seller’s Note shall be increased by an amount equal to such excess.

(ii) If the Final Closing Consideration is less than the Estimated Closing Consideration, then the principal amount of the Seller’s Note shall be decreased by an amount equal to such deficiency.

2.1 Closing Date. The closing of the transactions contemplated hereby (the “Closing”) shall take place at the offices of Harter Secrest & Emery LLP in Rochester, New York (or at such other place as is agreed in writing by Buyer and Seller Parties), or via electronic transmittal of documents, on the date hereof (the “Closing Date”). For financial accounting and tax purposes, to the extent permitted by Law, the Closing shall be deemed to have become effective as of 11:59 p.m. on the Closing Date (the “Effective Time”).

(a) Deliveries by Buyer. At the Closing, Buyer shall deliver or cause to be delivered the following to Seller:

(iv) a guaranty of the Seller’s Note, in the form mutually acceptable to Parent and the Seller (the “Note Guaranty”), duly executed by Parent;

(v) the Bill of Sale; Assignment and Assumption Agreement, duly executed by Buyer;

(vi) the Transition Services Agreement in the form of Exhibit C attached hereto (the “Transition Services Agreement”) by and between Buyer and Founder, duly executed by Buyer;

(viii) a lease agreement, in the form mutually acceptable to Buyer and the landlord of the Seller’s premises (the “Lease Agreement”), duly executed by Buyer;

(ix) a guaranty of the Lease Agreement, in the form mutually acceptable to Parent and the landlord of the Seller’s premises (the “Lease Guaranty”), duly executed by Parent;

(x) certificates of a duly authorized officer of each of Buyer and Parent, dated as of the Closing Date, (A) attaching true and correct copies of Buyer’s and Parent’s respective formation and organizational documents as of the Closing Date; (B) attaching resolutions of the manager (or other governing body) of each of Buyer and Parent authorizing the execution, delivery and performance of this Agreement, the Guaranteed Obligations (as defined in Section 5.10) and each of the other transaction documents and the consummation of the transactions contemplated hereby and thereby; and (C) certifying that such resolutions have not been amended, terminated or superseded;

(xi) with respect to each of Buyer and Parent, a certificate of good standing or legal existence dated not more than ten (10) days prior to the Closing Date from the Secretary of State of the state in which such entity was formed or organized, attesting to the good standing in such state;

(xii) such transaction documents, agreement or instruments executed by Parent as may be reasonably necessary to effectuate or evidence the Guaranteed Obligations (as defined in Section 5.10); and

(xiii) such other agreements, certificates and documents as may be reasonably requested by Seller to effectuate or evidence the transactions contemplated hereby.

(b) Deliveries by Seller. At the Closing, Seller shall deliver or cause to be delivered the following to Buyer:

(ii) the Bill of Sale; Assignment and Assumption Agreement, duly executed by Seller;

(iii) a trademark assignment, in a form acceptable to Buyer, duly executed by Seller;

(v) the Employment Agreements, each duly executed by the respective Key Employee;

(vi) duly executed lock up agreements, in a form acceptable to Buyer (the “Lock Up Agreements”);

(vii) the Lease Agreements, duly executed by the landlord of Seller’s premises;

(viii) a certificate of the sole member and manager of Seller, dated as of the Closing Date, (A) attaching true and correct copies of the certificate of organization and operating agreement of Seller as of the Closing Date; (B) attaching resolutions of the manager (or other governing body) of Seller authorizing the execution, delivery and performance of this Agreement and each of the other transaction documents and the consummation of the transactions contemplated hereby and thereby; and (C) certifying that such resolutions have not been amended, terminated or superseded;

(ix) a certificate of legal existence dated not more than ten (10) days prior to the Closing Date from (i) the Secretary of State of the State of Connecticut, attesting to the legal existence in Connecticut of Seller, and (ii) the secretary of state of each other state attesting to the good standing of Seller in each other state where Seller is qualified to do business;

(x) a duly executed non foreign affidavit by Seller, dated as of the Closing Date, sworn under penalty of perjury and in form and substance reasonably satisfactory to Buyer and required under the Treasury Regulations issued pursuant to Section 1445 and Section 1446(f) of the Code, certifying that such issuer is a not a “foreign person” as defined in Section 1445(f)(3) of the Code;

(xi) such lien releases or other written evidence reasonably satisfactory to Buyer, evidencing the release of all Encumbrances on the assets of Seller that are not Permitted Encumbrances;

(xii) offer letters of Buyer executed by no less than 90% of Seller’s employees;

(xiii) subject to confirmation that Buyer’s 401(k) plan allows for the rollover of account balances and participant loans, evidence that Seller has exercised reasonable commercial efforts to allow for the rollover of account balances (including outstanding loans) under the PeriShip, LLC 401(k) Plan (the “401(k) Plan”) to the Buyer’s 401(k) plan and to avoid all outstanding loans under the 401(k) Plan from defaulting as a result of the transaction and/or the termination of employment by participants in connection with the transaction; and

(xiv) subject to Section 1.1(e), the consents, if any, set forth on Schedule 3.3 of the Disclosure Schedules in forms reasonably acceptable to Buyer;

(xv) such payoff letters, lien releases or other written evidence reasonably satisfactory to Buyer, evidencing the release of all Encumbrances on the Acquired Assets that are not Permitted Encumbrances;

(xvi) the requisite documents required to effectuate the transfer of the sponsorship of the Seller H&W Plans and the rights under the Contracts set forth in Schedule 3.12(a)(xiv) to Buyer; and

(xvii) such other agreements, certificates and documents as may be reasonably requested by Buyer to effectuate or evidence the transactions contemplated hereby.

Subject to the terms and conditions of this Agreement, including, without limitation, Article VII, each of Seller and Founder, jointly and severally, hereby represents and warrants to Buyer as follows:

3.1 Organization. Seller is a limited liability company duly organized and validly existing under the laws of the State of Connecticut. Seller has all requisite entity power and authority to carry on the Business. Seller is duly qualified to do business and is in good standing as a foreign limited liability in all jurisdictions where the nature of the property owned or leased by it or the nature of the business conducted by it makes such qualification necessary, except where the failure to be so qualified can be cured without material expense and will not render any Material Contract of Seller unenforceable. Seller has delivered true and complete copies of the articles of organization, operating agreement and all other organizational or governance documents of Seller, all as amended to date, to Buyer.

3.2 Authority. Each of Seller and Founder has all requisite power, authority and capacity to execute, deliver, and perform this Agreement and each Ancillary Agreement to which Seller or Founder is a party, and to consummate the transactions contemplated hereby and thereby. This Agreement, and each Ancillary Agreement to which Seller or Founder is a party, has been duly and validly executed and delivered by Seller or Founder and constitutes the valid and binding obligation of Seller or Founder, enforceable against Seller or Founder in accordance with its respective terms, except as such enforcement shall be limited by bankruptcy, insolvency, moratorium or similar law affecting creditors’ rights generally and subject to general principles of equity.

3.3 No Conflict. The execution, delivery and performance by Seller and Founder of this Agreement and the Ancillary Agreements to which each of Seller or Founder is a party, and the consummation by Seller and Founder of the transactions contemplated hereby and thereby does not and will not, with or without the giving of notice or the lapse of time, or both, (x) violate any provision of any Law to which Seller or Founder is subject, (y) violate any provision of the articles of organization, operating agreement or other organizational or governance documents of Seller, or (z) violate or result in a breach of or constitute a default (or an event which might, with the passage of time or the giving of notice, or both, constitute a default) under, or require the consent of any third party under, or result in or permit the termination or amendment of any provision of, or result in or permit the acceleration of the maturity or cancellation of performance of any obligation under, or result in the creation or imposition of any Encumbrance of any nature whatsoever upon any of the assets of Seller or Founder or give to others any interests or rights therein under, any Contract or Permit to which Seller or Founder is a party or by which Seller or Founder may be bound or affected.

(a) Seller is a single-member limited liability company, and Founder is the sole member. All issued and outstanding membership interests of Seller have been duly authorized, are validly issued, fully paid and non-assessable, and are owned of record and beneficially by Founder, as the sole member, free and clear of all Encumbrances.

(b) There are no outstanding or authorized options, warrants, convertible securities or other rights, agreements, arrangements or commitments of any character relating to the capital stock of Seller or obligating Seller or Founder to issue or sell any shares of capital stock of, or any other interest in, Seller. Seller does not have outstanding or authorized any stock appreciation, phantom stock, profit participation, equity grant or ownership plans or similar rights. There are no voting trusts, stockholder agreements, proxies or other agreements or understandings in effect with respect to the voting or transfer of any of the Acquired Assets.

3.5 Subsidiaries. Seller does not (i) directly or indirectly own any stock of, equity interest in, or other investment in any other corporation, joint venture, partnership, trust or other Person or (ii) have any subsidiaries or any predecessors in interest by merger, liquidation, reorganization, acquisition or similar transaction.

(a) The books of account and related records of Seller fairly reflect in all material respects Seller’s assets, liabilities and transactions. Schedule 3.6 sets forth the following financial statements (the “Financial Statements”): (x) the balance sheets of Seller as of December 31, 2020, 2019 and 2018 and the related statements of income and stockholder’s equity and cash flows for the years ended December 31, 2020, 2019 and 2018, and (y) the balance sheet of Seller as of the Balance Sheet Date, and the related statements of income and Founder’s equity and cash flows for the three (3)-month period ended on the Balance Sheet Date (the “Interim Financial Statements”). The Financial Statements and Interim Financial Statements fairly present, in all material respects, the financial position of Seller and the results of its operations and cash flows as of the respective dates and for the respective periods indicated therein and have been prepared consistent with Seller’s historical accounting methods, applied in a manner consistent with past principles and practices, including with respect to the preparation of the Financial Statements. The Interim Financial Statements fairly present, in all material respects, the financial position of Seller and the results of its operations and cash flows as of the respective dates and for the respective periods indicated therein and have been prepared consistent with Seller’s historical accounting methods, applied in a manner consistent with past principles and practices, except that the Interim Financial Statements are subject to normal year-end adjustments, none of which are expected to be material in amount or nature. The Financial Statements and Interim Financial Statements have been prepared from and are in accordance with the books and records of Seller.

(b) Seller does not have any liabilities except for (a) liabilities reflected on or accrued and reserved against in the Balance Sheet, or (b) liabilities incurred in the Ordinary Course of Business after the Balance Sheet Date (none of which is material or results from, arises out of, or relates to any material breach or violation of, or default under, a contractual obligation or requirement of Law).

(c) Seller is not a party to, nor has it any commitment to become a party to: (i) any joint venture, off-balance sheet partnership, or any similar Contract or arrangement (including any Contract or arrangement relating to any transaction or relationship between or among Seller, on the one hand, and any other Person, including any structured finance, special purpose, or limited purpose Person, on the other hand); or (ii) any “off-balance sheet arrangements” (as defined in Item 303(a) of Regulation S-K promulgated by the U.S. Securities and Exchange Commission).

3.7 Absence of Certain Changes or Events. Except as set forth on Schedule 3.7, since December 31, 2020, Seller has conducted its business only in the Ordinary Course of Business and there has not been a Material Adverse Effect. Without limiting the foregoing, except as set forth on Schedule 3.7, since December 31, 2020, Seller has not

(a) issued, purchased or redeemed any of its equity securities, or granted or issued any option, warrant or other right to purchase or acquire any such equity securities;

(b) incurred or discharged any liabilities, except liabilities incurred or discharged in the Ordinary Course of Business;

(c) encumbered any of its properties or assets, tangible or intangible, except for Encumbrances incurred in the Ordinary Course of Business;

(d) (i) granted any increase in the salaries (other than normal increases for employees averaging not in excess of five percent per annum made in the Ordinary Course of Business) or other compensation or benefits payable or to become payable to, or any advance (excluding advances for ordinary business expenses consistent with past practice) or loan to, any officer, director, shareholder, member, partner, employee or independent contractor of Seller, (ii) made any payments to any pension, retirement, profit-sharing, bonus or similar plan except payments in the Ordinary Course of Business made pursuant to the Benefit Plans, (iii) granted or made any other payment of any kind to or on behalf of any officer, director, member, partner, shareholder, employee or independent contractor other than payment of base compensation and reimbursement for reasonable expenses in the Ordinary Course of Business or (iv) adopted, amended or terminated any employee benefit plan (including any Benefit Plan) or any stay bonus, retention bonus, transaction bonus or change in control bonus plan or arrangement, other than, in any case, amendments required by applicable Law;

(e) suffered any change or, to the knowledge of Seller, received any written threat of any change in any of its relations with, or any loss or, to the knowledge of Seller, written threat of loss of, any of the suppliers, clients, distributors, customers or employees that in the aggregate are material to the Business;

(f) disposed of or has failed to keep in effect any rights in, to or for the use of any Permit material to the Business;

(g) changed any method of keeping of their respective books of account or accounting practices;

(h) disposed of or failed to keep in effect any rights in, to or for the use of any of the Intellectual Property material to the Business;

(i) sold, transferred or otherwise disposed of any assets, properties or rights of the Business, except inventory sold in the Ordinary Course of Business;

(j) entered into any transaction, Contract or event outside the Ordinary Course of Business or with any partner, shareholder, member, officer, director or other Affiliate of Seller;

(k) made nor authorized any single capital expenditure in excess of $10,000, or capital expenditures in excess of $50,000 in the aggregate outside the Ordinary Course of Business;

(l) changed or modified in any manner its existing credit, collection and payment policies, procedures and practices with respect to accounts receivable and accounts payable, respectively, including acceleration of collections of receivables, failure to make or delay in making collections of receivables (whether or not past due), acceleration of payment of payables or failure to pay or delay in payment of payables;

(m) incurred any material damage, destruction, theft, loss or business interruption;

(n) made any declaration, payment or setting aside for payment of any distribution (whether in equity or property) with respect to any securities or interests of Seller;

(o) made (except as consistent with past practice) or revoked any Tax election or settled or compromised any material Tax liability with any Taxing Authority; or

(p) waived or released any material right or claim of Seller or incurred any modifications, amendments or terminations of any Contracts which are in the aggregate materially adverse to Seller or the Business.

(a) Schedule 3.8(a) sets forth a true and correct list of all equipment leases that have been or should be, in accordance with the Accounting Methods, recorded as capital leases including the amount required to pay in full all obligations in respect of each such lease as of the Closing Date (“Equipment Leases”). Seller has good and valid title to, or a valid leasehold interest in, all property and other assets used in the operation of the Business, reflected in the Financial Statements or acquired after the Balance Sheet Date, other than properties and assets sold, consumed or otherwise disposed of in the Ordinary Course of Business since the Balance Sheet Date, free and clear of all Encumbrances, except for Permitted Encumbrances.

(b) Except as set forth on Schedule 3.8(b), the buildings, plants, structures, fixtures, machinery, equipment, vehicles and other items of tangible personal property of Seller are in a condition and repair (except for ordinary wear and tear and routine maintenance in the Ordinary Course of Business), are adequate for the purposes for which they are presently used in the conduct of the Business and are usable in a manner consistent with their current use, and, to the knowledge of Seller, comply in all material respects with all applicable Laws. The buildings, plants, structures, fixtures, machinery, equipment, vehicles and other items of tangible personal property of Seller currently owned or leased by Seller constitute all of the assets, properties and rights necessary for the operation of the Business as the Business is currently conducted. Except as set forth on Schedule 3.8(b), no other Person other than Seller owns any assets, properties and rights used in the Business, other than assets owned by third parties and used in the Business pursuant to a Material Contract identified on Schedule 3.12.

(b) Schedule 3.9(b)(i) sets forth a true, correct and complete description of all written or oral leases, subleases, or other occupancies of real property used by Seller (collectively, the “Leases”) to which Seller is a party (as lessee, sublessee, licensee or otherwise) (collectively, the “Leased Real Property”) with a brief description of such lease or sublease including, without limitation, the parties to the lease, the term of the lease, the current expiration date of the lease, the renewal options, the basic rent, and any monthly payments of additional rent. Seller does not operate and has never operated its Business at any location other the Leased Real Property. Seller has delivered to Buyer a true, correct and complete copy of the Leases and all amendments, modifications and supplemental agreements thereto. Each of the Leases is in full force and effect and is binding and enforceable against Seller and, to the knowledge of Seller, each of the other parties thereto, in accordance with its terms and has not been modified or amended since the date of delivery to Buyer.

(c) Except as set forth on Schedule 3.9(c), there are no Encumbrances affecting the Leased Real Property, other than Permitted Encumbrances. No party to any Lease has sent written notice to the other claiming that such party is in default thereunder. There has not occurred any event which would constitute a breach of or default in the performance of any covenant, agreement or condition contained in any Lease, nor has there occurred any event which with the passage of time or the giving of notice or both would constitute such a breach or default. There is no current or pending event or circumstance that would permit the termination of any Lease or the increase of any liabilities or restrictions of Seller under any Lease. Neither Seller nor Founder has received any written notice from the other party to any Lease of the termination or proposed termination thereof. No construction, alteration or other leasehold improvement work with respect to any Lease remains to be paid for or to be performed by Seller. Seller does not have any obligations to provide deposits, letters of credit or other credit enhancements to retain its rights under any Lease or otherwise operate the Business at the Leased Real Property.

(d) Seller presently enjoys peaceful and undisturbed possession of the Leased Real Property. No Person other than Seller has any right to use, occupy, or lease any portion of the Leased Real Property. Neither Seller nor Founder has received written notice of any eminent domain, condemnation or other similar proceedings pending or threatened against Seller with respect to, or otherwise affecting any portion of, the Leased Real Property. The current use of the Leased Real Property in the conduct of the Business does not violate any Lease in any respect. Seller has not received any written notice that there is a violation of any covenant, condition, restriction, easement or order of any Authority having jurisdiction over the Leased Real Property or the use or occupancy thereof. To the knowledge of Seller, the Leased Real Property is in compliance in all material respects with all applicable building, zoning, subdivision, health and safety and other land use and similar applicable Laws, rules and regulations, permits, licenses and certificates of occupancy affecting the Leased Real Property, and neither Seller nor Founder has received any written notice of any violation or claimed violation Seller of any such Laws, rules and regulations with respect to the Leased Real Property which have not been resolved or for which any obligation of Seller remains to be fulfilled, including but not limited to payments of monetary damages, fines or penalties, or completion of any remedial or corrective measures. The Leased Real Property is served by proper utilities, sufficient parking and other building services necessary for its current use.

(e) Each use of the Leased Real Property by Seller is and has been valid, permitted and conforming uses in accordance with the current zoning classification of the Leased Real Property, and there are no outstanding variances or special use permits affecting the Leased Real Property or their uses.

(f) The transaction contemplated by this Agreement does not constitute an assignment of Seller’s rights under any Lease and does not require the consent of any Person under any Lease.

(g) The Leased Real Property is in good repair, ordinary wear and tear excepted, and fit for the purposes for which it is presently used. Seller has rights of egress and ingress with respect to the Leased Real Property that are sufficient for it to conduct its Business as presently conducted consistent with past practice.

(a) All of Seller’s accounts and notes receivable reflected on the Balance Sheet and the accounts and notes receivable arising after the date thereof (collectively, the “Accounts Receivable”) represent amounts receivable for products actually delivered or services actually provided (or, in the case of non-trade accounts or notes represent amounts receivable in respect of other bona-fide business transactions), have arisen in the Ordinary Course of Business and have been or will be billed and are generally due within thirty (30) days after such billing. Except as set forth on Schedule 3.10(a), all of the Accounts Receivable are and will be fully collectible within the time period set forth in each applicable invoice, purchase order or other sales contract, net of the reserves shown on the Balance Sheet (or in the books of Seller if such Accounts Receivable were created after the Balance Sheet Date). The reserve for bad debts shown on the Balance Sheet or, with respect to Accounts Receivable arising after the Balance Sheet Date, in the books of Seller, have been determined in accordance with the Accounting Methods, consistently applied, subject to normal year-end adjustments and the absence of disclosures normally made in footnotes. To the knowledge of Seller, there is no contest, claim, or right of set-off under any Contract with any obligor of a material Account Receivable relating to the amount or validity of such Account Receivable.

(b) Except as set forth on Schedule 3.10(b), since December 31, 2020, there have not been any write-offs as uncollectible of Seller’s accounts receivable except for write-offs in the Ordinary Course of Business and not in excess of $10,000 in the aggregate.

(a) Schedule 3.11(a)(i) sets forth a list of all patents, patent applications (including any provisional applications, divisions, continuations or continuations in part), material unregistered trademarks, registered trademarks and applications for registration for trademarks, copyright registrations and applications for registration of copyrights, and domain name registrations in each case owned by or held in the name of Seller, specifying as to each such item, as applicable, (i) the item (with respect to trademarks), or title (with respect to all other items), (ii) the owner of the item, (iii) the jurisdiction in which the item is issued or registered or in which any application for issuance or registration has been filed, including the respective issuance, registration or application number and (iv) the date of application and issuance or registration of the item (the “Material Owned Intellectual Property”). Except as set forth on Schedule 3.11(a)(ii), (A) each item of Intellectual Property owned by Seller including the Material Owned Intellectual Property is valid and in full force and effect and is owned by Seller free and clear of all Encumbrances and other claims, including any claims of joint ownership or inventorship, (B) the registrations and applications for registration of the Material Owned Intellectual Property are held of record in Seller’s name, and (C) none of the Material Owned Intellectual Property is the subject of any proceeding contesting its validity, enforceability or Seller’s ownership thereof. All issuance, renewal, maintenance and other payments that are or have become due as of the date hereof with respect to the Material Owned Intellectual Property have been timely paid by or on behalf of Seller. Schedule 3.11(a)(iii) sets forth a true and complete list of all Intellectual Property licensed to Seller and the license or agreement pursuant to which Seller obtained a license to such Intellectual Property. Except as set forth on Schedule 3.11(a)(iii): (u) Seller owns or possesses adequate licenses or other valid rights to use all patents, patent applications, trademarks, trademark applications, copyrights, industrial designs, software, databases, data compilations, domain names, know-how, trade secrets, product formulas, inventions, rights-to-use and other industrial and intellectual property rights (collectively, “Intellectual Property”) used in the conduct of the Business, (v) to the knowledge of Seller, the conduct of the Business of Seller does not infringe, misappropriate, dilute or conflict with, and has not conflicted with any Intellectual Property of any other Person, (w) neither Seller nor Founder has received any written notice alleging that the conduct of the Business, including the marketing, sale and distribution of the products and services of the Business, infringes, dilutes, misappropriates or otherwise violates any Person’s Intellectual Property (including, for the avoidance of doubt, any cease and desist letter or offer of license), (x) no current or former employee of Seller and no other Person owns or has any proprietary, financial or other interest, direct or indirect, in whole or in part, and including any rights to royalties or other compensation, in any of Intellectual Property owned or purported to be owned by Seller, (y) there is no agreement or other contractual restriction affecting the use by Seller of any of the Intellectual Property owned or purported to be owned by Seller, and (z) Seller has not received any written notice concerning any present claim of infringement, dilution, misappropriation or other violation of any of the Intellectual Property owned or purported to be owned by Seller by any Person, and neither Seller nor Founder has asserted or threatened any written claim or objection against any Person for any such infringement or misappropriation nor, to the knowledge of Seller or Founder, is there any basis in fact for any such objection or claim.

(b) Except as set forth on Schedule 3.11(b), the information technology systems owned, leased, licensed or otherwise used in the conduct of the Business, including all computer software, hardware, firmware, process automation systems and telecommunications systems used in the Business (the “IT Systems”) perform in material conformance with the documentation and specifications for such systems. The IT Systems are adequate for the operation of the Business. Seller has taken commercially reasonable steps to protect the IT Systems against viruses, “worms,” disabling or malicious code, or other anomalies that would materially impair the functionality of the IT Systems. Seller has taken commercially reasonable steps to provide for the backup, archival and recovery of the critical business data of Seller. Seller has taken commercially reasonable measures to maintain the confidentiality of all trade secrets. Neither Seller’s trade secrets nor any other confidential information of Seller has been disclosed by Seller to, or, to the knowledge of Seller and/or Founder, discovered by, any other Person except pursuant to non-disclosure agreements or to Persons entitled to receive such trade secrets or other confidential information that are legally obligated to maintain their confidentiality. Neither Seller nor Founder has received written notice that, or otherwise has knowledge that, any employee, consultant or agent of Seller is in default or breach of any employment agreement, non-disclosure agreement, assignment of invention agreement or similar agreement relating to the protection, ownership, development, use or transfer of Intellectual Property owned by Seller. Except as set forth in Schedule 3.11(b), each employee and consultant of Seller has executed a written agreement expressly assigning to Seller all right, title and interest in any Intellectual Property invented, created, developed, conceived or reduced to practice during the term of such employee’s employment or consultant’s service relationship and related to the work performed by such person for Seller, and all Intellectual Property rights therein. Each item of Intellectual Property owned or licensed by Seller will be owned or available for use by Seller immediately following the Closing on substantially identical terms and conditions as it was immediately prior to the Closing.

(a) Schedule 3.12(a) contains a complete and accurate list of all Material Contracts (classified (i) through (xv), as applicable, based on the definition of Material Contracts). As used in this Agreement, “Material Contracts” means all Contracts of the following types to which Seller is a party or by which Seller or any of its properties or assets is bound:

(ii) any labor or employment-related agreements, including employee leasing agreements;

(iv) mortgages, indentures, loan or credit agreements, security agreements and other agreements and instruments relating to the borrowing of money or extension of credit;

(v) agreements for the sale of goods or products or performance of services by or with any vendor or customer (or any group of related vendors or customers) involving consideration payable to or by Seller in excess of $25,000;

(vi) lease agreements for machinery and equipment, motor vehicles, or furniture and office equipment or other personal property by or with any vendor (or any group of related vendors) involving consideration payable to or by Seller in excess of $25,000;

(vii) agreements restricting in any manner the right of Seller to compete with any other Person, or restricting the right of Seller to sell to or purchase from any other Person;

(ix) guaranties, performance, bid or completion bonds, surety and appeal bonds, return of money bonds, and surety or indemnification agreements;

(xi) any license agreement or other agreements to which Seller is a party regarding any Intellectual Property of others;

(xii) other agreements, contracts and commitments which cannot be terminated by Seller on notice of 30 days or less and without payment by Seller of less than $5,000 upon such termination;

(xiv) claims administration agreements, stop loss policies or agreements, and other insurance policies with respect to the Seller H&W Plans;

(xv) any agreements or arrangements with any sales representatives, consultants, agents or other representatives of Seller (including sales commission agreements or arrangements) involving payments by the Seller to such consultant, agent or representative in excess of $175,000 in any calendar year; and

(xvi) each other agreement or contract to which Seller is a party or by which it or its assets are otherwise bound which is material to its Business, operation, financial condition or prospects and which involve consideration payable to or by Seller in excess of $175,000.

(b) To the knowledge of Seller, each Material Contract is valid, binding and enforceable against Seller and the other parties thereto in accordance with its terms and is in full force and effect. Except as set forth in Schedule 3.12(b), Seller and, to the knowledge of Seller and/or Founder, each of the other parties thereto, have performed in all material respects all obligations required to be performed by them under, and are not in material default under, any of such Contracts and no event has occurred which, with notice or lapse of time, or both, would constitute such a default. Neither Seller nor Founder has received any written claim from any other party to any Contract that Seller has breached any obligations to be performed by it thereunder, or is otherwise in default or delinquent in performance thereunder. Seller has delivered to Buyer a true and complete copy of each Material Contract required to be disclosed on Schedule 3.12(a).

3.13 Consents. Subject to Section 1.1(e), except as set forth on Schedule 3.13, no consent, approval, or authorization of, or exemption by, or filing with, any Authority or other Person is required to be obtained or made by Seller or Founder in connection with the execution, delivery, and performance by Seller or Founder of this Agreement, or any Ancillary Agreement to which Seller or Founder is a party or the taking by Seller or Founder of any other action contemplated hereby or thereby or the continuation by Buyer after the Closing of Seller’s Business conducted prior to the Closing.

3.14 Litigation. Except as set forth in Schedule 3.14, there is no, and during the last five years there has not been any, dispute, claim, action, suit, proceeding, review, arbitration or investigation before any Authority (“Litigation”) pending or, to the knowledge of Seller and/or Founder, threatened in writing against the Seller or Founder, any of their respective properties or assets or (to the extent Seller may have an obligation to provide indemnification or may otherwise become liable) any of their respective shareholders, members, officers, directors or employees. Except as set forth in Schedule 3.14, Seller is not a party to or bound by any outstanding orders, rulings, judgments, settlements, arbitration awards or decrees (or agreement entered into or any administrative, judicial or arbitration award with any Authority) with respect to or affecting the properties, assets, personnel or Business of Seller. Seller has provided Buyer with a list setting forth a general description of settlements occurring since January 1, 2015 regarding actual or threatened Litigation binding on Seller.

3.15 Compliance with Laws; Permits; Data Security. To the knowledge of Seller, Seller has been and is in compliance in all material respects with all applicable Laws. Set forth on Schedule 3.15 are all governmental or other industry permits, registrations, certificates, certifications, exemptions, licenses, franchises, consents, approvals and authorizations (“Permits”) necessary for the conduct of the Business as presently conducted, each of which Seller validly possesses and is in full force and effect. Except as set forth in Schedule 3.15, no written notice, citation, summons or order has been issued, no written complaint has been filed and served, no penalty has been assessed and written notice thereof given, and no investigation or review is pending or, to the knowledge of Seller, threatened in writing with respect to Seller, by any Authority with respect to any alleged (a) violation in any material respect by Seller of any Law, or (b) failure by Seller to have any Permit required in connection with the conduct of the Business. Without limiting the foregoing, to the knowledge of Seller, Seller is in material compliance with all applicable Data Security Requirements. No written notices, claims, charges or complains have been received by Seller since January 1, 2018 from any governmental authority or other Person relating to or alleging any actual or alleged violation by Seller of, or actual or alleged liability or misconduct under, any Data Security Requirements. Except as set forth in Schedule 3.15, since January 1, 2018, there has not been, to Seller’s or the Founder’s knowledge any actual or alleged incidents of data security breaches concerning any IT Systems, any unauthorized access to, use or encryption of Personal Information, Business Data or any IT Systems, or any unauthorized acquisition, destruction, damage, disclosure, loss, corruption, alteration or use of such Personal Information or Business Data.

(a) To the knowledge of Seller, Seller has conducted, and is conducting its operations and the Business, and has occupied and operated the Leased Real Property in compliance in all material respects with all Environmental Laws. Seller holds and, to the knowledge of Seller, has been and is in compliance in all material respects with all Permits required under Environmental Laws for the operation of Seller, the conduct of the Business as previously and currently conducted, or the occupancy and operation of the Leased Real Property (“Environmental Permits”), and all such Environmental Permits are in full force and effect. Schedule 3.16 lists all Environmental Permits.

(b) Neither the Seller nor Founder has received any written notice, citation, summons, order or complaint, no penalty has been assessed or is pending or, to the knowledge of Seller and/or Founder, threatened in writing by any third party (including any Authority) with respect to Seller, the Business, the Leased Real Property or any other real property and relating to or arising from, (i) the use, possession, generation, treatment, manufacture, processing, management, handling, storage, recycling, transport, discharge, disposal, release or threatened release of, and/or exposure to, Hazardous Substances, (ii) any non-compliance with Environmental Laws or Environmental Permits or (iii) failure to hold any Environmental Permits. Neither Seller nor Founder has received any written request for information, notice of claims, demand or other notification that Seller has or may have any liability under Environmental Laws.

(c) To the knowledge of Seller, neither the Leased Real Property nor any property formerly owned, operated, occupied, leased or otherwise used by Seller is listed or proposed for listing on any list maintained by any Authority of contaminated or potentially contaminated sites, and no Hazardous Substances generated, disposed, released or otherwise handled by or on behalf of Seller has come to be located at any site identified on any such list or has otherwise resulted in or could result in liability under Environmental Laws.

(d) There are no underground storage tanks, above ground storage tanks, asbestos containing materials or PCB-containing equipment located at, on or under the Leased Real Property. Any underground storage tanks, above ground storage tanks or wastewater treatment systems at the Leased Real Property or any property formerly owned, operated, occupied, leased or otherwise used by Seller that have been removed or closed have been removed or closed in compliance in all material respects with all applicable Environmental Laws and Environmental Permits, and there are no outstanding or contingent liabilities under Environmental Laws with respect to any such tanks or wastewater treatment systems.

(e) No Hazardous Substances have been released, spilled, leaked, discharged, disposed of, pumped, poured, emitted, emptied, injected, leached, dumped or allowed to escape and there are no Hazardous Substances in an uncontained state or in a condition representing a threat of a release at, on, about, under or from the Leased Real Property.

(f) All environmental reports, inspections, investigations, studies, audits, tests, reviews or other analysis, evaluations, assessments, sample results, and all correspondence or other documentation related to any of the foregoing (“Environmental Documents”) pertaining to Seller, the Business, the Leased Real Property or any property formerly owned, operated, leased or otherwise used by Seller in the possession or control of Seller or Founder have been provided or made available to Buyer, and all such Environmental Documents are listed on Schedule 3.16(f).

(g) Neither Seller nor Founder knows of or has any reason to know of any facts or circumstances related to environmental matters concerning Seller, the Business, the Leased Real Property that could result in any liabilities or responsibilities for Seller pursuant to Environmental Laws, and Seller has not assumed, by Contract, law or otherwise, any liability or responsibility pursuant to Environmental Laws for any environmental conditions, including, but not limited to, conditions or contamination related to any disposal, discharge or release of, or exposure to, any Hazardous Substances.

(a) Schedule 3.17(a) lists all “employee benefit plans,” as defined in Section 3(3) of ERISA and all other retirement, pension, profit sharing, bonus, stock, restricted stock, stock option, stock purchase, equity-based, profits interest, phantom equity, employment, service, retainer, cafeteria, compensation, consulting, change in control, welfare, health (including medical, dental and vision), life, disability, group insurance, savings, deferred compensation, incentive compensation, paid time off, severance, salary continuation, retention, indemnification and fringe benefit and perquisite (including but not limited to benefits relating to automobiles, clubs, vacation, child care, parenting, sabbatical, sick leave, and tuition reimbursement) agreements, arrangements, plans, programs, Contracts, policies, or practices maintained, contributed to, or required to be contributed to by Seller or any ERISA Affiliate for the benefit of any current or former employee, officer, director, member, partner or independent contractor of Seller or with respect to which Seller or any ERISA Affiliate may have any liability, whether contingent or otherwise (the “Benefit Plans”). In the case of each “employee welfare benefit plan” as defined in Section 3(1) of ERISA, Schedule 3.17(a) discloses whether such plan is (i) unfunded, (ii) funded through a “welfare benefit fund,” as such term is defined in Code Section 419(e), or other funding mechanism or (iii) insured.

(b) As applicable, with respect to each Benefit Plan, Seller has delivered or made available to Buyer true and complete copies of (i) all plan documents (including all amendments and modifications thereof) and in the case of an unwritten Benefit Plan, a written description thereof, (ii) the current summary plan description and each summary of material modifications thereto, (iii) the most recent IRS determination, advisory or opinion letter, (iv) all funding and administrative arrangement documents, including trust agreements, insurance contracts, custodial agreements, investment manager agreements and service agreements, (v) for the three most recent years, the filed Form 5500 for each Benefit Plan required to file Form 5500; and (vi) all communications, records, notices and filings received from or sent to the IRS, Department of Labor or Pension Benefit Guaranty Corporation in the last three years.

(c) Except as set forth on Schedule 3.17(c), to the knowledge of Seller, Seller and each ERISA Affiliate is in compliance with the provisions of ERISA, the Code and all other Laws applicable to the Benefit Plans (including all applicable aspects of the Patient Protection and Affordable Care Act, as amended, and the Health Insurance Portability and Accountability Act of 1996, as amended). All employee salary reduction contributions to the Benefit Plans and to any health savings accounts have been made in accordance with the applicable requirements under Section 125 of the Code, as applicable. Each Benefit Plan has been maintained, operated and administered in compliance with its terms and any related documents or agreements and the applicable provisions of ERISA, the Code and all other Laws. Neither Seller nor any ERISA Affiliate has incurred and neither could reasonably be expected to incur an employer shared responsibility penalty under Section 4980H of the Code. Seller and each ERISA Affiliate has timely and accurately satisfied its reporting obligations under Sections 6055 and 6056 of the Code.

(d) Except as required by applicable Law, including without limitation, COBRA, no Benefit Plan provides for or continues medical or health benefits, or life insurance or other welfare benefits (through insurance or otherwise) for any Person or any dependent or beneficiary of any Person beyond termination of service or retirement, and neither Seller nor, to Seller’s knowledge, any ERISA Affiliate has made a written or oral promise, or any written communication that could reasonably be expected to promise, to any Person to provide any such benefits.

(e) No Benefit Plan is (or at any time has been), and neither Seller nor any ERISA Affiliate has ever contributed to, or been required to contribute to, or has any liability (contingent or otherwise) under or with respect to, and no current or former employees of Seller or any ERISA Affiliate currently participate or ever have participated in any employee benefit plan that is (i) subject to Part 3, Subtitle B of Title I of ERISA, Title IV of ERISA or Code Section 412, (ii) a “multiemployer plan” (as defined in Section 3(37) of ERISA), (iii) a “multiple employer plan” as described in Section 413(c) of the Code, (iv) a “voluntary employees’ beneficiary association” (as defined in Section 501(c)(9) of the Code), or (v) a “multiple employer welfare arrangement” (as defined in Section 3(40)(A) of ERISA).

(f) All Benefit Plans which are “employee pension benefit plans” within the meaning of Section 3(2) of ERISA and which are intended to meet the qualification requirements of Code Section 401(a) now meet, and at all times since their inception have met, the requirements for such qualification, and the related trusts are now, and at all times since their inception have been, exempt from taxation under Code Section 501(a). Each Benefit Plan that is intended to be qualified under Code Section 401(a) has received a favorable determination letter (or an opinion or advisory letter on which it is entitled to rely) from the IRS that such Benefit Plan is qualified under Code Section 401(a). To the knowledge of Seller, no event has occurred that will or could give rise to the revocation of any applicable determination letter or the loss of the right to rely on any applicable opinion or advisory letter, or the disqualification or loss of tax-exempt status of any such Benefit Plan or trust under Code Sections 401(a) or 501(a).

(g) To the knowledge of Seller, the Seller’s execution of, and performance of the transactions contemplated by this Agreement will not (either alone or upon the occurrence of any additional or subsequent events) (i) constitute an event under any Benefit Plan or related agreement, trust or loan that will or may result in any payment (whether of severance pay or otherwise), acceleration, forgiveness of indebtedness, vesting, distribution, increase in benefits, or other obligation to fund benefits with respect to any Person (provided that any partial termination of the 401(k) Plan will require vesting of benefits under the 401(k) Plan) or (ii) result in the triggering or imposition or any restrictions or limitations on the right of Seller, Seller or any ERISA Affiliate to amend or terminate any Benefit Plan (or result in any adverse consequence for so doing).

(h) There is no pending or, to the knowledge of Seller and/or Founder, threatened litigation by or on behalf of any Benefit Plan, any employee or beneficiary covered under any Benefit Plan, any Authority with respect to a Benefit Plan, or otherwise involving any Benefit Plan (other than routine claims for benefits). No Benefit Plan is under audit or investigation by any Governmental Authority and, to the knowledge of Seller, no such audit or investigation is threatened.

(i) Each of the Benefit Plans can be terminated at any time in the sole discretion of the plan sponsor, without any additional contribution to such Benefit Plan or the payment of any additional compensation or amount or acceleration of any benefits (other than accelerated vesting with respect to tax-qualified retirement plans, which shall not require any additional contribution to be made). Nothing prohibits the prompt distribution of all amounts under any Benefit Plan subject to Section 401(a), 403(a) or 403(b) of the Code, provided that a participant terminates service with the Seller and any ERISA Affiliate or the Benefit Plan is terminated by the plan sponsor. No termination, discontinuance, load or other similar fee or expense is payable or shall be assessed in connection with the discontinuance of contributions to, and/or the amendment or termination of, any of the Benefit Plans.

(j) All contributions (including all employer contributions and employee salary reduction contributions) and premium payments which are or have been due have been paid to or with respect to each Benefit Plan within the time required by law. All required or discretionary (in accordance with historical practices) payments, premiums, contributions, reimbursements, or accruals for all periods ending prior to or as of the Closing Date shall have been made or properly accrued on the Closing Statement or will be properly accrued on the books and records of Seller and each ERISA Affiliate as of the Closing Date. None of the Benefit Plans has any unfunded liabilities which are not reflected on the Closing Statement or the books and records of Seller and each ERISA Affiliate.

(k) To the knowledge of Seller, each Benefit Plan that constitutes a “non-qualified deferred compensation plan” within the meaning of Code Section 409A, complies (and has at all relevant times complied) in both form and operation with the requirements of Code Section 409A; and neither Seller nor any ERISA Affiliate is or has been required to report any Taxes due as a result of a failure of a Benefit Plan to comply with Code Section 409A. With respect to each Benefit Plan, neither Seller nor any ERISA Affiliate has any indemnity obligation for any Taxes or interest imposed or accelerated under Code Section 409A.

(a) Except as set forth in Schedule 3.18(a)(i), (i) Seller has timely filed or caused to be filed (taking into account properly and timely filed extensions) with the appropriate federal, state, local, and foreign governmental entity or other authority (individually or collectively, “Taxing Authority”) all Tax Returns required to be filed with respect to Seller and has timely paid or remitted in full or caused to be paid or remitted in full all Taxes required to be paid with respect to Seller (whether or not shown due on any Tax Return); (ii) all Tax Returns are true, correct and complete in all material respects; and (iii) there are no liens for Taxes upon Seller or its assets, except liens for current Taxes not yet due and payable. Except as set forth on Schedule 3.18(a)(ii), Seller has not granted any waiver of any statute of limitations with respect to, or any extension of a period for the assessment of, any Taxes.

(b) Except as set forth on Schedule 3.18(b), there is no action, suit, proceeding, investigation, audit, claim, assessment or judgment now pending against Seller, in respect of any Tax, and no written notification of an intention to examine, request for information related to Tax matters or notice of deficiency or proposed adjustment for any amount of Tax has been received by Seller. No Taxing Authority with which Seller does not file Tax Returns has claimed in writing that Seller is or may be subject to taxation by that Taxing Authority.

(c) To the knowledge of Seller, Seller has withheld and paid to the proper Taxing Authority all Taxes that it was required to withhold and pay and has properly completed and timely filed all information returns or reports, including IRS Forms 1099 and W-2, that are required to be filed and has, in all material respects, accurately reported all information required to be included on such returns or reports.

(d) Except as set forth on Schedule 3.18(a), there is no Tax sharing or allocation agreement, arrangement or Contract with any Person pursuant to which Seller would have liability for Taxes of another Person following the Closing. Seller (i) has not been a member of an affiliated group under Section 1504(a) of the Code or any similar group defined under a similar provision of state, local, or non-U.S. law (other than a group the common parent of which was Seller), or (ii) does not have any liability for Taxes of another Person under Section 1.1502-6 of the Treasury Regulations (or any similar provision or state, local, or non-U.S. law), as a transferee or successor, by contract, or otherwise.

(e) Seller is not and has not been a party to any “listed transaction,” as defined in Section 6707A(c)(2) of the Code and Section 1.6011-4(b)(2) of the Treasury Regulations.

(f) Except for the Seller Note, Seller will not be required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any: (A) change in method of accounting for a taxable period (or portion thereof) ending on or prior to the Closing Date; (B) “closing agreement,” as described in Code Section 7121 (or any corresponding provision of state, local, or non-U.S. income Tax law); (C) intercompany transaction, as defined in Section 1.1502-13 of the Treasury Regulations, or any excess loss account, as defined in Section 1.1502-19 of the Treasury Regulations, (or any corresponding provision of state, local or non-U.S. income Tax law); (D) installment sale or open transaction made on or prior to the Closing Date; (E) prepaid amount received on or prior to the Closing Date; or (F) election under Code Section 108(i).

(h) Seller has not been a party to, or a material adviser with respect to, a “Reportable transaction” within the meaning of Section 6707A(c)(1) of the Code and Treasury Regulations Section 1.6011-4(b).

(i) Seller has not distributed the stock of another Person, or had its stock distributed by another Person, in a transaction that was purported or intended to be governed in whole or in part by Code Section 355 or Code Section 361.

(j) Seller has never (i) had a permanent establishment in any country other than the country under the Law of which it is organized, as defined in any applicable treaty or convention between such country and the jurisdiction of the entity’s incorporation or formation or (ii) engaged in activities in any jurisdiction other than the jurisdiction under the Law of which it is organized that would subject it to taxation by such jurisdiction.

3.19 Anti-Corruption Laws. Neither Seller, nor, to knowledge of Seller or the Founder, any officers, directors, employees, agents, contractors or representatives of Seller while acting on behalf of Seller has, within the past three (3) years, directly or indirectly (i) made or attempted to make any unlawful contribution, gift, bribe, rebate, payoff, influence payment, kickback or other payment to any Person, private or public, regardless of form, whether in money, property, or services, (A) to obtain favorable treatment for business or contracts secured, (B) to pay for favorable treatment for business or contracts secured, (C) to obtain special concessions or for special concessions already obtained or (D) in material violation of any requirement of applicable Anti-Corruption Laws in each jurisdiction where Seller is conducting or has conducted business, or (ii) established or maintained any fund or asset that has not been recorded in Seller’s books and records.

(a) Schedule 3.20(a) sets forth a true and complete list setting forth the name, position, job location, salary or wage rate, commission status, date of hire, full- or part-time status, active or leave status and “exempt” or “non-exempt” status, for each employee or individual service provider of Seller as of the date hereof (including any individual absent due to short-term disability, family or medical leave, military leave or other approved absence). Seller is not party to any management, employment, consulting or other agreements or understandings with any individual providing for employment for a defined period of time or on another than “at-will” basis or for termination or severance benefits. Except as set forth on Schedule 3.20(a), as of the date hereof, all compensation, including wages, commissions, bonuses, fees and other compensation, payable to all employees, independent contractors or consultants of the Seller for services performed on or prior to the date hereof have been paid in full, and there are no outstanding agreements, understandings or commitments of the Seller with respect to any compensation, commissions, bonuses or fees.

(b) Seller is not: (i) a party to or otherwise bound by any collective bargaining or other type of union agreement, (ii) a party to, involved in or, to the knowledge of Seller and/or Founder, threatened by, any material labor dispute or material unfair labor practice charge, or (iii) currently negotiating any collective bargaining agreement, and Seller has not experienced any work stoppage during the last three years. To the knowledge of Seller and/or Founder, no organizational effort is presently being made or is currently threatened by or on behalf of any labor union with respect to any group of employees of Seller.

(c) To the knowledge of Seller, Seller has been and is in compliance in all material respects with all applicable Laws respecting employment and employment practices, terms and conditions of employment and wages and hours, unemployment insurance, worker’s compensation, equal employment opportunity, employment discrimination and immigration control. Except as disclosed on Schedule 3.20(c), there are no outstanding claims against Seller or the Benefit Plans (other than routine claims for benefits under such plans), whether under Law, regulation, Contract, policy or otherwise, asserted by or on behalf of any present or former employee or job applicant of Seller on account of or for (i) overtime pay, other than overtime pay for work done in the current payroll period, (ii) wages or salary for a period other than the current payroll period, (iii) any amount of vacation pay (including paid time off) or pay in lieu of vacation time off (including paid time off), other than vacation time off or pay (including paid time off) in lieu thereof earned in or in respect of the current fiscal year, (iv) any amount of severance pay or similar benefits, (v) unemployment insurance benefits, (vi) workers’ compensation or disability benefits, (vii) any violation of any statute, ordinance, order, rule or regulation relating to employment terminations, layoffs, or discipline, (viii) any violation of any statute, ordinance, order, rule or regulation relating to employee “whistleblower” or “right-to-know” rights and protections, (ix) any violation of any statute, ordinance, order, rule or regulations relating to the employment obligations of federal contractors or subcontractors, (x) any violation of any regulation relating to minimum wages or maximum hours of work, or (xi) unfair labor practices, and neither Seller nor Founder is aware of any such claims which have not been asserted. No Person (including any Authority) has asserted or threatened in writing any claims against Seller or any of its predecessors under or arising out of any regulation relating to equal opportunity employment, discrimination, harassment, or occupational safety in employment or employment practices, and there are no claims against the Seller pending or, to Seller’s knowledge threatened in writing to be brought or filed, by or with any Authority or arbitrator in connection with the employment of any current or former applicant, employee, consultant or independent contractor of the Seller.

(d) With respect to each current employee of the Seller, such employee is either a United States citizen or has a current and valid work visa or otherwise has the lawful right to work in the United States and the Seller has in its files a Form I-9 that, to the Seller’s knowledge, was completed in accordance with applicable Law for each employee from whom such form is required under applicable Law. There is no pending or threatened investigation by any branch or department of the U.S. Immigration and Customs Enforcement, or other federal agency charged with administration and enforcement of federal immigration laws.

(e) Seller has properly classified all employees, leased employees, consultants, independent contractors or any other Persons providing services to Seller for all purposes (including, without limitation, for all Tax purposes and for purposes related to eligibility to participate in or accrue a benefit under the Benefit Plans) and has withheld and paid all applicable Taxes and made all appropriate filings in connection with services provided by such Persons to Seller. Seller has properly classified all employees as “exempt” or “non-exempt” under the Fair Labor Standards Act and similar state or local Law.

(f) Seller has not conducted any mass layoffs or plant closings as defined by the Worker Adjustment and Retraining Notification Act of 1988, as amended, or any similar state or local Law.

(g) Seller has materially complied with all required safety measures pursuant to applicable Laws, with respect to all employees, visitors, vendors and customers.

3.21 Transactions with Related Parties. Except as described in Schedule 3.21, no stockholder, officer or director of Seller, nor any Affiliate of any such Person, has or had:

(a) any contractual or other claims, express or implied, of any kind whatsoever against Seller;

(d) engaged in any other material transaction with Seller (other than employment relationships at the salaries disclosed in the Schedules).

Except as described in Schedule 3.21, no stockholder, officer or director of Seller, nor any Affiliate of such Person, has outstanding any loan, guarantee or other obligation of borrowed money made to or from Seller.

(a) Seller maintains, with financially sound and reputable insurers, insurance with respect to its properties and Business against loss or damages of the kinds customarily insured against by companies of established reputation engaged in the same or similar businesses as Seller (including potential losses or damages resulting from the use of Seller’s products in the transportation of Hazardous Substances), in such amounts that are commercially reasonable and customarily carried under similar circumstances by such other companies.

(b) Schedule 3.22(b)(i) contains a complete and correct list of all policies and Contracts for insurance (including coverage amounts and expiration dates) of which Seller is the owner, insured or beneficiary, or covering Seller’s properties or assets. All such policies are outstanding and in full force and effect. To the knowledge of Seller, Seller is not in default with respect to any provision contained in any such policy, nor has Seller failed to give any notice or present any claim under any such policy in a timely fashion or in the manner or detail required by the policy. Except as set forth on Schedule 3.22(b)(ii): (a) all of such coverages are provided on a “claims made” (as opposed to “occurrence”) basis; (b) there are no outstanding claims under such policies; (c) there are no premiums or claims due under such policies which remain unpaid; (d) no notice of cancellation or non-renewal with respect to, or disallowance (other than reservation of rights by the insurer) of any material claim under, any such policy has been received; and (e) Seller has not been refused any insurance, nor have any of its coverages been limited by any insurance carrier to which it has applied for insurance or with which it has carried insurance.

3.23 Brokers. Except as set forth on Schedule 3.23, neither Seller nor Founder has retained, nor is Seller nor Founder obligated for any commission, fee or expense to, any broker, finder or investment banking firm to act on their behalf in connection with the transactions contemplated by this Agreement or the Ancillary Agreements and, to the knowledge of the Seller, no other Person is entitled to receive any brokerage commission, finder’s fee or other similar compensation in connection with the transactions contemplated by this Agreement and the Ancillary Agreements.

3.24 Relationship with Significant Customers. Neither Seller nor Founder has received any written communication or notice from any Significant Customer stating that, or otherwise has any reason the believe that, any Significant Customer (a) has ceased, or will cease, to use the products or services of Seller, (b) has substantially reduced, or will substantially reduce, the use of such products or services at any time, or (c) will otherwise materially and adversely modify its business relationship with Seller (whether as a result of the consummation of the transactions contemplated hereby or otherwise). No top ten (10) Significant Customer both (x) has delivered, within thirty (30) days prior to the Closing Date, any oral communication or notice to Seller or Founder stating that such Significant Customer (i) intends to cease the use of products or services of Seller or (ii) intends or desires to materially and adversely modify the pricing terms of the products or services it receives from Seller and (y) will cease to use, or materially and adversely modify the pricing terms of, the products or services it receives from Seller within six (6) months after the Closing Date. “Significant Customer” means the top twenty (20) customers of Seller, by dollar volume of sales, for the nine (9)-month period ended on September 30, 2021 and for the fiscal year ended December 31, 2020, as set forth on Schedule 3.24.

3.25 Relationship with Significant Suppliers and Vendors. Neither Seller nor Founder has received any written communication or notice from any Significant Supplier or Vendor stating that, or otherwise has any reason the believe that, any Significant Supplier or Vendor (a) has ceased, or will cease, to provide products or services to Seller, (b) has substantially reduced, or will substantially reduce, the supply of such products or services at any time, or (c) will otherwise materially and adversely modify its business relationship with Seller (whether as a result of the consummation of the transactions contemplated hereby or otherwise). “Significant Supplier or Vendor” means the top twenty (20) suppliers and vendors of Seller, by dollar volume of sales, for the nine (9) month period ended on September 30, 2021 and for the fiscal year ended December 31, 2020, as set forth on Schedule 3.25. FedEx Corporate Services Inc. (“FedEx”) both (x) has not delivered, within thirty (30) days prior to the Closing Date, oral communication or notice to either Seller or Founder that FedEx (i) intends to cease the use of products or services of Seller or (ii) intends or desires to materially and adversely modify the pricing terms of the products or services it receives from Seller and (y) will not cease to use, or materially and adversely modify the pricing terms of, the products or services it receives from Seller within six (6) months of the Closing Date.

Buyer and Parent, jointly and severally, represent and warrant to Seller as follows:

(a) Buyer is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business as it is now being conducted, and to execute, deliver, and perform this Agreement and each Ancillary Agreement to which it is a party, and to consummate the transactions contemplated hereby and thereby.

(b) Parent is a corporation duly organized, validly existing, and in good standing under the laws of the State of Nevada and has all requisite corporate power and authority to carry on its business as it is now being conducted, and to execute, deliver, and perform this Agreement and each Ancillary Agreement to which it is a party, and to consummate the transactions contemplated hereby and thereby.

4.2 Authority. The execution, delivery, and performance by Buyer and Parent of this Agreement and each Ancillary Agreement to which each of Buyer and/or Parent is a party, and the consummation by Buyer and Parent of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of Buyer and Parent. This Agreement has been, and each Ancillary Agreement to which Buyer and Parent is a party will be at Closing duly and validly executed and delivered by Buyer and Parent, as applicable, and constitutes, or will constitute, the valid and binding obligation of Buyer and Parent, as applicable, enforceable against such entity in accordance with its respective terms, except as such enforcement shall be limited by bankruptcy, insolvency, moratorium or similar law affecting creditors’ rights generally and subject to general principles of equity.

4.3 No Conflict. The execution, delivery, and performance by Buyer and Parent of this Agreement and each Ancillary Agreement to which Buyer and Parent is a party, and the consummation by Buyer and Parent of the transactions contemplated hereby and thereby, does not and will not, with or without the giving of notice or the lapse of time, or both, (i) violate any provision of Law to which Buyer or Parent is subject, (ii) violate any provision of the certificate of incorporation or bylaws of Buyer or Parent, or (iii) violate or result in a breach of or constitute a default (or an event which might, with the passage of time or the giving of notice, or both, constitute a default) under, or require the consent of any third party under, or result in or permit the termination or amendment of any provision of, or result in or permit the acceleration of the maturity or cancellation of performance of any obligation under, or result in the creation or imposition of any Encumbrance of any nature whatsoever upon any assets or property or give to others any interests or rights therein under any indenture, deed of trust, mortgage, loan or credit agreement, license, Permit, Contract, lease, or other agreement, instrument or commitment to which Buyer or Parent is a party or by which either may be bound or affected; except, in each case, for violations, breaches, defaults, required consents, terminations, accelerations, Encumbrances or rights that in the aggregate would not materially hinder or impair the ability of Buyer or Parent to perform its obligations hereunder or the consummation of the transactions contemplated hereby.

4.4 Consents. No consent, approval, or authorization of, or exemption by, or filing with, any Authority is required to be obtained or made by Buyer in connection with the execution, delivery and performance by Buyer of this Agreement or any Ancillary Agreement to which Buyer is a party or the taking by Buyer of any other action contemplated hereby or thereby.

4.5 Brokers. Except as set forth on Schedule 4.5, neither Buyer nor Parent has retained any broker, finder or investment banking firm to act on its behalf in connection with the transactions contemplated by this Agreement.

4.6 Sufficiency of Funds; Ability to Satisfy Obligations. Buyer has sufficient cash, available lines of credit or other sources of available funds to: (i) enable it to make payment of the Cash Consideration; (ii) satisfy its obligations under the Seller Note; and (iii) operate the Business following the Closing in a manner consistent with Seller’s past practices. Parent has sufficient cash, available lines of credit or other sources of available funds to satisfy its obligations under the Guaranteed Obligations.

5.1 Name Change. Immediately after Closing, Seller will change its legal name to a name reasonably acceptable to Buyer that is not confusingly similar to “PeriShip” or any derivation thereof. Immediately after Closing, Founder shall cause Perinsure Corporation to change its legal name to a name reasonably acceptable to Buyer that does not use the syllable “Peri-” or any derivation thereof.

5.2 Confidentiality. From and after the date of this Agreement, Seller shall keep confidential and not disclose to any other Person or use for its own benefit or the benefit of any other Person any confidential or proprietary information, technology, know-how, trade secrets (including all results of research and development), product formulas, industrial designs, franchises, inventions or other intellectual property regarding Seller or the Business (“Confidential Information”) in its possession or control. The obligations of Seller under this Section 5.1 shall not apply to Confidential Information which (i) is or becomes generally available to the public without breach of the commitment provided for in this Section; or (ii) is required to be disclosed by Law; provided, however, that, in any such case, Seller shall notify Buyer as early as reasonably practicable prior to disclosure to allow Buyer or Seller to take appropriate measures to preserve the confidentiality of such Confidential Information.

(a) During the period beginning on the Closing Date and ending on the fifth (5th) anniversary of the Closing Date (the “Non-Compete Period”), each of Seller and Founder covenants and agrees not to, and shall cause Seller’s and Founder’s respective Affiliates not to, directly or indirectly and anywhere in the Restricted Territory, conduct, manage, operate, engage in, have an ownership interest in any business or enterprise engaged in (i) the Business, (ii) any business that uses any trademark, trade names or slogans similar to the “PeriShip” or “PerInsure” trademarks (including any associated logos, designs or trade dress), trade names or slogans, or (iii) any activities that are otherwise similar to, or competitive with, the Business.

(b) During the Non-Compete Period, neither Seller nor Founder shall, and each shall cause Seller’s and Founder’s respective Affiliates not to, directly or indirectly, call-on, solicit or induce, or attempt to solicit or induce, any past, present or prospective customer or other business relation of Buyer or Seller for the provision of products or services related to the Business or in any other manner that would otherwise interfere with business relationships between Buyer or Seller and its customers and other business relations.

(c) During the Non-Compete Period, neither Seller nor Founder shall, and shall cause each of Seller’s and Founder’s respective Affiliates not to, directly or indirectly, call-on, solicit or induce, or attempt to solicit or induce, any employee or staff of Buyer to leave the employ of Buyer for any reason whatsoever, nor shall Seller or Founder offer or provide employment (whether such employment is for Seller, Founder or any other Person), either on a full-time basis or part-time or consulting basis, to any Person who then currently is, or who within six (6) months immediately prior thereto was, an employee of or staffed by Buyer or Seller, except that Founder may hire any non-management level employee of Buyer or Seller that is not then currently employed by Buyer and who initiates contact with Founder regarding such employment or responds to a public employment listing by Founder not specifically targeted at any employee of Buyer or Seller.

(d) Seller acknowledges and agrees that the provisions of this Section 5.3 are reasonable and necessary to protect the legitimate business interests of Buyer and its investment in the Acquired Assets. Neither Seller nor Founder shall contest that Buyer’s remedies at law for any breach or threat of breach by either Seller or Founder or any of Seller’s or Founder’s Affiliates of the provisions of this Section 5.3 will be inadequate, and that Buyer shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Section 5.3 and to enforce specifically such terms and provisions, in addition to any other remedy to which Buyer may be entitled at law or equity. The restrictive covenants contained in this Section 5.3 are covenants independent of any other provision of this Agreement or any other agreement between the parties hereunder and the existence of any claim which Seller may allege against Buyer under any other provision of the Agreement or any other agreement will not prevent the enforcement of these covenants.

(e) If any of the provisions contained in this Section 5.3 shall for any reason be held to be excessively broad as to duration, scope, activity or subject, then such provision shall be construed by limiting and reducing it, so as to be valid and enforceable to the extent compatible with the applicable Law or the determination by a court of competent jurisdiction.

5.4 Non-Disparagement. Each party agrees that it shall not, and shall cause each of its Affiliates not to, at any time, in any written or oral communications with the press or other media, any customer, client, stakeholder, investor or supplier of the other party, or its Affiliate, or any other Person, criticize, ridicule, or make or encourage any other Person to make any statement that disparages, is derogatory of, or is negative toward the personal or business reputation, conduct or practices of the other party, any of its Affiliates, or any of their then current or former respective officers, directors, employees, representatives, agents or attorneys.

(a) Buyer shall extend offers of employment (which may be for employment with Buyer or any of its affiliates) to the Offered Employees with compensation and employee benefits at least reasonably comparable to that currently being paid and provided by the Seller prior to the Closing Date, and with an annual base wage or salary at least reasonably comparable to that being paid by Seller to such Offered Employee as shown in Schedule 3.20 of the Disclosure Schedules; provided that such Offered Employees satisfy Buyer’s customary hiring standards consistent with applicable law. Buyer shall use best efforts to retain all Offered Employees who choose to be employed by Buyer for no less than six (6) months, except to the extent any such Offered Employee is terminated by Buyer for cause, poor performance, or other reasonable purposes. Seller shall provide Buyer access to its personnel records and personnel files, and shall provide such other information, regarding the Offered Employees as Buyer may reasonably request to the extent permitted by applicable Law. Effective as of immediately before the Closing, Seller shall terminate the employment of its employees who are Offered Employees. Buyer shall assume and/or become the sponsor of the Seller H&W Plans (collectively, the “Employee Obligations”). For the avoidance of doubt regarding the Sponsored Employees, the Acquired Assets and Assumed Liabilities comprise the essential rights and obligations of Seller necessary for Buyer to carry on the Business post-closing in the same manner as carried on by Seller prior to Closing. Buyer or its affiliates shall: (i) offer COBRA coverage to Seller employees who were covered under Seller H&W Plans immediately prior to the Closing Date and do not become employees of Buyer upon the Closing Date; and (ii) provide notice to any individual who was enrolled in COBRA coverage under Seller H&W Plans immediately prior to the Closing Date specifying the maximum period of COBRA coverage available to the individual through Buyer after the Closing Date (such maximum period subject to earlier termination as may be permitted under COBRA), in each case, provided that Seller has provided Buyer with information necessary for Buyer to make such offers and provide such notice.

(b) Seller shall be solely responsible for any liability, claim or expense with respect to employment, immigration status, termination of employment, compensation or employee benefits of any nature (including, but not limited to the benefits to be provided under the Benefit Plans) owed to any current or former employee, officer, director, member, partner or independent contractor of Seller (or the beneficiary of any such individual) whether or not such individual becomes an employee of Buyer, that arises out of or relates to the provision of services to or on behalf of, or the employment relationship between, Seller and any such individual or the termination of such relationship or provision of services on or before the Closing Date, including, for the avoidance of doubt, any liability, claim or expense with respect of the immigration status and related filings by Seller related to the Sponsored Employees on or before the Closing Date. Without limiting the foregoing, Seller shall be responsible for the payment of any severance payment or benefits that become due to any current or former employee, officer, director, member, partner or independent contractor as a result of the termination of such individual by Seller or the transactions contemplated by this Agreement, including, for the avoidance of doubt, any change in control bonus payments pursuant to any employee and Seller or any similar payment pursuant to any agreement existing on or before the Closing Date. Buyer or its affiliates shall be responsible for any health care continuation coverage, which shall be substantially equivalent to such coverages available from Seller to the Offered Employee immediately prior to Closing, for any Offered Employee (and their qualified beneficiaries) who terminates employment with the Buyer or such affiliate after the Closing Date.

(c) Notwithstanding anything to the contrary contained herein, Buyer shall indemnify, defend, protect and hold Seller and Founder harmless from and against any and all liabilities, including but not limited to payment of reasonable attorney’s fees or costs, whether or not prosecuted to judgment, with respect to or arising out of any claim, liability, demand, tax, penalty or other obligation of any kind or manner whatsoever regarding the Employee Obligations, employee compensation and employment matters of any kind applicable to events or alleged events that occurred subsequent to the Closing Date. Buyer shall not be liable or responsible for the payment of any salaries or the withholding for any state or federal income taxes, state disability taxes, workmen’s compensation insurance or other pay, or for the payment of any accrued salaries, bonuses, sick pay, vacation pay or fringe benefits with respect to such employees for services performed on or before the Closing Date.

(d) The provisions of this Section 5.5 are for the benefit of the parties to this Agreement only and shall not be construed to grant any rights, as a third party beneficiary or otherwise, to any person who is not a party to this Agreement, nor shall any provision of this Agreement be deemed to be the adoption of, or an amendment to, any employee benefit plan, as that term is defined in Section 3(3) of ERISA, or otherwise to limit the right of Buyer or Seller to amend, modify or terminate any such employee benefit plan. In addition, nothing contained herein shall be construed to (i) prohibit any amendments to or termination of any employee benefit plans or (ii) prohibit the termination or change in terms of employment of any employee (including any Offered Employee). Nothing herein, expressed or implied, shall confer upon any employee (including any Offered Employee) any rights or remedies (including, without limitation, any right to employment or continued employment for any specified period) of any nature or kind whatsoever, under or by reason of this Agreement.

(e) Buyer shall not take or cause to be taken any action within the ninety (90) days after the Closing that could result in liability under the Worker Adjustment and Retraining Notification Act, 29 U.S.C. Chapter 23 (the “WARN Act”).

5.6 Further Assurances. From time to time after the Closing, Buyer shall, at the request of Seller, execute and deliver any further instruments or documents and take all such further action as Seller may reasonably request in order to evidence the consummation of the transactions contemplated hereby. From time to time after the Closing, Seller shall, at the request of Buyer, execute and deliver any further instruments or documents and take all such further action as Buyer may reasonably request in order to evidence the consummation of the transactions contemplated hereby.

5.7 Preparation of Audited Financial Statements. From and after the Closing Date, Seller and Founder shall each (a) reasonably cooperate with and assist Buyer in preparation of the audited balance sheets, statements of income, Members’ capital, and cash flows of Seller as of and for the fiscal year ended December 31, 2021, in each case prepared in accordance with GAAP (the “2021 Audited Company Financial Statements”), to be prepared as promptly as reasonably practicable, such that Buyer will be able to comply with its filing obligations under the Securities Exchange Act of 1934 (the “Securities Act”) with respect to the 2021 Audited Company Financial Statements and (b) cause the Seller’s external auditors to furnish any consents required under the Securities Act with respect to the 2021 Audited Company Financial Statements and the Financial Statements, in connection with Buyer’s filings with the Securities Exchange Commission.

5.8 Benefit Plan Transition. The Parties acknowledge that after the Closing Date, the claims administrator for the Seller H&W Plans may invoice Buyer for claims that constitute Retained Liabilities (e.g., a claim incurred on or prior to the Closing Date). The Buyer may, in its sole discretion, pay any or all such claims, and, if it does, Buyer shall notify Seller of the amount of each such claim paid at reasonable intervals, and Seller shall promptly reimburse Buyer for the amount of each such claim paid, subject to the H&W Cap. For the avoidance of doubt, Seller shall not be liable to Buyer for any amount in connection with any claim under the Seller H&W Plans to the extent such claim was already accounted for in the calculation of Final Indebtedness or on the books and records of Seller as of the Closing Date.

5.9 Qualified Retirement Plans. Seller shall take all commercially reasonable action necessary action to permit the rollover of the account balances of all Offered Employees that accept employment with Buyer under the 401(k) Plan to the Buyer’s 401(k) plan, including any participant loan promissory notes. Assuming loan rollovers into the Buyer’s 401(k) plan are permitted under the terms of such plan, with respect to the rollover of participant loans, Seller will take such actions as are reasonably necessary to (i) confirm that such loans will not default as a result of the transaction, the termination of the 401(k) Plan or the termination of employment by participants in connection with the transaction, and (ii) confirm that loan payments will be accepted by the 401(k) Plan following Closing pending a rollover to the Buyer’s 401(k) plan, and Seller and Buyer will accommodate the loan rollover process for loans which, as of the date of the rollover, are not in default; provided, however, that any such rollover shall be subject to such administrative rules and procedures as may be mutually agreeable, the terms of the plans, and receipt of a timely participant election.

5.10 Parent Guarantee. Parent hereby irrevocably, absolutely and unconditionally guarantees to each of the Seller and Founder, as a primary obligor, the due and punctual payment and performance by Buyer of all of Buyer’s obligations under this Agreement, including, without limitation, in payment of the Cash Consideration, Stock Consideration and Seller’s Note pursuant to Section 1.2 hereof in accordance with the terms and conditions of this Agreement and the Ancillary Agreements (the “Guaranteed Obligations”). Should Buyer default in the ‎discharge or performance of all or any portion of the Guaranteed Obligations, the obligations of Parent hereunder shall become immediately due. This guarantee shall remain in full force and effect pursuant to, and in accordance with, this Agreement. Parent acknowledges that its obligations under this Section 5.10 shall not be released or discharged in whole or in part by the insolvency, bankruptcy, liquidation, termination, dissolution, merger, consolidation or other business combination of Buyer.

5.11 Stockholder Solicitation. For so long as Seller, Founder or any of their respective Affiliates, heirs, successors or assigns, owns any interest in Parent, none of Seller, Founder or any of their respective Affiliates, heirs, successors or assigns shall, and each shall cause their Affiliates not to: (a) directly or indirectly initiate, solicit, seek, knowingly encourage, or knowingly facilitate the making of, any submission or announcement of a matter or proposal (a “Proposal”) at a meeting of Parent’s stockholders, or that constitutes, or could reasonably be expected to lead to, any Proposal, (b) solicit proxies with respect to a Proposal, or (c) initiate a stockholders' vote or action by written consent of Parent’s stockholders with respect to a Proposal, unless and until such Proposal has been recommended for stockholder approval by Parent’s board of directors. Nothing in this provision shall limit any right Seller or Founder have, if applicable, from voting on proposals or matters properly brought before the stockholders of the Parent at an annual or special meeting of the stockholders.

6.1 Allocation. Within sixty (60) days after the determination of Final Indebtedness and Final Transaction Expenses pursuant to Section 1.3, Buyer shall prepare and deliver to Seller the allocation (“Allocation”) of the Final Closing Consideration among the Acquired Assets sold by Seller (and the non-competition agreement described in Section 5.3) in a manner that is consistent with the principles set forth on Schedule 6.1. If Seller notifies Buyer in writing within ten (10) days of receipt that Seller objects to one or more items reflected in the Allocation, Buyer and Seller shall negotiate in good faith to resolve such dispute within thirty (30) days thereafter; if Seller does not respond within ten (10) days of receipt, the Allocation as proposed by Buyer shall be deemed approved. If Buyer and Seller are unable to reach final agreement as to the Allocations, any disputed item shall be resolved using the process set forth in Section 1.1(d). If, however, Buyer and Seller reach final agreement as to the Allocation, Buyer, Seller and Shareholder agree to report, as and when required, the Allocation among the Acquired Assets in a manner consistent with such Allocation in the preparation and filing of all Tax Returns (including IRS Form 8594). Notwithstanding the foregoing, Buyer hereby acknowledges receipt of Seller’s proposed Allocation and agrees that should Buyer’s proposed Allocation provided in accordance with this Section 6.1 differ from Seller’s proposed Allocation, Seller shall be deemed to have validly objected to Buyer’s proposed Allocation without the need for additional written notice.

6.2 Transfer Taxes. Sales taxes, transfer taxes, stamp taxes, conveyance taxes, intangible taxes, documentary recording taxes, license and registration fees, recording fees and any similar taxes or fees imposed by any Authority, if any, imposed upon the transfer of the Acquired Assets hereunder and the filing of any instruments (the “Transfer Taxes”) shall be borne by Seller. Buyer and Seller shall cooperate with each other in any mutually agreeable, reasonable and lawful arrangement designed to minimize any applicable Transfer Taxes.

6.3 Wage Reporting. Buyer and Seller agree to utilize the standard procedure set forth in Revenue Procedure 2004-53 with respect to wage reporting.

6.4 Cooperation on Tax Matters. Buyer, Seller, and Founder agree to furnish or cause to be furnished to each other, upon request, as promptly as is practicable, such information and assistance relating to Seller and the Acquired Assets (including without limitation access to books and records) as is reasonably necessary for the filing of all Tax Returns, the making of any election relating to Taxes, the preparation for any audit by any Taxing Authority, and the prosecution or defense of any claim, suit or proceeding relating to any Tax. Buyer and Seller shall retain all books and records with respect to Taxes for any period up to and including the Closing Date, pertaining to Seller and the Acquired Assets, for at least seven (7) years following the Closing Date. At the end of such period, each party shall provide the others with at least thirty (30) days prior written notice before destroying such books and records, during which period the party receiving such notice can elect to take possession, at its own expense, of such books and records.

7.1 Survival. The covenants and agreements in this Agreement or in any Ancillary Agreement shall survive the Closing. The representations and warranties under this Agreement or in any Ancillary Agreement shall survive until date that is fifteen (15) months following the Closing Date; provided, however, that (i) the representations and warranties set forth in Section 3.1 (Organization), Section 3.2 (Authority), Section 3.4 (Capitalization; Title to Membership Interests), Section 3.5 (Subsidiaries), Section 3.8(a) (Title, Condition and Sufficiency of Assets) with respect to matters related to title only, Section 3.23 (Brokers), Section 4.1 (Organization), Section 4.2 (Authority), and Section 4.5 (Brokers) (collectively, the “Fundamental Representations”), shall survive the Closing without limitation; and (ii) the representations and warranties set forth in Section 3.16 (Environmental Matters), Section 3.17 (Employee Benefits Matters), and Section 3.18 (Taxes) shall survive the Closing for the full period of all applicable statutes of limitations (giving effect to any waiver, mitigation or extension thereof) plus sixty (60) days; provided, however, that if there is no statute of limitations applicable to the subject matter of a given Section, then the representations and warranties of such Section shall survive a period of five (5) years. No action or claim for Losses resulting from any misrepresentation or breach of warranty shall be brought or made after the expiration of the survival period applicable to such representation or warranty (as provided in this Section), except that such time limitation shall not apply to claims which have been asserted and which are the subject of a written notice from Seller to Buyer or from Buyer to Seller, as may be applicable, prior to the expiration of such survival period.

(a) Subject to the limitations in Section 7.2(c) and Section 7.6, the Seller and Founder shall, jointly and severally, indemnify, defend and hold harmless Buyer and its directors, officers, Affiliates, employees, agents and representatives, from and against all Losses that are incurred or suffered by any of them in connection with or resulting from each of the following:

(i) any misrepresentation or breach of, or inaccuracy in, any representation or warranty made by Seller or Founder in this Agreement or any Ancillary Agreement;

(ii) any breach of any covenant made by Seller or Founder in this Agreement or any Ancillary Agreement;

(b) Subject to the limitations in Section 7.2(c), Buyer shall indemnify, defend and hold harmless the Seller and Seller’s officers, Affiliates, employees, agents and representatives and Founder and Founder’s heirs, successors and assigns from and against all Losses that are incurred or suffered by any of them in connection with or resulting from each of the following:

(i) any misrepresentation or breach of, or inaccuracy in, any representation or warranty made by Buyer in this Agreement or any Ancillary Agreement;

(ii) any breach of any covenant made by Buyer in this Agreement or any Ancillary Agreement; or

(iii) any Assumed Liability; provided that there shall be no indemnification under this Section 7.2(b) for any Losses against which Buyer is entitled to indemnification pursuant to Section 7.2(a).

(c) Notwithstanding the foregoing and subject to the proviso at the end of this paragraph and the terms of this Article VII, (i) Seller shall not be obligated to provide any indemnification for Losses pursuant to claims (other than Third Party Claims) for breaches of representations and warranties (other than Fundamental Representations) under Section 7.2(a)(i) unless the aggregate amount of Losses incurred by Buyer with respect to such breaches of representations and warranties exceeds $100,000 (the “Basket”), in which case Seller will be liable for all Losses in excess of the Basket, and (ii) Buyer shall not be obligated to provide any such indemnification for Losses pursuant to claims (other than Third Party Claims) for breaches of representations and warranties (other than Fundamental Representations) under Section 7.2(b)(i), unless the aggregate amount of Losses incurred by Seller with respect to such breaches of representations and warranties exceeds the Basket, in which case Buyer will be liable for all Losses in excess of the Basket. Subject to Section 7.8, the maximum aggregate obligation of (i) Seller and Founder for Losses pursuant to claims for breaches of representations and warranties (other than Fundamental Representations) under Section 7.2(a)(i), and (ii) Buyer for Losses pursuant to claims for breaches of representations and warranties (other than Fundamental Representations) under Section 7.2(b)(i), shall not exceed $1,500,000 (the “Cap”). Neither the Basket nor the Cap shall apply to Losses arising in respect of claims for misrepresentations and breach of the Fundamental Representations.

(d) In no event shall the limitations set forth in Section 7.2(c) apply to Losses suffered or incurred by any Indemnified Party as a result of or arising out of, (A) the matters set forth in Sections 7.2(a)(ii) through 7.2(a)(v), or 7.2(b)(ii) or 7.2(b)(iii), or (B) any fraud or intentional misrepresentation by a party. Notwithstanding the foregoing, the covenants of Seller and Founder set forth in Section 5.5(a) are expressly excluded from the de-limitation as to Section 7.2(a)(ii). For the avoidance of doubt, the parties acknowledge and agree that the limitations set forth in Section 7.2(c) shall apply with respect to the covenants set forth in Section 5.5(a).

(e) For purposes of calculating the amount of any Losses incurred in connection with any such misrepresentation or breach of warranty, any and all references to material or Material Adverse Effect (or other correlative terms) shall be disregarded.

(a) A party entitled to indemnification hereunder shall herein be referred to as an “Indemnified Party”. A party obligated to indemnify an Indemnified Party hereunder shall herein be referred to as an “Indemnifying Party”. Subject to the applicable survival periods set forth above, as soon as is reasonable after an Indemnified Party either (i) receives notice of any claim or the commencement of any action by any third party which such Indemnified Party reasonably believes may give rise to a claim for indemnification from an Indemnifying Party hereunder (a “Third Party Claim”) or (ii) sustains any Loss not involving a Third Party Claim or action which such Indemnified Party reasonably believes may give rise to a claim for indemnification from an Indemnifying Party hereunder, such Indemnified Party shall, if a claim in respect thereof is to be made against an Indemnifying Party under this Article VII, notify such Indemnifying Party in writing of such claim, action or Loss, as the case may be; provided, however, that failure to notify such Indemnifying Party shall not relieve such Indemnifying Party of its indemnity obligation, except to the extent such Indemnifying Party is actually prejudiced in its defense of the action by such failure. Any such notification must be in writing and must state in reasonable detail the nature and basis of the claim, action or Loss, to the extent known. The Indemnifying Party shall have the right to retain counsel acceptable to the Indemnified Party, to contest, defend, litigate or settle any such Third Party Claim which involves (and continues to involve) solely monetary damages; provided that the Indemnifying Party shall have notified the Indemnified Party in writing of its intention to do so within thirty (30) days of the Indemnified Party having given notice of the Third Party Claim to the Indemnifying Party. The Indemnified Party shall have the right to participate in, and to be represented by counsel (at its own expense) in any such contest, defense, litigation or settlement conducted by the Indemnifying Party.

(b) The Indemnifying Party, if it shall have assumed the defense of any Third Party Claim as provided in this Agreement, shall not consent to the entry of any judgment whereby there is a requirement of the Indemnified Party to make monetary payment arising from, any such Third Party Claim without the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld, conditioned or delayed), unless the Indemnified Party shall receive a full release of claims as part of such judgement. The Indemnifying Party shall not, without the prior written consent of the Indemnified Party, enter into any compromise or settlement which commits the Indemnified Party to take, or to forbear to take, any action or which does not provide for a complete release by such third party of the Indemnified Party. The Indemnified Party shall have the sole and exclusive right to settle any Third Party Claim, on such terms and conditions as it deems reasonably appropriate, to the extent such Third Party Claim involves equitable or other non-monetary relief. All expenses (including reasonable attorneys’ fees) incurred by the Indemnifying Party directly related to the foregoing shall be paid by the Indemnifying Party. No failure by an Indemnifying Party to acknowledge in writing its indemnification obligations under this Article VII shall relieve it of such obligations to the extent such obligations exist.

(c) If an Indemnified Party is entitled to indemnification against a Third Party Claim, and the Indemnifying Party fails to accept a tender of, or assume the defense of, a Third Party Claim pursuant to this Section 7.3, the Indemnifying Party shall not be entitled, and shall lose its right, to contest, defend, litigate and settle such a Third Party Claim, and the Indemnified Party shall have the right, without prejudice to its right of indemnification hereunder, in its discretion exercised in good faith, to contest, defend and litigate such Third Party Claim, and may settle such Third Party Claim either before or after the initiation of litigation, at such time and upon such terms as the Indemnified Party deems fair and reasonable, provided that at least ten (10) days prior to any such settlement, written notice of its intention to settle is given to the Indemnifying Party.

(a) Any Indemnified Party shall mitigate Losses relating to a claim under this Article VII to the extent required by Law.

(b) All Losses sought by Indemnified Party hereunder shall be net of any insurance proceeds actually received by Indemnified Party with respect to such indemnification claim (net of any increase or retroactive premiums and costs of recovery). If any such proceeds are received by an Indemnified Party (or any of its Affiliates) with respect to any Losses after an Indemnifying Party has made a payment to the Indemnified Party with respect thereto, the Indemnified Party (or such Affiliate) shall promptly pay to the Indemnifying Party the amount of such proceeds, benefits or recoveries (up to the amount of the Indemnifying Party’s payment).

7.5 Right of Offset. Without limiting any other remedies available at law or in equity, Buyer shall have the right to set off (the “Set Off Right”) against any payments due and owing from Buyer to Seller, including any principal and interest amounts due under the Seller’s Note, to the extent Buyer has suffered a Loss and has made a good faith claim for indemnity against Seller under this Article VII, provided, however, that at the time of the exercise of any Set Off Right, Buyer shall make a payment equal to the payment otherwise payable to the Seller to the clients’ fund account of the attorney of Buyer until an order or judgment is rendered by a court of competent jurisdiction or such claim is resolved by the written agreement of Buyer and the Seller.

7.6 Tax Treatment. Any indemnification payments under this Article VII shall be treated for Tax purposes as adjustments to the Final Closing Consideration to the extent permitted by applicable Law.

7.7 Release. Except for in connection with (a) amounts due to Seller in connection with the Seller’s Note; and (b) any obligations of Buyer arising under or in connection with this Agreement, each of Seller and Founder hereby releases and forever discharges Buyer and its individual, joint or mutual, past, present and future Representatives, successors and assigns (individually, a “Releasee” and collectively, “Releasees”) from any and all claims, demands, Proceedings, of any kind, causes of action and Judgments that Seller now has, has ever had or may hereafter have against the respective Releasees, and from any and all obligations, contracts, debts, liabilities and obligations in connection with the Acquired Assets or Assumed Liabilities that any Releasee now has, has ever had or may hereafter have in favor of Seller, in each case of any nature (whether absolute or contingent, asserted or unasserted, known or unknown, primary or secondary, direct or indirect, and whether or not accrued) arising contemporaneously with or before the Closing or on account of or arising out of any matter, cause or event occurring contemporaneously with or before the Closing, including any rights to indemnification or reimbursement from Seller, whether pursuant to their respective certificate of incorporation or bylaws (or comparable documents), contract or otherwise and whether or not relating to claims pending on, or asserted after, the Closing Date.

7.8 Exclusive Remedy and Source of Indemnification. Notwithstanding anything to the contrary contained herein, with the exception of claims based upon fraud, the indemnification remedies and other remedies provided in this Article VII shall be the sole and exclusive remedies any party hereto may have for breaches of this Agreement (including any covenant, obligation, representation or warranty contained in this Agreement) and for all causes of action in respect of the consummation of the transactions contemplated hereby, including without limitation claims arising in contract, tort or any other manner, and, further, the Set Off Right shall be the sole and exclusive source of recovery of Losses of Buyer and Parent from Seller and Founder for (a) indemnification pursuant to Section 7.2(a)(i) (other than Fundamental Representations) and (b) the covenants of Seller and Founder set forth in Section 5.5(a).

(a) Whenever used in this Agreement, (i) “including” (or any variation thereof) means including without limitation and (ii) any reference to gender shall include all genders.

(b) The parties acknowledge and agree that (i) each party and its counsel have reviewed the terms and provisions of this Agreement and have contributed to its drafting, (ii) the normal rule of construction, to the effect that any ambiguities are resolved against the drafting party, shall not be employed in the interpretation of it, and (iii) the terms and provisions of this Agreement shall be construed fairly as to all parties hereto and not in favor of or against any party, regardless of which party was generally responsible for the preparation of this Agreement.

8.2 Entire Agreement. This Agreement (including the Schedules and the exhibits attached hereto) together with the Ancillary Agreements constitute the sole understanding and agreement of the parties with respect to the subject matter hereof. The parties agree and acknowledge that as of the Closing Date, the Non-Binding Indication of Interest letter, dated February 3, 2022, by and among Buyer, Seller and Founder is terminated.

8.3 Successors and Assigns. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties hereto; provided however, that this Agreement may not be assigned by Seller without the prior written consent of Buyer or be assigned by Buyer without the prior written consent of Seller, except that (i) Buyer may, at its election and provided it remains liable for its obligations hereunder, assign this Agreement to any Affiliate of Buyer, and Buyer or any such assignee may make a collateral assignment of its rights (but not its obligations) under this Agreement to any lender providing financing to Buyer in connection with the Closing.

8.4 Headings. The headings of the Articles, Sections, and paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction hereof.

8.5 Modification and Waiver. No amendment, modification, or alteration of the terms or provisions of this Agreement shall be binding unless the same shall be in writing and duly executed by the parties hereto, except that any of the terms or provisions of this Agreement may be waived in writing at any time by the party that is entitled to the benefits of such waived terms or provisions. No single waiver of any of the provisions of this Agreement shall be deemed to or shall constitute, absent an express statement otherwise, a continuous waiver of such provision or a waiver of any other provision hereof (whether or not similar). No delay on the part of any party in exercising any right, power, or privilege hereunder shall operate as a waiver thereof.

8.6 Expenses. Except as otherwise expressly provided herein, each of the parties hereto shall bear the expenses incurred by that party incident to this Agreement and the transactions contemplated hereby, including all fees and disbursements of counsel and accountants retained by such party, whether or not the transactions contemplated hereby shall be consummated.

8.7 Notices. Any notice, request, instruction, or other document to be given hereunder by any party hereto to any other party shall be in writing and shall be given by delivery in person, by electronic mail, by electronic facsimile transmission, by overnight courier or by registered or certified mail, postage prepaid (and shall be deemed given when delivered if delivered by hand, when delivered if delivered by electronic mail, when transmission confirmation is received if delivered by facsimile during normal business hours, one Business Day after deposited with an overnight courier service if delivered by overnight courier and three days after mailing if mailed), as follows:

Green & Sklarz LLC
One Audubon Street
New Haven, CT 06511
Attn: Mark G. Sklarz
Email: [__________________]

Harter Secrest & Emery LLP
1600 Bausch & Lomb Place
Rochester, New York 14604
Attention: Alexander R. McClean, Esq.
Email: [__________________]

8.8 Governing Law; Consent to Jurisdiction. This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware applicable to agreements made and to be performed wholly within that jurisdiction. Each party hereto, for itself and its successors and assigns, irrevocably agrees that any suit, action or proceeding arising out of or relating to this Agreement may be instituted only in the Chancery Court of the State of Delaware or in the absence of jurisdiction, any federal court sitting in the State of Delaware, and generally and unconditionally accepts and irrevocably submits to the exclusive jurisdiction of the aforesaid courts and irrevocably agrees to be bound by any final judgment rendered thereby from which no appeal has been taken or is available in connection with this Agreement. Each party, for itself and its successors and assigns, irrevocably waives any objection it may have now or hereafter to the laying of the venue of any such suit, action or proceeding, including any objection based on the grounds of forum non conveniens, in the aforesaid courts. Each of the parties, for itself and its successors and assigns, irrevocably agrees that all process in any such proceedings in any such court may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to it at its address set forth in Section 8.7 or at such other address of which the other parties shall have been notified in accordance with the provisions of Section 8.7, such service being hereby acknowledged by the parties to be effective and binding service in every respect. Nothing herein shall affect the right to serve process in any other manner permitted by law.

8.9 Public Announcements. Neither Seller nor Buyer shall make any public statements, including any press releases, with respect to this Agreement and the transactions contemplated hereby without the prior written consent of the other party (which consent shall not be unreasonably withheld) except as may be required by Law. If a public statement is required to be made by Law, the parties shall consult with each other in advance as to the contents and timing thereof.

8.10 No Third Party Beneficiaries. This Agreement is intended and agreed to be solely for the benefit of the parties hereto and their permitted successors and assigns, and no other party shall be entitled to rely on this Agreement or accrue any benefit, claim, or right of any kind whatsoever pursuant to, under, by, or through this Agreement.

8.11 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original and all of which shall constitute the same instrument.

8.12 Delivery by Facsimile and Email. This Agreement and any amendments hereto, to the extent signed and delivered by means of a facsimile machine or by electronic mail, shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. No party hereto shall raise the use of a facsimile machine or electronic mail to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of a facsimile machine or electronic mail as a defense to the formation or enforceability of this Agreement and each such party forever waives any such defense.

“Accounting Methods” means the principles, practices, methodologies and procedures, classifications, assumptions, estimation techniques, and judgments used in connection with the preparation of the Financial Statements, so long as such principles, practices, methodologies and procedures are in compliance with the income tax basis of accounting.

“Affiliate” means, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such first Person.

“Ancillary Agreement” means any agreement, exhibit, schedule, statement, document or certificate executed or delivered in accordance with, in connection with or required by this Agreement, and any other agreement or certificate specifically identified as an Ancillary Agreement for purposes of this Agreement. Notwithstanding the foregoing, those certain employment agreements by and between Curt Kole, Jack Wang and Fred G. Volk, III and Buyer shall not be deemed Ancillary Agreements.

“Anti-Corruption Laws” means (i) the U.S. Foreign Corrupt Practices Act, as amended from time to time, and other similar Laws, (ii) the applicable Laws administered by the U.S. Department of the Treasury, Office of Foreign Assets Control and (iii) all applicable anti-money-laundering, anti-kickback and anti-corruption Laws of any jurisdiction (whether within or outside the United States), including any Law that prohibits or restricts corrupt payments to (A) any director, officer, employee, agent or representative (including anyone elected, nominated, or appointed to be an officer, employee, or representative) of any Governmental Authority, or anyone otherwise acting in an official capacity on behalf of a Governmental Authority; (B) any candidate for public or political office; (C) any royal or ruling family member; or (D) any agent or representative of any of those persons listed in foregoing subcategories (A) through (C).

“Authority” means the United States of America or any other nation, any state or other political subdivision thereof, or any entity, agency, court or authority (foreign, federal, state or local) exercising executive, legislative, judicial, regulatory or administrative functions of government or any arbitrator or mediator.

“Balance Sheet” means the balance sheet of Seller as of the Balance Sheet Date, as set forth in the Financial Statements.

“Base Amount” means the cash value of (a) the Cash Consideration, plus (b) the principal amount of the Seller’s Note at Closing, plus (c) the market value of the Stock Consideration based on the 15-day VWAP.

“Business” means the business of specializing in transit management and operational oversight of time and temperature shipments to businesses and consumers.

“Business Data” means all business information and personally identifying information and data (whether of employees, contractors, consultants, customers, clients, consumer or other Persons and whether in electronic or any other form or medium) that is accessed, collected, used, processed, stored, shared, distributed, transferred, disclosed, destroyed, or disposed of by Seller.

“Business Day” means any day other than a day on which banks in New York, New York are required or authorized to be closed.

“Cash” means, as of any applicable time of determination, Seller’s actual cash (bank) balances, cash equivalents (including cash on hand and deposits in transit), which shall be reduced by any Restricted Cash and marketable securities (net of any breakage costs that would be incurred in connection with the liquidation thereof), in each case, determined in accordance with the accounting principles and policies used in the preparation of the Balance Sheet. For the avoidance of doubt, Cash will be calculated net of issued but uncleared checks and will include checks, other wire transfers and drafts deposited or available for deposit for the account of Seller.

“Closing Indebtedness” means the Indebtedness as set forth on the Closing Statement.

“Closing Transaction Expenses” means the Transaction Expenses as set forth on the Closing Statement.

“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended.

“Contract” means any written or oral contract, lease, license, loan or credit agreement, bond, debenture, note, mortgage, indenture, supply agreement, sale or purchase order, or any other binding agreement, commitment, arrangement or understanding.

“control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly or as trustee or executor, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of stock, as trustee or executor, by contract or credit arrangement or otherwise;

“Data Security Requirements” means, collectively, all of the following to the extent relating to Data Treatment or otherwise relating to privacy, security or security breach notification requirements and applicable to Seller, any IT Systems or any Personal Information: (i) Seller’s own rules, policies, and procedures; (ii) all Laws applicable to Seller; (iii) industry standards applicable to the industry in which Seller operates; and (iv) Contracts to which Seller is a party or otherwise subject.

“Data Treatment” means the access, collection, use, processing, storage, sharing, distribution, transfer, disclosure, security, destruction or disposal of Personal Information.

“Disclosure Schedules” means the disclosure schedules attached hereto and made a part hereof.

“Employment Agreements” means each of the employment agreements by and between Buyer and each of the Key Employees attached hereto as Exhibit D.

“Encumbrances” means all liens, charges, mortgages, pledges, security interests or other encumbrances of any kind.

“Environmental Laws” means all foreign, federal, state and local laws, rules, regulations, ordinances, codes, common law, judgments, orders, consent agreements, legally-binding requirements and work practices relating to (i) the protection of the environment (including air, surface and subsurface water, drinking water supplies, surface and subsurface land, the interior of any building or building component, soil and natural resources) or human health (including without limitation occupational health and safety) or (ii) Hazardous Substances.

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

“ERISA Affiliate” means any Person, trade or business (whether or not incorporated) that is a member of a “controlled group of corporations” with, or is under “common control” with, or is a member of the same “affiliated service group” with Seller, as defined in Section 414 of the Code, or is otherwise required to be aggregated with Seller under Section 414(o) of the Code.

“Estimated Closing Consideration” means an amount equal to the total of (a) the Base Amount, minus (b) the Estimated Indebtedness minus (c) the Estimated Transaction Expenses.

“Estimated Indebtedness” means the Indebtedness as set forth on the Estimated Closing Statement.

“Estimated Transaction Expenses” means the Transaction Expenses as set forth on the Estimated Closing Statement.

“Final Closing Consideration” means an amount equal to the total of (a) the Base Amount, minus (b) the Final Indebtedness minus (c) the Final Transaction Expenses.

“Final Indebtedness” means the Closing Indebtedness, (x) as shown in the Closing Statement if no Notice of Disagreement with respect thereto is duly and timely delivered pursuant to Section 1.3 or (y) if such a Notice of Disagreement is so delivered, as agreed by Seller and Buyer pursuant to Section 1.3 or (z) if such Notice of Disagreement is so delivered and in the absence of such agreement, as shown in the Arbiter’s calculation delivered pursuant to Section 1.3.

“Final Transaction Expenses” means the Closing Transaction Expenses, (x) as shown in the Closing Statement if no Notice of Disagreement with respect thereto is duly and timely delivered pursuant to Section 1.3 or (y) if such a Notice of Disagreement is so delivered, as agreed by Seller and Buyer pursuant to Section 1.3 or (z) if such Notice of Disagreement is so delivered and in the absence of such agreement, as shown in the Arbiter’s calculation delivered pursuant to Section 1.3.

“Governmental Authority” means any legislative, executive, judicial, quasi-judicial or other public authority, agency, department, bureau, division, unit, court or other public body or Person.

“Hazardous Substances” means any and all hazardous or toxic substances, materials, and wastes, solid wastes, industrial wastes, pollutants, contaminants, polychlorinated biphenyls, asbestos, volatile and semi-volatile organic compounds, oil, petroleum products and fractions thereof, radioactive materials and wastes, and any and all other chemicals, substances, materials and wastes regulated under Environmental Law.

“Income Related Taxes” means (i) all income taxes (including any tax on or based upon net income, or gross income, or income as specially defined, or earnings, or profits, or selected items of income, earnings, or profits) and all gross receipts or windfall profit taxes or other taxes, fees, assessments, or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts.

“Indebtedness” means all principal, interest, premiums, penalties or other obligations related to (a) all indebtedness of Seller for borrowed money, (b) all obligations (contingent or otherwise) of Seller for the deferred purchase price of property or services (other than trade accounts payable in the Ordinary Course of Business) (including notes payable to the sellers of such property or services), (c) all other obligations of Seller evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired by Seller, (e) all obligations of Seller as lessee or lessees under leases that have been or should be, in accordance with the Accounting Methods, recorded as capital leases, such excess shall constitute Indebtedness for all purposes under this Agreement, (f) all obligations, contingent or otherwise, of Seller under acceptance, letter of credit or similar facilities, (g) all obligations owing pursuant to factoring agreements for accounts receivable, (h) all obligations in respect of unfunded pensions, (i) all obligations of the type referred to in clauses (a) through (h) above guaranteed directly or indirectly in any manner by Seller, or in effect guaranteed directly or indirectly by Seller through an agreement (1) to pay or purchase such obligations or to advance or supply funds for the payment or purchase of such obligations, (2) to purchase, sell or lease (as lessee or lessor) property, or to purchase or sell services, primarily for the purpose of enabling the debtor to make payment of such obligations or to assure the holder of such obligations against loss, (3) to supply funds to or in any other manner invest in the debtor (including any agreement to pay for property or services irrespective of whether such property is received or such services are rendered) or (4) otherwise to assure a creditor against loss; provided, that such Indebtedness referred under this clause (i) is of the type that would be reflected as debt on a balance sheet prepared in accordance with Accounting Methods, (j) all obligations of the type referred to in clauses (a) through (i) above secured by (or for which the holder of such obligations has an existing right, contingent or otherwise, to be secured by) any lien on property (including accounts and Contract rights) owned by Seller, even though such Person has not assumed, become liable for or guaranteed the payment of such Indebtedness, (k) all liabilities of Seller under or in connection with any accrued bonuses, deferred compensation bonuses and accrued paid-time off (including all related Taxes, including the employer’s share of any payroll Taxes attributable to such amounts and any amounts payable pursuant to Section 280G of the Code (or any corresponding provision of Law) or to offset or gross-up any Person for any excise Taxes, income Taxes or other Taxes related to such amounts), including, for the avoidance of doubt, any and all amounts due from Seller pursuant to the Change in Control Agreements, (l) any unfunded capital expenditures committed to by Seller, (m) all unpaid Indemnified Taxes, and (n) all accrued but unpaid interest (or interest equivalent) to the date of determination, and all prepayment premiums or penalties payable upon repayment of any items of Indebtedness of the type referred to in clauses (a) through (j) above.

“Judgment” means any judgment, order, decree, award, ruling, decision, verdict, injunction or settlement entered, issued, made or rendered by, or any consent agreement, memorandum of understanding or other contract with, any Governmental Authorities (in each case whether temporary, preliminary or permanent).

“knowledge”, “to the knowledge” or “known” and words of similar import means the actual knowledge of a natural person or, with respect to a Person that is not a natural person, the actual knowledge of the member and management of such Person and the knowledge that each such person would reasonably be expected to obtain in the course of diligently performing his or her duties for such Person.

“Laws” means any federal, state or local law (including, without limitation, principles of common law), statute, ordinance, regulation, Permit, judgment, order or other legally enforceable determination, decision or requirement of any Authority.

“Losses” means any and all losses, liabilities, damages, penalties, obligations, awards, fines, deficiencies, demands, interest, claims (including third party claims whether or not meritorious), costs and expenses whatsoever (including reasonable attorneys’, consultants’ and other professional fees and disbursements of every kind, nature and description, whether for enforcement of rights under this Agreement or otherwise) resulting from, arising out of or incident to any matter for which indemnification is provided under this Agreement, but shall not include any fees charged by the parties for their time or opportunity cost or that of their employees who are not hired for the specific purpose of prosecuting the claim for such Losses.

“Material Adverse Effect” means a result, occurrence, fact, change or effect which, individually or in the aggregate with any other circumstance or event, has a material and adverse to the business, properties, operations, condition (financial or otherwise), or results of operations of Seller taken as a whole, provided, that in determining whether there has been a “material adverse effect,” any adverse effects directly resulting from or directly attributable to general economic conditions or general conditions in the industry in which Seller does business which conditions do not affect Seller in a materially disproportionate manner shall be disregarded. For purposes of this definition of Material Adverse Effect, the effect of any matter as to any past period shall be determined based on its actual effect, and its effect as to any future period shall be determined based on the effect that such matter is reasonably likely to have.

“Offered Employees” means all persons employed by Seller as of the Closing Date and listed in Schedule 9.1(a), including, for the avoidance of doubt, the Sponsored Employees.

“Ordinary Course of Business” means, with respect to Seller, the ordinary course of business consistent with Seller’s past custom and practice (including with respect to quantity and frequency).

“Permitted Encumbrances” means (i) statutory liens for Taxes not yet due and payable or the validity or amount of which is being contested in good faith by appropriate proceedings and for which adequate reserves have been established on the Interim Financial Statements in accordance with the Accounting Methods; and (ii) mechanics’, carriers’, workers’, repairers’ and other similar liens arising or incurred in the Ordinary Course of Business and securing sums that are not yet due and payable or the validity or amount of which is being contested in good faith by appropriate proceedings, and for which adequate reserves have been established on the Interim Financial Statements in accordance with the Accounting Methods and do not otherwise constitute a breach of or an event of default under any lease.

“Person” means an individual, corporation, partnership, association, limited liability company, trust, unincorporated organization, other entity or group (as group is defined in Section 13(d)(3) of the Securities Act).

“Personal Information” means such term or like terms set forth in any Law that describes, covers or defines data that identifies or can be used to identify individuals or that is otherwise regulated, protected or covered by any Law.

“Proceeding” means any suit, action, proceeding, assessment, arbitration, audit, hearing or investigation (in each case, whether civil, criminal, administrative, investigative or informal) commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Authority.

“Representative” means with respect to any Person, any director, officer or employee of such Person and any agent, consultant, legal, accounting, financial or other advisor or other representative authorized by such Person to advise, represent or act on behalf of such Person.

“Restricted Cash” means any cash deposits, cash in reserve accounts, cash escrow accounts, custodial cash and cash otherwise subject to any legal or contractual restriction on the ability to freely transfer or use such cash for any lawful purpose.

“Schedule(s)” means one or more schedule included in the Disclosure Schedule.

“Seller Environmental Liabilities” means any and all losses, claims, demands, liabilities, causes of action, damages, costs and expenses, fines or penalties (including without limitation attorney fees and other defense costs), known or unknown, foreseen or unforeseen, whether contingent or otherwise, fixed or absolute, present or future asserted against or incurred by Seller or Buyer arising out of or related to (a) any environmental condition first existing or occurring on or prior to the Closing Date or resulting from facts, circumstances or events first existing or occurring on or prior to the Closing Date, including without limitation, (i) the presence, disposal, discharge, release or other handling or management of, or exposure to, Hazardous Substances at, on or in any the Leased Real Property during Seller’s period of occupancy (including, for the avoidance of doubt, any post-Closing migration, movement or continuing discharge, disposal or release of, or exposure to, any Hazardous Substances first present, discharged, disposed or released on or prior to the Closing Date), or (ii) the off-site or on-site transportation, storage, treatment, recycling, other handling, discharge, disposal or release of Hazardous Substances by or on behalf of Seller or any Person under Seller’s or Founder’s control; (b) any violation of, or liability under, any Environmental Law or any Environmental Permit first existing or occurring prior to the Closing Date (including without limitation costs and expenses incurred or required to bring the Leased Real Property, Seller or the Business into compliance with all applicable Environmental Laws and Environmental Permits and any fines, penalties and defense costs incurred by Seller or Buyer) with respect to Seller, the Business, the Leased Real Property or any property now or previously owned, operated, leased or otherwise used by Seller; or (c) any environmental condition or any violation of, or liability under, Environmental Laws or Environmental Permits with respect to the Leased Real Property that arise out of, relate to, or result from any acts or omissions of any Seller, Founder, their Affiliates or any other Person under their control after the Closing Date.

“Sponsored Employees” means all persons employed by Seller as of the Closing Date and listed in Schedule 9.1(b).

“Stock Consideration” means the aggregate number of restricted shares of common stock of Parent calculated as follows: (x) $1,000,000 divided by (y) the VWAP for the 15-day period beginning prior to and ending on, and including, the Closing Date.

“Tax” means (i) any federal, state, local or non-U.S. income, gross receipts, sales, use, ad valorem, transfer, franchise, license, withholding, payroll, employment, excise, severance, stamp, occupation, property taxes (real or personal), including unpaid property taxes, premium, windfall profits, environmental assessments, alternative or add-on minimum, custom duties, capital stock, profits, social security (or similar), unemployment, disability, estimated, or any other tax of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts, whether disputed or not, and (ii) any obligation to indemnify or otherwise assume or succeed to any liability described in clause (i) hereof of any other Person whether by contract or under common law doctrine of de facto merger and successor liability or otherwise.

“Tax Return” means any return, report, information return or other document (including any related or supporting information or any amended return) filed or required to be filed with any Taxing Authority within the preceding three (3) years in connection with the determination, assessment, or collection of any Tax paid or payable by Seller or the administration of any laws, regulations, or administrative requirements relating to any such Tax.

“Transaction Expenses” means (without duplication), (i) the collective amount payable by, or liabilities of Seller or Founder that were incurred by Seller or Founder (if any) to outside legal counsel, accountants, advisors, brokers and other Persons in connection with the transactions contemplated by this Agreement or otherwise arising by consummation of the transactions contemplated hereby, including 100% of the costs and expenses of obtaining any third party consents (including customer consents), 100% of the Transfer Taxes and other taxes, fees and charges described in Section 6.2, and 100% of the filing fees incurred by Seller in connection with any filing by Seller with an Authority, and (ii) all liabilities of Seller under or in connection with any severance arrangements, stay bonuses, incentive bonuses, transaction bonuses, termination and change of control arrangements, and similar obligations that are triggered in whole or in part by the consummation of the transactions contemplated by this Agreement (including all related Taxes, including the employer’s share of any payroll Taxes attributable to such amounts and any amounts payable pursuant to Section 280G of the Code (or any corresponding provision of Law) or to offset or gross-up any Person for any excise Taxes, income Taxes or other Taxes related to the foregoing items).

“VWAP” means, for the applicable period, the price determined by the first of the following clauses that applies: (a) the average daily volume weighted average price of such stock for such date (or the nearest preceding date) on the NASDAQ (based on a trading day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)) or (b) if OTCQB or OTCQX is not a trading market, the volume weighted average price of such stock for such date on OTCQB or OTCQX as applicable.

9.2 Other Definitions. Each of the following terms is defined in the Section set forth opposite such term:

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed on its behalf as of the date first above written.

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE FEDERAL SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAW, AND MAY NOT BE TRANSFERRED UNLESS AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS IS AVAILABLE AND THE PROVISIONS OF SECTION 7 OF THIS NOTE ARE COMPLIED WITH.

FOR VALUE RECEIVED, PeriShip Global LLC, a Delaware limited liability company (“Payor”), promises to pay to the order of PeriShip, LLC, (the “Lender”) the aggregate principal sum of Two Million and No/100 Dollars ($2,000,000.00) (the “Principal Amount”), together with interest on the unpaid principal balance of this Promissory Note (this “Note”) from time to time outstanding at a fixed rate per annum equal to six (6%) percent per annum (the “Stated Rate”). Upon occurrence of an Event of Default, as hereinafter defined, interest shall accrue at the rate of ten (10%) percent per annum from the date of an Event of Default until all amounts due and owing under this Note are paid in full.

1. Interest Payments. Accrued interest shall be payable on the Final Maturity Date.

2. Principal Payments. Payments of principal and interest of this Note shall be made in three installments with (a) the first installment, being for the amount by which the principal amount of this Note exceeds $1,500,000, due on the date that is six (6) months after the date hereof, (b) the second payment, being for the amount by which the principal amount of this Note exceeds $1,000,000, due on the date that is fifteen (15) months after the date hereof, and (c) the third and final payment, being for all accrued interest and remaining principal, due on the date that is eighteen (18) months after the date hereof. All payments shall be made by wire transfer of immediately available funds in lawful money of the United States to an account designated by the Lender and shall be applied first to accrued interest and then to the outstanding principal balance.

3. Prepayment. Payor reserves the right to prepay the principal of this Note in whole or in part without penalty at any time and from time to time. Any prepayment shall be accompanied by accrued interest on the amount so prepaid. All such prepayments of principal shall reduce the principal payment next due under this Note in the order of maturity. All prepayments shall be made by wire transfer of immediately available funds in lawful money of the United States to an account designated by the Lender.

4. Acceleration for Default. Upon the occurrence of any Event of Default that is not cured as provided herein, the entire unpaid balance of principal and accrued interest under this Note may be declared by the Lender to be and shall become immediately due and payable. The Lender will promptly notify the Payor in the event the Lender elects to declare the entire unpaid balance of principal and accrued interest under this Note immediately due and payable hereunder. As used herein, “Event of Default” means any of the following which is not cured in the manner and within the time periods specified below:

(a) any failure of Payor to make any payment due under this Note within ten (10) business days following the due date thereof;

(b) any default under, or the breach of, any covenant, representation or warranty contained in this Note, or the occurrence of any event, which with notice or lapse of time, would constitute a breach or default under this Note;

(c) any order or judgment by a court of competent jurisdiction or written agreement by Payor of material default or breach of Payor under that certain Asset Purchase Agreement of even date pursuant to which Payor, among other things, acquired substantially all of the assets off Payor;

(d) Payor shall make a general assignment for the benefit of creditors; shall file a petition in bankruptcy; or shall be adjudicated bankrupt or insolvent; shall file a petition seeking any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any present or future statute, law or regulation; shall file any answer admitting, or shall fail reasonably to contest, the material allegations of a petition filed against it in any such proceedings; shall seek or consent to or acquiesce in the appointment of any trustee, receiver or liquidator of it or any material part of its assets (the term “acquiesce” includes but is not limited to the failure to file a petition or motion to vacate or discharge any order, judgment or decree within thirty (30) days after its entry); within sixty (60) days after the commencement of any proceeding against such Payor seeking any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any present or future statute, law or regulation, such proceeding shall not have been dismissed; or within sixty (60) days after the appointment, without the consent or acquiescence of such Payor, of any trustee, receiver or liquidator of such Payor or any material part of its assets, such appointment shall not have been vacated.

(e) Payor shall (i) enter into any transaction or series of transactions to sell substantially all of the assets of Payor, or (ii) enter into any transaction or series of transactions in which at the completion of such transaction or transactions, the current equity holders of Payor do not own at least fifty percent (50%) of the voting power and ownership equity of Payor or of any surviving entity resulting from such transaction.

5. Certain Waivers. Payor expressly waives presentment, protest and demand, notice of protest, demand, dishonor and nonpayment of this Note and all other notices of any kind, and agrees to pay all costs of collection when incurred, including reasonable attorneys’ fees.

6. Governing Law. This Note shall be construed and enforced in accordance with the substantive laws of the State of Delaware, excluding such laws as relate to the choice of law.

7. Transfer of Note. This Note and any interest herein may not be hypothecated, pledged, sold, distributed or otherwise transferred by the Lender without the prior written consent of Payor. This Note and any obligations hereunder may not be assigned, hypothecated, sold, distributed or otherwise transferred by Payor without the prior written consent of the Lender; provided however Payor may transfer or assign this Note upon the dissolution of Payor.

8. Binding Effect. This Note shall be binding upon, inure to the benefit of and be enforceable by the permitted successors and assigns of Payor and the Lender.

9. Costs of Collection and Enforcement. Payor shall pay the reasonable fees, costs and expenses (including reasonable attorney’s fees) incurred by the Lender in the collection of and/or enforcing and/or collecting this Note.

In Witness Whereof, the undersigned has executed this Promissory Note as of the date first written above.

THIS GUARANTY (this “Guaranty”) is made as of the 22nd day of April, 2022, by VERIFYME, INC., a Nevada corporation having its principal place of business located at 75 South Clinton Avenue, Suite 510, Rochester, New York 14604 (“Guarantor”), in favor of PERISHIP, LLC, a Connecticut limited liability company having its principal offices located at 265 East Main Street, Branford, Connecticut 06405 (“Seller”).

WHEREAS, pursuant to an Asset Purchase Agreement dated April 22, 2022 (the “Purchase Agreement”) by and among the Seller, Luciano Morra, PeriShip Global, LLC, a Delaware limited liability company (the “Buyer”), and Guarantor, Seller will sell to the Buyer, and Buyer will purchase from the Seller, the Acquired Assets (as such term is defined in the Purchase Agreement), as more particularly set forth in the Purchase Agreement; and

WHEREAS, the Guarantor owns a one hundred (100%) percent membership interest in the Buyer; and

WHEREAS, Two Million Dollars ($2,000,000) of the total consideration to be paid by Buyer for the Acquired Assets (the “Purchase Price”) is payable in accordance with the terms and conditions of a certain Promissory Note of even date herewith made by the Buyer and delivered to the Seller (the “Note”); and

WHEREAS, Seller requires as a condition to accepting the Note as partial payment of the Purchase Price that Guarantor shall have executed and delivered this Guaranty for the benefit of Seller; and

WHEREAS, the Guarantor deems it to be to its financial advantage and benefit to execute, deliver and perform under this Guaranty; and

WHEREAS, the Guarantor will materially benefit from the transactions contemplated under the Purchase Agreement.

NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt of which is hereby acknowledged, and in order to induce Seller to extend credit to Buyer under the Note, Guarantor hereby represents, warrants and covenants to the Seller as follows:

(a) Guarantor unconditionally guarantees to Seller the prompt and unconditional payment of the Note and any interest thereon, whether now or hereafter advanced, as the same shall become due and payable under the Note, whether at stated maturity, by acceleration or otherwise, and any and all sums of money that, at the time, may have become due and payable under the provisions of the Note or this Guaranty (collectively, “Loan Documents”), as well as, without limitation, all other loans, advances, indebtedness, notes, and liabilities (collectively, the “Guaranteed Obligations”).

(b) Guarantor unconditionally guarantees to Seller payment in full of any and all expenses that may be paid or incurred by Seller in the collection of all or any portion of the Guarantor’s obligations hereunder or the exercise or enforcement of any one or more of the other rights, powers, privileges, remedies and interests of Seller under the Loan Documents including, without limitation, reasonable attorneys’ fees.

2. Unconditional Guaranty. This Guaranty is an absolute, irrevocable, unconditional, present and continuing guaranty of payment and performance and not of collection and is in no way conditioned or contingent upon any attempt to enforce Seller’s rights against Buyer or to collect from Buyer or upon any other condition or contingency; accordingly, Seller shall have the right to proceed against Guarantor immediately upon any default by Buyer under the Note without taking any prior action or proceeding to enforce the Loan Documents or any of them. Until such time as the Guaranteed Obligations are paid in full, Guarantor agrees not to assert any claim, remedy or other right which the Guarantor may now have or hereafter acquire against Buyer or any other person obligated to pay Guaranteed Obligations arising out of the creation or performance of the Guarantor’s obligation under this Guaranty, including, without limitation, any right of subrogation, contribution, reimbursement, indemnification, exoneration, and any right to participate in any claim or remedy the Guarantor may have against Buyer, collateral, or other party obligated for Buyer’s debts, whether or not such claim, remedy or right arises in equity, or under contract, statute or common law. It is expressly understood that the waivers and agreements of Guarantor constitute additional and cumulative benefits given to Seller for its security and as an inducement for its extension of credit to Buyer. Seller may at any time and from time to time take any and/or all actions and enforce all rights and remedies available to Seller hereunder or under applicable law to collect from Guarantor any amounts then due and payable hereunder by Guarantor and/or to cause Guarantor to fulfill his, her or its obligations hereunder.

3. Liability Unimpaired. Guarantor’s liability hereunder shall in no way be limited or impaired by, and Guarantor hereby consents to and agrees to be bound by, any amendment or modification of the provisions of any of the Loan Documents, or any other instrument or agreement made to or with Seller, by Buyer or Guarantor, or any Person (as hereafter defined) who succeeds to Buyer’s interests thereunder. In addition, to the furthest extent permitted by law, Guarantor’s liability hereunder shall in no way be limited or impaired by (i) any extensions of time for performance required by any of said documents, (ii) any sale, assignment or foreclosure of the Note, (iii) any exculpatory provision in any of said documents limiting Seller’s rights to a deficiency judgment against Buyer, (iv) the release of Buyer or any other person from performance or observance of any of the agreements, covenants, terms or conditions contained in any of said documents including any other guarantor under this or any other guaranty, for any reason, including by Seller’s election, by operation of law, or otherwise, by operation of law or otherwise, (v) Seller’s failure to file any UCC financing statements (or Seller’s improper recording or filing of same) or to otherwise perfect, protect, secure or insure any security interest or lien given as security for the Note, (vi) the invalidity, irregularity or unenforceability, in whole or in part, of any of the Loan Documents, this Guaranty or any other instrument or agreement executed or delivered to Seller in connection with the Note, except to the extent that there is a final adjudication by a court of competent jurisdiction of a valid defense to Buyer’s obligations under the Loan Documents to payment of the indebtedness thereunder, (vii) the material inaccuracy of any of the representations and warranties made by Buyer in the Loan Documents, or (viii) any other action or circumstance whatsoever that constitutes, or might be construed to constitute, a legal or equitable discharge or defense (except full payment and satisfaction) of Buyer for its obligations under any of the Loan Documents or of Guarantor under this Guaranty; and, in any such case, whether with or without notice to Guarantor and with or without consideration. As used herein, “Person” shall mean any individual, corporation, partnership, limited liability company, joint venture, estate, trust, unincorporated association, any other entity, any federal, state, county or municipal government or any bureau, department or agency thereof, and any fiduciary acting in such capacity on behalf of any of the foregoing.

4. Preservation of Loan Documents. Guarantor will cause Buyer to maintain and preserve the enforceability of the Loan Documents as the same may be modified and will not permit Buyer to take or to fail to take actions of any kind which might be the basis for a claim that Guarantor has a defense to Guarantor’s obligations hereunder.

5. Certain Waivers. To the furthest extent permitted by law, Guarantor (i) waives any right or claim of right to cause a marshalling of Buyer’s assets or to cause Seller to proceed against any of the security for the Guaranteed Obligations before proceeding against Guarantor, (ii) agrees that any payments required to be made by Guarantor hereunder shall become due on demand in accordance with the terms of Paragraph 1 hereof and without presentment to Buyer, demand for payment or protest, or notice of non-payment or protest, and (iii) except as hereinafter provided, expressly waives and relinquishes all rights and remedies accorded by applicable law to guarantors. Without limiting the generality of the foregoing, to the furthest extent permitted by law, Guarantor hereby waives all rights (x) to participate in any claim or remedy Seller may now or hereafter have against Buyer or in any collateral that Seller now has or hereafter may acquire for the obligations guaranteed hereby and (y) except as provided in Section 2 hereof, to contribution, indemnification, set-off, exoneration or reimbursement, whether from Buyer, any guarantor, or any other person now or hereafter primarily or secondarily liable for any of Buyer’s obligations to Seller, and whether arising by contract or operation of law or otherwise by reason of Guarantor’s execution, delivery or performance of this Guaranty.

6. Reinstatement. This Guaranty shall continue to be effective, or be reinstated automatically, as the case may be, if at any time payment, in whole or in part, of any of the Guaranteed Obligations is rescinded or otherwise must be restored or returned by Seller or any affiliate (whether as a preference, fraudulent conveyance or otherwise) upon or in connection with the insolvency, bankruptcy, dissolution, liquidation or reorganization of Buyer, Guarantor or any other person, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Buyer, Guarantor or any other person or for a substantial part of Buyer’s, Guarantor’s or any of such other person’s property, as the case may be, or otherwise, all as though such payment had not been made. Guarantor further agrees that in the event any such payment is rescinded or must be restored or returned, all costs and reasonable expenses (including, without limitation, reasonable legal fees and expenses) incurred by or on behalf of Seller in defending or enforcing such continuance or reinstatement, as the case may be, shall constitute costs of enforcement, the payment of which is guaranteed by Guarantor pursuant to Paragraph 1 above.

7. Representations and Warranties. The Guarantor hereby represents and warrants that:

(a) Enforceability; No Conflicts. This Guaranty is a legal, valid and binding instrument, enforceable against Guarantor in accordance with its terms. Guarantor represents and warrants with respect to itself that the consummation of the transactions contemplated hereby and the performance of this Guaranty and the other Loan Documents to which Guarantor is a party have not resulted and will not result in any breach of, or constitute a default under, any corporate charter, by-laws, partnership agreement or other instrument to which Guarantor is a party or by which Guarantor may be bound or affected.

(b) Solvency. Guarantor, after giving effect to the transactions contemplated by this Guaranty (i) is solvent; (ii) has assets having a fair value in excess of the amount required to pay its liabilities on existing debts as such debts become due and payable, and (iii) has, and expects to continue to have, the ability to pay its debts from time to time incurred as such debts mature. Guarantor has not filed a voluntary petition for bankruptcy and Guarantor has not received notice that an involuntary petition for bankruptcy, or assignment for the benefit of creditors, or any other action involving debtor’s and creditor’s rights has been filed under the laws of the United States of America or any state thereof, or has been threatened against Guarantor.

(c) Information Complete. Subject to any limitations stated in writing therein or in connection therewith, all information furnished or to be furnished by Guarantor to Seller, taken as a whole, is, or will be at the time the same is furnished, accurate and complete in all material respects necessary in order to make the information furnished, in the light of the circumstances under which such information is furnished, not misleading.

(d) Litigation. There are no proceedings by or before any private, public or governmental body, agency or authority and no litigation is pending, or, so far as is known to Guarantor is threatened against Guarantor as would materially and adversely affect Guarantor’s ability to satisfy its obligations under this Guaranty or any of the Loan Documents.

(e) Compliance with Laws. Guarantor represents and warrants that Guarantor is in compliance with, and the transactions contemplated by the Loan Documents and this Guaranty do not and will not violate any provision of, or require any filing, registration, consent or approval under, any federal, state or local law, rule, regulation, ordinance, order, writ, judgment, injunction, decree, determination or award (hereinafter, “Laws”) presently in effect having applicability to Guarantor, and agrees that Guarantor will comply promptly with all laws now or hereafter in effect having applicability to Guarantor.

8. Non-Waiver Remedies Cumulative. No failure or delay on Seller’s part in exercising any right, power or privilege under any of the Loan Documents, this Guaranty or any other document made to or with Seller in connection with the Loans or shall operate as a waiver of any such privilege, power or right or shall be deemed to constitute Seller’s acquiescence in any default by Buyer or Guarantor under any of said documents. A waiver by Seller of any right or remedy under any of the Loan Documents, this Guaranty or any other document made to or with Seller in connection with the Loan. The rights and remedies provided in said documents are cumulative, may be exercised singly or concurrently and are not exclusive of any rights or remedies provided by law.

9. Severability. Any provision of this Guaranty, or the application thereof to any person or circumstance, that, for any reason, in whole or in part, is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Guaranty (or the remaining portions of such provision) or the application thereof to any other person or circumstance, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision (or portion thereof) or the application thereof to any person or circumstance in any other jurisdiction.

10. Entire Agreement; Amendments. This Guaranty contains the entire agreement of the parties with respect to the subject matter hereof and supersedes all prior oral or written agreements or statements relating to such subject matter, and none of the terms and provisions hereof may be waived, amended or terminated except by a written instrument signed by the Person against whom enforcement of the waiver, amendment or termination is sought.

11. Successors and Assigns. This Guaranty shall be binding upon and shall inure to the benefit of Seller and Guarantor and their respective successors and assigns. This Guaranty may be assigned by Seller with respect to all or any portion of the Guaranteed Obligations, and when so assigned Guarantor shall be liable under this Guaranty to the assignee(s) of the portion(s) of the Guaranteed Obligations so assigned without in any manner affecting the liability of Guarantor hereunder to Seller with respect to any portion of the obligations guaranteed hereby retained by Seller.

12. WAIVER OF TRIAL BY JURY. GUARANTOR, AND BY THE ACCEPTANCE HEREOF, SELLER, EACH HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVE ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD TO THE LOAN DOCUMENTS OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY BY GUARANTOR AND SELLER AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. GUARANTOR AND SELLER ARE EACH HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.

13. ADDITIONAL WAIVERS IN THE EVENT OF ENFORCEMENT. GUARANTOR HEREBY EXPRESSLY AND UNCONDITIONALLY WAIVES, IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING BROUGHT BY OR ON BEHALF OF SELLER ON THIS GUARANTY, ANY AND EVERY RIGHT GUARANTOR MAY HAVE TO (I) INJUNCTIVE RELIEF, (II) INTERPOSE ANY COUNTERCLAIM THEREIN (OTHER THAN COMPULSORY COUNTERCLAIMS), AND (III) HAVE THE SAME CONSOLIDATED WITH ANY OTHER OR SEPARATE SUIT, ACTION OR PROCEEDING. NOTHING HEREIN CONTAINED SHALL PREVENT OR PROHIBIT GUARANTOR FROM INSTITUTING OR MAINTAINING A SEPARATE ACTION AGAINST SELLER WITH RESPECT TO ANY ASSERTED CLAIM; (IV) ANY DEFENSES OF A SURETY OR RELATING TO IMPAIRMENT OF COLLATERAL AND/OR ANY ACT OR OMISSION BY THE SELLER WHICH INCREASES THE SCOPE OF THE GUARANTOR’S RISK HEREUNDER, INCLUDING, WITHOUT LIMITATION ANY NEGLIGENT SERVICING OR ADMINISTRATION OF THE BUYER’S OBLIGATIONS OR OTHER LIABILITIES OR FAILURE OF SELLER TO EXERCISE ANY OR ALL OF ITS RIGHTS OR REMEDIES AGAINST ANY PARTY, INCLUDING, WITHOUT LIMITATION, THE BUYER AND/OR ANY OTHER GUARANTOR.

14. Governing Law; Submission to Jurisdiction. This Guaranty and the rights and obligations of the parties hereunder shall in all respects be governed by, and construed and enforced in accordance with, the laws of the State of Delaware. Guarantor hereby irrevocably submits to the nonexclusive jurisdiction of any state or federal court sitting in the State of Delaware over any suit, action or proceeding arising out of or relating to this Guaranty, and Guarantor hereby agrees and consents that, in addition to any methods of service of process provided for under applicable law, all service of process in any such suit, action or proceeding in any Delaware state or federal court may be made by certified or registered mail, return receipt requested, directed to the Guarantor at the address indicated below, and service so made shall be complete five (5) days after the same shall have been so mailed.

15. Paragraph Headings. Any paragraph headings and captions in this Guaranty are for convenience only and shall not affect the interpretation or construction hereof.

16. Liability Unaffected by Release. Any other Person liable upon or in respect of any Guaranteed Obligations may be released without affecting the liability of Guarantor hereunder.

17. Notices. All notices and other communications to be given to any party under this Guaranty shall be in writing and any such notice shall be deemed given (a) on the date of actual delivery or rejection of delivery, if by hand or by recognized overnight delivery service, (b) when confirmed as received, if by facsimile, or (c) three days after being mailed, if by registered or certified United States mail, postage prepaid, return receipt requested, and shall be directed to the address or facsimile of such party specified below (or at such other address or facsimile number as such party shall designate by like notice):

18. Principles of Construction. All references to sections, paragraphs, schedules and exhibits are to sections, schedules and exhibits in or to this Guaranty unless otherwise specified. Unless otherwise specified, the words “hereof,” “herein” and “hereunder” and words of similar import when used in this Guaranty shall refer to this Guaranty as a whole and not to any particular provision of this Guaranty. The recitals to this Guaranty shall be deemed a part hereof and all exhibits and schedules attached hereto, if any, are incorporated herein by reference for all purposes. Unless otherwise specified, all meanings attributed to defined terms herein shall be equally applicable to both the singular and plural forms of the terms so defined and “including” means including without limitation. Whenever the context requires, each gender shall include all other genders.

19. Advice of Counsel. By his execution and delivery of this Guaranty, the Guarantor accepts, agrees and acknowledges that he has received a complete copy of this Guaranty Agreement, the Note and all other Loan Documents and has had an opportunity to review said Guaranty, Note and Loan Documents with its counsel and ask questions regarding the same prior to execution and delivery of this Guaranty.

IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be duly executed and delivered by its duly authorized official as of the date first above stated.

This Transition Services Agreement, dated as of April 22, 2022 (this “Agreement”), is entered into by and between PeriShip Global LLC, a Delaware limited liability company (“Buyer”), PeriShip, LLC, a Connecticut limited liability company (the “Company”), and Luciano Morra, an individual (“Morra,” and, together with the Company, “Seller”).

WHEREAS, Buyer and Seller have entered into that certain Asset Purchase Agreement, dated as of April 22, 2022 (the “Purchase Agreement”), pursuant to which the Company, of which Morra is the sole member, has agreed to sell and assign to Buyer, and Buyer has agreed to purchase and assume from the Company, substantially all the assets, and certain specified liabilities, of the Business (as such term is defined in the Purchase Agreement), all as more fully described therein;

WHEREAS, to ensure an orderly transition of the Business to Buyer and as a condition to consummating the transactions contemplated by the Purchase Agreement, Buyer and Morra have agreed to enter into this Agreement, pursuant to which Morra will provide, or cause Seller’s Affiliates, including the Company, to provide Buyer with certain services, in each case on a transitional basis and subject to the terms and conditions set forth herein; and

WHEREAS, capitalized terms used herein and not otherwise defined shall have the meaning ascribed to such terms in the Purchase Agreement.

NOW, THEREFORE, in consideration of the mutual agreements and covenants hereinafter set forth, Buyer and Seller hereby agree as follows:

(a) Seller agrees to provide, or to cause Seller’s Affiliates to provide, the services (the “Services”) set forth on Exhibit A attached hereto (as such exhibit may be amended or supplemented pursuant to the terms of this Agreement, collectively, the “Service Exhibit”) to Buyer for the respective periods and on the other terms and conditions set forth in this Agreement and in the respective Service Exhibit.

(b) Notwithstanding the contents of the Service Exhibit, Seller agrees to respond in good faith to reasonable requests by Buyer for access to any additional services that are necessary for the operation of the Business and which are not currently contemplated in the Service Exhibit. Any such reasonable additional services so provided by Seller shall constitute Services under this Agreement and be subject in all respect to the provisions of this Agreement as if fully set forth on the Service Exhibit as of the date hereof.

(c) The parties hereto acknowledge the transitional nature of the Services. Accordingly, as promptly as practicable following the execution of this Agreement, Buyer agrees to use commercially reasonable efforts to make a transition of each Service to its own internal organization or to obtain alternate third-party sources to provide the Services.

(d) Subject to Sections 2.03, 2.04, and 3.04, the obligations of Seller under this Agreement to provide Services shall terminate with respect to each Service on the end date specified in the Service Exhibit (the “End Date”). Notwithstanding the foregoing, the parties acknowledge and agree that Buyer may determine from time to time that it does not require all the Services set out on one or more of the Service Exhibits or that it does not require such Services for the entire period up to the applicable End Date. Accordingly, Buyer may terminate any Service, in whole and not in part, upon notification to Seller in writing of any such determination.

(a) Seller represents, warrants and agrees that the Services shall be provided in good faith, in accordance with Law and, except as specifically provided in the Service Exhibit, in a manner generally consistent with the historical provision of the Services by Seller and with the same standard of care as historically provided. Seller agrees to assign sufficient resources and qualified personnel as are reasonably required to perform the Services in accordance with the standards set forth in the preceding sentence. Notwithstanding anything herein to the contrary, Buyer agrees to reasonably accommodate the personal schedule and availability of Seller’s and its Affiliates’ personnel performing the Services, in particular that of Morra. Buyer shall make a good faith effort to advise Seller and its Affiliates of Services to be requested at least two weeks in advance of Services being requested and the contemplated dates, hours and locations with respect to such Services.

(b) Except as expressly set forth in Section 1.02(a) or in any contract entered into hereunder, Seller makes no representations and warranties of any kind, implied or expressed, with respect to the Services, including, without limitation, no warranties of merchantability or fitness for a particular purpose, which are specifically disclaimed. Buyer acknowledges and agrees that this Agreement does not create a fiduciary relationship, partnership, joint venture or relationships of trust or agency between the parties and that all Services are provided by Seller as an independent contractor.

1.03. Presence on Premises. Seller agrees that all of Seller’s and Seller’s Affiliates’ employees and subcontractors, when on the property of Buyer or when given access to any equipment, computer, software, network or files owned or controlled by Buyer, shall conform to the reasonable and legal policies and procedures of Buyer concerning health, safety and security which are made known to Seller in advance in writing.

2.01. Responsibility for Wages and Fees. For such time as Seller or any of Seller’s Affiliates are providing the Services to Buyer under this Agreement, (a) such employees will remain employees of Seller or such Affiliate, as applicable, and shall not be deemed to be employees of Buyer for any purpose, and (b) Seller or such Affiliate, as applicable, shall be solely responsible for the payment and provision of all wages, bonuses and commissions, employee benefits, including severance and worker’s compensation, and the withholding and payment of applicable Taxes relating to such employment.

(a) As consideration for provision of the Services, Buyer shall pay Seller the fees specified for the Services on Exhibit A. In addition to such amount, in the event that Seller or any of Seller’s Affiliates incurs reasonable and documented out-of-pocket expenses in the provision of any Service, including, without limitation, license fees and payments to third-party service providers or subcontractors (such included expenses, collectively, “Out-of-Pocket Costs”), Buyer shall reimburse Seller for all such Out-of-Pocket Costs in accordance with the invoicing procedures set forth in Section 2.02(b).

(b) As more fully provided in the Service Exhibits and subject to the terms and conditions therein:

(i) Seller shall provide Buyer, in accordance with Section 5.01 of this Agreement, with monthly invoices (“Invoices”), which shall set forth in reasonable detail Services performed and Out-of-Pocket Costs payable under this Agreement; and

(ii) payments pursuant to this Agreement shall be made within thirty (30) days after the date of receipt of an Invoice by Buyer from Seller.

2.03. Extension of Services. The parties agree that Seller shall not be obligated to perform any Service after the applicable End Date; provided, however, that if Buyer desires and Seller agrees to continue to perform any of the Services after the applicable End Date, the parties shall negotiate in good faith to determine an amount that compensates Seller for all of Seller’s costs for such performance. The Services so performed by Seller after the applicable End Date shall continue to constitute Services under this Agreement and be subject in all respects to the provisions of this Agreement for the duration of the agreed-upon extension period. If the parties are unable to agree upon a fee, then the fee of $23,750 per month, as set forth on Exhibit A shall continue in full force and effect.

2.04. Terminated Services. Upon termination or expiration of any or all Services pursuant to this Agreement, or upon the termination of this Agreement in its entirety, Seller shall have no further obligation to provide the applicable terminated Services and Buyer will have no obligation to pay any future compensation or Out-of-Pocket Costs relating to such Services (other than for or in respect of Services already provided in accordance with the terms of this Agreement and received by Buyer prior to such termination), all of which shall be paid in full within thirty (30) days of the termination or expiration of this Agreement.

2.05. Invoice Disputes. In the event of an Invoice dispute, Buyer shall deliver a written statement to Seller no later than ten (10) days prior to the date payment is due on the disputed Invoice listing all disputed items and providing a reasonably detailed description of each disputed item. Amounts not so disputed shall be deemed accepted and shall be paid, notwithstanding disputes on other items, within the period set forth in Section 2.02. The parties shall seek to resolve all such disputes expeditiously and in good faith. Seller shall continue performing the Services in accordance with this Agreement pending resolution of any dispute, providing all undisputed amounts are paid in accordance with this Section 2.05.

2.06. No Right of Setoff. Each of the parties hereby acknowledges that it shall have no right under this Agreement to offset any amounts owed (or to become due and owing) to the other party, whether under this Agreement, the Purchase Agreement or otherwise, against any other amount owed (or to become due and owing) to it by the other party.

3.01. Termination of Agreement. Subject to Section 3.04, this Agreement shall terminate in its entirety (i) on the date upon which Seller shall have no continuing obligation to perform any Services as a result of each of their expiration or termination in accordance with Section 1.01(d) or Section 3.02 or (ii) in accordance with Section 3.03.

3.02. Breach. Any party (the “Non-Breaching Party”) may terminate this Agreement with respect to any Service, in whole but not in part, at any time upon prior written notice to the other party (the “Breaching Party”) if the Breaching Party has failed to perform any of its material obligations under this Agreement relating to such Service, and such failure shall have continued without cure for a period of fifteen (15) days after receipt by the Breaching Party of a written notice of such failure from the Non-Breaching Party seeking to terminate such service. For the avoidance of doubt, non-payment by Buyer for a Service provided by Seller in accordance with this Agreement and not the subject of a good-faith dispute shall be deemed a breach for purposes of this Section 0.

3.03. Insolvency. In the event that either party hereto shall (i) file a petition in bankruptcy, (ii) become or be declared insolvent, or become the subject of any proceedings (not dismissed within sixty (60) days) related to its liquidation, insolvency or the appointment of a receiver, (iii) make an assignment on behalf of all or substantially all of its creditors, or (iv) take any corporate or other action for its winding up or dissolution, then the other party shall have the right to terminate this Agreement by providing written notice in accordance with Section 5.01.

3.04. Effect of Termination. Upon termination of this Agreement in its entirety pursuant to Section 3.01, all obligations of the parties hereto shall terminate, except for the provisions of Section 2.04, Section 2.06, and Article V, which shall survive any termination or expiration of this Agreement, and Seller shall be paid, according to a final Invoice (as defined below) delivered by Seller, (a) for all Out-of-Pocket Costs (as defined below) incurred by Seller as of the date of termination and (b) a pro rata portion of the fees set forth on the Exhibit for the month in which this Agreement is terminated as of the date of termination.

4.01. Indemnification by Seller. Seller shall indemnify, defend and hold harmless Buyer and its Affiliates, members managers, officers, agents and Representatives (collectively, the “Buyer Indemnified Parties”) from and against any and all claims, liabilities, obligations, judgments, damages, fines, penalties and Losses, of any kind and manner whatsoever (including reasonable attorney’s fees), arising out of or relating in any manner to the Services performed or to be performed herein, unless caused solely by the willful misconduct or intentional violation of law of Buyer or its Affiliates.

4.02. Indemnification by Buyer. Buyer shall indemnify, defend and hold harmless Seller and its Affiliates, members managers, officers, agents and Representatives (collectively, the “Seller Indemnified Parties”) from and against any and all claims, liabilities, obligations, judgments, damages, fines, penalties and Losses, of any kind and manner whatsoever (including reasonable attorney’s fees), arising out of or relating in any manner to the Services performed or to be performed herein, unless caused solely by the willful misconduct or intentional violation of law of Seller or its Affiliates.

5.01. Notices. Any notice, request, instruction, or other document to be given hereunder by any Party to any other Party shall be in writing and shall be given by delivery in person, by electronic mail, by overnight courier or by registered or certified mail, postage prepaid (and shall be deemed given when delivered if delivered by hand, when transmitted if delivered by electronic mail during normal business hours or on the succeeding Business Day, one Business Day after deposited with an overnight courier service if delivered by overnight courier and three days after mailing if mailed), as follows:

to Seller:

Luciano Morra
[______________]
[________________]
Email: [________________]

with a copy to:

Green & Sklarz LLC
One Audubon Street
New Haven, CT 06511
Attn: Mark G. Sklarz
Email: [________________]
Phone: [________________]

to Buyer to:

VerifyMe, Inc.
75 South Clinton Avenue, Suite 510
Rochester, New York 14604
Attn: Patrick White
Email: [________________]

with a copy to:

Harter Secrest & Emery LLP
1600 Bausch & Lomb Place
Rochester, New York 14604
Attention: Alexander R. McClean, Esq.
Email: [________________]
Phone: [________________]

5.02. Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

5.03. Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

5.04. Entire Agreement. This Agreement, including all Exhibits, and the Purchase Agreement constitute the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein and supersedes all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event and to the extent that there is a conflict between the provisions of this Agreement and the provisions of the Purchase Agreement as it relates to the Services hereunder, the provisions of this Agreement shall control.

5.05. Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. Neither party may assign its rights or obligations hereunder without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed. No assignment shall relieve the assigning party of any of its obligations hereunder. Notwithstanding anything provided herein to the contrary, it is understood and agreed by the parties that the Services to be provided herein may be performed by Morra.

5.06. No Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit or remedy of any nature whatsoever, under or by reason of this Agreement.

5.07. Amendment and Modification; Waiver. This Agreement may be amended, modified or supplemented only by an agreement in writing signed by each party hereto. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

5.08. Governing Law; Submission to Jurisdiction. This Agreement shall be construed in accordance with and governed by the laws of the State of Connecticut applicable to agreements made and to be performed wholly within that jurisdiction. Each party hereto, for itself and its successors and assigns, irrevocably agrees that any suit, action or proceeding arising out of or relating to this Agreement may be instituted only in the Superior Court of the State of Connecticut or in the absence of jurisdiction, any federal court sitting in the State of Connecticut, and generally and unconditionally accepts and irrevocably submits to the exclusive jurisdiction of the aforesaid courts and irrevocably agrees to be bound by any final judgment rendered thereby from which no appeal has been taken or is available in connection with this Agreement. Each party, for itself and its successors and assigns, irrevocably waives any objection it may have now or hereafter to the laying of the venue of any such suit, action or proceeding, including any objection based on the grounds of forum non conveniens, in the aforesaid courts. Each of the parties, for itself and its successors and assigns, irrevocably agrees that all process in any such proceedings in any such court may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to it at its address set forth in Section 5.01 or at such other address of which the other parties shall have been notified in accordance with the provisions of Section 5.01, such service being hereby acknowledged by the parties to be effective and binding service in every respect. Nothing herein shall affect the right to serve process in any other manner permitted by law.

5.09. Waiver of Jury Trial. Each party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising out of or relating to this agreement or the transactions contemplated hereby. Each party to this agreement certifies and acknowledges that (a) no representative of any other party has represented, expressly or otherwise, that such other party would not seek to enforce the foregoing waiver in the event of a legal action, (b) such party has considered the implications of this waiver, (c) such party makes this waiver voluntarily, and (d) such party has been induced to enter into this agreement by, among other things, the mutual waivers and certifications in this Section 5.09.

5.10. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

This Employment Agreement (this “Agreement”) is entered into as of April 22, 2022 (the “Effective Date”), by and between PeriShip Global LLC, a Delaware limited liability company (the “Company”), and Curt Kole (the “Executive”). Some of the terms of this Employment Agreement are in the attached schedule (the “Schedule”), which is part of this Agreement.

WHEREAS, the Company is a subsidiary of VerifyMe, Inc., a Nevada corporation (“VerifyMe”); and

WHEREAS, Executive was formerly an employee of PeriShip, LLC, a Connecticut limited liability company (“PeriShip”); and

WHEREAS, pursuant to that certain Asset Purchase Agreement by and between the Company and PeriShip dated even date herewith, the Company acquired substantially all of the assets of PeriShip (the “Transaction”);

WHEREAS, in connection with the Transaction and in their business, the Company has acquired and developed certain trade secrets both as defined by applicable law and the common law, including, but not limited to, proprietary processes, sales methods and techniques, and other like confidential business and technical information, including but not limited to, technical information, design systems, pricing methods, pricing rates or discounts, processes, procedures, formulas, designs of computer software, or improvements, or any portion or phase thereof, whether patented, or not, or unpatentable, that is of any value whatsoever to the Company, as well as information relating to the Company’s Services (as defined in Section 9(a)), information concerning proposed new Services, market feasibility studies, proposed or existing marketing techniques or plans (whether developed or produced by the Company or by any other person or entity for the Company), other Confidential Information (as defined in Section 9(a)) and information about the Company’s executives, officers, and directors, which necessarily will be communicated to the Executive by reason of his or her employment by the Company; and

WHEREAS, the Company has strong and legitimate business interests in preserving and protecting its investment in the Executive, its trade secrets and Confidential Information, and its substantial, significant, or key, relationships with vendors, whether actual or prospective; and

WHEREAS, the Company desires to preserve and protect its legitimate business interests further by restricting competitive activities of the Executive during the term of this Agreement and for a reasonable time following the termination of this Agreement; and

WHEREAS, the Company desires to employ or continue to employ the Executive and to ensure the availability or continued availability to the Company of the Executive’s services, and the Executive is willing to accept such employment and render such services, all upon and subject to the terms and conditions contained in this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants set forth in this Agreement, and intending to be legally bound, the Company and the Executive hereby agree as follows:

1. Representations and Warranties. The Executive hereby represents and warrants to the Company that the Executive (i) is not subject to any non-solicitation or non-competition agreement affecting his or her employment with the Company (other than any prior agreement with the Company or other agreement disclosed on Exhibit A), (ii) is not subject to any confidentiality or nonuse/nondisclosure agreement affecting the Executive’s employment with the Company (other than any prior agreement with the Company), and (iii) has brought to the Company no trade secrets, confidential business information, documents, or other personal property of a prior employer other than PeriShip.

(a) Term. Subject to the terms and conditions set forth herein, the Company hereby agrees to employ Executive, and Executive hereby agrees to accept employment with the Company, to be effective on the Effective Date. Executive’s employment with the Company shall continue, subject to earlier termination of such employment pursuant to the terms hereof, for a period of two (2) years (the “Initial Term”). Unless a Non-Renewal Notice (as herein defined) is given as herein provided or Executive’s employment is earlier terminated in accordance with the terms hereof, commencing on the day following the last day of the Initial Term and on each anniversary thereof, the period of Executive’s employment shall thereafter be automatically extended for an additional twelve-month period. The period of Executive’s employment with the Company as set forth in this Section 2 is referred to herein as the “Term.” The Company or Executive may elect to terminate the automatic extension of the Term by giving written notice of such election not less than sixty (60) days prior to the end of the then current Term (the “Non-Renewal Notice”).

(b) Continuing Effect. Notwithstanding any termination of this Agreement, at the end of the Term or otherwise, the provisions of Sections 6(e), 7, 8, 9, 10, 12, 15, 18, 19, and 22 shall remain in full force and effect and the provisions of Section 9 shall be binding upon the legal representatives, successors and assigns of the Executive.

(a) General Duties. The Executive shall serve in the position indicated in the Schedule, with duties and responsibilities that are customary for such an executive. The Executive shall report to the Company’s Board of Directors (the “Board”) or other person designated by the Board. The Executive shall also perform services for VerifyMe and other members of the Company as may be necessary. The Executive shall use his or her best efforts to perform his or her duties and discharge his or her responsibilities pursuant to this Agreement competently, carefully and faithfully. In determining whether or not the Executive has used his or her best efforts hereunder, the Executive’s and the Company’s delegation of authority and all surrounding circumstances shall be taken into account and the best efforts of the Executive shall not be judged solely on the Company’s earnings or other results of the Executive’s performance, except as specifically provided to the contrary by this Agreement.

(b) Devotion of Time. The Executive shall devote such time, attention and energies to the affairs of the Company and its subsidiaries and affiliates as are necessary to perform his or her duties and responsibilities pursuant to this Agreement. The Executive shall not enter the employ of or serve as a consultant to, or in any way perform any services with or without compensation to, any other persons, business, or organization, without the prior consent of the Board. Notwithstanding the above, the Executive shall be permitted to devote a limited amount of his or her time, to professional, charitable or similar organizations, including, but not limited to, serving as a non-executive director or an advisor to a board of directors, committee of any company or organization provided that such activities do not interfere with the Executive’s performance of his or her duties and responsibilities as provided hereunder.

(c) Location of Office. The Executive’s principal office shall be located in Branford, Connecticut. The Executive’s job responsibilities shall include all business travel necessary for the performance of Executive’s job.

(d) Adherence to Inside Information Policies. The Executive acknowledges that the Company’s parent, VerifyMe, is publicly-held and, as a result, has implemented inside information policies designed to preclude its executives and those of its subsidiaries from violating the federal securities laws by trading on material, non-public information or passing such information on to others in breach of any duty owed to the Company, VerifyMe, or any third party. The Executive shall promptly execute any agreements generally distributed by the Company to its employees requiring such employees to abide by its inside information policies.

(a) Salary. For the services of the Executive to be rendered under this Agreement, the Company shall pay the Executive the annual salary indicated on the Schedule (the “Base Salary”), less such deductions as shall be required to be withheld by applicable law and regulations payable in accordance with the Company’s customary payroll practices. The Executive’s Base Salary shall be reviewed at least annually by the Board and the Board may, but shall not be required to, increase the Base Salary during the Term. However, the Executive’s Base Salary may not be decreased during the Term.

(b) RSU Grant. Following the Effective Date, Executive shall be granted an Award (the “Award”) of VerifyMe Restricted Stock Units (the “RSUs”) with a grant date fair value equal to 100% of Executive’s Annual Base Salary. The Award will be made pursuant to an award agreement under the VerifyMe, Inc. 2020 Equity Incentive Plan, which will govern the terms of the Award and provide that the Award shall vest on the two year anniversary of the grant date, subject to continuous employment and other conditions, as follows: 50% if VerifyMe’s stock price exceeds $5.00 per share for a period of 20 consecutive days, and the remaining 50% if VerifyMe’s stock price exceeds $7.00 per share for a period of 20 consecutive days, in each case prior to the two year anniversary of the grant date.

(c) Commissions. Subject to the terms and conditions of a commission plan, which shall be adopted by the Company, Executive shall be eligible to earn a commission of (i) one and one-half percent (1.5%) of all eligible sales revenue in excess of $30,000,000 but less than $32,000,000, plus (ii) two percent (2.0%) of all of eligible sales revenue in excess of $32,000,000.00, accrued by the Company on the books of the Company during each calendar year, less such deductions as shall be required to be withheld by applicable law and regulations payable in accordance with the Company’s customary payroll practices. For example, if during an applicable calendar year, the Company accrues on its books $34,000,000 in sales revenue, then Executive shall receive a commission payment of $70,000 (i.e., 1.5% of $2,000,000, plus 2% of $2,000,000.00) less such deductions. The commission will be paid within 30 days of the conclusion of the applicable calendar. Executive must have been employed as of the date of payment in order to earn and receive a commission payment. Notwithstanding the foregoing, if Executive is terminated without Cause (as defined below) as of the date of payment, he will be eligible to earn a commission payment if, as of the date of his termination without Cause, the Company has accrued on its books for that calendar year the revenue targets described this paragraph 4(c)(i) and 4(c)(ii), which shall be pro-rated based upon the date of Executive’s termination without Cause. For example, if during an applicable calendar year, the Company accrues on its books $20,000,000 by June 30^th, and Executive is terminated without Cause on that same date, Executive will be eligible to receive a commission payment of $95,000 (i.e. 1.5% of the all eligible sales revenue in excess of $15,000,000 but less than $16,000,000, plus 2% of all eligible sales revenue in excess of $16,000,000 but less than $20,000,000) less such deductions as shall be required to be withheld by applicable law and regulations payable in accordance with the Company’s customary payroll practices. The commission will be paid within 30 days of the conclusion of the applicable calendar year.

(d) Expenses. In addition to any compensation received pursuant to this Section 4, the Company will reimburse or advance funds to the Executive for all reasonable documented travel (including travel expenses incurred by the Executive related to his or her travel to the Company’s other offices), entertainment and miscellaneous expenses incurred in connection with the performance of his or her duties under this Agreement, provided that the Executive properly provides a written accounting of such expenses to the Company in accordance with the Company’s expense reimbursement policies and procedures.

(a) Paid Time Off. The Executive will be entitled to the number of weeks of Paid Time Off indicated on the Schedule without loss of compensation or other benefits to which he or she is entitled under this Agreement, to be taken at such times as the Executive may select and the affairs of the Company may permit, with the understanding that vacation days will not be specifically counted, and no compensation, shall be granted for unused days.

(b) Employee Benefits. During the Term, the Executive shall be entitled to participate in all employee benefit plans, practices and programs maintained by the Company, as in effect from time to time (collectively, “Employee Benefit Plans”), on a basis which is no less favorable than is provided to other similarly situated executives of the Company, to the extent consistent with applicable law and the terms of the applicable Employee Benefit Plans. The Company reserves the right to amend or cancel any Employee Benefit Plans at any time in its sole discretion, subject to the terms of such Employee Benefit Plan and applicable law.

(a) Death or Disability. Except as otherwise provided in this Agreement, this Agreement shall automatically terminate upon the death or disability of the Executive. For purposes of this Section 6(a), “disability” shall mean (i) the Executive is unable to engage in his or her customary duties (with or without reasonable accommodation) by reason of any medically determinable physical or mental impairment that can be expected to result in death, or last for a continuous period of not less than 12 months; (ii) the Executive is, by reason of any medically determinable physical or mental impairment that can be expected to result in death, or last for continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company; or (iii) the Executive is determined to be totally disabled by the Social Security Administration. Any question as to the existence of a disability shall be determined by the written opinion of the Executive’s regularly attending physician (or his or her guardian) (or the Social Security Administration, where applicable) and me made in accordance with the Americans with Disabilities Act or other applicable law. In the event that the Executive’s employment is terminated by reason of Executive’s death or disability, the Company shall pay the following to the Executive or his or her personal representative: (i) any accrued but unpaid Base Salary for services rendered to the date of termination, (ii) accrued but unpaid expenses required to be reimbursed under this Agreement, and (iii) any Annual Bonus for which the Executive completed the applicable calendar performance year but has not yet earned solely as a result of termination prior to the payment date (an “Annual Bonus Payout”). The Executive (or his or her estate) shall receive the payments provided herein at such times as he or she would have received them if there was no death or disability. Additionally, if the Executive’s employment is terminated because of disability, any benefits (except perquisites) to which the Executive may be entitled pursuant to Section 5(b) hereof shall continue to be paid or provided by the Company, as the case may be, for the Disability Benefits Continuation Period indicated on the Schedule, subject to the terms of any applicable plan or insurance contract and applicable law provided that such benefits are exempt from Section 409A (as defined in Section 22(a)) by reason of Treasury Regulation Section 1.409A-1(a)(5) or otherwise. In the event all or a portion of the benefits to which the Executive was entitled pursuant to Section 5(b) hereof are subject to Section 409A, the Executive shall not be entitled to the benefits that are subject to Section 409A subsequent to the “applicable 2 ½ month period” (as such term is defined under Treasury Regulation Section 1.409A-1(b)(4)(i)(A)).

(b) Termination by the Company for Cause, by the Executive Without Good Reason or by Delivery of Non-Renewal Notice. The Company may terminate the Executive’s employment pursuant to the terms of this Agreement at any time for Cause (as defined below) by giving the Executive written notice of termination. Such termination shall become effective upon the giving of such notice. The Executive may terminate his or her employment pursuant to the terms of this Agreement at any time without Good Reason (as defined in Section 6(c)) by giving the Company at least sixty (60) days’ written notice of resignation. Such termination shall become effective upon the date provided by the Executive; provided, however, that the Company may relieve the Executive of any duties during such notice period without causing Good Reason. Either Party may terminate Executive’s employment pursuant to the terms of this Agreement in accordance with Section 2(a) by delivering a Non-Renewal Notice to the other party. Upon any such termination for Cause, such resignation without Good Reason, or termination as a result of a delivery of a Non-Renewal Notice, then the Executive shall have no right to compensation, or reimbursement under Section 4, or to participate in any Executive benefit programs under Section 5, except as may otherwise be provided for by law, for any period subsequent to the effective date of termination. For purposes of this Agreement, “Cause” shall mean: (i) the Executive is convicted of, or pleads guilty or nolo contendere to, a felony related to the business of the Company; (ii) the Executive, in carrying out his or her duties hereunder, has acted with gross negligence or intentional misconduct resulting, in any case, in material harm to the Company; (iii) the Executive misappropriates Company funds or otherwise defrauds the Company including a material amount of money or property; (iv) the Executive breaches his or her fiduciary duty to the Company resulting in material profit to him, directly or indirectly; (v) the Executive materially breaches any agreement with the Company and fails to cure such breach within 10 days of receipt of notice, unless the act is incapable of being cured; (vi) the Executive breaches any provision of Section 8 or Section 9; (vii) the Executive becomes subject to a preliminary or permanent injunction issued by a United States District Court enjoining the Executive from violating any securities law administered or regulated by the Securities and Exchange Commission; (viii) the Executive becomes subject to a cease and desist order or other order issued by the Securities and Exchange Commission after an opportunity for a hearing; (ix) the Executive refuses to carry out a resolution adopted by the Company’s Board at a meeting in which the Executive was offered a reasonable opportunity to argue that the resolution should not be adopted; or (x) the Executive abuses alcohol or drugs in a manner that interferes with the successful performance of his or her duties.

(1) This Agreement may be terminated: (i) by the Executive for Good Reason (as defined below) and (ii) by the Company without Cause.

(2) In the event this Agreement is terminated by the Executive for Good Reason or by the Company without Cause, the Executive shall be entitled to the following:

(A) any accrued but unpaid Base Salary for services rendered to the date of termination;

(B) any accrued but unpaid expenses required to be reimbursed under this Agreement;

(C) if during Initial Term, the First Award and/or Second Award if not previously paid and if all conditions other than employment until the end of the Initial Term are met;

(D) a payment equal to severance amount indicated on the Schedule (the “Severance Amount”); and

(E) any benefits (except perquisites) to which the Executive was entitled pursuant to Section 5(b) hereof shall continue to be paid or provided by the Company, as the case may be, for the Benefits Continuation Period indicated on the Schedule, subject to the terms of any applicable plan or insurance contract and applicable law provided that such benefits are exempt from Section 409A by reason of Treasury Regulation Section 1.409A-1(a)(5) or otherwise. In the event all or a portion of the benefits to which the Executive was entitled pursuant to Section 5(b) hereof are subject to Section 409A, the Executive shall not be entitled to the benefits that are subject to Section 409A subsequent to the “applicable 2 ½ month period” (as such term is defined under Treasury Regulation Section 1.409A-1(b)(4)(i)(A)).

(3) In the event of a termination without Cause, but not in the event of a termination for Good Reason, Executive shall also be entitled to any accrued but unpaid commissions earned by Executive under this Agreement and pursuant to the terms described in Section 4(c).

(4) In the event of a termination for Good Reason or without Cause, the payment of the Severance Amount shall be made at the same times as the Company pays compensation to its employees over the applicable monthly period and any other payments owed under Section 6(c) shall be promptly paid. Provided, however, that any balance of the Severance Amount remaining due on the “applicable 2 ½ month period” (as such term is defined under Treasury Regulation Section 1.409A-1(b)(4)(i)(A)) after the end of the tax year in which the Executive’s employment is terminated or the Term ends shall be paid on the last day of the applicable 2½ month period. The payment of the Severance Amount and the acceleration of vesting shall be conditioned on the Executive signing an Agreement and General Release (in the form attached hereto as Exhibit B, with such revisions as counsel to the Company deems necessary) which releases the Company or any of its affiliates (including its officers, directors and their affiliates) from any liability under this Agreement or related to the Executive’s employment with the Company provided that (x) the payment of the Severance Amount is made on or before the 90th day following the Executive’s termination of employment; (y) such Agreement and General Release is executed by the Executive, submitted to the Company, and the statutory period during which the Executive is entitled to revoke the Agreement and General Release under applicable law has expired on or before that 90th day; and (z) in the event that the 90 day period begins in one taxable year and ends in a second taxable year, then the payment of the Severance Amount shall be made in the second taxable year.

The term “Good Reason” shall mean: (i) a material diminution in the Executive’s authority, duties or responsibilities due to no fault of the Executive other than temporarily while the Executive is physically or mentally incapacitated or as required by applicable law; or (ii) any other action or inaction that constitutes a material breach by the Company under this Agreement. Prior to the Executive terminating his or her employment with the Company for Good Reason, the Executive must provide written notice to the Company, within 30 days following the Executive’s initial awareness of the existence of such condition, that such Good Reason exists and setting forth in detail the grounds the Executive believes constitutes Good Reason. If the Company does not cure the condition(s) constituting Good Reason within 30 days following receipt of such notice, then the Executive’s employment shall be deemed terminated for Good Reason.

(d) Any termination made by the Company under this Agreement shall be approved by the Board.

(e) Upon (1) voluntary or involuntary termination of the Executive’s employment, or (2) the Company’s request at any time during the Executive’s employment, the Executive shall (i) provide or return to the Company any and all Company property, including keys, key cards, access cards, security devices, employer credit cards, network access devices, computers, cell phones, smartphones, manuals, work product, thumb drives or other removable information storage devices, and hard drives, and all Company documents and materials belonging to the Company and stored in any fashion, including but not limited to those that constitute or contain any Confidential Information or work product, that are in the possession or control of the Executive, whether they were provided to the Executive by the Company or any of its business associates or created by the Executive in connection with his or her employment by the Company; and (ii) delete or destroy all copies of any such documents and materials not returned to the Company that remain in the Executive’s possession or control, including those stored on any non-Company devices, networks, storage locations and media in the Executive’s possession or control.

7. Indemnification. As provided in an Indemnification Agreement to be entered into or previously entered into between the Company and the Executive, a copy of which is annexed as Exhibit C, the Company shall indemnify the Executive, to the maximum extent permitted by applicable law, against all costs, charges and expenses incurred or sustained by him in connection with any action, suit or proceeding to which he or she may be made a party by reason of him being an officer, director or employee of the Company or of any subsidiary or affiliate of the Company. The Company shall provide, at its expense, directors and officers insurance for the Executive in amounts and for a term consistent with industry standards.

(a) Competition with the Company. Until termination of his or her employment and for the Restricted Period indicated on the Schedule and commencing on the date of termination, the Executive (individually or in association with, or as a shareholder, director, officer, consultant, employee, partner, joint venturer, member, or otherwise, of or through any person, firm, corporation, partnership, association or other entity) shall not, directly or indirectly, compete with the Company (which for the purpose of this Section also includes any of its subsidiaries or affiliates, including VerifyMe) by acting as an officer (or comparable position) of, owning an interest in, or providing services to any entity within any metropolitan area in the United States or other country in which the Company was actually engaged in business as of the time of termination of employment or where the Company reasonably expected to engage in business within three months of the date of termination of employment. For purposes of this Agreement, the term “compete with the Company” shall refer to any business activity in which the Company was engaged as of the termination of the Executive’s employment or reasonably expected to engage in within three months of termination of employment; provided, however, the foregoing shall not prevent the Executive from (i) accepting employment with an enterprise engaged in two or more lines of business, one of which is the same or similar to the Company’s business (the “Prohibited Business”) if the Executive’s employment is totally unrelated to the Prohibited Business, (ii) competing in a country where as of the time of the alleged violation the Company has ceased engaging in business, or (iii) competing in a line of business which as of the time of the alleged violation the Company has either ceased engaging in or publicly announced or disclosed that it intends to cease engaging in; provided, further, the foregoing shall not prohibit the Executive from owning up to five percent of the securities of any publicly-traded enterprise provided as long as the Executive is not a director, officer, consultant, employee, partner, joint venturer, manager, or member of, or to such enterprise, or otherwise compensated for services rendered thereby.

(b) Solicitation of Customers. During the periods in which the provisions of Section 8(a) shall be in effect, the Executive, directly or indirectly, will not seek nor accept Prohibited Business from any Customer (as defined below) on behalf of any enterprise or business other than the Company, refer Prohibited Business from any Customer to any enterprise or business other than the Company or receive commissions based on sales or otherwise relating to the Prohibited Business from any Customer, or any enterprise or business other than the Company. For purposes of this Agreement, the term “Customer” means any person, firm, corporation, partnership, limited liability company, association or other entity to which the Company or any of its affiliates sold or provided goods or services during the 24-month period prior to the time at which any determination is required to be made as to whether any such person, firm, corporation, partnership, limited liability company, association or other entity is a Customer, or who or which was approached by or who or which has approached an employee of the Company for the purpose of soliciting business from the Company or the third party, as the case may be. Provided, however, the goods or services must be competitive in some respect to the Company’s business during such time.

(c) Solicitation of Employees. During the period in which the provisions of Sections 8(a) and 8(b) shall be in effect, the Executive agrees that he or she shall not, directly or indirectly, request, recommend or advise any employee of the Company to terminate his or her employment with the Company, for the purposes of providing services for a Prohibited Business, or solicit for employment or recommend to any third party the solicitation for employment of any individual who was employed by the Company or any of its subsidiaries and affiliates at any time during the one year period preceding the Executive’s termination of employment.

(d) Non-disparagement. The Executive agrees that, after the end of his or her employment, he or she will refrain from making, in writing or orally, any unfavorable comments about the Company, its operations, policies, or procedures that would be likely to injure the Company’s reputation or business prospects; provided, however, that nothing herein shall preclude the Executive from responding truthfully to a lawful subpoena or other compulsory legal process or from providing truthful information otherwise required by law.

(e) No Payment. The Executive acknowledges and agrees that no separate or additional payment will be required to be made to him in consideration of his or her undertakings in this Section 8, and confirms he or she has received adequate consideration for such undertakings.

(f) References. References to the Company in this Section 8 shall include the Company, VerifyMe and each of their subsidiaries and affiliates.

(a) Confidential Information. For purposes of this Agreement, “Confidential Information” includes, but is not limited to, trade secrets under any applicable statute or the common law, processes, policies, procedures, techniques, designs, drawings, know-how, show-how, technical information, specifications, computer software and source code, information and data relating to the development, research, testing, costs, marketing, and uses of the Services (as defined below), the Company’s budgets and strategic plans, and the identity and special needs of Customers vendors, and suppliers, subjects and databases, data, and all technology relating to the Company’s businesses, systems, methods of operation, and Customer lists and information, solicitation leads, marketing and advertising materials, methods and manuals and forms, all of which pertain to the activities or operations of the Company, the names, home addresses and all telephone numbers and e-mail addresses of the Company’s directors, employees, officers, executives, former executives, and Customer contacts. Confidential Information also includes, without limitation, Confidential Information received from the Company’s subsidiaries and affiliates. For purposes of this Agreement, the following will not constitute Confidential Information (i) information which is or subsequently becomes generally available to the public through no act or fault of the Executive, (ii) information set forth in the written records of the Executive prior to disclosure to the Executive by or on behalf of the Company which information is given to the Company in writing as of or prior to the date of this Agreement, and (iii) information which is lawfully obtained by the Executive in writing from a third party (excluding any affiliates of the Executive) who lawfully acquired the confidential information and who did not acquire such confidential information or trade secret, directly or indirectly, from the Executive or the Company or its subsidiaries or affiliates and who has not breached any duty of confidentiality. As used herein, the term “Services” shall include all services offered for sale and marketed by the Company during the Term.

(b) Legitimate Business Interests. The Executive recognizes that the Company has legitimate business interests to protect and as a consequence, the Executive agrees to the restrictions contained in this Agreement because they further the Company’s legitimate business interests. These legitimate business interests include, but are not limited to (i) trade secrets; (ii) valuable confidential business, technical, and/or professional information that otherwise may not qualify as trade secrets, including, but not limited to, all Confidential Information; (iii) substantial, significant, or key relationships with specific prospective or existing Customers, vendors or suppliers; (iv) Customer goodwill associated with the Company’s business; and (v) specialized training relating to the Company’s technology, Services, methods, operations and procedures. Notwithstanding the foregoing, nothing in this Section 9(b) shall be construed to impose restrictions greater than those imposed by other provisions of this Agreement.

(c) Confidentiality. During the Term of this Agreement and following termination of employment, for any reason, the Confidential Information shall be held by the Executive in the strictest confidence and shall not, without the prior express written consent of the Company, be disclosed to any person other than in connection with the Executive’s employment by the Company. The Executive further acknowledges that such Confidential Information as is acquired and used by the Company or its subsidiaries or affiliates is a special, valuable and unique asset. The Executive shall exercise all due and diligent precautions to protect the integrity of the Company’s Confidential Information and to keep it confidential whether it is in written form, on electronic media, oral, or otherwise. The Executive shall not copy any Confidential Information except to the extent necessary to his or her employment nor remove any Confidential Information or copies thereof from the Company’s premises except to the extent necessary to his or her employment. All records, files, materials and other Confidential Information obtained by the Executive in the course of his or her employment with the Company are confidential and proprietary and shall remain the exclusive property of the Company. The Executive shall not, except in connection with and as required by his or her performance of his or her duties under this Agreement, for any reason use for his or her own benefit or the benefit of any person or entity other than the Company or disclose any such Confidential Information to any person, firm, corporation, association or other entity for any reason or purpose whatsoever without the prior express written consent of an executive officer of the Company (excluding the Executive).

(d) References. References to the Company in this Section 9 shall include the Company, VerifyMe and each of their subsidiaries and affiliates.

(e) Whistleblowing. Notwithstanding the foregoing, nothing in this Agreement shall (i) prohibit the Executive from making reports of possible violations of federal law or regulation to any governmental agency or entity in accordance with the provisions of and rules promulgated under Section 21F of the Securities Exchange Act of 1934 or Section 806 of the Sarbanes-Oxley Act of 2002, or of any other whistleblower protection provisions of state or federal law or regulation, or (ii) require notification or prior approval by the Company of any reporting described in clause (i).

(f) Trade Secrets. Pursuant to The Defend Trade Secrets Act (18 USC § 1833(b)), the Executive may not be held criminally or civilly liable under any federal or state trade secret law for disclosure of a trade secret: (i) made in confidence to a government official, either directly or indirectly, or to an attorney, solely for the purpose of reporting or investigating a suspected violation of law; and/or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Additionally, the Executive, if suing the Company for retaliation based on the reporting of a suspected violation of law, may disclose a trade secret to his attorney and use the trade secret information in the court proceeding, so long as any document containing the trade secret is filed under seal and the Executive does not disclose the trade secret except pursuant to court order.

(a) The Company and the Executive recognize that the services to be rendered under this Agreement by the Executive are special, unique and of extraordinary character, and that in the event of the breach by the Executive of the terms and conditions of this Agreement or if the Executive, without the prior express consent of the Board, shall leave his or her employment for any reason and/or take any action in violation of Section 8 and/or Section 9, the Company shall be entitled to institute and prosecute proceedings in any court of competent jurisdiction referred to in Section 10(b) below, to enjoin the Executive from breaching the provisions of Section 8 and/or Section 9.

(b) Any action arising from or under this Agreement must be commenced only in the appropriate state or federal court located in New York County, New York. The Executive and the Company irrevocably and unconditionally submit to the exclusive jurisdiction of such courts and agree to take any and all future action necessary to submit to the jurisdiction of such courts. The Executive and the Company irrevocably waive any objection that they now have or hereafter may have to the laying of venue of any suit, action or proceeding brought in any such court and further irrevocably waive any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. Final judgment against the Executive or the Company in any such suit shall be conclusive and may be enforced in other jurisdictions by suit on the judgment, a certified or true copy of which shall be conclusive evidence of the fact and the amount of any liability of the Executive or the Company therein described, or by appropriate proceedings under any applicable treaty or otherwise.

11. Conflicts of Interest. While employed by the Company, the Executive shall not, unless approved by the Board, directly or indirectly:

(a) participate as an individual in any way in the benefits of transactions with any of the Company’s or VerifyMe’s Customers or vendors, including, without limitation, having a financial interest in the Company’s or VerifyMe Customers or vendors, or making loans to, or receiving loans, from, the Company’s or VerifyMe Customers or vendors;

(b) realize a personal gain or advantage from a transaction in which the Company or VerifyMe has an interest or use information obtained in connection with the Executive’s employment with the Company or VerifyMe for the Executive’s personal advantage or gain; or

(c) accept any offer to serve as an officer, director, partner, consultant, manager with, provide services to or to be employed by, a person or entity which does business with the Company or VerifyMe.

12. Inventions, Ideas, Processes, and Designs. All inventions, ideas, processes, programs, software, and designs (including all improvements) (i) conceived or made by the Executive during the course of his or her employment with the Company (whether or not actually conceived during regular business hours) and for a period of six months subsequent to the termination (whether by expiration of the Term or otherwise) of such employment with the Company, and (ii) related to the business of the Company, shall be disclosed in writing promptly to the Company and shall be the sole and exclusive property of the Company, and the Executive hereby assigns any such inventions to the Company. An invention, idea, process, program, software, or design (including an improvement) shall be deemed related to the business of the Company if (a) it was made with the Company’s funds, personnel, equipment, supplies, facilities, or Confidential Information, (b) results from work performed by the Executive for the Company, or (c) pertains to the current business or demonstrably anticipated research or development work of the Company. The Executive shall cooperate with the Company and its attorneys in the preparation of patent and copyright applications for such developments and, upon request, shall promptly assign all such inventions, ideas, processes, and designs to the Company. The decision to file for patent or copyright protection or to maintain such development as a trade secret, or otherwise, shall be in the sole discretion of the Company, and the Executive shall be bound by such decision. The Executive hereby irrevocably assigns to the Company, for no additional consideration, the Executive’s entire right, title and interest in and to all work product and intellectual property rights, including the right to sue, counterclaim and recover for all past, present and future infringement, misappropriation or dilution thereof, and all rights corresponding thereto throughout the world. Nothing contained in this Agreement shall be construed to reduce or limit the Company’s rights, title or interest in any work product or intellectual property rights so as to be less in any respect than the Company would have had in the absence of this Agreement. If applicable, the Executive shall provide as a schedule to this Agreement, a complete list of all inventions, ideas, processes, and designs, if any, patented or unpatented, copyrighted or otherwise, or non-copyrighted, including a brief description, which he or she made or conceived prior to his or her employment with the Company and which therefore are excluded from the scope of this Agreement. References to the Company in this Section 12 shall include the Company, its subsidiaries and affiliates.

13. Indebtedness. If, during the course of the Executive’s employment under this Agreement, the Executive becomes indebted to the Company for any reason, the Company may, if it so elects, and if permitted by applicable law, set off any sum due to the Company from the Executive and collect any remaining balance from the Executive unless the Executive has entered into a written agreement with the Company.

14. Assignability. The rights and obligations of the Company under this Agreement shall inure to the benefit of and be binding upon the successors and assigns of the Company, provided that such successor or assign shall acquire all or substantially all of the securities or assets and business of the Company. The Executive’s obligations hereunder may not be assigned or alienated and any attempt to do so by the Executive will be void.

(a) The Executive expressly agrees that the character, duration and geographical scope of the non-competition provisions set forth in this Agreement are reasonable in light of the circumstances as they exist on the date hereof. Should a decision, however, be made at a later date by a court of competent jurisdiction that the character, duration or geographical scope of such provisions is unreasonable, then it is the intention and the agreement of the Executive and the Company that this Agreement shall be construed by the court in such a manner as to impose only those restrictions on the Executive’s conduct that are reasonable in the light of the circumstances and as are necessary to assure to the Company the benefits of this Agreement. If, in any judicial proceeding, a court shall refuse to enforce all of the separate covenants deemed included herein because taken together they are more extensive than necessary to assure to the Company the intended benefits of this Agreement, it is expressly understood and agreed by the parties hereto that the provisions of this Agreement that, if eliminated, would permit the remaining separate provisions to be enforced in such proceeding shall be deemed eliminated, for the purposes of such proceeding, from this Agreement.

(b) If any provision of this Agreement otherwise is deemed to be invalid or unenforceable or is prohibited by the laws of the state or jurisdiction where it is to be performed, this Agreement shall be considered divisible as to such provision and such provision shall be inoperative in such state or jurisdiction and shall not be part of the consideration moving from either of the parties to the other. The remaining provisions of this Agreement shall be valid and binding and of like effect as though such provisions were not included.

16. Notices and Addresses. All notices, offers, acceptance and any other acts under this Agreement (except payment) shall be in writing, and shall be sufficiently given if delivered to the addressees in person, by FedEx or similar receipted delivery, or next business day delivery to the addresses detailed below (or to such other address, as either of them, by notice to the other may designate from time to time), or by e-mail delivery (in which event a copy shall immediately be sent by FedEx or similar receipted delivery), as follows:

17. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. The execution of this Agreement may be by actual or facsimile signature.

18. Attorneys’ Fees. In the event that there is any controversy or claim arising out of or relating to this Agreement, or to the interpretation, breach or enforcement thereof, and any action or proceeding is commenced to enforce the provisions of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees, costs and expenses (including such fees and costs on appeal).

19. Governing Law. This Agreement shall be governed or interpreted according to the internal laws of the State of New York without regard to choice of law considerations and all claims relating to or arising out of this Agreement, or the breach thereof, whether sounding in contract, tort, or otherwise, shall also be governed by the laws of the State of New York without regard to choice of law considerations.

20. Entire Agreement. This Agreement constitutes the entire Agreement between the parties and supersedes all prior oral and written agreements between the parties hereto with respect to the subject matter hereof. Neither this Agreement nor any provision hereof may be changed, waived, discharged or terminated orally, except by a statement in writing signed by the party or parties against which enforcement or the change, waiver discharge or termination is sought.

21. Section and Paragraph Headings. The section and paragraph headings in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

(a) This Agreement is intended to comply with Section 409A of the Internal Revenue Code of 1986, as amended, and the treasury regulations promulgated and other official guidance issued thereunder (collectively, “Section 409A”) or to qualify for an exemption thereunder, and this Agreement shall be construed and administered consistent with such intent. Notwithstanding any other provision of this Agreement to the contrary, payments provided under this Agreement may only be made upon an event and in a manner that complies with Section 409A or an applicable exemption. Any payments under this Agreement that may be excluded from Section 409A either as separation pay due to an involuntary separation from service (including a voluntary separation from service for good reason that is considered an involuntary separation for purposes of the separation pay exception under Treasury Regulation Section 1.409A-1(n)(2)) or as a short-term deferral shall be excluded from Section 409A to the maximum extent possible. For purposes of Section 409A, each installment payment provided under this Agreement shall be treated as a separate payment. Any payments to be made under this Agreement upon a termination of employment shall only be made if such termination of employment constitutes a “separation from service” under Section 409A. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with or qualify for an exemption from Section 409A and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest, or other expenses that may be incurred by the Executive on account of non-compliance with Section 409A.

(b) Notwithstanding any other provision of this Agreement, if at the time of the Executive’s termination of employment, the Executive is a “specified employee”, determined in accordance with Section 409A, any payments and benefits provided under this Agreement that constitute “nonqualified deferred compensation” subject to Section 409A (e.g., payments and benefits that do not qualify as a short-term deferral or as a separation pay exception) that are provided to the Executive on account of the Executive’s separation from service shall not be paid until the first payroll date to occur following the six-month anniversary of the Executive’s termination date (“Specified Employee Payment Date”). The aggregate amount of any payments that would otherwise have been made during such six-month period shall be paid in a lump sum on the Specified Employee Payment Date without interest and thereafter, any remaining payments shall be paid without delay in accordance with their original schedule. If the Executive dies during the six-month period, any delayed payments shall be paid to the Executive’s estate in a lump sum upon the Executive’s death.

(c) To the extent required by Section 409A, each reimbursement or in-kind benefit provided under this Agreement shall be provided in accordance with the following:

(1) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during each calendar year cannot affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year;

(2) any reimbursement of an eligible expense shall be paid to the Executive on or before the last day of the calendar year following the calendar year in which the expense was incurred; and

(3) any right to reimbursements or in-kind benefits under this Agreement shall not be subject to liquidation or exchange for another benefit.

IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the date and year first above written.

This Employment Agreement (this “Agreement”) is entered into as of April 22, 2022 (the “Effective Date”), by and between PeriShip Global LLC, a Delaware limited liability company (the “Company”), and Fred Volk III (the “Executive”). Some of the terms of this Employment Agreement are in the attached schedule (the “Schedule”), which is part of this Agreement.

WHEREAS, the Company is a subsidiary of VerifyMe, Inc., a Nevada corporation (“VerifyMe”); and

WHEREAS, Executive was formerly an employee of PeriShip, LLC, a Connecticut limited liability company (“PeriShip”); and

NOW, THEREFORE, in consideration of the premises and the mutual covenants set forth in this Agreement, and intending to be legally bound, the Company and the Executive hereby agree as follows:

(a) Term. Subject to the terms and conditions set forth herein, the Company hereby agrees to employ Executive, and Executive hereby agrees to accept employment with the Company, to be effective on the Effective Date. Executive’s employment with the Company shall continue, subject to earlier termination of such employment pursuant to the terms hereof, for a period of two (2) years (the “Initial Term”). Unless a Non-Renewal Notice (as herein defined) is given as herein provided or Executive’s employment is earlier terminated in accordance with the terms hereof, commencing on the day following the last day of the Initial Term and on each anniversary thereof, the period of Executive’s employment shall thereafter be automatically extended for an additional twelve-month period. The period of Executive’s employment with the Company as set forth in this Section 2 is referred to herein as the “Term.” The Company or Executive may elect to terminate the automatic extension of the Term by giving written notice of such election not less than thirty (30) days prior to the end of the then current Term (the “Non-Renewal Notice”).

(c) Location of Office. The Executive’s principal office shall be located in Branford Connecticut. The Executive’s job responsibilities shall include all business travel necessary for the performance of Executive’s job.

(c) Commissions. Subject to the terms and conditions of a commission plan, which shall be adopted by the Company, Executive shall be eligible to earn a commission of one percent (1.0%) of all of eligible sales revenue in excess of $30,000,000.00 actually received by the Company during each calendar year, less such deductions as shall be required to be withheld by applicable law and regulations payable in accordance with the Company’s customary payroll practices. For example, if during an applicable calendar year, the Company receives $34,000,000 in sales revenue, then Executive shall receive a commission payment of $40,000 (i.e., 1% of $4,000,000.00). The commission will be paid with 30 days of the conclusion of the applicable Calendar year Executive must be employed of the date of payment in order to earn and receive the commission.

(1) This Agreement may be terminated: (i) by the Executive for Good Reason (as defined below) and (ii) by the Company without Cause.

(2) In the event this Agreement is terminated by the Executive for Good Reason or by the Company without Cause, the Executive shall be entitled to the following:

(A) any accrued but unpaid Base Salary for services rendered to the date of termination;

(B) any accrued but unpaid expenses required to be reimbursed under this Agreement;

(C) if during Initial Term, the First Award and/or Second Award if not previously paid and if all conditions other than employment until the end of the Initial Term are met;

(D) a payment equal to severance amount indicated on the Schedule (the “Severance Amount”); and

(3) In the event of a termination for Good Reason or without Cause, the payment of the Severance Amount shall be made at the same times as the Company pays compensation to its employees over the applicable monthly period and any other payments owed under Section 6(c) shall be promptly paid. Provided, however, that any balance of the Severance Amount remaining due on the “applicable 2 ½ month period” (as such term is defined under Treasury Regulation Section 1.409A-1(b)(4)(i)(A)) after the end of the tax year in which the Executive’s employment is terminated or the Term ends shall be paid on the last day of the applicable 2½ month period. The payment of the Severance Amount and the acceleration of vesting shall be conditioned on the Executive signing an Agreement and General Release (in the form attached hereto as Exhibit B, with such revisions as counsel to the Company deems necessary) which releases the Company or any of its affiliates (including its officers, directors and their affiliates) from any liability under this Agreement or related to the Executive’s employment with the Company provided that (x) the payment of the Severance Amount is made on or before the 90th day following the Executive’s termination of employment; (y) such Agreement and General Release is executed by the Executive, submitted to the Company, and the statutory period during which the Executive is entitled to revoke the Agreement and General Release under applicable law has expired on or before that 90th day; and (z) in the event that the 90 day period begins in one taxable year and ends in a second taxable year, then the payment of the Severance Amount shall be made in the second taxable year.

(d) Any termination made by the Company under this Agreement shall be approved by the Board.

(d) Non-disparagement. Each of the Company and the Executive agrees that, after the end of Executive’s employment, each will refrain from making, in writing or orally, any unfavorable comments about the other, its operations, policies, or procedures that would be likely to injure the such other’s reputation or business prospects; provided, however, that nothing herein shall preclude the Company or Executive from responding truthfully to a lawful subpoena or other compulsory legal process or from providing truthful information otherwise required by law.